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How can England possibly be running out of water?

theguardian.com

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Re: How can England possibly be running out of water?

#291

Post by OtherShrezzing »

qcnguy wrote: post #265
michaelt wrote: post #181

Earlier quoted context omitted.

The thing is, if a water company is in good financial health, with low debt and lots of money to invest in infrastructure, it’s completely legal for private equity to buy the company, stop investing in infrastructure, take out loans until a third of customer bills go on interest payments, and take the loaned money as ‘management fees’. Then dump untreated sewerage in rivers and demand more money from bill payers, bec…

Governments don't pay for infrastructure by saving up surplus tax revenue in a piggy bank. They take out loans to pay for it, same as the water companies do. The UK pays around 8% of its spending on interest payments and that's rising rapidly, despite the fact it can print money. British water companies are in lots of debt because they aren't really private. They're forced to spend huge sums to repair Victorian-era i…

>Decades of populist left or centre-left governments have kept the prices artificially low whilst requiring investment

The overwhelming majority of people would disagree that the Conservative Party can be described as "left". Since 1979, the Conservatives have been in power for all but 14 years.

Re: How can England possibly be running out of water?

#292

Post by graemep »

teamonkey wrote: post #233
arethuza wrote: post #184

Earlier quoted context omitted.

It's not free - there are explicit charges for it attached to our council taxes?

I literally said “I.e. paid for by taxes” :) But it’s unmetered, unlike most of the UK, and, as the other poster mentioned, cheaper.

Unmetered water is still common in the rest of the UK. There is a gradual move to metering.

I think there is a good argument for metering water - it provides an incentive not to waste it, and potable water is expensive to supply and has a significant environmental impact.

It does need to be affordable even to people on the lowest incomes though.

Re: How can England possibly be running out of water?

#293

Post by KoolKat23 »

qcnguy wrote: post #272
sandbags wrote: post #228

Earlier quoted context omitted.

It's a fair point that nationalised water industries can also be poorly run. But I'm not sure what the argument is that means the amount of money that privatised UK water companies have paid in dividends vs. invested in maintaining and expanding infrastructure isn't a significant part of the UK's problems. However, as a further point. If national priorities change then a nationalised water industry can respond (relat…

Paying dividends is good. It's how you attract the capital for investment without having to raise it via sale of government bonds or money printing. The problem here is financial illiteracy - the alternative to paying dividends isn't that the same money all gets spent on the water network. Large scale investment is rarely funded from general revenues as it'd require spending years accumulating a huge cash pile that s…

Government bonds are considered lower risk and the interest rate is lower, i.e they will attract the same money for less. Private shareholders are more expensive.

This also doesn't consider "debt recapitalisation" where these private companies draw down new debt on promise of future cash inflows from consumers and then suck out dividend cash "de-risking" their holding in the company. The government can bail it out or the can close it then, it's not their problem as they received the cash upfront.

Re: How can England possibly be running out of water?

#294

Post by runako »

krona wrote: post #145
autoexec wrote: post #64

Earlier quoted context omitted.

When it comes to things like utilities every penny of profit comes at the expense of the public. Either prices are raised so that a small number of people can stuff their pockets with extra cash above what it costs to deliver the service and maintain the system or they get that extra money by failing to deliver the service or they do it by failing to maintain the system itself. I think the neglect and failure to inve…

> I think the neglect and failure to invest in infrastructure is the worst Cumulative capital investment by water companies in England and Wales since privatisation: £250bn. The infrastructure they inherited was never designed for the things it's being asked to do today, and it has a life expectancy. It would literally cost trillions to upgrade the entire sewerage system. This isn't apologia, it's just reality. The r…

> The infrastructure they inherited was never designed for the things it's being asked to do today

I am not British, but this is confusing. Was private capital forced to take on the burden of privatizing the water system? Or did private investors err in their economic analysis? (Or did those investors just assume the problems would happen long after they personally had gotten paid?)

Re: How can England possibly be running out of water?

#295

Post by scythe »

qcnguy wrote: post #265
michaelt wrote: post #181

Earlier quoted context omitted.

