Nine water companies, including stricken Thames Water, will be blocked from using customer money to fund “undeserved” bonuses for top bosses worth £6.8 million, the water regulator has announced.
Ofwat said it had stepped in to use its new powers to halt water companies that cannot show that bonuses are sufficiently linked to performance from using customer money to fund the payouts, amounting to 73% of the total executive awards proposed across the industry.
Debt-laden Thames Water is among three firms – also including Yorkshire Water, and Dwr Cymru Welsh Water – which were directly blocked from allowing customers to pay £1.5 million of bonuses.
Ofwat said a further six companies had voluntarily decided not to push the cost of executive bonuses worth a combined £5.2 million onto customers, with shareholders instead paying.
David Black, chief executive of Ofwat, said: “In stopping customers from paying for undeserved bonuses that do not properly reflect performance, we are looking to sharpen executive mindsets and push companies to improve their performance and culture of accountability.
“While we are starting to see companies take some positive steps, they need to do more to rebuild public trust.”
