LONDON (Reuters) -Britain’s water legislation does not currently allow the government to give a struggling company, such as Thames Water, any leniency on sewage fines, environment minister Steve Reed said on Monday.
Proposals aimed at overhauling the water sector published by Jon Cunliffe earlier on Monday suggested a formal turnaround regime should be established, giving struggling companies space to recover under so-called “regulatory forbearance”.
“The legislation currently doesn’t allow for that,” Reed said.
“We’re going to publish a white paper in the autumn, which will be our response to Jon’s report today, and then consult, but as things stand, Thames need to resolve the situation themselves as a stand-alone, private company.”
He said the government was prepared for Thames to enter special administration, a form of temporary nationalisation, if that became necessary.
“My hope and expectation is that the creditors will come to an agreement themselves,” he added.
(Reporting by Sarah Young; Editing by Kate Holton)
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