Bonus ban blocks £6.5m for water bosses as review will target loopholes
Environment Secretary calls for a tighter rule to ensure failure doesn't pay
Last updated 7 hours ago
Water companies had £6.5 million worth of bonuses blocked last year due to failures in their operations, according to the latest assessment from Ofwat.
Nine companies, including Anglian Water, Thames Water, and Southern Water, triggered the bonus ban rule for the 2025-26 year, contributing to a total of more than £10 million in blocked payments since 2024.
The regulator is reviewing the performance-related executive pay (PRP) prohibition rule after noticing significant changes in remuneration behaviour that could potentially undermine the ban.
Environment Secretary Dame Angela Eagle announced a review aimed at closing loopholes, stating, "People are sick of seeing water bosses profit while rivers are polluted and customers are repeatedly let down."
This review seeks to ensure that bonuses are not disguised as alternative payments, following Ofwat's concerns about increasing retention payments and unexplained hikes in base salaries.
The companies affected include Anglian Water, Thames Water, Southern Water, Northumbrian Water, Severn Trent Water, South West Water, Wessex Water, Yorkshire Water, and Dwr Cymru.
Public trust in the sector remains low, with Ofwat's interim director Helen Campbell emphasising the need for the rule to better meet customer expectations. Campbell noted the disappointing trend of companies triggering the bonus ban due to serious performance failures.