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Thames Water

Jim Audiomisc said:
It is for UK *Governent* and regulators to check and ensure that companies are doing what is required,
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Agree, but we have an economic model built on deregulation, not more regulation.

The same model also makes a virtue out of cuts to public spending, so it is hardly surprising that there are not enough regulators to regulate in the public interest

The model is about private interests, the ‘small state’ thinking is about reducing the public role of the state in private affairs.

Water needs to be made public if it is to be properly regulated
 
Jim Audiomisc said:
The issue isn't USS being a 'pension fund'. It is that causing them to loose out will then have negative impact on the *UK* economy. Overseas bankers and the ultra-wealthy aren't our problem. Our concern is that damage to UK pension funds will cost us all if we accept that cost like dumb bunnies.
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I'm not sure what you're proposing Jim. If my pension fund holds, say, Centrica or Natwest and their share price collapses because of poor decisions taken by the business I'll take a hit. That's just the nature of investing in equities. Return in exchange for taking on risk.

For me it does raise the wider question of whether people's retirement savings should be dependant on the vagaries of the stock market.

Completely agree that in the case of Thames Water there's been a woeful absence of regulation.
 
Seanm said:
LOL at the Guardian’s reporting of Labour’s back door dealings with water bosses:

https://www.theguardian.com/busines...arfield-thames-water-labour-renationalisation

Unsurprising given the involvement of idiotic Blairite Will Hutton.
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The idea that private companies can have a ‘social purpose’ is fatuous. A private company has a legal duty to its shareholders, the shareholders are its end purpose, only a public company can have a proper ‘public purpose’.

Hutton’s ‘stake holder’ thing was a nonsense in 1996 and it makes even less sense now
 
ks.234 said:
The idea that private companies can have a ‘social purpose’ is fatuous. A private company has a legal duty to its shareholders, the shareholders are its end purpose, only a public company can have a proper ‘public purpose’.

Hutton’s ‘stake holder’ thing was a nonsense in 1996 and it makes even less sense now
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The dogmatism and gullibility of certain journalists, still, after everything. Total belief in whatever fig leaves corporations and the Labour right present them with. Professional idiots.
 
Seanm said:
The dogmatism and gullibility of certain journalists, still, after everything. Total belief in whatever fig leaves corporations and the Labour right present them with. Professional idiots.
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Yes, though trying to remove the fig leaf, will leave you exposed. There isn’t a great deal of sympathy, or decent salaries, in the mainstream for iconoclasts
 
Plenty of companies with a social purpose, no reason the water companies can't do the same. Some people need open their minds rather than let ideology cloud their judgment.
 
Kirk said:
Plenty of companies with a social purpose, no reason the water companies can't do the same. Some people need open their minds rather than let ideology cloud their judgment.
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Can you give some examples, please? I’d like to explore your position a bit but have nowhere to start.
 
Kirk said:
Plenty of companies with a social purpose, no reason the water companies can't do the same. Some people need open their minds rather than let ideology cloud their judgment.
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Privatisation is an ideology.

Social purpose is an ideology.

if people need to open their minds, what is it they need to be open to?
 
I'm guessing this will come as a surprise to absolutely no one.

Two-thirds of England’s biggest water companies employ key executives who had previously worked at the watchdog tasked with regulating them, the Observer can reveal. Cathryn Ross, the new interim joint chief executive of Thames Water and a former head of watchdog Ofwat, is one of several ex-employees working for water companies in senior roles such as strategy, regulation and infrastructure.

An analysis by the Observer has found 27 former Ofwat directors, managers and consultants working in the industry they helped to regulate, with about half in senior posts. The findings have raised fresh concerns over a revolving door between the regulator and the industry.

https://www.theguardian.com/environ...giants-recruit-top-staff-from-regulator-ofwat
 
ks.234 said:
The idea that private companies can have a ‘social purpose’ is fatuous. A private company has a legal duty to its shareholders, the shareholders are its end purpose, only a public company can have a proper ‘public purpose’.
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Not sure I agree here. Even if you define the responsibilities of the company (directors/board) very narrowly to just "maximise shareholder profits" you'd still have a question that says "measured on which timeframe?" so the tradeoffs and assessments are everywhere - even the supposed "easy answer" isn't easy (outside of an economics textbook...). If anything, the way these privatised companies are run in the UK and many other places in Europe seems to prove that the "shareholder profits" target is unfit for purpose and they must have broader targets than just what can be measured in money. The whole point of "sustainability" in it's core form is that you have to be financially, ecologically and socially sustainable to have a long term future and that perspective seems to be exactly what is missing here.

Also, what's to stop a private company board from redefining it's purpose to be broader than just maximising profits at any cost? You can then decide if you want to be a shareholder in that company or take your investment elsewhere - in any case the "market" decides whether said company survives or not. Patagonia is one example of a company that has decided to do something else than just make money and as far as I know they are not out of buiness yet ;) Historically you can also see many family-owned companies who realised their dependence on their local community and built schools, public housing, sports facilities etc. because they realised that this was a good investment in the long run.

ks.234 said:
Hutton’s ‘stake holder’ thing was a nonsense in 1996 and it makes even less sense now
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No, if anything it makes more sense now, because whichever way you look at it then narrowly defining profit as the only measure of success is even more dangerous for companies now. Even if you don't care about anything except money, society as a whole has started to care about other factors as well meaning that there are reputational and legal risks if you do not think broader. IMHO any company board that does not consider this aspect is borderline negligent and it seems that some shareholders (e.g. in Shell) have started to agree.
 
paulfromcamden said:
I'm not sure what you're proposing Jim. If my pension fund holds, say, Centrica or Natwest and their share price collapses because of poor decisions taken by the business I'll take a hit. That's just the nature of investing in equities. Return in exchange for taking on risk.

