Thames Water drops £1m bonuses for prime bosses after authorities criticism

Thames Water has “withdrawn” plans to pay senior bosses bonuses linked to the corporate securing a £3bn emergency mortgage, the setting secretary has stated.

Steve Reed confirmed the proposals had been dropped throughout an Atmosphere, Meals and Rural Affairs (Efra) committee session with MPs on Tuesday.

The so-called retention plan would have amounted to 50% of senior bosses’ salaries – resulting in them getting £1m on prime of their annual salaries and common bonuses.

The funds have been linked to the struggling agency securing a rescue mortgage of as much as £3bn to stave off collapse earlier this 12 months.

Thames Water had been “attempting to avoid” upcoming guidelines that may ban water corporations from paying bonuses by “calling their bonuses one thing totally different”, Mr Reed advised MPs.

“It was the flawed factor to do,” he stated. “It offends towards their very own prospects’ sense of truthful play.”

A spokesman for Thames stated: “It has by no means been the Thames Water board’s intention to be at odds with the federal government’s ambition to reform the water trade.”

The corporate’s board “has determined to pause the retention scheme and await forthcoming steering from the regulator” in relation to the brand new guidelines, he added.

In a letter to the committee, Thames Water’s chairman Sir Adrian Montague stated he could have “within the warmth of the second […] misspoken” when he was quizzed on the agency’s turnaround at an Efra session final week.

Thames Water is England’s largest water agency, supplying round 16 million households throughout London and the South East.

It has been on the centre of rising public outrage over the extent of air pollution and rising payments – which have inched greater whereas executives have been paid large bonuses.

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New guidelines from the Water Companies Laws Authority (Ofwat) imply bonus funds to bosses might be banned if corporations fail to fulfill requirements to guard the setting, shoppers and firm funds.

It may additionally block funds funded not simply by buyer cash, however by lenders and shareholders.