Latest news with #UnitedUtilities
ITV News
4 days ago
- Business
- ITV News
Water sector needs ‘root-and-branch' reform, MPs say
The water sector is in need of 'root-and-branch reform', a committee of MPs has said as it called for 'much more regulated management' of bonuses for senior bosses. The cross-party Environment, Food and Rural Affairs committee has said that the industry is 'failing', but that water companies are 'deaf to the crisis' that it is facing. In their report, Priorities For Water Sector Reform, released on Monday, the MPs argue that the UK Government 'should feel able to use its temporary nationalisation powers' when needed. They also said the system should 'ensure that more money gained from investors and through customer bills is directed towards investment in water infrastructure and service delivery' and less towards debt repayment or financial rewards for executives. United Utilities was also one of six water companies banned earlier this month from paying bonuses to senior bosses. A new law has been introduced which will prevent bonuses from being paid if a water company does not meet environmental or consumer standards, does not meet financial resilience requirements, or is convicted of a criminal offence. The system of fines and rewards should also focus on a reduction in pollution incidents, responsible ownership and the need for the sector to have long-term resilience, the MPs said. 'Despite some initial success after privatisation in 1989, root-and-branch reform of the water sector is now needed to improve the sector's culture,' the committee said. As part of their investigation, the MPs found that 'public disquiet has increasingly turned to outrage' at the way water companies and their bosses are benefiting from the sector. 'Over hearings with 10 of the largest water companies and Ofwat, we regularly encountered a culture that is deaf to the crisis the sector is facing,' they said. Committee chairman Alistair Carmichael, a Liberal Democrat MP, said the sector 'must not shy away from bold proposals' and that it has a 'serious culture problem'. He said: 'Water companies' complex and sometimes impenetrable financial structures, with their myriad subsidiaries, holding companies and parent organisations, seem to suggest that their purpose is less to provide a good service to their customers and more to allow them to juggle their finances and their increasingly unsustainable levels of debt. 'Meanwhile, an ineffective regulatory system has failed to protect customers, the environment and the financial stability of the sector. 'It has failed to ensure that companies invest in essential infrastructure and it has not encouraged long-term thinking. 'This has got to stop now. Trust and accountability in the water sector are very low. 'It is not acceptable that it has fallen to commendable citizen scientists to expose issues with local water resources. 'Environmental protection and the delivery of reliable and safe water must be the first priorities of water companies and regulators.' A Defra spokesperson said: 'Our rivers, lakes and seas are polluted, and our water system is broken. 'As part of the plan for change, new legislation has banned unfair multimillion-pound bonuses for bosses at six water companies and launched a record 81 criminal investigations. 'This Government has also secured the largest investment into the water sector in history, with £104bn in private sector investment to clean up rivers, lakes and seas and cut sewage by nearly half by 2030.' A Water UK spokesperson said: 'Everyone agrees that the water system is not working, and we have been calling for fundamental reforms which allow investment to get quickly to where it needs to go. 'In the meantime, companies are focused on investing a record £104 billion over the next five years to secure our water supplies, end sewage entering our rivers and seas and support economic growth.'
Yahoo
06-06-2025
- Business
- Yahoo
Water firms would be foolish to increase salaries to get around bonus ban
Environment Secretary Steve Reed has suggested that water companies would be 'extremely foolish' to increase salaries to try and get around a bonus ban. Six firms have been banned from paying bonuses to senior bosses under new rules that came into force on Friday. Thames Water, Yorkshire Water, Anglian Water, Wessex Water, United Utilities and Southern Water have been told that they cannot issue bonuses for the financial year 2024/25, which concluded in April. Mr Reed said that customers need to have 'confidence' in what water firms are doing, but also said it would not be 'right' for the Government or regulator to be 'capping' salaries in private sector businesses. Asked if he was going to make sure that firms cannot raise base salaries to compensate for any bonus ban, Mr Reed told Times Radio: 'I think they would be extremely foolish to do anything of the sort that you're describing, because (…) these companies need to rebuild their broken relationship with their customers. 'Their customers need to have confidence in what they're doing, their customers are furious at the fact that they're seeing local waterways being polluted, but bosses taking multimillion-pound bonuses.' He later told the BBC that it would not be 'right' for the Government or regulator to be setting salaries. He told Radio 4's Today programme: ''I don't think it's right that government or regulators should be capping the salaries in private sector businesses. 'But those businesses need to have an eye on how their customers are feeling about what they are doing, and there are steps that you can take that are appropriate within regulation.' The firms have all been banned under new rules which prevent bonuses from being paid if a water company does not meet environmental or consumer standards, does not meet financial resilience requirements, or is convicted of a criminal offence. The six companies are not under an indefinite ban, and those firms may be able to offer rewards for the 2025/26 year, provided they stick within the Ofwat rules, under the Water (Special Measures) Act which comes into force on Friday. If a company pays a bonus while it is under a ban, the water regulator Ofwat has the power to get the money back. Under the new rules, Yorkshire Water, United Utilities, Thames Water, and Southern Water will all be unable to pay bonuses to the chief executive or chief financial officer, for the 24/25 financial year. Anglian Water will be banned from paying its chief executive a bonus, but the chief financial officer will not be banned. Wessex Water will be banned from paying its chief financial officer any extra, but the chief executive will be exempt. The exemptions are because people were not in post when the incident that broke Ofwat's rules happened. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
06-06-2025
- Business
- Yahoo
Water firms would be foolish to increase salaries to get around bonus ban
