Fatcat investors at scandal hit Southern Water have pocketed nearly £120million in a single year, sparking new calls for the water industry to be brought back into public ownership.
New research by the GMB union shows the company dished out £673million to shareholders in the past five years while 11 directors were paid more than £8million.
The bumper payouts will fuel growing anger at the huge financial rewards earned by shareholders 30 years after water industry was privatised.
Last week Southern Water was hit with a £126million bill for dumping sewage into rivers and the sea and falsifying records.
Regulator Ofwat said the behaviour of the firm, which covered up the failures over a seven year period, was “shocking”.
Southern, which made a £176million profit last year, is owned by a consortium of City investors including US bank JP Morgan, investment fund giant Hermes, Swiss bank UBS’s asset management arm and Australian pension funds.
They took out £119million in dividends in its latest financial year.
The findings come ahead of a GMB demonstration in London this week week as part of the union’s “take back the tap” campaign calling for suppliers to be re-nationalised.
Customer water bills have increased by 40 per cent above inflation since the industry was privatised in 1989, it says.
GMB national officer Stuart Fegan said: “The Southern Water fiasco is yet another shameful chapter in Britain’s failed experiment into the privatisation of the water industry.
“This shows the extent companies will go to cover up their behaviour. And despite it all, the fatcats get paid fortunes and shareholders trouser hundreds of millions
“Southern water customers will be rightfully appalled by their providers conduct. However previous fines dished out by Ofwat suggest this will doing nothing to deter the poor behaviour of privatised water companies in England.
“That’s why 30 years on from privatisation, it’s time to take back the tap.”
Southern, which has 4.5 million customers in Kent, Sussex, Hampshire and the Isle of Wight, has been ranked among the worst performing suppliers for customer complaints.
Boss Ian McAulay, 55, took home a £420,000 salary last year while a £517,000 bonus and other perks brought his total pay package to just over £1million.
He was brought in as chief executive at the start of 2017 after the pollution problems occurred.
Southern has blamed the failures on a previous management regime. It will refund £123million to customers through bills and pay a £3million fine.
Dr Mike Keil, of the Consumer Council for Water, said: “Southern needs to do a lot more to convince us and its customers it is committed to winning back the trust it has broken.
“Customers may also question whether the regulator has gone far enough, given that bill payers would have received about three quarters of this money anyway in regulatory penalties had Southern been honest about its performance at the time.”
The Environment Agency is carrying out a criminal investigation into the way Southern behaved.
Water UK, whuch represents the industry, said: “Privatisation of the water and sewerage industry has achieved a great deal over the last 30 years - more investment, a healthier environment, better water quality and improved service to customers.
“Customers are now 5 times less likely to suffer from supply interruptions, 8 times less likely to suffer from sewer flooding, and 100 times less likely to have low water pressure than they were when the industry was in Government hands.
“Nationalisation would risk turning back the clock to the days when service and quality failures were far more common, and cash-strapped governments wouldn’t pay for the improvements needed.”
