United Utilities banned from paying bonuses to senior bosses 'after fish killed in reservoir'
United Utilities and five other water firms have been banned
The region's water company is among six that have been banned from paying bonuses to senior bosses, under new rules that come into force today (Friday).
United Utilities (UU) are unable to pay bonuses to the chief executive or chief financial officer for the 2024/2025 financial year.
The government have made the move under new rules which prevent bonuses from being paid if a water company does not meet environmental or consumer standards, does not meet financial resilience requirements, or is convicted of a criminal offence.
United Utilities say the measure against them does not relate to pollution but 'fish being killed when they got trapped in a valve during a routine safety inspection' at High Rid reservoir in Bolton.
The firm said they will 'ensure lessons are learned'.
Thames Water, Yorkshire Water, Anglian Water, Wessex Water and Southern Water have also been given similar bans.
The six companies are not under an indefinite ban, and those firms may be able to offer rewards for the 2025/26 year, provided they stick within the Ofwat rules, under the Water (Special Measures) Act which comes into force on Friday.
If a company pays a bonus while it is under a ban, the water regulator Ofwat has the power to get the money back.
According to the Department for Environment, Food and Rural Affairs, more than £112 million in bonuses and incentives have been handed out by water firms in the last ten years.
Water companies set their own salary and reward packages, and it is understood that if firms that are banned from offering bonuses increase salaries to try to compensate, then officials may look into it.
Environment Secretary Steve Reed said: "Water company bosses, like anyone else, should only get bonuses if they've performed well, certainly not if they've failed to tackle water pollution.
"Undeserved bonuses will now be banned as part of the Government's plan to clean up our rivers, lakes and seas for good. Promise made, promise delivered."
A United Utilities spokesperson said: “We have a long track record of ensuring performance related pay for executives is closely linked to the outcomes that matter most to our customers. In addition, our performance related pay is funded by shareholders, not by customers.
“We will comply fully with the new remuneration rules, which mean any Category One incident results in no bonus being paid to Board Executive Directors.
"This particular incident did not involve pollution but was related to fish being killed when they got trapped in a valve during a routine safety inspection at a reservoir.
“We will ensure lessons are learned from this incident, while remaining focused on our £13 billion investment programme – our biggest ever – which will improve services for customers and the environment, support 30,000 jobs and deliver an estimated £35 billion of economic value to the North West.”
Under the new rules, UU, Yorkshire Water, Thames Water, and Southern Water will all be unable to pay bonuses to the chief executive or chief financial officer, for the 24/25 financial year.
Anglian Water will be banned from paying their chief executive a bonus, but their chief financial officer will not be banned. Wessex Water will be banned from paying their chief financial officer any extra, but their chief executive will be exempt.
The exemptions are because people were not in post when the incident that broke Ofwat's rules happened.
Campaign group River Action have called the move a 'welcome step' but said that increased salaries should be prevented. Chief executive James Wallace said: "We won't end pollution for profit until water companies are refinanced and governed for public benefit. Any attempt to inflate base pay as a workaround must be stamped out.
"The era of rewarding criminal leadership must end. No more cream for the fat cats."