Burnham: Water Privatisation 'Very Difficult to Reverse'
The Prime Minister cooled expectations of water nationalisation overnight, telling MPs privatisation has left the country “in a position where we’re going to find it very difficult to reverse” — because “funding has left through salaries and dividends… it’s the billpayers who are being asked to pay 20 per cent-plus on their bills, not those who siphoned the money out in the first place. It’s an industry where the shareholders never lose and the billpayers never win.” Ministers are assessing “all possible solutions”.
Read alongside Tuesday’s “stronger public control” pledge, this is the sound of a promise meeting a balance sheet: Defra has previously put nationalisation near £100bn, and a prime minister being punished by the bond market for ambition cannot add a nationalisation bill to it. The interesting phrase is “very difficult”, not impossible — and his diagnosis, that shareholders extracted the equity while billpayers now fund the repair, is the argument for taking utilities back, deployed to explain why he may not. Expect the eventual plan to live in the space between: special administration regimes, dividend controls, mutualisation of failing companies rather than purchase of solvent ones. Watch whether Thames Water — the leaking monument itself — forces the question before the plan is ready.