Hunt rejects Thames Water’s bid for higher bills amid failures

Jeremy Hunt has condemned Thames Water’s plea for higher household bills in the face of possible insolvency as “completely outrageous.”

Amid growing concerns about the utility’s financial problems, the chancellor emphasized the responsibility of shareholders to rectify the situation, rather than burdening consumers.

Addressing his constituents at a public meeting in his South West Surrey constituency, Hunt expressed his strong opposition to the idea of ​​households bearing the brunt of poor management and financial missteps by Thames Water shareholders. He claimed: “It would be completely outrageous and completely unfair if we had to foot the bill.”

Hunt’s comments come amid mounting pressure on the government to intervene as Thames Water’s parent company Kemble missed an interest payment on a £400 million loan. With the utility giant serving 16 million households in the UK, concerns about possible insolvency have escalated.

David Black, chief executive of Ofwat, assured on Friday that customers would not be held responsible for Thames Water’s management failures, although he did not rule out the possibility of higher bills.

Hunt reiterated his position on the sidelines, emphasizing that voters should not be required to bail out shareholders for their bad decisions. He stressed the importance of Thames Water taking responsibility and resolving the crisis internally.

Thames Water chief executive Chris Weston reiterated his commitment to saving the company amid ongoing discussions with Ofwat over the company’s financial prospects.

The water company’s challenges are multi-faceted, with rising interest payments, credit rating downgrades and hefty fines from the Environment Agency for environmental breaches. Thames Water’s liquidity, while substantial at £2.4 billion, is facing depletion due to rising debt financing costs and looming fines.

The recent water disruption in the Godalming and Guildford areas following Storm Ciarán led to further scrutiny, with voters expressing frustration at the lack of access to water and inadequate compensation for those affected.

Hunt’s conviction underlines the urgency for Thames Water to deal responsibly with its financial situation and protect consumers from bearing the burden of its failures.