Yesterday
Left Foot Forward
The news has triggered renewed calls for public ownership.
Left Foot Forward
The news has triggered renewed calls for public ownership.
South West Water received £450 million in government subsidies at the same time as it paid over a billion pounds to shareholders, it has been revealed.
According to data obtained by Democracy for Sale through a Freedom of Information request, the firm has been given an annual subsidy of £40 million per year since 2013. Over that period, over £1.5bn was paid out to the firm’s shareholders in dividends.
That subsidy has been used to pay the first £50 of customers’ bills. Despite this subsidy, South West Water’s bills are the second highest in England and Wales.
The revelation has led to renewed calls for England’s water firms to be taken into public ownership.
Campaign group We Own It told Left Foot Forward that the news showed that ‘water is broken in this country’.
Matthew Topham, lead campaigner at We Own It, said: “South West Water is vandalising our waterways whilst being propped up by the Government with huge subsidies. Nearly £0.5 billion in taxpayer cash has been pumped in, whilst £1.5bn has been sucked out in dividends over the same period.
“Any rational person would consider this a failed business model – at least for the customers and the environment. For the shareholders and executives, it’s working beautifully. A seemingly endless supply of cash that isn’t even disrupted by a measly £2m fine for sewage dumping in 2023.
“Our water supply is essential to life – the very definition of an industry ‘too big to fail’. Yet the Government is ruling out any move to bring it back into public ownership. Regulation doesn’t work, fines don’t work, public pressure doesn’t work. Water is broken in this country – the Government must intervene and put the public back in control of water.”
South West Water has been forced to pay millions of pounds in fines for sewage pollution in recent years.
Chris Jarvis is head of strategy and development at Left Foot Forward
Water companies in England ‘using loopholes’ to avoid paying for outages
Helena Horton Environment reporter
Helena Horton Environment reporter
THE GUARDIAN
Tue 26 November 2024
A station set up for residents to pick up bottles of still water in Reading after the supply to some households was interrupted.Photograph: Geoffrey Swaine/REX/Shutterstock
Water companies in England are using loopholes in order to not pay people who are left for days without running water, the CEO of the regulator has said.
Tens of thousands of homes across the country have been left without water for days this year as ageing pipes burst.
In May, 32,500 properties in Hastings and St Leonards-on-Sea had no service after a mains pipe burst, with some homes left without running water for five days. In January, households across Reading also faced an interruption to their water supply.
Ofwat chair, David Black, told the parliament’s environment, food and rural affairs committee that the rules need to be changed by government so those in areas with disruption to water supply get paid compensation automatically.
At the moment, companies are able to avoid paying compensation to those left without running water if they can claim it was due to an “extreme event”.
Black said: “The difficult issue is the way the standards are currently drafted as they allow exemptions for extreme events. Our worry is companies use these to avoid a responsibility – we think those rules should be changed but that’s not our responsibility. We have to follow the rules that are set by Defra [the Department for Environment, Food and Rural Affairs]. I think the regime needs to be changed so compensation is automatically provided where customers are off supply regardless of whether there is an extreme weather event.”
He added that only three water companies out of 17 meet Ofwat’s targets for providing a consistent supply of tap water to customers.
Ofwat’s representatives also told the committee that Labour’s new water bill won’t necessarily ban bonuses for CEOs of polluting water companies. Steve Reed, the environment secretary, recently promised “this government is urgently introducing laws to ban the payment of unfair bonuses to polluting water bosses”. The new bill gives regulators powers to ban bonuses for water company CEOs who fail to meet environmental and consumer standards, and if their company is not financially resilient. These environmental standards have not yet been decided by the regulator.
Last year, Liv Garfield of Severn Trent took a £584,000 bonus despite her company having been fined £2m for dumping sewage, and the firm scored highly on the EA’s environment rankings even with this human waste spillage taken into account.
Helen Campbell, senior director for sector performance at Ofwat, explained the new rules. She said: “It is not for Ofwat to decide exactly how companies should remunerate their executives. We expect companies to set out how bonuses are justified against performance delivery and through the extra measures that we will introduce – we will be very clear on circumstances where they are not justified. For example, if a company has received a criminal conviction we would expect the company to explain extremely clearly why those bonuses are justified despite that.”
Water UK and Defra have been contacted for comment.
Tue 26 November 2024
A station set up for residents to pick up bottles of still water in Reading after the supply to some households was interrupted.Photograph: Geoffrey Swaine/REX/Shutterstock
Water companies in England are using loopholes in order to not pay people who are left for days without running water, the CEO of the regulator has said.
Tens of thousands of homes across the country have been left without water for days this year as ageing pipes burst.
In May, 32,500 properties in Hastings and St Leonards-on-Sea had no service after a mains pipe burst, with some homes left without running water for five days. In January, households across Reading also faced an interruption to their water supply.
Ofwat chair, David Black, told the parliament’s environment, food and rural affairs committee that the rules need to be changed by government so those in areas with disruption to water supply get paid compensation automatically.
At the moment, companies are able to avoid paying compensation to those left without running water if they can claim it was due to an “extreme event”.
Black said: “The difficult issue is the way the standards are currently drafted as they allow exemptions for extreme events. Our worry is companies use these to avoid a responsibility – we think those rules should be changed but that’s not our responsibility. We have to follow the rules that are set by Defra [the Department for Environment, Food and Rural Affairs]. I think the regime needs to be changed so compensation is automatically provided where customers are off supply regardless of whether there is an extreme weather event.”
He added that only three water companies out of 17 meet Ofwat’s targets for providing a consistent supply of tap water to customers.
Ofwat’s representatives also told the committee that Labour’s new water bill won’t necessarily ban bonuses for CEOs of polluting water companies. Steve Reed, the environment secretary, recently promised “this government is urgently introducing laws to ban the payment of unfair bonuses to polluting water bosses”. The new bill gives regulators powers to ban bonuses for water company CEOs who fail to meet environmental and consumer standards, and if their company is not financially resilient. These environmental standards have not yet been decided by the regulator.
Last year, Liv Garfield of Severn Trent took a £584,000 bonus despite her company having been fined £2m for dumping sewage, and the firm scored highly on the EA’s environment rankings even with this human waste spillage taken into account.
Helen Campbell, senior director for sector performance at Ofwat, explained the new rules. She said: “It is not for Ofwat to decide exactly how companies should remunerate their executives. We expect companies to set out how bonuses are justified against performance delivery and through the extra measures that we will introduce – we will be very clear on circumstances where they are not justified. For example, if a company has received a criminal conviction we would expect the company to explain extremely clearly why those bonuses are justified despite that.”
Water UK and Defra have been contacted for comment.
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