Thames Water 'could collapse' amid fears over £14bn debt pile

THE future of Thames Water was thrown into doubt today after its boss dramatically quit amid reports that the Government is drawing up contingency plans for its collapse.

- Jonathan Prynn and Nicholas Cecil

Ministers and regulators are said to be concerned that Britain’s biggest water supplier, with 15 million customers in the capital and along the Thames Valley, may be unable to service its huge debt pile. The Reading-based company has at least £14 billion of borrowings at a time of rising interest rates and heavy investment demands.

According to a Sky News report, talks in Whitehall involving ministers and officials at the Department for Environment, the Ofwat regulator and the Treasury revolve around a possible special administration regime for the privatised utility. A similar process was used when the energy supplier Bulb collapsed in 2021 and would amount to a temporary renationalisation that would be the biggest since Royal Bank of Scotland and Lloyds Banking Group were rescued at the height of the global financial crisis in 2008. It would ensure that water and sewerage services are not disrupted.