Baroness Grender (LD)

My Lords, I want to return to a point I raised in this House only last week when I asked whether the Government were delaying the clean water Bill pending resolution of the Thames Water situation. We were told then that the Government were ready to deploy a special administration regime, if required. Yesterday’s Statement raises a straightforward question: what has changed? We are told that the Secretary of State has set out early views in a letter to Ofwat, but the underlying facts have been evident for so long: specifically, a highly leveraged company, prolonged financial fragility and ongoing environmental failure. Can the Minister share what threshold the Government are applying for intervention? Given that Thames Water has been operating without an investment-grade credit rating for a long period, does the Minister consider that this constitutes a breach of financial resilience expectations and, if so, why has it not triggered special administration, particularly on performance? The Secretary of State has said she is not convinced by the latest recapitalisation proposal. That is significant. On what specific grounds has that conclusion been reached, and what tests are the Government applying to determine whether any proposal is credible, financeable and in the interests of the consumer? Sixteen million customers are trapped in this monopoly. Does the Minister accept that a substantial proportion of customer bills is already being directed towards servicing debt? Indeed, one-third of every Thames Water bill is already spent solely on servicing the company’s massive debt. In assessing the current proposal, what explicit protections are being put in place to ensure that customers are not required, either directly through higher charges or indirectly through weaker outcomes, to absorb the cost of that debt? Related to that, reports suggests that creditors are seeking adjustments to regulatory expectations. Can the Minister confirm whether any relaxation of performance or environmental standards has been proposed and share with us unequivocally whether the Government would permit such an approach? On environmental performance, Thames Water was responsible for over 100,000 hours of sewage discharges last year. How are the Government weighing that record when considering the suitability of the current ownership and the current financing model? Finally, the Government have repeatedly stated that special administration remains an available option. Can the Minister clarify what specific conditions would need to be met for that mechanism to be triggered, and over what timeframe? Since the Conservative privatisation over 35 years ago, some £85 billion of bill payers’ money has gone mostly to overseas shareholders and executives, through things such as bonuses. Is it not time to blow the final whistle on this failed experiment and put the interests of the public and our environment first?