Overview

• Under the new law, senior executives at Thames Water, Yorkshire Water, Anglian Water, Wessex Water, United Utilities and Southern Water cannot receive performance pay for the 2024/25 year.
• The move follows Ofwat’s record £122.7 million fine for Thames Water’s sewage spills and dividend rule breaches and highlights concerns over £112 million in bonuses paid by the sector in the past decade.
• Ofwat will oversee company pay structures to prevent base-salary hikes as a workaround and has the authority to claw back any unlawful awards.
• Firms can regain bonus rights in the 2025/26 financial year if they meet stricter environmental, customer service and financial resilience benchmarks.
• The government has signalled further water industry reforms to attract investment, strengthen oversight and curb pollution.