Sanctioning hearing for Thames Water due to conclude today

The sanctioning hearing for Thames Water restructuring plans is due to conclude today, with a judgment expected in writing at a later date.

Oxfordshire’s water supplier is in debt of around £16bn and needs £3.3bn over the next five years to keep running, but risks entering special administration if a judge does not approve its plans.

"The industry is crippled with debt"

Thames Water Utilities Holdings Limited (TWUH), the parent company of Thames Water Group (TWG), fears that run out of cash by the end of next month.

In December, a High Court judge ruled that a restructuring plan could be voted on by creditors, which could be approved at the sanctioning hearing due to conclude today.

England's biggest water company serves around 16 million customers, around 25% of the UK's population, and owns more than 20,000 miles of water mains and more than 68,000 miles of sewers across the Thames Valley, London and the Home Counties.

Feargal Sharkey, Water and sewage campaigner & former lead vocalist of punk band The Undertones, said: “The industry is crippled with debt, crippled by lack of intervention and lack of regulation. I think all of it now needs to be reviewed from the ground up otherwise were going to continue this litany of pain and that’s got to stop.”

“We need to find a way to rid the company of that debt and remove the profit motivation that’s ultimately riddled the company along with the regulatory system that’s clearly failed customers, bill-payers and the environment.

He continued: “Government has ultimately said that they’re not going to re-nationalise the industry.

“Strategically, I think that was a mistake to make that fact publicly. In my experience with water companies, you’ve now displayed a weakness and it’s one that they will exploit.”

On Monday, Charlie Maynard, MP for Witney, opposed the plans in court, claiming the company should be put into administration as the company plan is "a short-term fix at the expense of the company, Thames Water customers and UK taxpayers".

"It is simply not possible to take any risk"

Earlier during the hearing, in written submissions, Tom Smith KC, for TWUH, said: "If the present plan was not to be sanctioned, the directors would therefore be faced with a situation where the existing plan, which had been the product of many months of negotiation and work, had been rejected, and where the group's cash (is) due to run out in around six weeks' time.

"Further, this is the context of the group being a provider of essential infrastructure services to millions of people in one of the major cities in the world."

He continued: "Given the importance of the role of the group, it is simply not possible to take any risk at all that it may run out of cash which would cause it to cease operations.

"For reasons which barely require stating, that it is a risk which cannot be run."