Minister Condemns Thames Water Bonuses
Environment Secretary Emma Reynolds has criticised Thames Water for handing 'outrageous' payouts to top executives, as the troubled utility company revealed it paid over £4 million in bonuses and boosted its chief executive's pay to £1.2 million.
Britain's largest water firm, which is on the brink of nationalisation with a £20 billion debt pile, disclosed in its annual report that bonuses of £4.09 million were paid to 'key management personnel' under its management retention plan. This marks an increase from £2.8 million the previous year and includes performance-related and retention awards.
CEO Pay Rises Despite Controversy
Chief Executive Chris Weston's total pay rose to £1.16 million in the year to March 31, up from £1.04 million in 2024-25, after he received a £99,000 retention payment deferred from a previous year. His basic pay was also hiked by 14% from April 1 this year to £995,000.
Environment Secretary Emma Reynolds said the payouts add to evidence that water companies are side-stepping bans on bosses' bonuses. She stated: 'It's outrageous that one of the worst-performing water companies is handing out bonuses and inflation-busting pay rises to its executives. It flies in the face of basic fairness, and the British public are right to be furious. We've banned bonuses for polluting water bosses and will be taking action to prevent bonuses by any other name.'
Regulatory Context and Retention Payments
Last year's Water (Special Measures) Act allowed regulator Ofwat to ban performance-related bonuses for bosses at utilities failing customers and the environment. Mr Weston said his £99,000 retention bonus was awarded before the Act came into effect in June last year, and Thames Water confirmed he did not receive a performance-related payout for 2025-26.
However, the firm has already caused controversy over retention payments to senior executives, seen as evading the ban. In December, amid outcry, it agreed to pause £2.46 million of these payments to 21 top bosses – not thought to include Mr Weston – until further notice, having already paid out a similar amount earlier in the year.
Remuneration Committee's Defence
In its annual report, Thames Water's remuneration committee said: 'The committee fully accepts and complies with the legal and regulatory position on performance-related pay but is concerned that the constraints now operating materially limit the extent to which the scale and challenge of the transformation being delivered can be reflected in total remuneration. The committee believes this creates a real risk to the retention of experienced leaders with the capability to deliver this transformation in exceptionally challenging circumstances.'
