Water Industry: Financial Resilience

Lord Teverson Excerpts

Tuesday 4th July 2023 Lords Chamber

[Lord Benyon (Con)]

The £190 billion is the amount water companies, with regulator approval, have invested in our water infrastructure. Thames Water has not paid out any dividends to its investors, but it has paid out dividends to its holding company to finance its borrowings. In 2017-18, it was £55 million; in 2021-22, it was £37 million; and it has since been, roughly speaking, around and between that. The figure is lower this year than it has been in the past. It has also recently secured from investors a further £500 million, and, as I said earlier, its liquidity, at about £4.4 billion, means that it is a viable trading company.

[Lord Teverson (LD)]

My Lords, it seems to me that there is a real cultural arrogance within the management of water companies, and a feeling that however fast and loose they play with financial engineering, they are too important to fail. Does the Minister agree?

[Lord Benyon (Con)]

I can speak only across the whole range, and there are some very good, well-run water companies and some to which, in the past, I would have applied some of the words that the noble Lord used. I think the message has really come home to roost, not least from this place and the other place, but also from a general feeling of anger among the wider population about the degree of pollution. One reason for that anger is that we have provided the public with the information, and I am extremely proud that we did. We used to know about 5% of the sewage outflows; we now know about nearly 95%, and by the end of this year it will be 100%. We have made that information public—you can see it on Twitter almost every day—and I am really pleased that people can hold their water companies to account. I have certainly questioned some of the practices of certain water companies, but I think the model is right and we need to get behind it, as did the previous Labour Government. I hope that all future Governments of any persuasion will recognise that this is the best way to get significant investment into protecting our environment for the future.