Labour MPs and regional mayors push cooperative model for struggling water utilities

A group of Labour MPs and regional mayors, including Helena Dollimore and mayors Tracy Brabin, Oliver Coppard and David Skaith, have asked the prime minister to adopt a "third way" for water utilities, turning them into not-for-profit cooperatives rather than pursuing full nationalisation. Their proposal, backed by the Good Growth Foundation’s report on water cooperatives, targets Thames Water, which is on the brink of financial failure and negotiating a rescue package that could waive fines and environmental duties.

The plan calls for a bail-in mechanism similar to that used for banks, forcing shareholders and creditors to absorb losses, and mandates that any company emerging from special administration become a cooperative. It also recommends sector-wide regulatory tightening, including caps on executive pay and a dividend ban unless performance targets are met. Supporters claim the model would keep debt off the public balance sheet, give customers a say in governance, and curb sewage pollution, while avoiding the fiscal risks of outright nationalisation.