Ofwat orders Thames Water and Southern Water to return £80m to customers
Two of the UK’s leading water companies will have to return more than £80m to customers after missing key performance targets, confirmed Ofwat.
Thames Water will have to hand back over £50m to its customers and Southern Water almost £30m in time for next year’s water bills – the two biggest payouts in the water sector.
Both water suppliers will have to return the heavy sums to customers after failing to reach targets on water treatment works, pollution incidents and internal sewer flooding across the 2021-22 window.
This follows Ofwat finalising the financial payments and penalties for all water companies next year – with the majority of firms having to pay back customers after missing targets regarding sewage, leaks and customer service.
Overall, water companies will have to pay back £4.9m more to customers than they will be able to claim in their bills.
The best performing company, Severn Trent Water, will be to take an extra £101.8m from customers, after meeting all of their targets.
David Black, Ofwat chief executive, said: “Too many water companies are failing to deliver for their customers. The poorest performers, Thames Water and Southern Water, are consistently falling beneath our expectations and those of their customers.
“They need to take immediate action to improve their performance and rebuild trust with the people they serve. We will continue to hold companies to account for their performance and we will make sure that they raise their game.”
Sewage leaks ‘unacceptable’ says Thames Water
Last month, Sarah Bentley, chief executive of the Thames Water, told the House of Lords that storm overflows causing severe discharges of sewage were “unacceptable” and must be addressed.
The water boss confirmed the Thames Tideway Tunnel would help mitigate issues in London, with the project aiming to cut sewer discharges by 95 per cent on completion in 2025.
The company is under intense regulatory scrutiny from Ofwat, which has slapped six water companies with enforcement cases.
It also teamed up with the Environmental Agency to announce investigations into all water and wastewater companies last November.
A Southern Water spokesperson said: “As laid out in our annual report, we recognise that Southern Water has not always met expectations in recent years but are now in a position to deliver significant change for our customers and the environment.
Warren Buckley, customer experience director at Thames Water, said: “We can confirm that the financial penalties incurred will be refunded to customers. We’re determined to do better, and while we’re heading in the right direction, we know there is a long way to go.”