From BBC
Thames Water has decided to “pause” its scheme to pay out big bonuses to senior executives linked with securing its £3bn rescue loan.
The decision comes after Downing Street said bosses at the troubled firm “rewarding themselves for failure is clearly not acceptable”.
The company’s “retention scheme” was set to amount to 50% of senior bosses’ pay packets, which could have led to them getting £1m on top of their annual salaries and regular bonuses.
Thames had been accused by the environment secretary of “trying to circumvent” forthcoming rules to ban water companies from paying bonuses.
Steve Reed told MPs on Tuesday the company had been “calling their bonuses something different so they continue to pay them”.
Downing Street added ministers were “clear that, after presiding over years of mismanagement, Thames Water should not be handing itself bonuses”.
Reed and officials at the Department for Environment, Food and Rural Affairs (Defra) held talks with Thames bosses ahead of the company’s decision.
A spokesperson for Thames its board had “decided to pause the retention scheme” and await guidance from the regulator Ofwat, who could be granted new rules to prevent any water firms from handing out any bonuses.
Thames said it would wait for the regulator’s steer to ensure the company’s “approach supports both our turnaround objectives and broader public expectations”.
“It has never been the Thames Water board’s intention to be at odds with the government’s ambition to reform the water industry,” the spokesperson added.
Thames has faced heavy criticism over its performance in recent years following a series of sewage discharges and leaks.
Since the dire state of the company’s finances first emerged about 18 months ago, the government has been on standby to put Thames into special administration.
The company secured an emergency £3bn loan in March to stave off collapse and is now looking to
