Stress testing
The good news for the British economy is that its banks have passed the latest stress tests from the Bank of England, so they should be able to survive the current crisis of higher interest rates, defaults and possible recession.
The bad news is that the water companies are due to give evidence to the House of Commons, never will PR folks have worked so hard to prepare the unimpressive to at least not cock up.
But what should really be happening is that the water industry should be stress tested. Can it supply enough clean water? Can it survive a drought or the challenges of climate change? Does it have enough money to clean up the country’s rivers and coastline? Where is its copious amounts of guaranteed cash going every year?
If the banks did not have enough capital, had an ATM system that lost 25% of its cash, could not provide basic banking services because they had not invested enough, were not ready for future possible shocks, had syphoned off profits to shareholders when they could not really afford it; they would be made to put it right at their own expense.
The water companies’ representatives will be trying to persuade us that we should pay more to fix their system.
What really needs to happen is that the water companies need to be scared of Ofwat, maybe they should be regulated by the Bank of England.
Economics, trade and Brexit, not necessarily in that order but the dog always comes first.
By Jonty Bloom Media