Unfair bonuses have been banned with immediate effect for senior bosses at Southern Water as part of this Labour Government’s Plan for Change after tough new legislation came into effect.
Under these new rules, introduced with the landmark Water (Special Measures) Act 2025, companies including Southern Water are not permitted to pay bonuses to water bosses that oversee poor environmental and customer outcomes.
This action delivers on a key Labour manifesto commitment and has been backdated to apply to any bonuses relating to the financial year from April last year.
Southern Water was awarded over £5.4 million in bonuses and incentives over the last decade, paying £312,000 in bonuses last year alone.
Companies that do meet Ofwat’s standards will still be eligible to pay executives bonuses – a powerful incentive for bosses to deliver immediate environmental improvements, better customer outcomes, and improve financial resilience.
Cleaning up our rivers, lakes and seas is essential after 14 years of Conservative failure.
The Labour Government’s Plan for Change is delivering with tougher regulation and enforcement action, together with a record £104 billion of private investment over the next five years, to reduce sewage discharges to clean up our rivers, lakes and seas for good.
Commenting, Portsmouth South MP Stephen Morgan said:
“Sewage dumping in Portsmouth has been a stain on our local environment for too long.
“That’s why I’ve relentlessly campaigned to stop the sewage and why I’ve long called for unfair bonuses for water bosses to be stopped.
“This Labour Government is sorting out the dirty mess the Conservatives failed to tackle. We are banning unfair bonuses with immediate effect and ensuring investment is made to clean up our seas for good.”
Labour’s Environment Secretary Steve Reed said:
“Cleaning up our rivers, lakes and seas after 14 years of shameful Conservative failure is essential to this Labour Government’s Plan for Change.
“Water company bosses, just like anyone else, should only get bonuses for good performance, certainly not if they’ve failed to tackle water pollution.
“That’s why Labour is banning undeserved bonuses with immediate effect delivering on the promise we made at the General Election.”
Earlier this year Mr Morgan welcomed Environment Secretary Steve Reed to Portsmouth as the Labour Government’s landmark bill to crack down on bosses polluting waterways in Portsmouth became law.
You can read about Mr Morgan’s long track record campaigning to stop the sewage here: https://www.stephenmorgan.org.uk/backs-tough-plans-to-tackle-sewage/
