A coalition of regional mayors and MPs is presenting a 'third way' for the UK’s water sector, suggesting that failing private water companies should be converted into mutualized, not-for-profit cooperatives. This proposal emerges amid ongoing debates regarding the future of Thames Water and other utilities that have faced intense public scrutiny for discharging sewage into waterways while simultaneously raising consumer bills and failing to meet infrastructure investment targets.

Greater Manchester Mayor Andy Burnham and his allies are advocating for this model as an alternative to full state nationalization. While there is broad consensus among these leaders that the current private model is not delivering for the public, there is disagreement on the best path forward. Burnham has expressed reservations about the potential impact of full nationalization on government debt, citing Treasury projections that suggest taking these companies into public ownership could significantly increase the national deficit. By shifting to a mutual or cooperative structure, proponents argue that the companies could be managed in the public interest without the government assuming the full financial burden of the debt currently held by private firms. The government has yet to formally respond to the proposal, and the debate continues over how to balance the need for massive infrastructure investment with the fiscal constraints of the public purse.