The most telling detail of the picture below is in the caption
Jo and Gill’s story is about the impact of the write down of the value of Thames Water in the USS pension portfolio, but what about the Thames Water’s closed DB Pension Schemes. There are two of them and Thames Water also makes a substantial contribution paid every month into a master trust as its replacement workplace pension. This article asks “what steps are being taken to secure the retirement futures of Thames Water’s current staff and pensioners?”
From where I am writing, I can see the Thames running past Windsor and Eton, the water is not going to run out. But in less than year, the money to operate its sewage systems and provide clean water to its customers and to pay its pension contributions, will run out. That is the prediction of Thames Water and its parent Kemble. The money will run out next May.
That is, of course, unless it finds a way to refinance. I quote the summary of a recent Reuters article by Carolyn Cohn on Capital Backed Journey Plans
I am afraid that the Thames Water pension scheme is not particularly keen to talk to Edi Truell . I know, because I have tried to make introductions and have been told in no uncertain terms that the Thames Water Pension Schemes are currently in purdah.
It strikes me that the one thing that has been in very short supply with regards Thames Water, is a sensible discussion about how it continues to operate as a functioning organisation beyond May 2025. Since any deal with regards financing of a pension scheme takes time, I would suggest that the trustees are bound to consider offers in a timely fashion. The scheme’s funding advisers – it’s actuarial advisers – are bound under TAS300 to consider offers made to their clients – from buy-out and buy-ins to Capital Backed Journey Plans.
There is nothing particularly offensive about offering Trustees who have a weak covenant , support. It is not a sign of weakness to enter into a conversation at an early stage. If Thames Water is unable to pay its bills, including its pension bills, its pension schemes will go into the PPF and members will get PPF benefits rather than Thames Water Pension Schemes benefits. The PPF benefits are not designed to pay the full pension, this will not be a good outcome for members.
So entering into discussions with Edi Truell, or Carlyle or Clara or any one of the companies who are lining capital up to keep schemes like Thames Water’s out of the PPF has got to be in the interests of members.
Or is there some plan B we are not being told about?
It is absolutely in the interests of all parties – but especially the members of threatened pension funds, that their trustees and their advisers explore offers made to them when offers are appropriate. Reuters are maintaining that Edi Truell is offering capital to the Thames Water Pension Schemes.
Thames Water may not run out any time soon, but the money to treat it and pay pension contributions to its pension schemes is predicted to run out in less than twelve months time.
Surely it is time for the Pension Trustees, their executive and their advisers to start talking to the people prepared to help?
Henry. What about the rest of London plus getting our clean water in 2025. I have sympathy for the pensioners – being one of the same defrauded by the FAS, but the more important matter is the ensuring the protection of the rest of us who are presently paying for good clean water? It’s about time that the government does something about the quality of our water just in case these ‘finace suits’ leave us in the lurch!
Of course the quality of our water is important – speak to those in Bramley who can’t drink tap water this week. Getting Thames Water back on track means seeing through the project for the London Sewer. But Thames Water has a responsibility to its pension scheme and if they go under , the Trustees have a responsibility to get an alternative sponsor in place. An alternative sponsor is offering its capital.