Ofwat has established new powers enabling it to prevent water company customers from funding bonuses deemed unjustifiable, emphasizing the need for performance-linked compensation.
Despite being debt-laden, Thames Water attempted to utilize customer funds for executive bonuses, prompting Ofwat to intervene and stop the payouts as shareholders were deemed responsible.
In 2023-24, water companies distributed £1 billion in dividends, notably reducing from the previous year, reiterating Ofwat's early impacts of new regulatory measures.
David Black from Ofwat highlighted a commitment to ensuring performance-based compensation, underscoring that customers should not bear the costs of undeserved executive bonuses.
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