This interested me a little, so I had a quick look around at water company websites.
Unusually for highly profitable industries none of them have an easy-access link to their most recent Annual Reports. Anglian in particular had the report available, but it is useless as it’s just a holding company that shows no directors’ emoluments (wages, sort of) or indeed where income comes from.
So, I had a look at OFWAT, the regulator. It has some interesting stuff on its website, mostly about what good value for money it is. I was unable to find any data about Enforcement it had taken, so I assume that either to its mind all is well, or it sends Sternly Worded Letter should something bad happen, and then, well, maybe write another. OFWAT is the body that sets the prices the companies can charge, amongst other things.
I have, personally, a real issue with this. If I wish, I can dispense with a TV, a phone, electricity etc. I cannot do without water. It is necessary for life. I can’t really look around and say “oh, hang on, Portsmouth Water is the cheapest (£91 pa average) I’ll ask them to supply me, because that’s not how it works. Instead I get lumped with Severn Trent, which looks really poor, see below for the key performance areas it failed, per OFWAT.
Its report goes on about how much the water industry spends on infrastructure each year (£3 billion for the lot of them. ST’s profit alone is half a billion, and there are 10 big ones, and 24 others). At ST the average (statistical mean) employee (including directors) earned about £31,000 in 2011. Which is nice. The highest paid director is not named (just referenced to being the same as last year, and I cannot be bothered to check) and (s)he earned £878,100 excluding pension payments, which is really nice. Especially as Severn Trent failed the following tests: Supply Interruptions, Serviceability, Water Supply Security, and Leakage. So well done to him or her for running such a shocking business. Luckily it did manage to monitor its greenhouse emissions, which makes the £878k worthwhile I think. (see
http://bit.ly/tzHLYt for how your company did).
Anyhow, my point is that water and sewerage provision is vital for life. I do not see why anyone should profit from it. It is a risk-free sector. Directors should be paid accordingly. No risk = no reward. There should be no profits. Excess moneys each year should be re-invested back into repairing leaks (I am looking at you, Tony Wray, Chief Exec) not have the majority of it paid away as dividends.