Bosses paid £27m extra since 2020 despite 1,000 sewage spills a day, according to the party’s research.
Image source, Getty Images
The Liberal Democrats have urged the UK government to ban bonuses for water company bosses until sewage offences are stopped.
The party’s analysis showed firms in England had paid executives nearly £27m in bonuses since 2020.
The bonuses are “obscene” given 1,000 sewage spills a day were recorded in 2021, the Lib Dems said.
The government has not backed the ban, but said it was taking urgent action to curb sewage discharges.
“We are clear that we want water companies to spend more on better infrastructure and far less on pay-outs to shareholders,” a government source told the BBC.
Labour stopped short of backing the call for a ban on bonuses, but accused the government of allowing the companies bosses to dump sewage “while pocketing eye-watering bonuses amid a cost of living crisis”.
Water companies could face fines or criminal prosecutions after admitting possible illegal discharges into rivers and waterways.
The admission last year prompted a major government investigation into more than 2,200 sewage treatment works spanning all water and sewerage companies in England.
Lib Dem leader Sir Ed Davey accused the Conservative government of “allowing water companies to pump raw sewage into our precious rivers and lakes while awarding themselves obscene bonuses”.
“Just like the millions paid out to bankers during the financial crisis, the public will find this hard to stomach,” he said.
His party’s analysis of company records showed executives at England’s water companies were paid £48m in 2020 and 2021 – including £27.6m in bonuses, benefits and incentives.
They claimed United Utilities paid out the largest package of bonuses, worth nearly £6m, followed by Severn Trent (£5.5m) and Anglian Water (£3.5m).
In the same 2020-21 period, water companies made £2.7bn in operating profits, according to the analysis.
Sir Ed said the bosses should hand back their bonuses “to help clean up their mess”.
But Green Party peer Jenny Jones said “much stronger action” was needed to tackle the “sewage dumping scandal”.
She called for water companies to be brought back into public ownership to ensure “proper accountability”, but in the meantime, introduce a “much tougher watchdog… to properly enforce the protection of our rivers and coastlines with heavy fines on companies that continue to carelessly pollute them.”
United Utilities declined to comment. On its website, the company said it had a “long-term ambition” to “eliminate pollution incidents”.
Severn Trent pointed to its plan to ensure no river in its catchment areas would be unhealthy because of its operations by 2030.
The same commitment was made by Anglian Water, which said it would not comment on the remuneration of its staff.
“It is a matter for them and the independent remuneration committee, who ensure pay is benchmarked against other companies and industries,” a spokeswoman said.
The Lib Dems have also called for a sewage tax on the profits of water companies to fund the cleaning up of waterways polluted by sewage.
But a government source accused the Lib Dems of “hypocrisy” for “preaching about water quality”.
“They voted down our measures to improve water quality during the passage of the Environment Act,” the source said.
The government’s Environment Bill was approved by Parliament last year, following a lengthy battle over the amount of sewage released into rivers.
But Labour’s shadow environment secretary Jim McMahon said the law “allowed water firm bosses to dump raw sewage into our communities, while pocketing eye-watering bonuses amid a cost of living crisis.”
He added: “Labour is on your side and would respect our communities by cleaning up the sewage being dumped by companies in our fields, rivers, and lakes – which the Tories passed laws to allow.”
Last month, the Environment Agency said the “state of our rivers is not in the condition we want” and “we are still seeing too much pollution from a number of sources”.
In 2021, the agency recorded more than 372,000 spill events lasting more than 2.6 million hours from storm overflows, which release untreated sewage and rainwater into the environment to ease pressure on the system.
Water companies are allowed to discharge untreated sewage into rivers in exceptional circumstances – for example, during heavy rainfall.
They can, however, be acting illegally if they fail to meet certain requirements, such as treating enough wastewater before overflows are released into the environment.
- 15 February
