No free lunch for nationalisation of water firm says Lord Howard

"There is nary escaped lunch" erstwhile it comes to backing nationalist companies specified arsenic Thames Water, Lord Michael Howard has told the BBC.

The firm, which is billions of pounds successful debt, faces a crisis, prompting caller calls for it to beryllium nationalised.

Mr Howard, who led the privatisation of the h2o manufacture much than 30 years ago, denied the program has failed.

Green Party's Caroline Lucas said h2o firms should beryllium placed nether nationalist ownership.

Thames Water, which serves a 4th of the UK population, has faced dense disapproval implicit its show pursuing a bid of sewage discharges and leaks, with its main enforcement quitting past week.

Lord Howard, who was the curate charged with privatising the h2o nether manufacture nether Margaret Thatcher's authorities told BBC Radio 4's Today programme that semipermanent investments successful infrastructure required large investment.

"You tin wage for them by borrowing, successful which lawsuit involvement has to beryllium paid to the lenders, oregon you tin wage for them by raising backstage capital, successful which lawsuit dividends person to beryllium paid to the radical who supply that capital," helium said.

"That is the lone prime available, determination is nary escaped lunch."

He said industries nether nationalist ownership indispensable "compete for resources" with the likes of health, acquisition and police, saying that erstwhile h2o was nationalised it was "way down the queue".

"When you merchandise it into the backstage sector, you person recourse to backstage superior - you tin marque the concern that's needed," said Lord Howard, who was besides the erstwhile Conservative enactment leader.

However, helium accepted with hindsight that immoderate companies should person been raising much of their superior done issuing equity.

"I deliberation it is arguable that the companies person been allowed to instrumentality connected excessively overmuch debt," helium said.

Ms Lucas, a Green Party MP and erstwhile enactment leader, told the aforesaid programme that erstwhile privatisation took spot h2o firms were "essentially handed a monopoly". She accused them of "loading up indebtedness to wage their dividends to shareholders".

"This is an experimentation that has wholly failed - h2o remains successful nationalist ownership successful astir different countries for bully reason," she said.

"We should beryllium prioritising nationalist request and biology protection, and not backstage profit."

Lord Howard described her remarks arsenic a "diatribe".

Under the plans, they would not beryllium renationalised, but the h2o regulator would unit them to beryllium tally for the bully of the environment, arsenic good arsenic for profit.