Environment Secretary Steve Reed has suggested that water companies would be 'extremely foolish' to increase salaries to try and get around a bonus ban. Six firms have been banned from paying bonuses to senior bosses under new rules that came into force on Friday. Thames Water, Yorkshire Water, Anglian Water, Wessex Water, United Utilities and Southern Water have been told that they cannot issue bonuses for the financial year 2024/25, which concluded in April. Mr Reed said that customers need to have 'confidence' in what water firms are doing, but also said it would not be 'right' for the Government or regulator to be 'capping' salaries in private sector businesses. Asked if he was going to make sure that firms cannot raise base salaries to compensate for any bonus ban, Mr Reed told Times Radio: 'I think they would be extremely foolish to do anything of the sort that you're describing, because (…) these companies need to rebuild their broken relationship with their customers. 'Their customers need to have confidence in what they're doing, their customers are furious at the fact that they're seeing local waterways being polluted, but bosses taking multimillion-pound bonuses.' He later told the BBC that it would not be 'right' for the Government or regulator to be setting salaries. He told Radio 4's Today programme: ''I don't think it's right that government or regulators should be capping the salaries in private sector businesses. Promise made. Promise delivered. — Steve Reed MP (@SteveReedMP) June 6, 2025 'But those businesses need to have an eye on how their customers are feeling about what they are doing, and there are steps that you can take that are appropriate within regulation.' The firms have all been banned under new rules which prevent bonuses from being paid if a water company does not meet environmental or consumer standards, does not meet financial resilience requirements, or is convicted of a criminal offence. The six companies are not under an indefinite ban, and those firms may be able to offer rewards for the 2025/26 year, provided they stick within the Ofwat rules, under the Water (Special Measures) Act which comes into force on Friday. If a company pays a bonus while it is under a ban, the water regulator Ofwat has the power to get the money back. Under the new rules, Yorkshire Water, United Utilities, Thames Water, and Southern Water will all be unable to pay bonuses to the chief executive or chief financial officer, for the 24/25 financial year. Anglian Water will be banned from paying its chief executive a bonus, but the chief financial officer will not be banned. Wessex Water will be banned from paying its chief financial officer any extra, but the chief executive will be exempt. The exemptions are because people were not in post when the incident that broke Ofwat's rules happened.
The Independent
06-06-2025
- Business
- The Independent
Water firms would be foolish to increase salaries to get around bonus ban
Environment Secretary Steve Reed has suggested that water companies would be 'extremely foolish' to increase salaries to try and get around a bonus ban. Six firms have been banned from paying bonuses to senior bosses under new rules that came into force on Friday. Thames Water, Yorkshire Water, Anglian Water, Wessex Water, United Utilities and Southern Water have been told that they cannot issue bonuses for the financial year 2024/25, which concluded in April. Mr Reed said that customers need to have 'confidence' in what water firms are doing, but also said it would not be 'right' for the Government or regulator to be 'capping' salaries in private sector businesses. Asked if he was going to make sure that firms cannot raise base salaries to compensate for any bonus ban, Mr Reed told Times Radio: 'I think they would be extremely foolish to do anything of the sort that you're describing, because (…) these companies need to rebuild their broken relationship with their customers. 'Their customers need to have confidence in what they're doing, their customers are furious at the fact that they're seeing local waterways being polluted, but bosses taking multimillion-pound bonuses.' He later told the BBC that it would not be 'right' for the Government or regulator to be setting salaries. He told Radio 4's Today programme: ''I don't think it's right that government or regulators should be capping the salaries in private sector businesses. 'But those businesses need to have an eye on how their customers are feeling about what they are doing, and there are steps that you can take that are appropriate within regulation.' The firms have all been banned under new rules which prevent bonuses from being paid if a water company does not meet environmental or consumer standards, does not meet financial resilience requirements, or is convicted of a criminal offence. The six companies are not under an indefinite ban, and those firms may be able to offer rewards for the 2025/26 year, provided they stick within the Ofwat rules, under the Water (Special Measures) Act which comes into force on Friday. If a company pays a bonus while it is under a ban, the water regulator Ofwat has the power to get the money back. Under the new rules, Yorkshire Water, United Utilities, Thames Water, and Southern Water will all be unable to pay bonuses to the chief executive or chief financial officer, for the 24/25 financial year. Anglian Water will be banned from paying its chief executive a bonus, but the chief financial officer will not be banned. Wessex Water will be banned from paying its chief financial officer any extra, but the chief executive will be exempt. The exemptions are because people were not in post when the incident that broke Ofwat's rules happened.
ITV News
06-06-2025
- Business
- ITV News
United Utilities banned from awarding bonuses to executives under new Ofwat rules
Water supplier United Utilities has been barred from awarding bonuses to its most senior executives after the introduction of new regulations aimed at holding water companies accountable for their performance. The new rules, which came into force on Friday 6 June under the Water (Special Measures) Act, mean United Utilities cannot offer financial bonuses to its chief executive or chief financial officer. The measures apply to companies that fail to meet environmental or consumer standards, fall short on financial resilience, or are convicted of a criminal offence. Regulator Ofwat has been given new powers to recover any bonus payments made in breach of the ban. The restrictions are not permanent, and United Utilities may be able to resume performance-related rewards in 2025/26, provided it complies with the new conditions. The Department for Environment, Food and Rural Affairs (Defra) has revealed that over the past decade, more than £112 million in bonuses and incentives have been paid out by UK water companies. Ministers say this is no longer acceptable where companies have failed to meet key standards. Commenting on the new measures, Environment Secretary Steve Reed said: ' Water company bosses, like anyone else, should only get bonuses if they've performed well, certainly not if they've failed to tackle water pollution. 'Undeserved bonuses will now be banned as part of the Government's plan to clean up our rivers, lakes and seas for good.' Campaign group River Action has welcomed the ban, but warned against companies attempting to bypass it by increasing base pay. Chief executive James Wallace said: 'We won't end pollution for profit until water companies are refinanced and governed for public benefit. Any attempt to inflate base pay as a workaround must be stamped out.'
