The UK’s Thames Water – infamous for pumping raw sewage into waterways – parent company has now defaulted on its debt.

Why should the failure of a UK water company be of interest to Australia and Australians? First, because it illustrates the failure of many privatisations to improve service and performance. Second, because it is symptomatic of problems throughout the UK not only in the water industry but also other services – from railways to NHS supplies.

…and finally, because at the heart of the problems was the Australian Macquarie Group – dubbed the vampire kangaroo in a nod to Goldman Sachs’s great vampire squid taunt.

The various financial complications in the history of Thames Water need deep forensic accounting knowledge to properly explain. But the problems started when Margaret Thatcher wrote off five billion pounds of debt when she privatised the industry in 1989.

Macquarie bought Thames Water in 2016 and successively sold off slices of the company finally quitting in 2017 with the sale of its final stake for an estimated 1.35 billion pounds.

The original price was 2.8 billion pounds with 2 billion repaid – not by Macquarie and investors – but by new borrowings raised by Thames Water through a Caymans island subsidiary.

During its........

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