OnTheWight always welcomes a Letter to the Editor to share with our readers – unsurprisingly they don’t always reflect the views of this publication. If you have something you’d like to share, get in touch and of course, your considered comments are welcome below.
This from Stephen Cockett of Ventnor. Ed
The recent furore surrounding the MP voting down a clean water amendment and Southern Water deliberately pumping billions of litres of raw sewage into our rivers and seas has led me to ask a question so big that you can easily miss it, I am hoping that someone can help me answer this.
Why is Southern Water a private company?
Law breakers can be penalised
The rationale that has propped up our economic model since the 16th century is that free-markets and competition delivers us better prices, better goods and weeds out poor performers. This is coupled to a legal system so that law breakers can be penalised sufficiently to see them either change their ways or go broke.
None of this seems to apply to Southern Water who – by force of law – are the sole supplier of one of life’s indispensable goods, a good that no one can forgo for more than a day.
A legally protected profit-making monopoly
So Southern Water are a legally protected profit-making monopoly supplying a good that you’ll die without, and in supplying that good they show according to Mr Justice Jeremy Johnson, “a shocking and wholesale disregard for the environment, for precious and delicate ecosystems and coastlines, [and] for human health” it is a company that the environment agency described as being engaged in “very serious widespread criminality”.
Eye-watering profits
Pretty bad so far, but it gets significantly worse when you discover the audacious amount of profit that the company pockets from us. The latest financial report shows a revenue of £784 million and a profit of £139 million and that’s AFTER a fine of £90 million.
Clearly tough times at Southern as in 2020 they walked away with a cool £213 million of our money. The ‘good old days’ seem to be 2018 when the booty amounted to £275 million from a revenue of £857 million, a massive 32 per cent profit margin, a margin unthinkable in any normal business environment.
Macquarie group own 50 per cent
Southern Water’s ownership structure is a mish mash of investment funds, the big player with a 51 per cent stake is former Wightlink owner, Sydney based Macquarie group, who have recently bought in for a billion pounds.
Looking back, the business has been passed around several times through various companies, all taking a slice of our money in return for a management that looks the other way when raw sewage is pumped into our waters.
Profits should be invested in infrastructure
So, we have gotten a law breaking yet essential-for-life water company owned by foreign financiers that is saddled with around £5 billion in debt to other financiers (a debt that we will clearly be paying a pretty penny for in interest) that creams off staggering amounts of profit to private hands.
Those hundreds of millions of ours should be invested in infrastructure NOT foreign investment funds balance sheets and shareholder dividends.
Stop these people taking the pee
For us, the citizens, what on earth is the point of this privatised financial merry-go-round if not even the essential product – clean water – is being provided?
If anyone can answer that I would be most grateful, and if no one can then let’s get this back in public hands and stop these people taking the pee for the next 32 years.
Image: Simon Arthur under CC BY 2.0
