Water company executive bonuses up 21% despite sewage ‘scandal’, new analysis finds

The pay packets of water company bosses have risen by a fifth, new figures show, despite raw sewage being pumped into waterways.

Average water company executives’ salaries and bonuses rose by 21 per cent from 2020-2021 to 2021-2022, according to an analysis of their annual reports by the Liberal Democrats. That’s a year-on-year average rise per executive of nearly £200,000, according to the party.

Bonuses alone have risen by £100,000 per water company executive, meaning their average annual bonus stands at £670,000.

In total, the 22 water bosses paid themselves £24.8m, including £14.7m in bonuses, benefits and incentives in 2021-2022, the figures show.

The news comes as water companies pumped sewage from storm overflows into Britain’s seas this week after thunderstorms hit, prompting warnings for swimmers to stay out of the water at more than 50 beaches.

“This is a national scandal,” Liberal Democrat environment spokesperson Tim Farron said. “These disgusting polluting habits have made beaches unsafe in the middle of the summer holidays and harmed precious British wildlife.”

Companies discharged raw sewage into rivers in England more than 400,000 times last year, according to government figures.

Liberal Democrat MP for Tiverton and Honiton Richard Foord, who toldThe Independent earlier this year that his son fell ill after going swimming in a Devon river and who has seen beaches in his constituency marked as “unsafe” this week, said the country needed to see action.

“Local people and holidaymakers shouldn’t be forced to swim amidst human waste,” he said. “Devon’s beaches are amongst the best in the world but the government is turning a blind eye while private companies ruin them.”

“We have been clear that water companies’ reliance on overflows is unacceptable and they must significantly reduce how much sewage they discharge as a priority,” said water minister Steve Double.

“This is on top of ambitious action we have already taken including consulting on targets to improve water quality which will act as a powerful tool to deliver cleaner water, pushing all water companies to go further and faster to fix overflows.”

The Environment Agency has also driven up monitoring of water companies and “will not hesitate to act” to eliminate the harm sewage discharges cause to the environment, the Department for Environment, Food and Rural Affairs said in a blog post on Thursday.

A Water UK spokesperson said the companies were investing over £3bn to improve overflows as part of a wider national programme to improve the environment between 2020 and 2025.

The spokesperson said bonuses were linked to performance and reflected customer and environmental outcomes.

“Private investment has brought more than £160bn into an industry that was previously starved of cash, while improving water company efficiency by over 70 per cent,” the spokesperson added.

David Black, CEO of the regulator of Ofwat, said: “I was very clear with company remuneration committees in March that performance-related pay for CEOs should be clearly linked to their performance for customers, the environment and society. We are carrying out our own analysis and plan to report on whether we feel companies have clearly made this link.

“Performance-related pay can’t be a one-way street, if companies are not performing that should be reflected in executive pay.”