LONDON’S BUSINESS NEWSPAPER
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THURSDAY 13 JULY 2023
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PRIMED Zelensky hits back at UK’s ‘We’re not Amazon’ comment
SEEMS TO BE THE HARDEST WORD
FORMER REGULATOR CHIEF AND NOW THAMES WATER BOSS REFUSES TO APOLOGISE FOR SECTOR FAILINGS NICHOLAS EARL OFWAT’s former boss refused to apologise yesterday for allowing the water industry to rack up an eye-watering £65bn of debt, which has led to Thames Water’s desperate scramble to secure funds and avoid collapse. “I won’t apologise for my role at Ofwat, no,” Cathryn Ross (pictured) said, during yesterday’s grilling with MPs when Labour MP Darren Jones scrutinised her record. As chief executive of Ofwat for four years between 2013 and 2017, Ross signed off the watchdog’s price review in 2014, which enabled former Thames Water owner Macquarie to hike Thames Water’s debts from £3bn to £10bn before later selling the supplier. She is now interim co-chief executive of Thames Water, following the trou-
bled company’s boardroom exodus and pressing financial difficulties – which has seen the UK’s largest supplier scramble to secure £750m in funds from stakeholders as it struggles beneath a £14bn debt pile. Ross also confirmed households will be on the hook for improvements to Thames Water’s creaking infrastructure and poor operational performance, with customers footing the bill for billions of pounds of investment needed to tackle sewage spills, wastewater flows and leaking pipelines. “It is an unfortunate truth that the only source of ultimate funding for that in the current model is the customer,” Ross said. Water suppliers are pushing for hikes in customer bills of up to 40 per cent to fund their improvement plans, as they struggle with the present
challenges of debt and poor infrastructure, and the future issues of climate change and population growth which will weigh on supply and demand. Ofwat is currently working on the 2024 price review, which will set price controls for water and sewerage companies for 2025 to 2030. Exposing the crisis water suppliers are facing, Ofwat chief executive David Black refused to rule out the potential nationalisation of Thames Water – confirming they had made contingency plans to place the supplier in a special administration regime if the firm buckles under its debts. However, Black played down the prospect of any imminent breakdown for Thames Water, and expected a special administration regime “won’t be needed”. The watchdog is now confident Thames Water’s £4.4bn liquidity position and recent £750m reprieve from shareholders will ensure the supplier stays afloat.
JAMES SILVER UKRAINIAN President Vlodymyr Zelensky told the British defence secretary to tell him “how he would like us to be grateful” after a testy end to this week’s NATO summit. Ben Wallace told reporters that western countries were “not Amazon” and that Ukraine could do a better job of winning over sceptical politicians, particularly in the US. Rishi Sunak distanced himself from Wallace’s remarks, saying Zelensky
had consistently shown “gratitude” for the UK’s support with armaments in the war against the Kremlin. Zelensky had already expressed exasperation with NATO leaders for failing to put a timeline on Ukraine’s accession to the defensive alliance. However, yesterday he welcomed “signals” from NATO leadership, including secretary general Jens Stoltenberg, that the country would be able to join the group – which guarantees mutual defence – in due course.
HS2 boss quits £660,000 role as train-less network goes looking yet again GUY TAYLOR HS2’s longest serving chief executive has announced his resignation from the project amid ongoing criticism over soaring costs and delay. Mark Thurston will depart at the end of September after six and a half years at the helm, stating yesterday that “someone else should lead the
organisation and programme through what will be another defining period for HS2”. Sir John Thompson, HS2 Ltd’ chair, will fill in as interim CEO as the search begins for a successor. The departure comes as HS2 Ltd, the firm overseeing the project, and the Department for Transport (DfT) grapple with mounting costs of the
rail route. HS2’s price tag has risen from £33bn ten years ago to upwards of £100bn, with the project also undergoing a significant reduction in scope. Its initial opening date of 2026 has also been pushed back to between 2029 and 2033.
The Euston section of the project – which involved plans to build an 11 platform station – has come under particular scrutiny in recent months after being paused in March, with MPs describing its initial £2.6bn budget as “completely unrealistic”.
Last week, an investigation from the Public Accounts Committee concluded that the Euston project’s “floundering” leadership had failed to be transparent about its cost. Transport secretary Mark Harper said “the government remains committed to unlocking all the benefits of this flagship infrastructure scheme”.
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