New estimates claim that water companies in England will hand out nearly £15bn to shareholders by 2030.
Research conducted for The Observer newspaper has revealed that shareholders can expect to receive a total of £14.7bn in payouts, while customers struggle to pay their bills in the midst of the cost-of-living crisis.
The article quotes analysis by David Hall, a visiting professor at Greenwich University. According to Professor Hall, the dividend payments will see each customer stump up £624 by the end of the decade, based on last year’s prices.
The news will heap additional pressure on water company CEOs at a time when the industry is facing a barrage of criticism over sewage spills. Last week, water and sewage firms in England issued a joint apology for ‘not acting quickly enough’ and pledged to spend £10bn to clean up the mess. The statement followed reports that untreated sewage was pumped into waterways over 300,000 times in the last 12 months.
The former Labour minister Ruth Kelly, who is now the chair of UK water industry membership body Water UK, said: ‘The message from the water and sewage industry today is clear: we are sorry. More should have been done to address the issue of spillages sooner and the public is right to be upset about the current quality of our rivers and beaches. We have listened and have an unprecedented plan to start to put it right. This problem cannot be fixed overnight, but we are determined to do everything we can to transform our rivers and seas in the way we all want to see.’
In an interview broadcast on Sky News’ Sophy Ridge on Sunday programme, Environment Minister Therese Coffey said she was ‘pretty fed up’ with the water companies and described their public apology as the ‘right’ thing to do. However, when challenged on the issue of customers picking up the tab for the investment, Ms Coffey said that: ‘…of course penalties and fines are paid for by the company, not by the bill payer, but in terms of general payments, I think you’re right to say that a lot of this investment gets repaid through by bills and a small amount of return.’
At the same time she pointed to the size and scale of payouts during the last Labour government and said that: ‘Going forward the dividends will be significantly lower than what had happened in the past.’
The Workers Union Says…
Water is fundamental to our continued existence. We cannot live without it, and yet it seems that this dependency is routinely exploited.
We understand that shareholders and investors want return on their investments. But in any moral reckoning dividends should be subject to performance. To blot the UK’s rivers and seas with sewage, then ask customers to meet infrastructure costs after firms have posted millions in profit plays like a very bleak joke – a joke with an unwelcome punchline for hard-pressed households everywhere.