In a move that has sparked public outrage, water companies across England and Wales have hiked bonuses for their top executives to a staggering £9.1 million this year. The generous payouts come despite these same companies being responsible for dumping record amounts of raw sewage into the nation’s rivers and seas.
Severn Trent and Thames Water Lead the Pack
Leading the charge in the bonus bonanza is Severn Trent, which accounted for over a third of the total with £3.36 million in executive bonuses. This is particularly galling given that the company was slapped with a £2 million fine this year for what regulators called “reckless” pollution.
Not to be outdone, Thames Water nearly doubled its payouts to executives from £746,000 in 2021-22 to a whopping £1.3 million in 2023-24. This is despite the fact that the company’s CEO jumped ship halfway through the year and Thames is drowning in over £15 billion of debt.
Regulator Under Pressure to Act
The eye-popping bonuses are piling pressure on Ofwat, the water industry regulator, to intervene and rein in the excess. Last year alone, water companies discharged raw sewage into the environment for a disgusting 3.6 million hours – a 105% increase from the previous 12 months.
It is a national scandal that these bonuses are being paid out by firms who disgustingly pollute rivers, lakes and beaches. These executives are pocketing more every year while sewage levels rise. Frankly, the whole thing stinks.
– Tim Farron, Liberal Democrats Environment Spokesperson
Thames Water on the Brink
Making the bonus payouts even more egregious is the precarious financial position many water companies find themselves in. Thames Water, saddled with billions in debt, is reportedly down to its last 8 months of operating cash. This has raised serious concerns for its 8,000 employees and 16 million customers who rely on it for water and wastewater services.
Thames executives are scrambling to negotiate with creditors and restructure debts to avoid falling into a form of temporary nationalization. But critics argue that the company’s irresponsible borrowing, underinvestment in infrastructure, and failure to control sewage dumping mean it may need to come under public ownership and management to sort out the mess.
Contamination and Illness in the South West
South West Water also joined the bonus club, increasing its payout pot from £325,000 to £504,000. The company oversaw a mass tap water contamination event this year in which dozens fell ill after drinking water polluted with the parasite cryptosporidium.
Calls for a Bonus Ban
The new government is facing loud calls to ban bonuses for water company executives who fail to meet environmental and consumer standards. The Liberal Democrats are pushing an amendment to an upcoming water bill to try to force a ban through Parliament.
- Almost all bonuses were paid by shareholders, not customers
- Companies say bonuses needed to attract top talent to deliver investment plans
- Government expected to give regulator new powers to veto unjustified bonuses
But for now, the cash keeps flowing to the very executives responsible for massive environmental violations and service failures. Until the regulator or government steps in and stops the gravy train, water bosses will keep getting richer while the nation’s waterways get dirtier. The public stink over this scandal is only going to grow.
