Home Money Water companies warn: rising bills must not line bosses’ pockets

Water companies warn: rising bills must not line bosses’ pockets

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Thrills and spills: Pennon boss Susan Davy's salary rose to £860,000

Thrills and spills: Pennon boss Susan Davy’s salary rose to £860,000

The Chancellor has warned water companies that any rise in customer bills should be used to rebuild “crumbling” infrastructure rather than enriching shareholders or executives.

Rachel Reeves said regulators must keep a tight rein on the industry even as the Government launches a broader attack on bureaucracy.

Customers will face average bill increases of £94, or 21 per cent, over the next five years, although water companies had asked for even bigger increases.

“If prices are going to go up,” Reeves said, “it’s really important that all that money goes into investments, rather than stock buybacks, dividends and bonus payments.”

Figures from April showed that England and Wales’ 16 water companies had paid out £78 billion in dividends in the three decades since privatization in 1991, while racking up £64 billion in debt, the Financial Times said.

Infrastructure spending totaled £190 billion, which critics say is not enough, arguing the financial model has created today’s sewage spills, high leaks and water cuts.

It occurs when bosses see their salaries increase. Pennon director Susan Davy received £860,000 in total for the last financial year, up from £543,000, despite the owner of South West Water seeing an outbreak of diarrhea caused by a parasite in Devon’s water supply this summer.

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