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Thames Water Increased Bills And Made £549M Profit, But Paid No Corporation Tax Last Year

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Remind me again, why were public utilities privatised?

Weren't we promised privatisation would lead to more investment in the infrastructure and lower bills? :rolleyes:

Thames Water was accused of “ripping off the taxpayer” this afternoon after revealing it did not pay a penny of corporation tax last year.

It also got a £5 million Treasury rebate in the financial year when it made £549 million and hit customers with a 6.7 per cent increase in bills.

The details emerged on the day that the head of industry regulator Ofwat said that the profits and complex tax arrangements of some water companies were “morally questionable”.

Thames Water, owned by the Australian company Macquarie and a group of investment funds,

http://www.standard.co.uk/news/london/thames-water-increased-bills-and-made-549m-profit-but-paid-no-corporation-tax-last-year-8652412.html

The parasites are gorging themselves... <_<

---

Edited by The Eagle

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Disgraceful.

We seem to have a problem in the UK. Privatecompanies/corporations controlling the cost/availability of:

Housing

Water

Gas

Petrol

Electricity

Food.

and hammering up the prices.

Thatchers vision.

Thatchers shame.

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There is the possibility that they really are reinvesting all the profits - the infrastructure may have got so bad that they have to.

I suppose the question would be if it paid a dividend or did share buy-backs.

If it did either of these then it should be considered to have made a profit.

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Thatchers vision.

Thatchers shame.

While Maggie might have started this, NuLiebor continued with the same policies so I wouldn't make this a party-political issue.

They are all in it together working for the same corporate/bankster interests with the same objective: to fleece the common people as much as possible.

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Well in that case I will switch my water suply to one of their competitors... :unsure: ... :angry:

The problem with water privatisation explained in one poorly spelt sentence.

Edited by RufflesTheGuineaPig

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Just stop paying your Water bill then, Water companies are not allowed to switch off your supply by Law even if you're in arrears...

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Well in that case I will switch my water suply to one of their competitors... :unsure: ... :angry:

Caught something on BBC brekkie about a "broadband price war." Even more so in the States where I think broadband packages have dropped or £5 a month a month or $5 not sure.

Interesting because many ISP's run off the back of the same broadband "pipes" operated by BT mainly.

And in 1971 my parents bought their first colour tv for the then massive sum of £300 which was cheapish for a set back then, as it had a 19" tube and was one of the first "solid state" sets (apart from the tube).

Now a small flat screen TV can be bought for a third that in a supermarket. Be interesting to know how much water charges relate to income in then and now too, despite this lovely privatisation.

And colour TV makers have had to invest too.

I dread to think how much we would pay for water now given current land values, if it weren't for the Victorians.

Edited by Secure Tenant

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Be interesting to know how much water charges relate to income in then and now too, despite this lovely privatisation.

And colour TV makers have had to invest too.

I dread to think how much we would pay for water now given current land values, if it weren't for the Victorians.

Remember that they haven't really invested in the network for about 25 years, and in fact have sold much of the critical infrastructure off to reduce costs.

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Remind me again, why were public utilities privatised?

Weren't we promised privatisation would lead to more investment in the infrastructure and lower bills? :rolleyes:

http://www.standard.co.uk/news/london/thames-water-increased-bills-and-made-549m-profit-but-paid-no-corporation-tax-last-year-8652412.html

The parasites are gorging themselves... <_<

---

Could be wrong but wasn`t it to pay for the last time UK PLC went cap in hand to the IMF al la 1970s

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Remember that they haven't really invested in the network for about 25 years, and in fact have sold much of the critical infrastructure off to reduce costs.

Really...where has all the money gone? ;)

View PostParkwell, on 11 June 2013 - 12:23 AM, said:

Well in that case I will switch my water suply to one of their competitors... :unsure: ... :angry:

So that means we are forced to pay what they force us to pay....when they themselves are not paying? :ph34r:

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Thames Water Increased Bills And Made £549M Profit, But Paid No Corporation Tax Last Year

The £549m profit was before interest payments, those are allowable expenses and in any event will be taxable in the hands of the recipients.

The taxable figure is the profit on ordinary activities before taxation of £145m.

Here's what's going on:

The accounts include a credit of £5m, being a reduction of the deferred tax provision.

The company spent just over £1bn on infrastructure investment which they classify as "assets in the course of construction"; their policy is not to charge depreciation on these assets until they are completed but they will get a substantial capital allowance for this expenditure, for tax purposes this more than wipes out their profits.

Ordinarily these accounts would show a deferred tax charge of £34m to recognise that the liability exists but has been delayed into a later accounting period. In this year's accounts there is a £42m reduction in the deferred tax provision to reflect the reduction in the rate of corporation tax.

So no "fun and games" and no clever avoidance here, they are just doing exactly what the tax law and accounting standards say that they must do.

Edit: The financial statements for those who want to see what's going on.

