The Macquarie Thames Water saga may be coming to an end albeit at great cost – but not, of course, to Macquarie which has reinvested the billions it took out into other things.

The Guardian reports (28 May) that Thames Water has been hit with a record £123 million of fines over sewage and dividend breaches. Ofwat, the regulator, said the penalties would be paid by the company and its shareholders and not by customers. Indeed, £18.2 million of the fine was for breaching dividend rules when the company paid out cash to investors, despite falling short in its service to customers and its environmental record.

Ofwat said its investigation into Thames Water uncovered failings around the company’s handling of sewage and wastewater which were a significant breach of its legal obligations and had caused an unacceptable impact on the environment and customers.

While a bit late in the piece, Ofwat chief executive David Black said: “This decision provides certainty for the company for both its past failures and what we expected from the company to comply with its obligations in future”.

Thames has been put under a “cash lock-up” which restricts how it distributes cash to investors and the company must now seek formal permission before paying any more cash to shareholders.

The environment secretary (Australia would call him a minister) said the penalties were “the toughest crackdown on water companies in history". He also said 81 criminal investigations had been launched into water companies demonstrating that the problem went beyond Thames and was endemic.

James Wallace, River Action chief executive, called for Thames Water to be put into a special administration regime – a form of temporary nationalisation. He told The Guardian: “Thames Water poured sewage into our rivers for nearly 300,000 hours last year while racking up £22 billion in debt. It has ripped off customers, damaged the environment and failed to invest in solutions. At last we are seeing a government using the law and punishing a major polluter. But nothing will change unless the privatisation of Thames Water stops."

The Lib Dem environment spokesperson, Tim Farron, said: “This should be the final nail in the coffin for Thames Water. It needs to be turned into a public benefit company and Ofwat needs to be scrapped and replaced with a real regulator with teeth.”

Sadly, the whole water industry disaster is just one example of the disasters left by the privatisation and deregulation policies followed by the Thatcher and Blair Governments. The once great NHS is now crumbling after massive reorganisation and outsourcing; infrastructure is decaying across the UK, and nothing from train lines to roads are built on time or on budget.

Rome may have been the first great infrastructure builder — from aqueducts to roads — but 19th century Britain was the first great modern infrastructure builder. 21st century Britain, sadly, shows how not to do it.

You may also be interested in this earlier article from Noel Turnbull:

https://johnmenadue.com/post/2025/05/the-vampire-kangaroo-legacy/

The views expressed in this article may or may not reflect those of Pearls and Irritations.