Four worst performing water companies named and shamed

The water regulator Ofwat has named and shamed the four worst performing water companies.

Thame Water, Southern Water, SES Water and South East Water have been told by the regulator to deliver a turnaround over their financial performance.

The latest yearly report has revealed that the four water companies are causing concern mid their long-term finances and £1.4 billion was paid to shareholders in dividends.

Severn Trent paid £426 million to shareholders in the year and United Utilities gave £452 million.

“There are some companies that did not fully meet our expectation in explaining dividend decisions and payments,” Ofwat said.

David Black, Ofwat’s chief executive, said: “We expect companies to maintain a level of financial headroom so they can manage periods of volatility and meet their obligations to customers and the environment.

“We’ve been calling for the water sector to be strengthened by further investment – that is why we welcome the £4.6 billion of additional equity.

“Where we have seen cause for concern, we have also seen some companies responding to the challenge and we expect them to continue to work on improving their financial resilience.”

Rebecca Pow, the water minister for the Government’s Department for Environment, Food and Rural Affairs (Defra), said, “However, we are clear that water companies must not profit from environmental damage.

“That is why we gave Ofwat new powers to impose tougher rules on water company dividends and we welcome the tighter restrictions on bonuses too.”

Andy Prendergast, GMB National Secretary, said, “Privatising the UK’s water network has been a disastrous failed experiment.

“Shareholders are trousering fortunes with money that should be used to restore infrastructure and tackle sewage spills and leakage.

“Ofwat and Ministers have been asleep at the wheel. Naming and shaming companies is not enough – we need a regulator with sharper teeth.”