Water CEOs fleece the public
Residents’ bills are sky high, the nation’s water reserves are seeping away, but privateer bosses are still shamelessly rinsing the coffers.
Figures from the National Audit Office (NAO) last year revealed that, over the three decades that have elapsed since the water industry was denationalised in 1989, water bills have increased by 40 percent above inflation. Over the past ten years, meanwhile, shareholder dividends have paid out more than £13.5bn. (England’s running out of water – and privatisation is to blame by Sondhya Gupta, The Guardian, 21 March 2019)
Shareholders are making a killing whilst the nation’s water infrastructure is falling apart. Currently the main beneficiaries of Thames Water’s shareholder bonanza hail from Canada and Kuwait, from which distance the question of what might constitute responsible stewardship of Britain’s water supply can hardly loom large.
When the industry was privatised in 1989 the territory was carved up between different monopolies. There is no competition between the lucky franchise holders, and little concern about the plight of householders having to pay rising bills whilst the privateers drag their feet over fixing the estimated 3bn litres of water leaking out of pipes every day across the country.
As the then CEO of Thames Water Steve Robertson whinged to a Standard journo in 2017, the “trouble is there are 3200km of these things running down the middle of every major street in London. They’ve all got to be replaced, but the question is: in what order and over what period of time? They’re very deep and very, very tricky to understand.” (Meet Steve Robertson: The Thames Water chief who has to keep us out of the gutter by Jim Armitage, The Standard, 28 July 2017)
With neither public accountability nor the spur of competition to trouble their profit-taking, the water companies have become openly contemptuous about what view the public at large might be taking – to such an extent that the House of Commons public accounts committee has been prodded into administering a slap on the wrist, protesting that at the current rate of leakage, amounting to 20 percent of the country’s daily usage, Britain will be running out of water within 20 years.
Most galling of all is the sight of water company directors awarding themselves massive payouts after having signally failed in their task of fixing the leaks and delivering an affordable water supply, prompting the regulator Ofwat to warn that the pay levels of top executives have “damaged customer trust”.
The Times reported on this summer’s annual filing of executive payouts, detailing the unbridled greed and overweening insolence of the privateers.
“Steve Robertson, 62, the former boss of Thames Water who left the company last year, received a £2.8m pay-off. It included a £2m ex-gratia payment because he had not received any bonuses during his three-year tenure due to the company’s chronic failures on leaks.”
So to make up for having forfeited bonuses, withheld because the company he ran abysmally failed to patch up the leaks, Robertson was given an extra £2m tip on his departure!
The Times continues: “That news follows revelations in The Times of the bonanza promised to his successor, the most generous package ever offered in the sector. Sarah Bentley, 48, who was poached from Severn Trent, has been hired on the promise of a £12m three-year deal, including a £3m ‘golden hello’ in compensation for loss of bonuses at her former employer.
“Liv Garfield, 44, the chief executive of Severn Trent, was paid £2.7m last year, a rise of 10 percent, including £1.8m in bonuses.
“Steve Mogford, 64, chief executive of United Utilities, the northwest England supplier, was paid £2.5m, a rise of 5 percent, of which nearly £1.6m were bonuses. Chris Loughlin, 67, the chief executive of the South West Water group Pennon, had a pay rise of 60 percent, taking his earnings to £2.1m, of which £1.4m was bonuses.” (Water bosses showered with big payouts by Robert Lea, The Times, 13 July 2020)
These are neither workers by hand nor by brain but parasites of a dying system that is moribund to the core and ripe for overthrow. As a first step, the water companies should be expropriated and the water industry brought into public ownership.
