Water bosses get multi-million-pound payments that will NOT be hit by regulator’s power to ban bonuses

Executives at water companies will receive payouts worth millions of pounds despite the regulator’s power to ban bonuses.

Northumbrian Water will pay its CEO £1.5 million in ‘continuation pay’ over the next five years.

Although water regulator Ofwat can now ban bonuses from being given to bosses of companies that break pollution rules, these payments will not be subject to its powers.

Northumbrian Water’s long-time boss Heidi Mottram is understood to be paid £300,000 in five installments.

Northumbrian Water, a Hong Kong-owned company, expected that any bonuses to Mottram would be banned.

He said Mottram needed the incentive because he was ‘a highly marketable individual working in an industry where pay is highly regulated and often subject to media scrutiny’.

Earlier in July Northumbrian Water was forced to pay £500,000 for two sewage discharges into North East waterways.

Louise Beardmore from United Utilities, which supplies water to the North West, also receives a £435,000 ‘allowance’ which is not subject to the bonus ban.

Anglian Water is also paying £1.3 million as a reward to its chief executive, Mark Thurston, who is also HS2’s former boss.

The company said: ‘The decision was taken to ensure leadership stability.’

Pennon’s chief executive has seen his £270,000 annual bonus stripped after his South West Water unit was blocked after poisoning more than 500 customers with parasite-tainted tap water.

This brings Susan Davy’s total income during her tenure at Pennon, which owns South West Water, to £5.6 million, higher than previously reported.

In June, South West Water was fined £1.9 million for allowing cryptosporidium in animal faeces to affect drinking water supplied to more than 16,000 homes in Brixham, Devon, in May 2024, while Ms Davy was still boss.

Watchdog Ofwat initially banned any bonuses from being awarded to him and the £190,000 payment to Pennon finance director Laura Flowerdew.

But in his annual report last week, Pennon said the ban had been reversed and payments were released ‘following further guidance’ from Ofwat.

The bounty ban came into force a year ago amid public anger over sewage dumping and rising household water bills.

Anglian Water is also paying £1.3m as a reward to CEO Mark Thurston, former boss of HS2

This allows Ofwat to block performance-related awards given to the most senior managers if water companies are found guilty of the worst pollution incidents.

Separately, Wessex Water chief executive Ruth Jefferson’s salary has been increased by 14 per cent to £670,000. Times.

Southern Water’s chief executive, Lawrence Gosden, has seen his salary rise by 3.5 per cent to £536,000. He also receives £140,000 for benefits such as housing benefit, car and private health insurance.

Thames Water has given its CEO a 9.5 per cent pay rise to take Chris Weston’s total pay to £1.2 million.

Northumbrian Water has been contacted for comment.