Today, servicing that debt pile consumes an estimated 28% of the company\u2019s revenue \u2013 meaning a substantial share of every Thames Water bill goes not towards repairing pipes or reducing sewage spills, but to paying interest.\u00a0<\/p>\n
Liberal Democrat MP Charlie Maynard describes this dynamic as a \u201cdebt doom loop\u201d.\u00a0<\/p>\n
\u201cThese companies are not fixing our rivers,\u201d he told Big Issue in 2025. \u201cBetween a quarter and a third of your bills will be spent on just the interest expenses.\u201d\u00a0<\/p>\n
The government fears nationalisation could cost around \u00a3100bn, but campaigners dispute this. That figure is based on the \u201cregulatory capital value\u201d (RCV) \u2013 a legacy accounting benchmark \u2013 rather than the real market value of companies. Thames Water, for example, has an RCV of \u00a321bn, yet KKR valued it at just \u00a34bn.<\/p>\n
Advertising helps fund Big Issue\u2019s mission to end poverty<\/p>\n
\u201cThe refinancing of the water sector in public ownership will be cheaper than the current privatised system,\u201d the People\u2019s Commission on the Water Sector concluded. Some economists suggest the cost could fall further if part of the sector\u2019s debt were written off, arguing that companies have not met all their obligations, such as controlling sewage pollution. \u201cSocial ownership will likely cost less than the scare story estimates,\u201d Williams says.\u00a0<\/p>\n
<\/p>\n <\/a><\/p>\n 2: Charge the rich<\/p>\n Ending privatisation is \u201cnecessary\u201d, says Williams, \u201cbut it\u2019s not sufficient.\u201d The system also struggles because there isn\u2019t enough revenue to maintain it properly.\u00a0<\/p>\n Keeping the country\u2019s pipes, sewers, treatment plants, reservoirs and pumps working is expensive. For every \u00a31 of revenue, Murky Water analysis finds, water companies in England and Wales operate around \u00a36.50 worth of physical assets. Tesco and other supermarkets typically employ less than 5p worth of physical assets per pound of revenue.\u00a0<\/p>\n \u201cThere isn\u2019t enough revenue in the system from current forms of charging to allow it to\u00a0perform well in terms of water supply and sewage disposal<\/a>,\u201d Williams explains, \u201cbecause the revenue won\u2019t cover the cost of the financial capital which pays for physical\u202finvestment.\u201d\u00a0<\/p>\n D\u0175r Cymru (Welsh Water), the not-for-profit utility often held up as the alternative to for-profit privatisation, illustrates the point. It has no shareholders and reinvests surpluses, but it still raises money through bonds and pays interest. D\u0175r\u2019s sewage discharge record in 2025 was the worst in a decade, and average household bills are set to rise from \u00a3503 to \u00a3639 in 2025-26.\u00a0<\/p>\n \u201cIf D\u0175r could apply all the money from bills to physical investment, it would be OK,\u201d Williams says. \u201cBut you have to raise the money for investment too, which D\u0175r does through selling bonds, and nobody is going to give you free capital. So you need some money from bills to pay interest on your borrowed capital.\u00a0<\/p>\n Advertising helps fund Big Issue\u2019s mission to end poverty<\/p>\n \u201cThe end result is that D\u0175r Cymru like the other companies just\u202fpiles up debt.\u201d\u00a0<\/p>\n The solution, according to Murky Water, is progressive charging \u2013 linking water bills<\/a> to household income. Currently, the system is regressive. Poorer households spend a larger share of their income on water, while wealthier households often pay less. Social tariffs exist but are patchy and funded by other customers.\u00a0<\/p>\n Murky Water\u2019s modelling shows that even a flat-rate system could double industry revenue from \u00a39.5bn to \u00a319bn. A fully progressive system could raise at least as much while also delivering far greater social fairness.\u00a0<\/p>\n Read more:<\/strong><\/p>\n 3: Avoid \u2018projectification\u2019<\/p>\n In late November, the taps ran dry in Tunbridge Wells. Some 24,000 residents had their water supply cut off<\/a> for almost a week after chemicals contaminated water at the local South East Water treatment plant.\u00a0<\/p>\n While this was a supply failure rather than a drought, the chaos may be a taste of what is to come. By 2050, there is a one-in-four chance households across England and Wales will face extended water cut-offs, and experts say we will need to add an extra million litres per day to the national supply to prevent shortages.\u00a0<\/p>\n Advertising helps fund Big Issue\u2019s mission to end poverty<\/p>\n We need more water infrastructure \u2013 including new reservoirs. But the way these are currently planned is \u201ccatastrophic\u201d, said Williams. \u201cCompanies carve out one-off, privately financed projects,\u201d he explains, \u201cbecause they lack the retained earnings to upgrade the system as a whole, so they create one-off projects whose\u202fcosts are passed directly to customers.\u201d\u00a0<\/p>\n Take Thames Tideway, the \u201csuper sewer\u201d under London. It is financed through a special purpose vehicle (a separate company set up to finance one project) established by the heavily indebted Thames Water<\/a>.