The water sector is in need of “root and branch reform”, with private water firms failing to adequately look after critical infrastructure, MPs have said.
A report from the House of Commons Environment, Food and Rural Affairs Committee has called for “a major refresh of the incentives and drivers” and “much more regulated management of financial incentives for senior executives” in the water sector.
It urged the Water Commission, which delivers recommendations to the government on how to reform the sector, to consider a variety of models of corporate ownership, which “could offer a better culture of responsible leadership”.
The committee said that bonuses totalling millions of pounds had been repeatedly paid to senior executives over many years, despite poor performance, which they say “seriously diminish trust” and may fail to incentivise improvement.
Thames Water is one of the biggest water and sewerage companies in the UK, serving around 15 million people daily. A 2023 analysis of its...