Britain is drawing up contingency plans to bring the country's biggest water supplier, indebted Thames Water, into temporary state ownership in case it collapses, Sky News reported.
Water companies in England and Wales have over the last year been condemned for sewage spills, creaking infrastructure and rising bills, putting the industry, which was privatised in 1989, under growing political scrutiny.
As well as concerns over Thames Water's 14 billion pounds ($17.8 billion) of debt, the government is also looking at water bills, with a Times newspaper study suggesting these could rise by an average 25% between 2025-2030.
Public anger has been fuelled by the payment of dividends to investors and large salaries and bonuses to water industry executives.
Thames Water, which supplies about 27% of Britain's population, is being looked at by ministers and regulator Ofwat, Sky said on Wednesday, about the possibility of placing the company into a "special administration regime", effectively state ownership, should it fail.
Campaign groups accuse the water companies, which include listed operators Severn Trent, Pennon Group and United Utilities, of failing to invest in infrastructure.
Thames Water is owned by financial investors including biggest shareholder Canadian pension fund Ontario Municipal Employees Retirement System with a 32% stake, and UK pension fund Universities Superannuation Scheme with 20%.
The Daily Telegraph also reported that Thames Water was trying to raise 1 billion pounds from shareholders to improve its operations and reduce its debt.
In a sign of the pressure the company is under, Chief Executive Sarah Bentley stepped down with immediate effect on Tuesday after two years in the job.
She was replaced by two co-chief executives, Chief Finance Officer Alastair Cochran and former Ofwat boss Cathryn Ross, who has been at Thames Water since 2021.
Daily headlines about rivers and beaches polluted by sewage released by water companies looks set to turn water into a major issue at the next general election, expected next year.
The release of sewage into waterways is only supposed to happen during exceptional rainfall to stop it backing up into homes, but campaigners say water companies are discharging much more often than they should.
In 2022, water companies in England alone released raw sewage into rivers and the sea 301,091 times, an average of 825 times a day, according to data from the Environment Agency.
Thames Water, Ofwat and Britain's Department for Environment, Food and Rural affairs could not immediately be reached for comment.
($1 = 0.7858 pounds)
