The cost of nationalising Thames Water? Nothing

A view from a passerby last night. “I’ve been a customer of Thames Water for 30 years. It has got worse every single year. It is a shambles.”

Since our commentator was wearing red trousers and a green shirt, I don’t think he was from Just Stop Oil — though they also managed to get tickets to Lord’s.

That such sentiments about Thames Water are so common suggests the Government would face few political objections if it renationalises the water utility, something it may have to do regardless of ideological preference.

Leaving politics aside, what about the money? The objection to such a deal would be that already strained Government coffers just can’t afford it. I’d say the cost of buying Thames Water back for the nation would cost about this much: £0.

Let’s say the Government plays nice and decides to give investors some money for Thames (it could just seize it).

And let’s say £10 billion is the figure agreed.

In balance sheet terms, the Government has a liability of £10 billion. And an asset of… £10 billion.

The way a banker would look at this would be to say that if the public sector can buy an asset at a distressed price then it’s pounds in rather than out.

The banker might also say to a buyer, if the lifetime value of dividends from Thames Water might exceed £10 billion, then you are even more quids in.

Even if you hate the idea of the Government owning our utilities, there is no reasonable financial objection to buying Thames Water