Independent Water Commission Debate
Full Debate: Read Full DebateDepartment: Department for Environment, Food and Rural Affairs
Lord Sikka
Main Page: Lord Sikka (Labour - Life peer)Department Debates - View all Lord Sikka's debates with the Department for Environment, Food and Rural Affairs
Independent Water Commission
Lord Sikka Excerpts(4 days, 7 hours ago)
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Baroness Hayman of Ullock (Lab)
The noble Baroness is correct: we have ruled out nationalisation. But if she would like to share the paperwork, I would be more than happy to look at it.
Lord Sikka (Lab)
My Lords, Ministers claim that public ownership of water would somehow cost £100 billion, which is a totally unsound claim. Let me explain. The £100 billion figure is generated by Ofwat, which calls it “recognised capital value”. It is calculated by taking the value of the company at the time of privatisation, adding the annual investment and multiplying it by the annual rate of inflation. It adds that 35 times—that is, over 35 years—and comes up with the figure of £100 billion, which does not represent anything. On the same basis, a £10,000 Reliant Robin bought by Del Boy in 1990 would now have a value of over £50,000. There is no way that Del Boy would be able to sell it for £50,000, because that figure has absolutely nothing to do with value. So, can the Minister explain why the Government consider £100 billion to be a credible figure for the cost of public ownership?
Baroness Hayman of Ullock (Lab)
I would just say to my noble friend that we have discussed this on a number of occasions, including with officials in the department. I am sure that we will continue to discuss it.