UK
Water chiefs ‘have pocketed £26m in bonuses, benefits and incentives since 2019’


Sophie Wingate, PA Political Correspondent
Sun, 21 January 2024 

Water company executives who may have presided over illegal sewage spills have pocketed more than £26 million in bonuses, benefits and incentives over the last four years, Labour has said.

The party accused the Government of turning “a blind eye to corruption at the heart of the water industry” by allowing firms to openly pollute British rivers, lakes and seas while paying out millions to bosses.

Water chiefs have received more than £10 million in bonuses, nearly £15 million in incentives and £621,580 in benefits since the 2019 general election, Labour found in its analysis of pay at nine water companies.

That includes £1.4 million in bonuses last year, less than half the £3.1 million paid in the previous year.

At the same time, companies plan to hike consumers’ bills by about £156 per year to pay for investment to prevent 140,000 sewage overflow spills a year.

Labour, if it wins the next election, has said it will give water regulators the power to ban senior executives’ bonuses if their companies are illegally polluting waterways.

It said it will end self-monitoring, make sure chief executives face personal criminal liability for “extreme and persistent” lawbreaking, and introduce “severe and automatic” fines for illegal discharges.

The party said that under its plans, regulator Ofwat could have blocked six out of nine water bosses’ bonuses last year.

Shadow environment secretary Steve Reed said: “This Conservative Government has wilfully turned a blind eye to corruption at the heart of the water industry.

“The result is stinking, toxic sewage destroying our countryside, and consumers facing higher bills while failing water bosses pocket millions in bonuses.

Labour frontbencher Steve Reed accused the Government of turning a ‘blind eye to corruption’ in the water industry (Aaron Chown/PA)

“Labour will put failing water companies under special measures. We will strengthen regulation so lawbreaking water bosses face criminal charges, and give the regulator new powers to block the payment of any bonuses until water bosses have cleaned up their filth.

“With Labour, the polluter – not the public – will pay.”

Labour’s proposals come after a BBC Panorama investigation suggested United Utilities has been misreporting its pollution incidents as being less serious than they are in order to avoid having them counted in Ofwat’s figures, something the company denies.

Environment Agency insiders also claimed most reported pollution incidents go unchecked, with officers using only what water companies tell them for their reports.

Ofwat in December said the senior executives that did take a bonus did so from shareholders, not customers.

The Environment Agency has said it takes sewage pollution “very seriously” and it will always prosecute companies that are being misleading.

A Government spokesperson said: “Our Plan for Water is delivering more investment, stronger regulation, and tougher enforcement – and we have already been very clear that water companies must never profit from environmental damage.

“That is why we have given Ofwat increased powers to hold them to account, as well as boosting Environment Agency powers through unlimited financial penalties. That’s on top of the £150 million levied through criminal prosecutions since 2015.

“All storm overflows across England are also already fitted with monitors, with this Government having increased monitoring from 7% in 2010 to 100% now.”

A spokesperson for trade association Water UK said: “We agree that any financial reward should be tightly linked to performance – including protecting the environment. It is also right that regulators have all the powers they feel they need to hold water companies to account.

“It is clear, however, that the only way to the change we all want to see is through significant investment. Water companies have set out plans for the biggest investment in the sector’s history – including £11 billion to improve sewage overflows – tripling current levels of investment.”