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How Labour Collapsed The Deal to Save Thames Water – Guido Fawkes



How Labour Collapsed The Deal to Save Thames Water





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When news broke yesterday that private equity powerhouse KKR had pulled out of its bid to rescue troubled Thames Water – withdrawing £4 billion of desperately-needed cash in the process – the government sought to hide its embarrassment. Environment secretary Steve Reed boasted to Parliament that “we have worked with the water companies to secure £104 billion pounds of private sector investment to rebuild our broken water infrastructure – that means new sewage pipes, fewer leaking pipes and new reservoirs across the country”. But what about the deal…

KKR are pointing the finger of blame at Reed for deterring investment. According to the BBC, “Sources close to the situation told the BBC that the politicisation of the water industry was a major disincentive for investors to put money into the sector.” According to Sky News, one factor in their decision was the “political risk” of investing in water, given criticism of the sector from ministers, campaigners and the media, and uncertainty over the future of regulation. Shadow environment secretary Vicky Atkins told Parliament: “...according to a source close to KKR, one of the reasons they pulled out was because they were concerned about negative rhetoric directed at Thames Water and the rest of the industry in recent weeks by the Secretary of State and other ministers. In other words, the Secretary of State and his ministers have talked themselves out of this rescue deal…” Oops…

Guido has taken a look at that rhetoric in full and the pattern is pretty clear:

  • Steve Reed: “The era of profiting from failure is over.”
  • Steve Reed: The Government has launched the “toughest crackdown on water companies in history. The era of profiting from failure is over. The government is cleaning up our rivers, lakes and seas for good.” 
  • Labour Party:Under the Tories, water companies got away with polluting our rivers, lakes and seas. With Labour, the era of profiting from failure is over.”
  • Labour Party:Under the Tories, record levels of illegal sewage were dumped into our rivers, lakes and seas. Labour is cleaning up their mess. A record number of criminal investigations have been launched against water companies following the Labour Government’s crackdown.”
  • DEFRA:BREAKING: 81 criminal investigations launched into water companies under Government crackdown.”
  • Steve Reed:Water companies have acted as if the rules don’t apply to them. They have acted as if they have carte blanche to poison our watercourses, which are loved by so many, with impunity. With this Labour Government, this will change. As part of our Plan for Change to secure a better future for Britain, I am spearheading the biggest increase in legal action against water companies in history – which could put law-breaking bosses behind bars.”
  • Keir Starmer:We’ve launched the largest criminal action against water companies in history. When I said I would take on those pumping filth into our waters, I meant it.”
  • Steve Reed:When we said water companies had nowhere to hide, we meant it.”
  • Keir Starmer: “Bonuses for failure? We won’t stand for it.”
  • John Healey:Sewage dumping across South Yorkshire has been a stain on our local environment for too long. The previous government’s record on sewage was a disgrace, they let water bosses off the hook and let criminal dumping into our rivers, lakes and seas go unpunished. These investigations are strong action that will see Yorkshire Water punished if they are found to have broken the law and force them to clean up their act, and our environment.”
  • Steve Reed:Bosses must face consequences if they commit crimes. There must be accountability. From today, there will be no more hiding places. As part of the Plan for Change, water companies must now focus on cleaning up our rivers, lakes and seas for good.”

Reed might be regretting his careless language, which has left Thames Water on the brink. Last month, the Guardian reported Defra would have to meet the £4 billion cost of temporary nationalisation from its existing budgets – aka, from the taxpayer’s pocket. Labour talked the deal out of existence…

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