Listening
Unlocking Word Meanings
Read the following words/expressions found in today’s article.
- cash-strapped / ˈkæʃ stræpt / (adj.) – not having enough money
Example:Many cash-strapped students take part-time jobs to pay for tuition and living expenses.
- creditor / ˈkrɛd ɪ tər / (n.) – a person, company, or organization that lends money to someone and expects to be paid back
Example:Creditors can take legal action against the company if it doesn’t pay back the money it borrowed by the end of the year.
- nationalize / ˈnæʃ ə nlˌaɪz / (v.) – to place something under the national government’s authority
Example:Corporations want to stop the government’s plan to nationalize the oil industry.
- dividend / ˈdɪv ɪˌdɛnd / (n.) – an amount of money that a company pays to people who own shares or stocks in the company
Example:Those who invested in the company are expecting higher dividends because the company earned a lot.
- reservoir / ˈrɛz ərˌvwɑr / (n.) – a large lake, usually made by people, where water is stored for use in homes, businesses, and other places
Example:Water levels in many reservoirs will drop a lot this summer.
Article
Read the text below.
Thames Water, which serves 16 million customers in and around London, is seeking court approval for up to 3 billion pounds ($3.7 billion) of emergency funding to prevent the cash-strapped company from falling into government administration.
The High Court in London began a four-day hearing on the financing package, with Thames Water facing off against smaller creditors who complain that the deal is too expensive and favors bigger investors. Creditors holding about 90% of the company’s debt have already backed the deal.
Without the funding, Thames Water will run out of money in March, which could force the government to temporarily nationalize the company. Both the government and Thames Water say water will continue flowing to customers regardless of what happens.
Thames Water, which has about 17 billion pounds ($20.9 billion) of debt and has been repeatedly cited for illegal sewage spills, is at the center of a nationwide backlash over rising water bills as Britain seeks to modernize its water and sewage systems to cope with climate change and a growing population.
The company has been the focus of criticism from consumers and politicians who say Thames Water created its own problems by paying overly generous dividends to investors and high salaries to executives while failing to invest in pipelines, pumps and reservoirs. Company executives say the fault lies with regulators, who kept bills too low for too long, starving the company of the cash it needed to fund improvements.
Ofwat, which regulates water companies in England and Wales, in December approved a 35% increase in Thames Water’s consumer charges over the next five years. The company argued that bills needed to rise by 53% in order to finance needed projects and provide the financial returns necessary to attract investors.
The company had until Feb. 18 to appeal the decision.
This article was provided by The Associated Press.
Viewpoint Discussion
Enjoy a discussion with your tutor.
Discussion A
- In your opinion, should public services such as water and electricity be managed by private companies or the government? Why do you say so? Discuss.
- Are you satisfied with the public services, such as water and electricity, in your country? Why or why not? What can the management do to further improve the services? Discuss.
Discussion B
- If you were a customer of Thames Water, how would you feel about the company paying high dividends to investors instead of improving services? What would you do in this situation? Discuss.
- If you were an executive of Thames Water, what would you invest in first to improve the company (ex. reservoirs, customer service)? How would you keep both investors and customers happy? Discuss.
