Water bosses 'have pocketed £25m in bonuses since 2019' despite sewage scandal

Water company bosses have awarded themselves over £25m in bonuses and incentives since the last general election, according to analysis by Labour.

Sewage pipes

The analysis found that nine water chief executives were paid £10m in bonuses, £14m in incentives and £603,580 in benefits since 2019.

It comes amid outrage over illegal sewage dumping, with water firms in England seeking to hike customers’ bills by an extra £156 a year to invest in Britain’s Victorian infrastructure.

Labour has pledged to give the water regulator new powers to ban payouts to bosses of firms that are illegally polluting rivers, lakes and seas if it wins the next election.

It said under the plans, Ofwat could have blocked six out of nine water chiefs’ bonuses last year because of severe levels of sewage pollution.

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Steve Reed, the shadow environment secretary, 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.”

The government has introduced unlimited fines for water companies who pollute and increased Ofwat’s powers to ensure water company dividends are linked to environmental performance.

And last year, Ofwat decided that water companies failing to meet environmental commitments would be barred from funding bonuses from household bills.

Labour said it will go further by allowing the regulator to ban bonuses altogether and making sure chief executives face personal criminal liability for “extreme and persistent” lawbreaking.

Mr Reed said: “Labour will put failing water companies under special measures. We will strengthen regulation so law-breaking 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.”

The sewage scandal has come under the spotlight in recent years, with a string of high-profile incidents, including a sewage discharge at a picturesque beach in Cornwall, fuelling disgust over the issue.

Water companies have faced a backlash over bonuses and shareholder dividends – seen by critics as rewards for failure given the scale of the problems facing the sector.

Untreated sewage was discharged more than 1,000 times a day across the UK’s waterways between September 2022 and 2023, according to the Surfers Against Sewage campaign group.

They said that as well as being an environmental problem, the sewage scandal is increasingly a public health one too – with reports of sickness after entering the water tripling over the past year.

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Water firms in England have apologised to customers and submitted a business plan to Ofwat that would see investment almost double from current levels to £96bn between 2025 and 2030.

Water UK said the plans would pay for 10 new reservoirs, cut leaks and stop the equivalent of 6,800 Olympic swimming pools-worth of sewage spills.

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It said the scale of the work meant that the average bill in England was expected to be £7 per month higher by 2025, rising to £13 by 2030.

That sum is equivalent to £156 more per year.

It forms part of the government’s Plan for Water to update the UK’s Victorian-era sewage network.

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 £150m 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.”