RI 2024 H2 Y6 Timed Practice - Paper 1

9757/CT/Y6/2024 © RI 2024 [Turn over RAFFLES INSTITUTION 2024 YEAR 6 TERM 3 TIMED PRACTICE Higher 2 ECONOMICS 9757/01 Paper 1: Case Study June 2024 1 hours 15 minutes Additional Materials: Answer Paper READ THESE INSTRUCTIONS FIRST Write your name, index number and civics class on all the work you hand in. Write in dark blue or black pen on both sides of the paper. You may use a soft pencil for diagrams, graphs or rough working. Do not use paper clips, highlighters, or correction fluid. Answer ALL questions in Paper 1: Case Study Indicate the question number clearly The number of marks is given in brackets [ ] at the end of each question or part question. This document consists of 4 printed pages.

9757/CT/Y6/2024 © RI 2024 [Turn over Question 1: Water challenges and policies Extract 1: UK’s water industry crisis Financial trouble at the company that supplies more than a fifth of the UK population with water has raised alarm about the dire state of an industry that delivers a resource people can’t live without. The problems are most acute at Thames Water, London’s water utility, but the wider industry across England and Wales is struggling to deliver a reliable service under the weight of huge debts built up since it was sold to private investors over 30 years ago. The UK water sector is “clearly in a state of multiple crises,” said Dieter Helm, a professor of economic policy at the University of Oxford. The day job of maintaining the assets has not been done very well, and in some cases very badly,” Helm told CNN, adding that sewage spills into rivers and coastal waters are routine, leakage is enormous, service is poor, and water bills are high — and could go even higher starting in 2025 as mountains of debt make it hard for companies to fix those problems. Water companies in England and Wales were privatised under Margaret Thatcher’s Conservative government in 1989 and were granted a licence to operate from the industry regulator, Ofwat, and are responsible for providing water exclusively for a particular geographical area. This, combined with significantly high infrastructure costs from maintaining an extensive network of pipelines, restricts the chance for new companies to enter the market. The privatisation was done with the rationale that this would unleash the vast investment required to upgrade Britain’s Victorian-era sewage network. But not enough has materialized because money has been taken out, not put in. Profits from water companies has been diverted to paying shareholders as dividends instead of investing in critical water infrastructure. The UK government has held emergency talks over the future of Thames Water. V isiting professor at the University of Greenwich, David Hall, said the government should find a way of bringing the water companies back into public ownership, as it had done with the rail network. No othe