For me it does raise the wider question of whether people's retirement savings should be dependant on the vagaries of the stock market.

Completely agree that in the case of Thames Water there's been a woeful absence of regulation.
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IIUC if a pension scheme fails its active members may then be entitled to be paid something by a Government scheme instead. In addition, the loss has an impact on the economy more generally via a rise in benefits paid and a drop in buying power of the public. So it hits us all one way or another.

Hence it makes sense for UK Gov to take a path that discriminates between 'indirect' UK investors (like those who get pensions from trapped pensions, etc) and the sharks overseas who engineered this as they vampired away the profits abroad.

You'll note that we did 'bail out the banks' last time round, but in ways we could improve upon.

Blaming the investment managers at pension schemes may be unfair as they may be tied to 'rules of engagement' that don't take this kind of overseas-created problem into account.

Our problem at present is that some of the horrible details have been kept out of sight by those who benefitted and their shills.
 
Jim Audiomisc said:
You'll note that we did 'bail out the banks' last time round, but in ways we could improve upon.
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Swiss bank UBS repays its bailout loan - BBC News

I think that it is very easy to get all Daily-Mail about bailouts. Twisted knickers about bad news but ignore good news.

It is very easy to make simplistic statements about a company's duty to make money for shareholders and ignore the way that they do this Sustainability at UBS | UBS Global

(UBS is my current employer so I see a lot from the inside)
 
CarrotMan said:
Not sure I agree here. Even if you define the responsibilities of the company (directors/board) very narrowly to just "maximise shareholder profits" you'd still have a question that says "measured on which timeframe?" so the tradeoffs and assessments are everywhere - even the supposed "easy answer" isn't easy (outside of an economics textbook...). If anything, the way these privatised companies are run in the UK and many other places in Europe seems to prove that the "shareholder profits" target is unfit for purpose and they must have broader targets than just what can be measured in money. The whole point of "sustainability" in it's core form is that you have to be financially, ecologically and socially sustainable to have a long term future and that perspective seems to be exactly what is missing here.

Also, what's to stop a private company board from redefining it's purpose to be broader than just maximising profits at any cost? You can then decide if you want to be a shareholder in that company or take your investment elsewhere - in any case the "market" decides whether said company survives or not. Patagonia is one example of a company that has decided to do something else than just make money and as far as I know they are not out of buiness yet ;) Historically you can also see many family-owned companies who realised their dependence on their local community and built schools, public housing, sports facilities etc. because they realised that this was a good investment in the long run.


No, if anything it makes more sense now, because whichever way you look at it then narrowly defining profit as the only measure of success is even more dangerous for companies now. Even if you don't care about anything except money, society as a whole has started to care about other factors as well meaning that there are reputational and legal risks if you do not think broader. IMHO any company board that does not consider this aspect is borderline negligent and it seems that some shareholders (e.g. in Shell) have started to agree.
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I don’t disagree with much that you say, and agree about sustainability. But the bottom line is that sustainability and economic growth are incompatible.

Our current model, already broken and failed even on its own terms, is incapable of delivering sustainability. It is a model which is antithetical to sustainability.

If we really want social, economic and environmental justice, we need a new economic model in which government spending is explicitly purposed as a public utility, not a private one. One driven by moral ends, not as now, amoral ends. One based on science, not a quasi religious belief in an invisible hand
 
Ponty said:
You’re in the too big to fail camp then. Something could have been done with the payment system etc if there was the will. The whole ABN debacle was nothing more than a Goodwin ego trip built on sand which cost the taxpayer billions. I remember when NatWest was ‘taken over’ by RBS. Sure, they weren’t the most dynamic bank but they wouldn’t have gone bust, same as Lloyds before having the similarly woeful HBOS group forced upon them. 2 of our steady Eddie retail banks effectively taken down by corporate criminals.
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I don't agree it is the best way to allow banks to behave, but that is just how it was. I worked for RBS at the time, and it was pretty unnerving to know that the lights could (metaphorically) have gone out at any time, with zero notice.
 
Seanm said:
LOL at the Guardian’s reporting of Labour’s back door dealings with water bosses:

https://www.theguardian.com/busines...arfield-thames-water-labour-renationalisation

Unsurprising given the involvement of idiotic Blairite Will Hutton.
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It gets worse:

https://www.theguardian.com/comment...-how-capitalism-must-work-for-the-common-good

To recap:

1. Leaked email from the CEO of a privatised water company rallies her fellow CEOs to discuss how to avoid nationalisation - by signing up to the idea of "social purpose".
2. She tells her fellow CEOs that Observer columnist Will Hutton (who has contacts in the Labour Party) will facilitate this discussion.
3. She also mentions that the Labour leadership is aware of this initiative and has asked for it to be treated with utmost secrecy.
4. Evening Standard publishes the story - rightly so, as it looks like a pretty big deal to me.
5. The Guardian publishes a sanitised version of the same story.
6. The Observer publishes a column by Will Hutton arguing that nationalisation is not a priority, with some warm fuzzy words about "social purpose".
7. In the same column, Hutoon assures us that this is not a "fig leaf", oh no, heaven forfend!

What the hell is wrong with The Guardian/Observer (and the Labour Party)?

Seriously, can you believe these ****ers?!
 
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