Edited by Goat

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So no "fun and games" and no clever avoidance here, they are just doing exactly what the tax law and accounting standards say that they must do.

That's not the real issue here, the issue is that Thames Water should be a public utility that reinvests all profits into the network and if profits are larger than what's required then they should reduce the water rates.

There is no reason why an Australian investment bank and other investment funds make a profit on London's drinking water.

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South West Water has the highest water bills in the country. Apparently environmental regulations and the long South West coastline that they have a duty to clean up is to blame... at least, so the corporate marketing department claims.

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There is no reason why an Australian investment bank and other investment funds make a profit on London's drinking water.

What about making a profit on food?

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What about making a profit on food?

You clearly miss the point.

Food provision clearly acts as a competitive market with many many competing providers involved. That forces companies to compete on price and improve quality of goods, whilst being efficient as possible.

With utilities such as water they act as natural monopolies. Having multiple sets of water pipes to each home would be extremely inefficient but that is the only way you could have true competition.

This is why the price of water is not decided by the market (because there is none) but by Ofwat which dictates the amount they can charge.

In the absence of market forces there is absolutely no reason for water utilities to be in private sector ownership. The reason d'etre of private ownership just does not exist.

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You clearly miss the point.

Food provision clearly acts as a competitive market with many many competing providers involved. That forces companies to compete on price and improve quality of goods, whilst being efficient as possible.

With utilities such as water they act as natural monopolies. Having multiple sets of water pipes to each home would be extremely inefficient but that is the only way you could have true competition.

This is why the price of water is not decided by the market (because there is none) but by Ofwat which dictates the amount they can charge.

In the absence of market forces there is absolutely no reason for water utilities to be in private sector ownership. The reason d'etre of private ownership just does not exist.

in the water industry you need more deregulation, not nationalisation to make it more like electricity and telecoms.

in Scotland they deregulated the water supply in 2008 for non domestic customers which meant that businesses could pick and choose who they buy their water from different suppliers.

the rest of the UK is following suit.

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in the water industry you need more deregulation, not nationalisation to make it more like electricity and telecoms.

in Scotland they deregulated the water supply in 2008 for non domestic customers which meant that businesses could pick and choose who they buy their water from different suppliers.

the rest of the UK is following suit.

Lordy, I keep explaining and you keep completely ignoring the point.

THERE CAN BE NO TRUE COMPETITION. IT WILL ALWAYS BE A NATURAL MONOPOLY.

These supposed scottish companies are using the same pipe network. The same natural monopoly exists. It is one supplier with a different front-company used to send the bill.

Go read some economics on this subject, your wasting my time and everyone elses by posting as you are, and worse potentially misleading the less informed and knowledgeble who might be reading these threads.

Here's some links for you -

http://www.economicsonline.co.uk/Business_economics/Natural_monopolies.html

https://www.boundless.com/economics/monopolies/origins-monopolies/creation-natural-monopoly/

http://en.wikipedia.org/wiki/Natural_monopoly

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That's not the real issue here, the issue is that Thames Water should be a public utility that reinvests all profits into the network and if profits are larger than what's required then they should reduce the water rates.

There is no reason why an Australian investment bank and other investment funds make a profit on London's drinking water.

That's your opinion, in any event it's nothing to do with your original post or my reply.

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not this again. The article refers to capital allowances on infrastructure as the bulk of it. I would gave thought investing infrastructure was a good thing?

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Lordy, I keep explaining and you keep completely ignoring the point.

THERE CAN BE NO TRUE COMPETITION. IT WILL ALWAYS BE A NATURAL MONOPOLY.

These supposed scottish companies are using the same pipe network. The same natural monopoly exists. It is one supplier with a different front-company used to send the bill.

Go read some economics on this subject, your wasting my time and everyone elses by posting as you are, and worse potentially misleading the less informed and knowledgeble who might be reading these threads.

Here's some links for you -

http://www.economicsonline.co.uk/Business_economics/Natural_monopolies.html

https://www.boundless.com/economics/monopolies/origins-monopolies/creation-natural-monopoly/

http://en.wikipedia.org/wiki/Natural_monopoly

the pipe isnt the be all and end all of the supply chain. i can buy broadband and phone services from 100's of different suppliers, i dont need 100 different phone lines. i can buy landline deals from the post office, they never setup a phone line.

If youre worried about BT jacking up the price then put in some regulation about how much it must supply services for. No ones saying there should be no regulation whatsoever. As far as im aware BT cant go above a certain price for line rental.

You are creating competition at different points of the supply chain so that its not owned by 1 company from start to finish.

there are different ways to skin a cat. thats the point of a market.

for example you are seeing mobile phone operators go into the landline rental space. or TV companies like sky hope to rope you in with cheap landline deals so that you buy it as part of a TV package.

the aim is to break the monopoly wherever you can, including the state.

Edited by mfp123

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