Water Industry News

How Can Water Bosses Get Millions In Bonuses Amid Water Crisis?

The problem of poor quality and availability of freshwater in the UK is getting worse and worse, as a result of an increase in pollution, a rising population, and climate change.


However, despite rivers in England being the worst kept in the whole of Europe, according to a House of Commons Committee report, water company bosses have been rewarded with bonuses worth millions of pounds.


  • Labour analysis of water company bonuses


The Labour party conducted analysis into payments given to nine water chief executives since the last general election.


It reported that they were paid £10 million in bonuses, as well as £14 million in incentives, and £603,580 in benefits over the last four years.


Shadow environment secretary Steve Reed told Sky News: “This Conservative government has wilfully turned a blind eye to corruption at the heart of the water industry.”


This news has particularly upset people, given that customers’ bills are likely to increase by a further £156 a year, or £13 per month by 2030.


Water companies state this is to improve the UK’s Victorian water pipes and infrastructure, which is still in use and not able to cope with the demands of Britain in 2024.


For instance, the Victorian sewers in London were built for four million people. However, there are nearly nine million citizens living there. Consequently, storm overflows are being used more and more, stopping sewage from leaking into homes during periods of heavy rain.


Thanks to a rise in hard surfaces, due to urbanisation of towns and cities, and climate change causing heavy storms, storm overflows need to be increasingly used.


That is why the government hopes to transform the water network in the UK, including investing £4.4 billion in the Thames Tideway Tunnel, which is being dubbed as a ‘super sewer’ for the capital.


However, more money is needed to improve other pipes around the country, which is why water companies are forcing their prices up over the next six years.


  • An increase in water pollution


Another reason why many people will be angry to hear about the large bonuses the water executives have received is because many are believed to have been polluting waterways.


Indeed, the Surfers Against Sewage group revealed untreated sewage was released over 1,000 times a day across the UK in the year between September 2022 and 2023.


Labour has said bosses of water firms will not be given their bonuses if they are found to be illegally polluting waterways under its new plans. Therefore, six out of the nine water executives who received bonuses would not have been given theirs due to the levels of pollution their companies produced.


While the current government has introduced pollution fines for water companies, and has allowed Ofwat to ban them from taking bonuses from household bills, Labour has argued this does not act as enough of a deterrent.


“We will strengthen regulation so law-breaking water bosses face criminal charges, and give the regulator new powers to block the payment of any bosses until water bosses have cleaned up their filth,” Mr Reed commented.


Although water companies plan to make improvements to reduce sewage leaking into waterways, including building ten new reservoirs and making necessary repairs, this investment will also be taken out of bill payers’ pockets.


SAS argues that the main priority and responsibility of water companies “must be to the environment, not their shareholders and executives”.


Therefore, it believes this money should not have been given to the water bosses when so much investment is needed to reduce water pollution in the UK.


  • Poor water quality


The water pollution problem is getting worse by the year, and only 14 per cent of England’s rivers met good ecological status between 2021 and 2022.


At the same time, none reached good chemical status, meaning that they were all contaminated in some way.


Out of the 86 per cent that did not meet good ecological status, more than a third (36 per cent) failed to do so because of sewage and wastewater discharges.


  • The impact of water pollution


With such a large proportion of the country’s rivers and lakes polluted, this has a big impact on many areas.


For instance, it affects the surrounding environment, including harming wildlife and encouraging excessive algae growth. A high concentration of chemicals reduces the amount of oxygen in the water, which means aquatic life can no longer live there. This has an impact on predators that feed on them, as they have to move on to other areas.


Fish and other water organisms that do consume toxic substances can also cause harm to predators who eat them, having a disastrous implication for the wider environment.


Unsurprisingly, this has a knock-on effect for humans too, as it means those who work in the fishing industry can no longer use the waterways they rely on.


Humans who consume dirty water can also suffer from health complaints, including gastrointestinal problems, skin infections and respiratory difficulties. Serious health conditions, including cancer and developmental abnormalities, can also develop after long-term exposure to water pollution.


It is not surprising that many people are put off from visiting areas where the water is polluted, having a big impact on the tourism sector in the UK, particularly in coastal towns. This means hotels, restaurants, cafes and activity businesses are all being hit because of the problem of water contamination.


Therefore, it is obvious something needs to be done to fix the problem, so that less water can be wasted and polluted.


While Labour argues this begins with water executives, who do not deserve to be paid their sky-high bonuses while the public are losing out on business and are being forced to pay higher water bills, everyone can do their bit to help.


Repairing water leaks to switching water supplier to one that serves the environment better are just two ways to help the water crisis from getting worse.