Water chiefs not taking their mini bonuses? Hurrah for small mercies

Relying on a boss’s embarrassment is a bad way to structure performance pay at utilities

Contain your excitement at news that bosses of a few water companies won’t be taking their bonuses this year. In all three cases – South West Water, Thames Water and Yorkshire Water - acceptance of any bonus at all would rightly have provoked general outrage. These firms were at, or near to, the bottom of the league table in the Environment Agency’s last set of annual environmental performance ratings.

At the most sludgy end, South West joined Southern in scoring the lowest possible one star out of four, which the chair of the EA – a body that itself has hardly excelled during three decades of under-regulation – translated into plain English. It meant the companies’ environmental performance “was terrible across the board”. Thames and Yorkshire were two of four companies getting two stars, which indicated a need for “significant improvement”, so still deeply in cruddy territory.

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