Material cultures of water financialisation in England and Wales

The ownership structure of the water and sewerage sector has changed substantially in England and Wales (EW) since the 10 companies were listed on the London Stock Exchange in 1989. The majority of firms are now delisted and a number of companies are now owned by financial investors via special purpose vehicles. In some cases, revenue streams from customer water bills have become securitised for decades into the future not only to raise funds for investment, but also for finance distributions to shareholders. The high financing costs associated with these highly leveraged corporate structures are passed on to customers. The regulator, Ofwat, tasked with protecting the interests of consumers, operates largely within a system of price controls intended to mimic a competitive market in the absence of financial speculation. This means that regulation steers away from intervening in the financialised corporate structures that have emerged around some of the water utilities. These manifestations of financialisation are considered to be ‘market outcomes’. This paper explores the discourses and narratives that have developed in the provision of water in EW to create a situation where such rentier transfers are normalised. Using the systems of provision approach, the paper shows that the material culture of water finance has been constructed along narrow lines with superficial consumer consultation, while extensive financial engineering to increase shareholder returns continues unimpeded