Water - Thames Water sold again
WORKERS, NOV 2006 ISSUE
Thames Water (until October owned by the German company RWE) has been sold again, this time to Australian bankers Macquarie for £8 billion. It's clearly big business, profiting from people's need for clean water.
RWE took £1.5 billion in profits and dividends during the six years it owned Thames Water, and will net £3.2 billion profit from this sale. And during five out of those six years it failed to meet the Regulator targets to prevent leaks. RWE was said to be facing a fine of over £140 million by the Water Regulator for such poor performance.
It is estimated that over 2,744 million gallons of water leaked from the Thames Water system during the first two weeks of October 2006 – more than 196 million gallons a day. With such staggering losses it is no wonder London faces drought and standpipes in 2007.
While Thames has made billions milking the people of Greater London, it has announced the possible loss of up to 1,500 jobs – to boost profits still further. These jobs are predominantly for highly skilled support workers. The company has already put out to contract any part of the business which could be outsourced, for example repairing leaks.
Privately Thames Water had admitted to the trade unions – Unison and GMB – that owing to previous staff cuts the company could not meet any major crisis affecting the network or leak repair targets. The job losses are a sweetener for potential buyers. And given that Macquarie has paid over the odds, the ploy would seem to have worked.
On the same day as the sale to Macquarie there was more robbery – the Institute of Civil Engineers forecast that water bills in London would have to rise by 30 per cent to pay for investment and replacement of Victorian pipework. And the response from the government? Londoners were advised to move to Manchester or Wales, where there is rainfall in abundance.