\u00a0<\/p>\n Households pay for this via a \u00a325-\u00a326 annual surcharge, locked in for 100 years \u2013 at an overall value of more than \u00a3600 million. This guarantees century-long revenue streams for\u202f investors even as Thames Water teeters on the precipice of collapse.\u00a0<\/p>\n Across England, 27 major private finance projects, from reservoirs<\/a> to sewer upgrades, are planned in the same way. Billed as \u2018good news\u2019, these projects lock in costs for households; by the end of the decade, Williams estimates, surcharges combined with rising base bills could double household costs. Under a nationalised or social ownership model, he argues, reservoirs could instead be publicly funded, coherently planned and paired with progressive charging.\u00a0<\/p>\n 4: Embrace nature<\/p>\n Nature provides natural plumbing. Planting trees in upland catchments and restoring floodplains slows rainwater running off the land and can reduce flood peaks by up to 65%. That water doesn\u2019t disappear \u2013 it soaks into the soil, recharging rivers and underground aquifers.\u00a0<\/p>\n But nature-based solutions \u2013 planting upland forests<\/a>, restoring wetlands, reconnecting rivers to their floodplains, and creating reedbeds to filter pollutants \u2013 \u201cdon\u2019t make anyone any money\u201d, says Williams. That\u2019s why they often get overlooked. \u201cYou can\u2019t make a Private Finance Initiative (PFI) project out of it,\u201d he adds. \u201cSo that sustained pressure hasn\u2019t existed.\u201d\u00a0<\/p>\n Advertising helps fund Big Issue\u2019s mission to end poverty<\/p>\n If nature-based projects were used properly at scale, they could help capture millions of litres of water a year, reducing the pressure on reservoirs and treatment plants. Right now, around 70% of UK drinking water comes from upland catchments, so managing these areas\u202f is crucial for supply and for curbing downstream flooding.\u00a0<\/p>\n The government has taken some steps: it\u2019s committed \u00a325\u202fmillion to a Natural Flood Management programme, funding projects that slow and store water naturally. There are also 144 nature-based schemes funded through the \u00a35.2bn flood<\/a> and coastal defence programme. But Williams warns this still isn\u2019t enough.\u00a0<\/p>\n \u201cBut there is no systematic approach to this, and there isn\u2019t a structure of incentives and punishments to actually persuade upland farmers and landowners to plant trees, for example,\u201d he says.\u00a0<\/p>\n \u201cIt\u2019s a huge, huge missed opportunity.\u201d\u00a0<\/p>\n Murky Water<\/a> by Luca Calafati, Julie Froud, Colin Haslam, Sukhdev Johal and Karel Williams<\/a>, is out now (Manchester University Press, \u00a314.99). <\/strong><\/p>\n You can buy it from the\u00a0<\/strong>Big Issue shop<\/a>\u00a0on bookshop.org, which helps to support Big Issue and independent bookshops.<\/strong><\/p>\n Advertising helps fund Big Issue\u2019s mission to end poverty<\/p>\n Do you have a story to tell or opinions to share about this?\u00a0Get in touch and tell us more<\/a>.\u00a0<\/p>\n Change a vendor\u2019s life this winter.<\/strong><\/p>\n Buy from your local Big Issue vendor every week \u2013 and always take the magazine. It\u2019s how vendors earn with dignity and how we fund our work to end poverty.<\/strong><\/p>\n You can also support online with a\u00a0<\/strong>vendor support kit<\/strong><\/a>\u00a0or a\u00a0<\/strong>magazine subscription<\/strong><\/a>. Thank you for standing with Big Issue vendors.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"The scale of financial extraction is staggering, says Williams. \u201cWhat we\u2019ve had in the English water companies is…\n","protected":false},"author":2,"featured_media":723442,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,4],"tags":[168354,11246,3444,748,46000,393,7056,4884,1144,712,16,15,1764,6507,63372],"class_list":{"0":"post-723441","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-uk","8":"category-united-kingdom","9":"tag-access-to-water","10":"tag-analysis","11":"tag-books","12":"tag-britain","13":"tag-drought","14":"tag-england","15":"tag-from-the-magazine","16":"tag-great-britain","17":"tag-northern-ireland","18":"tag-scotland","19":"tag-uk","20":"tag-united-kingdom","21":"tag-wales","22":"tag-water","23":"tag-water-pollution"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115965348138402561","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/723441","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=723441"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/723441\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/723442"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=723441"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=723441"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=723441"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"\"](\"https:\/\/www.europesays.com\/uk\/wp-content\/uploads\/2026\/01\/50-OFF-CTA-Desktop-800x250-1.jpg\")
<\/p>\n![\"\"](\"https:\/\/www.europesays.com\/uk\/wp-content\/uploads\/2026\/01\/9781526188717.jpg\")
<\/a><\/p>\n