Corbyn’s £20bn water firms takeover ‘will hit pensioners’

JEREMY Corbyn would put pensions at risk by renationalising the water companies at far less than their market value, it was claimed yesterday.

Leaked documents suggested that Labour would pay £20billion to buy out the private water firms, even though their estimated worth is £44billion.

yesterday Shadow Chancellor John McDonnell gave an even lower figure of just £14billion, but said it was up to Parliament to decide.

The plans have triggered fears over pension funds, many of which are invested in utility companies. The Tories said it would lead to millions losing money in retirement.

Pensions minister Guy Opperman said: ‘Labour are planning a massive raid on people’s pensions, letting politicians decide on a whim how much people will receive for investing their hard- earned money in a pension fund. Millions of people will lose money in their retirement.’

Michael Roberts, of Water UK, said: ‘It would be a devastating blow for millions of pensioners if the water industry was subject to a smash-andgrab raid... More than five million pensioners have funds invested in the water industry – including many public sector workers – and they would lose thousands of pounds each under these leaked plans.

‘As well as hurting pensioners it would land taxpayers with a multi-billion-pound bill, both for the purchase of the industry and the extra £100billion that needs to be invested in the sector over the next decade.’

The Labour document, obtained by the Sunday Times, speaks of a ‘political process of negotiation with shareholders’ if Labour wins power. It says: ‘We think this is a better place to start than market values because it reflects how much shareholders have actually put into a company, and doesn’t incorporate future expected profits.’

Speaking on the BBC’s Andrew Marr Show, Mr McDonnell said: ‘It will all depend what price Parliament puts on it. That money will be borrowed. Water is a successful company in terms of the income it raises. The income that we will manage more effectively will cover the borrowing so there’ll be no net cost.’

Asked about shareholders, he said: ‘They’ll be protected. They will get the appropriate payment that Parliament will decide.’

Last night a Labour spokesman said: ‘Water bills have risen 40 per cent in real terms since privatisation. In the last ten years, water companies have paid 1,000 times more in dividends to their shareholders than in tax. Some have even paid more in dividends than they have made in profit, running up debts that are passed on to bill payers.

‘Labour will fix this broken system by bringing the water companies back into public ownership, saving households £100 per year on their bills.’

‘It would be a devastating blow’