Ofwat £126 million charge to Southern Water for sewage treatment failures
25 Jun 2019
Regulator Ofwat has imposed a massive £126 million penalty on Southern Water after serious failures were exposed at a number of its sewage works.
The vast majority of the money – £123 million – will cover compensation to its 4million-plus customers. This will be paid out in bills reductions over five years starting in the next financial year. There will also be a fine of £3 million.
And in a further blow to the utility company, the Environment Agency announced that it will start a criminal investigation against the firm.
The regulator accused Southern Water management of failing to invest properly in sewage treatment, resulting in failures but also spillages of waste.
More seriously still, it stated that the company had misreported the performance of its sewage sites and wastewater sampling.
Ofwat head Rachel Fletcher was forthright in her criticism stating: “What we found was shocking.”
The incidents took place over a seven year period, starting in 2010. Three years earlier, Southern Water was fined more than £20 million by Ofwat for misreporting poor service, which deprived customers of an opportunity for repayments.
Talking after the latest incident, Southern Water chief executive Ian McAulay admitted the company had “fallen short of expectations and trust”.
