Thames Water is seeking further hikes to customer charges despite facing criticism for substantial bill increases and executive bonuses amidst a backdrop of environmental failings.
The company has requested the Competition and Markets Authority (CMA) to review a decision by Ofwat, the water regulator, which granted a 35 per cent rise in consumer bills over the next five years.
This follows an earlier, unsuccessful attempt by Thames Water to secure a staggering 59 per cent increase.
Chairman Adrian Montague defended the move to appeal to the CMA, claiming it is "in the interests of our customers and the environment".
However, the decision is expected to draw further ire from politicians and consumer groups already expressing outrage over the approved increases. The controversy surrounding Thames Water has intensified in recent months, with the company facing scrutiny for awarding large bonuses to senior executives while its performance on sewage pollution deteriorates.
The company even threatened to increase the salaries of its top directors if Ofwat follows through on plans to limit bonus payments.
Thames Water is also on the verge of financial collapse.
It has racked up a roughly £19 billion debt pile, and only has enough cash to see it to March 24.
It is waiting for a court decision in the coming days which would allow it to take out another £3.3 billion loan from a selection of large hedge funds, asset managers and other lenders.
They include Abrdn, Apollo Global Management, Elliott Investment Management, Invesco and M&G.
The emergency loan has an unusually high interest rate of 9.75% over two-and-a-half years.
It is designed as a temporary measure to keep it operating while it finds a new source of permanent funding.
Mr Montague said the appeal is aimed at “putting the business on a long-term stable footing so we can succeed in our turnaround, and build and maintain an infrastructure that supports growth and can withstand the effects of climate change”.
He said Ofwat’s current allowance will “impact our ability” to fund the improvements needed to its vast network of pipes, sewers and drains, which are creaking from a severe lack of investment over recent decades.
If Thames does not get the emergency loan it will likely fall into Government hands until officials can find a new owner.
Mike Keil, chief executive of the Consumer Council for Water, said: “Customers of Thames Water are already facing steep bill rises and they will be incensed the company now has the temerity to pursue an even larger increase.
“This is a company which has a poor track record on service delivery and customer complaints, so people will rightly question why it should be trusted with even more of billpayers’ money.
“People want investment to improve services but they also expect value for money and to be treated fairly.”
It comes after Ofwat launched an investigation into Thames Water over concerns it will not complete more than 100 environmental schemes funded by customers.
The regulator said earlier this week that it will probe whether delays to the plans mean England’s largest water firm has breached its licence.
The schemes were aimed at making improvements to water companies’ environmental impact, such as through upgrades to sewage treatment works and reducing wastewater spillages.
Thames pledged to carry out 812 schemes as part of a wider national programme between 2020 and 2025, to meet national regulations.
But Ofwat said it was told by the utilities giant that it would be unlikely to complete more than 100 of these schemes by the end of March deadline.
