Southern Water must pay customers £61 each as part of £126m penalty in biggest case of its kind after ‘shocking’ cover-up of polluting spills at sewage plants
- The £126m package includes a rebate of £123m set to be paid to customers
- Biggest package of Ofwat penalties ever, proportionate to the size of the firm
- Southern Water failed to invest enough in order to prevent wastewater spills
Southern Water must pay a record £126 million package of fines and rebates after deliberately misreporting its performance, regulator Ofwat has announced.
The company failed to operate some wastewater treatments works properly and did not invest enough to prevent wastewater spills.
It manipulated the wastewater sampling process, meaning the provider avoided penalties.
This morning it was announced Southern Water must pay a £126m package, including a rebate of £123m to customers through their bills and a fine of £3m.
The firm will also have to fork out £91m in penalties previously avoided and £32m of payments to recognise its serious failures.
Southern Water must pay a record £126 million package of fines and rebates after misreporting its performance (pictured, Margate sewage works)
Pictured: Unlawfully discharged sewage at Margate pumping station. Southern Water must now fork out for a record package in penalties and payouts
This untreated sewage at Margate pumping station in Kent is among the reasons that Southern Water now faces the record package payout
It is the biggest package of penalties and payments Ofwat has ever imposed, proportionate to the size of the business, and would have been larger had Southern Water not co-operated.
Wastewater customers should expect a rebate on their bills of £61, with £17 in 2020/21 and £11 in each of the following four years.
Ofwat Chief Executive Rachel Fletcher said: ‘What we found in this case is shocking. In all, it shows the company was being run with scant regard for its responsibilities to society and the environment.
…and its boss was paid £900k before quitting
Shamed Southern Water’s former boss was paid nearly £900,000 in his final year at the company – and then walked into a top job at a green energy firm where he has spoken of wanting to save the planet.
Millionaire Matthew Wright, 54, stepped down as chief executive after six years in late 2016, during which the shocking spills of waste water from its sewage plants into the environment took place. He was paid £873,000 for his final year in charge. Under a long-term incentive payment scheme, he received a bumper payout of £1.9 million in 2014.
Millionaire Matthew Wright, 54, stepped down as chief executive after six years in late 2016
In June 2017, Mr Wright was appointed UK managing director of Danish energy group Dong, which has since been renamed Orsted.
Mr Wright has claimed that offshore windfarms can plug Britain’s green energy gap.
He was unavailable for comment yesterday.
‘It was not just the poor operational performance, but the co-ordinated efforts to hide and deceive customers of the fact that are so troubling. The previous management failed to stamp out this behaviour and failed to manage its plants properly.
‘In doing so, Southern Water let-down its customers and operated in a way completely counter to the public service ethos we expect. That is why the company deserves such a significant sanction. We also think it is important Southern Water has a formal fine on their record for this serious breach.
‘The rebates on customer bills will go some way towards putting things right. It is now for Southern Water, under its new leadership, and with the improvements it is introducing, to show it has learnt from this unacceptable behaviour and can be trusted again.
‘Today’s announcement should also serve as a reminder to all other companies about the gravity of their responsibilities to society and the environment and that we will take action if they neglect them.’
Ofwat has not investigated the environmental impact as a result of Southern Water’s actions. That investigation is being overseen by the Environment Agency.