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Material cultures of water financialisation in England and Wales

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  • Kate Bayliss

Abstract

The ownership structure of the water and sewerage sector has changed substantially in England and Wales (EW) since the 10 companies were listed on the London Stock Exchange in 1989. The majority of firms are now delisted and a number of companies are now owned by financial investors via special purpose vehicles. In some cases, revenue streams from customer water bills have become securitised for decades into the future not only to raise funds for investment, but also for finance distributions to shareholders. The high financing costs associated with these highly leveraged corporate structures are passed on to customers. The regulator, Ofwat, tasked with protecting the interests of consumers, operates largely within a system of price controls intended to mimic a competitive market in the absence of financial speculation. This means that regulation steers away from intervening in the financialised corporate structures that have emerged around some of the water utilities. These manifestations of financialisation are considered to be ‘market outcomes’. This paper explores the discourses and narratives that have developed in the provision of water in EW to create a situation where such rentier transfers are normalised. Using the systems of provision approach, the paper shows that the material culture of water finance has been constructed along narrow lines with superficial consumer consultation, while extensive financial engineering to increase shareholder returns continues unimpeded.

Suggested Citation

  • Kate Bayliss, 2017. "Material cultures of water financialisation in England and Wales," New Political Economy, Taylor & Francis Journals, vol. 22(4), pages 383-397, July.
    • Handle: RePEc:taf:cnpexx:v:22:y:2017:i:4:p:383-397
    DOI: 10.1080/13563467.2017.1259300
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    References listed on IDEAS

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    1. John Allen & Michael Pryke, 2013. "Financialising household water: Thames Water, MEIF, and ‘ring-fenced’ politics," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 6(3), pages 419-439.
    2. Cooper, Christine, 2015. "Accounting for the fictitious: A Marxist contribution to understanding accounting's roles in the financial crisis," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 30(C), pages 63-82.
    3. Rhodante Ahlers, 2010. "Fixing and Nixing: The Politics of Water Privatization," Review of Radical Political Economics, Union for Radical Political Economics, vol. 42(2), pages 213-230, June.
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    Cited by:

    1. Ola Michalec & Sveta Milyaeva & Awais Rashid, 2022. "Reconfiguring governance: How cyber security regulations are reconfiguring water governance," Regulation & Governance, John Wiley & Sons, vol. 16(4), pages 1325-1342, October.
    2. Morris, Jonathan & McGuinness, Martina, 2019. "Liberalisation of the English water industry: What implications for consumer engagement, environmental protection, and water security?," Utilities Policy, Elsevier, vol. 60(C), pages 1-1.
    3. Tallgauer, Maximilian & Schank, Christoph, 2024. "Challenging the growth-prosperity Nexus: Redefining undergraduate economics education for the Anthropocene," Ecological Economics, Elsevier, vol. 216(C).

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