Burnham orders radical rethink of Thames Water and seeks public control

Andy Burnham has ordered a radical rethink of how to fix Thames Water, telling officials to tear up existing plans and start again. The move puts public control at the centre of the debate over the troubled water company. Reports said Burnham wants more radical options rather than another tweak to the current privatised model. One option is to convert £100m of fines imposed on Thames Water into government shares, giving ministers a more direct stake and more control.

The proposal has reopened a wider argument about ownership. Supporters of public control said water should not be run as a commercial enterprise because households cannot choose their supplier and most countries do not privatise water. They argued that the privatised model has failed to deliver investment in pipes and reservoirs, and that companies have prioritised shareholder payouts. One contributor said the industry needed a complete rethink.

Critics of renationalisation warned that taking water back into public ownership would be expensive and could put politicians in charge of an industry they say is already poorly managed. One estimate put the cost of taking over Thames Water alone at £2.8bn, and the whole water industry at £20bn to £30bn. It was also noted that water company shareholders include large pension funds, so a state takeover could affect pension savers. Another contributor argued that leaks were worse before privatisation and that profit can drive efficiency.

The discussion also touched on regulation and infrastructure. Ofwat sets the level of profit water companies can make, and critics said that has allowed money to go to shareholders instead of investment. One speaker said England had not built enough reservoirs for decades, calling it a bipartisan problem. The row over fines also featured: one guest said penalties can be absorbed as a cost of doing business, while another said the £100m fine should be used to give the government direct control.

The overall picture is of a policy debate that has moved from routine repair plans to fundamental questions about who owns and runs Thames Water. Burnham's intervention has forced the issue of public control back on the agenda, but the questions of cost, pension fund exposure and the right model for investment remain unresolved.