Customers are paying the price that water companies spend twice as much on debt than on environmental investments.

Nine UK water and sanitation companies spend more than twice as much on debt and dividends as they do on reducing river flow and other environmental improvements, according to analysis I Found.

During the last full financial year to the end of March 2022, the UK water companies spent nearly £3.8bn on debt repayments and annual shareholder dividends, while all nine companies invested £1.8bn on improving the environment .

Investments in environmental protection include measures such as cleaning sewers, building fish passages, reducing pipe leaks and improving biodiversity.

All nine water companies have a net debt of around £50bn, with each company required to pay interest annually to creditors, including its own shareholders.

According to the Competition and Markets Authority, consumers pay around £80 a year, or 20 percent of their bills, to pay off the water company’s debt.

When the sector was privatized by Prime Minister Margaret Thatcher in 1989, the English water companies were free from debt.

Competition of payments of the general director for water

Leading UK water bosses have made just under £18m in their last full financial year.

The agreements were made in a year when 2.7 million hours of sewage was pumped into the rivers and baths of England.

The highest paid in the UK was Liv Garfield of Severn Trent Water. Ms Garfield earned £3.9m a year through the end of March 2022, over 12 months during which her company was fined £1.5m for dumping raw sewage from four wastewater treatment plants.

Next in salary is United Utilities’ Steve Mogford who took home almost £3.2m and Thames Water chief executive Sarah Bentley took £2m despite leading a £10m loss-making company. Tax.

During the last full financial year, Thames Water was also fined £4 million for discharging half a million liters of sewage over two days in July 2016 into the Oxford Rivers Seacourt Stream and Hinksey Stream.

Of the 12 water and sanitation groups in the UK, six are led by women and three women make up three of the five highest paid groups under 12.

Annual salary agreement for the CEO of the company
Severn Trent Water Liv Garfield – £3.9 million
United Utilities Steve Mogford £3.2m
Water Thames Sarah Bentley £2 million
South West Water Susan Davy £1.6 million
South Water Lawrence Gosden £1.4m
Yorkshire Water Liz Barber – £1.4 million
Anglian Water Peter Simpson £1.3 million
Wessex Water Colin Skeleton £975,000
Welsh Water Peter Perry £675,000
Northumbrian Water Heidi Mottram £648,000
Scottish Water Douglas Millican £558,000
Northern Ireland Water Sarah Venning £235,000
In total, water workers pay £17.9 million.

Through analysis I targets nine UK companies as water and sanitation services in Northern Ireland and Scotland are publicly owned, while in Wales they are run by a non-profit group.

Thames Water has the highest net debt of any UK water company at £12.9bn at the end of its last financial year. The group spent £385.5m paying off its debt within a year and paid no corporation tax despite a turnover of over £2bn.

Thames Water, which serves 15 million customers in and around London, says it has invested a total of £1.3bn in the company in the year to the end of March 2022. Of these, £606 million was listed as environmental investment.

United Utilities, which serves about seven million customers in the North West of England, has piled up £7.6bn of debt. Borrowing costs for the last full financial year were £373.3m while the group paid just £6.7m in corporation tax on nearly £1.9bn in annual sales.

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The company has spent around £153 million on environmental investments, including repairs or upgrades to wastewater monitoring systems and fixing water leaks.

Industry regulator Ofwat has raised concerns about the use of UK water companies and how this affects the amounts they are investing in the network to prevent sewage and water leaks.

With interest rates rising, the level of debt is raising concerns about the financial stability of some water companies, and some are seeking cash injections to improve sustainability.

With a net debt to enterprise value ratio of more than 60%, water companies are considered highly indebted.

Northumbrian Water, which serves 2.7 million households, has a leverage ratio of 69.7% while Wessex Water has a leverage ratio of 67%.

I announced earlier this month that water regulator Ofwat is seeking new powers from the government to cut billions in cash payments to investors as it seeks to increase investment in environmental improvements.

David Black, CEO of Ofwat: “In too many areas, water and sanitation companies fail when it comes to customer care, the environment and their own financial sustainability. We are pure; These companies urgently need to address this unacceptable performance

Speaking on behalf of the industry, Water UK added: “Water companies fully agree that urgent action is needed to protect and improve the environment, including our rivers and seas.

“Water companies want to invest, it’s in their best interest and they will build on what is already the highest level of investment in the UK water sector, with an additional £70bn by 2050 to offset damage caused by storm surges, river conversion and seas and increased water supply through new reservoirs and national water transfer programs.

“Combined with increased environmental spending to be determined at the next price review, this will reshape our natural world the way we all want it to be.”

Like the rest of England

While England’s privatized water utilities invest around £35 for each of the country’s 56 million inhabitants, public or non-profit businesses in the rest of the UK invest more than three times that amount.

With a combined population of 10.6 million Northern Ireland, Scotland and Wales, their national water companies’ investment of nearly £1.3 billion equates to a per capita expenditure of £120.

Both Northern Ireland Water and Scottish Water are publicly owned by their respective devolved governments, while Welsh Water is owned by Glas Cymru, a sole proprietor with no shareholders, operating solely on behalf of clients.

Although the three companies have a combined debt of £8.7bn, they do not pay dividends to investors. However, in the year to the end of March 2022, Northern Ireland Water paid a share of £31.2 million to the government.

While the average salary for a water company CEO in England is nearly £1.7 million, Peter Perry, the highest paid boss in the rest of the UK, was Welsh Water’s highest paid boss. Year.

Scottish Water head Douglas Millican received £558,000 in 2021-22, while North Ireland Water CEO Sarah Wenning received £235,000.