IV Garfield, the boss of FTSE 100 water big Severn Trent, is making an attempt to carry a taskforce of utility bosses along with the Labour party in a bid to go off the specter of nationalisation.
In an e mail despatched to different utility CEOs which she describes as “sensitive” and “highly confidential”, the £4 million a 12 months Garfield asks them to affix an “off-the-record roundtable” with Will Hutton, the Observer journalist greatest identified for books crucial of capitalism together with The State We’re In.
Her transfer comes as water corporations face the specter of being re-nationalised, many years after they have been privatised as certainly one of Margaret Thatcher’s free market reforms.
She writes: “Whilst it is clear Labour will not include nationalisation in its next manifesto, they are also not keen on entering into the election race championing the status quo. The leadership thinks there is room for improvement and, politically, there is significant pressure to ‘do something’ about utilities.”
She provides: “One idea we believe might be attractive to the Labour leadership is re-purposing utilities and utility networks into a new breed of declared social purpose companies – companies that remain privately owned, who absolutely can (and should) make a profit, but ones that also have a special duty to take a long-term view.”
Garfield, certainly one of a handful of feminine bosses of FTSE 100 corporations, warns her colleagues: “The Labour leadership is aware we are soft testing various ideas but have asked us to keep it highly confidential so please don’t forward this email.”
Ministers are already discussing plans to grab management of Thames Water within the wake of intense criticism over fears of a monetary collapse that noticed the abrupt exit this week of CEO Sarah Bentley. Utility bosses are involved that others may very well be subsequent.
Garfield says that utility sectors similar to water, power and telecoms, ought to have “clear social purpose” whereas remaining extremely worthwhile.
Bills for all utilities have soared recently. Garfield takes a swipe at former PM Liz Truss within the e mail: “The UK is entering a period of heavy investment in infrastructure (£650bn over the next 10 years, according to some reports) and the last thing we want to do is push-up (Truss-style) the cost of investment.”
On Labour, she says her new taskforce ought to, “Seek to ensure that any manifesto commitment emphasises the importance of independent economic regulation, something to which investors attach huge weight”.
Not the entire CEOs she contacted are supportive of her plans. One mentioned bluntly, “this is not our problem, it is hers”.
Severn Trent has been approached for remark.
Severn Trent is among the greatest water corporations within the UK, supplying almost 5 million houses. It has 7000 workers and a inventory market worth of £6.5 billion.
It has reported sturdy earnings this 12 months however admitted it ought to have given sewage leaks “much more attention and acted faster”.
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