MPs have ‘no confidence’ in South East Water’s leadership after outages
The parliamentary Environment, Food and Rural Affairs (Efra) Committee said the leadership’s incompetence and lack of accountability have driven its poor performance
A crossbench group of MPs said they have “no confidence” in South East Water’s (SEW) chief executive and board following the company’s handling of major outages in Kent and Sussex.
The parliamentary Environment, Food and Rural Affairs (Efra) Committee said the leadership’s incompetence and lack of accountability have driven its poor performance, while its inadequate governance framework has failed to hold senior employees responsible.
It comes after bosses were grilled twice by the MPs over their response to multiple supply interruptions across Kent and Sussex.
Thousands of customers were left unable to access tap water, shower or flush their toilets during the outages between November and January.
In a report, published on Friday, the committee said: “South East Water presents as a company devoid of proper leadership, riddled with cultural problems that raise serious concerns about the ability of the executive team, led by the CEO David Hinton, to bring the company back into compliance and deliver the services their customers deserve.
“Leadership teams play a major role in how company culture develops; culture change at this scale requires South East Water’s leadership to change.”
The report also called on SEW’s shareholders – Utilities Trust of Australia, NatWest Group Pension Fund, and Desjardins Group and associated holding companies – to hold the company to account.
The firm was fiercely criticised over multiple failings that led to the outages as well as its response during the crisis.
These included poor maintenance of infrastructure, failing to monitor critical risks, failing to invest or build resilience and blaming external factors such as climate change and increased demand.
The company was also accused of a disorganised and slow response to restore supply, a lack of communication with customers and insufficient emergency supply through water tankers and bottled water, which left some vulnerable residents without.
Mr Hinton was grilled by the Efra committee in January but MPs said they had concerns about the accuracy of his evidence and his lack of accountability.
They then recalled the chief executive alongside company chairman Chris Train to answer further questions at a hearing earlier this month.
In a contrite appearance, Mr Hinton admitted he “got it wrong” in his handling of the outages and acknowledged some of the team’s failings.
But in its report, the committee said the leadership demonstrated a clear pattern of obfuscating responsibility and “groupthink”, arguing that this is preventing their ability to analyse problems and learn lessons.
Committee chairman Alistair Carmichael said the group of MPs “feel obliged to highlight the gravity of this extraordinarily poor situation”.
“This is an exceptional failure of management and of corporate governance,” he said.
“One cannot overstate the dangers of so many communities losing water supply for extended periods, including schools, GP surgeries and care homes.
“Someone in this company needs to take a grip, be accountable for its failings and to put them right.”
In a holding statement, a spokesperson for the water company said: “We are carefully considering the details of the Efra Committee Report, which is due to be published tomorrow.
“We will respond later today, once we have reviewed the report.”