Ofwat has blocked Thames Water from using customers’ money to fund “undeserved bonuses”.

Thames Water plans to double bonuses for its executive staff despite a 40% increase in pollution incidents and spills during the first half of the year to 30 September.

In the first half of this financial year, the struggling firm has set aside £1.85 million in bonuses for executive staff members, compared to £888,000 in the same period last year, marking a 108% increase. 

Meanwhile, the number of pollution incidents is up from 257 last year, to 359 between March and the end of September this year.

Thames Water’s chief executive, Chris Weston said: “After record rainfall and groundwater levels in our region, pollutions and spills are unfortunately up”. 

Thames Water is in £15.7 billion worth of debt, and is trying to secure another £3 billion to keep it running beyond mid-next year.

In November, the regulator Ofwat introduced new rules which require water companies to demonstrate that executive bonuses are “sufficiently linked” to company performance. 

Thames Water’s half year results said that bonuses are calculated based on half of the expected bonus for the whole year, and that the final amount will be decided by its remuneration committee at the end of the year.

In the results, it said that “the increase in the bonus for this period is due to the introduction of a new performance-related pay scheme”.

Weston also defended the attempt to pay bosses £770,000 in bonuses, which Ofwat intervened in, saying that no clear justification was given for the payments.

He argued: “We need to attract talent to this company… If we don’t offer competitive packages, people will not come and work at Thames”.

Weston, who was hired in January, was also awarded a bonus of £195,000 for his first three months at the company.

Olivia Barber is a reporter at Left Foot Forward

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