The thing is, if a water company is in good financial health, with low debt and lots of money to invest in infrastructure, it’s completely legal for private equity to buy the company, stop investing in infrastructure, take out loans until a third of customer bills go on interest payments, and take the loaned money as ‘management fees’. Then dump untreated sewerage in rivers and demand more money from bill payers, bec…

Governments don't pay for infrastructure by saving up surplus tax revenue in a piggy bank. They take out loans to pay for it, same as the water companies do. The UK pays around 8% of its spending on interest payments and that's rising rapidly, despite the fact it can print money. British water companies are in lots of debt because they aren't really private. They're forced to spend huge sums to repair Victorian-era i…

>This is exactly what would have also happened if the water companies were not privatized

The post office in the United States is not privatized and yet has been able to set prices in a way that sustains the business for centuries. You can't simply assume that all public entities will ignore fiscal reality.

In fact you may run into the opposite problem: when a utility is public, their debts appear on the government balance sheet and legislators are responsible for them. When it's spun off as a quasi-private monopoly, the government can impose debt on the utility without appearing to increase the public debt.

Re: How can England possibly be running out of water?

#296

Post by neuroelectron »

antonly wrote: post #251
neuroelectron wrote: post #245

1. England population reaches ecological balance mediated by thousands-year old social hiarchies 2. Tax base plateaus 3. Import refugees and give them free money to increase tax base 4. Run out of natural resources 5. ? 6. Profit

This is a really shallow and unfounded take. Sad to see this here. This particular issue is imho mostly related to a lack in investment in water infrastructure (reservoirs and pipes). I don't see how migrants factor into this equation (not to mention that the "free money" given to migrants is scarcely a drop in the bucket). Please spread your hatred elsewhere.

16%

As of the 2021 Census, approximately 16% of the population in England and Wales were born outside the UK, which translates to about 10 million people. This figure represents a significant increase from previous years, indicating a growing presence of foreign-born individuals in the country.

Wikipedia

+1

Re: How can England possibly be running out of water?

#297

Post by Lord-Jobo »

MrDrDr wrote: post #240

This highlights one of the big problems with liberal democracies - how do you provide efficient (and even innovative) public services? There is no free market for many public services like water (and where there is I’m all for privatisation). But the people (I am in the UK) do not tend to elect a government on its ability to manage these types of services. I do wonder if there some other structure that blends a not f…

A triumvirate of Unions, government, and private enterprise are supposed to be balanced and keep each other in check the same way the three branches of government in the United States are supposed to keep each other in check.

And just as the executive branch has bloated into a monolith at the expensive of Congress, private enterprise has bloated at the expense of Unions (just as true in the U.K. as far as I can tell).

You have the two primary governmental/economic systems of balance failing in the same way, at the same time, both failing due to the actions of corporations.

This kind of failure may be common with liberal democracies but is not inevitable. We have simply been bad stewards and let corporations vacuum up everything with little resistance.

Re: How can England possibly be running out of water?

#298

Post by jmyeet »

sandbags wrote: post #34

As the article mentions, privatised water companies have built no new reservoir capacity and relied on drawing from rivers and other sources. What the article doesn’t mention is that pre-privatisation a new reservoir was built every year up to about 1960 and then every few years until privatisation in 1992. So we are about 30 years behind in adding capacity to the system. This combined with the inadequate levels of i…

So... because capitalism.

People have this propagandized view that the "free market" (which isn't real) is responsible for innovation.

All capitalism does is build enclosures and engage in rent-seeking. With the tendency for profits to decrease, ultimately it comes down to cutting costs and raising prices. So why would a water company invest in a new reservoir? That increases supply. That might lower prices.

The UK is going to neoliberal all the way into being a developing nation.

Re: How can England possibly be running out of water?

#299

Post by alt227 »

walthamstow wrote: post #248
alt227 wrote: post #225

Earlier quoted context omitted.

IMO 'around London' is Greater London. If you mean the whole South East of England, then say that.

Anyone local would not think a number of 25m pop was referring to Greater London. South East England is a defined statistical region, using it like that could be confusing

> Anyone local would not think a number of 25m pop was referring to Greater London.

Which is why we are picking you up on saying the area 'around London' has that population. I could also say that the enirety of Europe is 'around London'. Its ambiguous at best and has no real meaning.

Re: How can England possibly be running out of water?

#300

Post by alt227 »

cramcgrab wrote: post #212

Fresh water shortages is the new ice age, I meant global warming, I meant climate change. You’ll see, there won’t be any new technology invented for cheap water treatment, only taxes, land grabs, and many politicians elected. Maybe even wars.

> there won’t be any new technology invented for cheap water treatment

Oh there will be plenty of new technology invented, but it will either be underinvested, or bought out and buried by competition.

Just like how the electricity companies buried Nikola Teslas perpetual motion machines. /s

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