Winding Up — Water bills will drown customers in the new year as Thames saga continues
- Alessia Argentieri
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Although Christmas is already in the air and the holidays are approaching, this week we’ve had a very busy time in the restructuring world, with troubled UK waters once again under the spotlight.
On Tuesday (17 December) all eyed were on the courts following the latest developments on Thames Water. A group of company’s Class B noteholders announced it will challenge the Class A’s rescue loan proposal with a parallel restructuring plan. It would be the first time that a court considers a rival proposal since the introduction of the new UK restructuring procedure in 2020.
Meanwhile, the water utility firm was handed an £18.2m fine by UK regulator Ofwat for paying £158.3m in “unjustified” dividends to shareholders.
Thames Water will be allowed to increase consumer bills by 35% over the next five years. This means that water bills will rise by £152 for an average household, reaching £588 by 2030, plus further hikes that will be caused by inflation.
The biggest annual increase is expected next year, when bills will rise by 20% excluding inflation, with smaller percentage increases in each of the next four years – a tough pill to swallow just before Christmas for the 16 million customers of the water utility firm.