THAMES Water is once again seeking further funding after plans to charge customers to fill pension scheme gaps were denied by regulators.
The water company had laid out plans to charge customers more than £150 million in extra fees to address a shortfall in pension schemes.
Now regulator Ofwat has “provisionally” rejected the plans, arguing that the gap was the full responsibility of management and shareholders.
The company has been barred from funding pension deficits with customer money since last year, with management having been responsible for the funding since a price review which took place in 2009.
Thames Water had planned to plug the deficit by 2027 through customer charges.
It is the latest setback faced by the company, which is now more than £15 billion in debt and which has more than 16 million customers in London and the Thames Valley.
A spokesperson for Thames Water said: “Constructive dialogue is taking place between the trustees, company and the Pension Regulator to finalise and agree the [pension scheme] valuation as soon as possible.
“All contributions on all pension schemes due have been made and are up to date.”
The news comes just weeks after the company was named as one of three water providers which could be fined in one of the largest ever investigations by regulators into performance.
Regulator Ofwat examined the levels of service provided by Thames Water, Yorkshire Water, and Northumbrian Water amid continued criticism of the environmental and financial performance of providers across the country.
The three companies were judged to have provided inadequate investment into their networks, which in turn caused continued sewage outflow into natural waterways, which more than doubled last year according to figures from the environment agency.
Following the investigation, Ofwat announced that it is proposing fines of £104 million for Thames Water.
Reading Today reported last month that the company has already amassed more than £15bn in debts, a jump of more than £1bn in just the last year.
Thames Water stated its intentions to seek further funding from investors as well as to raise bills by just under 60%.
It proposed a price increase of £191 to the average bill over the next five years, but Ofwat agreed to a rise of only £99, despite environmental campaigners arguing that money from customers bills isn’t being invested in infrastructure to reduce sewage letting.
Shareholders have indicated that they do not intend to inject any further funding into the company, meaning it could go into administration as early as next summer.
