While the chancellor is desperate to avoid taking on Thames and busting her own Budget, there is a way forward that bond market investors would understand.
The ability of managers of utilities to exploit gaps within the regulatory environment to create debt-burdened cash cows that have neglected investment is quite extraordinary. Surely the regulators should have spotted this wheeze when it began to happen in the 2000s and worked with the relevant government departments to change the framework or get cast iron guarantees around debt/equity ratios and investment levels. Once again, it reveals an administrative regime that is not fit for purpose.
The ability of managers of utilities to exploit gaps within the regulatory environment to create debt-burdened cash cows that have neglected investment is quite extraordinary. Surely the regulators should have spotted this wheeze when it began to happen in the 2000s and worked with the relevant government departments to change the framework or get cast iron guarantees around debt/equity ratios and investment levels. Once again, it reveals an administrative regime that is not fit for purpose.