Those responsible for South West Water’s poor environmental performance should not be rewarded with bonus payments, MPs representing the region have said.
During a House of Commons debate on the performance of South West Water, highlighted the company’s environmental record that earnt it a one-star rating from the Environment Agency.
Simon Jupp, MP for East Devon who called the debate, said he “struggles to see why bonuses even exist within the company” given its poor environmental record.
He noted the government subsidy towards household bills, which are higher in the region, and said the support is discretionary on public finances. “Our money should not be used to reward failure,” Jupp stated and said he has challenged the company to commit to continuing to fund that support, should it ever be withdrawn by government.
“I am sad to report that South West Water has so far refused to make such a commitment,” Jupp added.
He also urged colleagues to resist political point scoring and spreading misinformation that led to one unnamed MP having faeces posted through their letterbox. He suggested the Liberal Democrat rhetoric that Tory MPs had voted to pollute waters and seas was “frankly ridiculous” and continuing it would be shameful.
Totnes MP Anthony Mangnall posed suggestions to speed up delivery of projects that will lead to environmental improvements. These included housing developments not being approved until sewer and water infrastructure is in place to prevent existing systems being overloaded. Secondly, to make sure fines levied at companies for environmental offences by Ofwat are directly used to clean up waterways and can be “done in a speedy way”.
Conservative MP for Newton Abbot Anne Marie Morris questioned why investment levels by South West are below that of other companies. She queried the absence of corporate governance that had allowed underspend and asked if subsequent investment increases had gone up enough.
She said: “We ought to look closely at the numbers—the investment that has been put in, how that falls short of what could have been put in as agreed with the regulator, the rewards for shareholders and the bonuses for executives. Does it feel right? Does it pass the smell test? Right now, the jury is out.”
On the other side of the debate, Labour’s Ruth Jones, MP for Newport West and member of the APPG water group, called out current government for inadequate intervention, which led to pollution incident increases.
She said: “The failure of ministers to act means that the water companies know that they can laugh all the way to the bank. Why? Simply because the government are not stepping up to show the required leadership.”
She reminded Tories they have been in government for 13 years and it has only taken action in very recent times, “which is why we are scrutinising the situation”.
In defense of the actions taken, water minister Rebecca Pow highlighted that Ofwat is exploring options relating to dividends and pay.
This includes changes to companies’ licences and ensuring that fines for misdemeanours come out of dividends, and do not impact customers, Pow said.
A consultation is anticipated imminently about licence changes and also on the next steps for monitoring storm overflows that will include water quality measurements.
Pow praised South West for its WaterShare+ scheme that offered all households the option of money off of bills or the opportunity to become a shareholder
“South West Water is taking note of what comes its way from its customers. It needs to put it right, and I genuinely hope it will.”
A spokesperson for the company said: “We have already delivered 80% of our Operational Delivery Indicator (ODI) as part of our business plan.”
The company has installed monitoring on 100% of its storm overflows, which enables its to target investment and interventions to reduce spill numbers.
The spokesperson added: “Also mentioned in the debate, we will soon launch WaterFit Live, providing customers and communities with near real time data on the performance of our network at designated bathing beaches – far in advance of the government-mandated 2025 deadline.
“We are investing further and faster than ever before to deliver major improvements in the region’s water resources and wastewater infrastructure for the future. We will continue to work closely and liaise with our regulators, Defra and the MPs in our region, whilst engaging with our customers and communities.”