Thames Water has been criticised by the Environment Secretary for handing “outrageous” payouts to top bosses after the troubled supplier forked out more than £4 million in bonuses and boosted its chief executive pay to £1.2 million.
Britain’s biggest water firm – which has been left on the brink of nationalisation as it struggles under a £20 billion debt pile – revealed in its annual report that bonuses of £4.09 million were paid to “key management personnel” as part of its so-called management retention plan.
It said the bonuses were made to board members and executives over the year to March 31, up from £2.8 million the previous year, and included performance-related and retention awards.
The report also showed chief executive Chris Weston’s total pay rose to £1.16 million in the year to March 31, up from £1.04 million in 2024-45 after he picked up 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 took aim at the Thames Water payouts, saying it adds to evidence that suppliers are side-stepping bans on bosses’ bonuses.
She said: “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.”
Last year’s Water (Special Measures) Act allowed regulator Ofwat to ban performance-related bonuses for bosses at utilities failing customers and the environment as part of the Government’s wider response to cracking down on the ailing sector.
Mr Weston said his £99,000 retention bonus was awarded before the Water (Special Measures) Act came into effect in June last year and the group confirmed he did not receive a performance-related payout for 2025-26.
But the firm has already caused controversy over retention payments to senior executives, seen as evading the ban.
It agreed last December amid outcry 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.
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.”
