The claim competition is not possible is therefor false. We can debate if we want it, but it is incorrect to claim it cannot work.
https://en.wikipedia.org/wiki/Privatisation_of_British_Rail#...
Traffic dropped a lot in the Great Depression but stabilized immediately after, and remained stable right up until nationalization in 1948 at which point the network entered a period of continuous decline, eventually falling to a level of ridership last seen in 1865. That is a staggering failure.
The moment the railways were privatized ridership starts going up again, despite the privatization not being complete and being unable to roll back the huge damage done under the decades of state ownership (before nationalization the railway companies were entirely self sufficient, which they no longer are).
So to argue that privatization makes "no sense" you have to ignore the fact that when privately managed usage of the railways goes up and when run by the state it goes down. If the goal of the railway is to be used, then it does make sense.
Except when they merge/consolidate and say they can find savings (which of course will be passed onto consumers) through "efficiencies" and "synergies".
You can set up a system where companies are involved in the delivery of water in a way that let's them compete. For example, national entity owns the pipes and needs to provide a given service, companies compete for pipe maintenance, IT services, etc. It's hardly difficult to think up a system that is mostly free market and better in every way than what the people from the UK have to suffer through.