Thames Water boss scoops major bonus
Thames Water's annual report has revealed that its chief executive Martin Baggs scooped a six-figure bonus - despite hosepipe bans and falling customer satisfaction.
According to the report, Mr Baggs received an annual bonus of £418,359 for the year to March 31 2012 on top of his £425,000 salary – a move which has been slammed by trade union GMB.
While the report shows that the company exceeded its leakage targets for 2010/11 with leakage down 26% – beating an Ofwat target of 36m litres, Thames Water drew criticism last week after a burst main caused major delays to the Central Line in London.
Water quality was shown to have marginally improved, which Thames Water saying this is the result of continued investment in infrastructure and upgrades works, with more than £1bn paid out.
However, underlying profit at Thames Water before tax fell by 12.6% to £182.2m, compared to £208.5m in 2011, which Thames Water has attributed to increased bad debt costs relating to the economic climate, higher interest costs and increased investment.
Trade union GMB has criticised the bonus payout, with national secretary Gary Smith arguing that the bonus is “a classic case of reward for failure. It is an absolute outrage. This money came from the hard earned income of hard pressed householders.”
Last month, Thames Water came under fire from the trade union, which blamed the UK drought on water reservoir closures by water companies.
Mr Smith added: “We have had Thames Water announce to its customers that they need to curtail their use of water as they don’t have enough supplies stored for their use. This is disgraceful in that we use less than 2% of the rain that falls in the UK. Thames Water closed 25 reservoirs many of which were sold for development. Thames Water has paid out £5bns in dividends since privatisation.”
Commenting on the hosepipe ban, Mr Baggs said: “After many weeks of unusually wet and miserable weather the situation is now a lot less serious and we expect to be able to lift the hosepipe ban sooner rather than later. That will be a great relief for everyone.”
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