The chairman of South East Water has admitted the company failed in its primary duty to supply customers with water after recent outages left thousands without drinking water.
Bosses of the company were grilled by the Parliamentary Environment, Food and Rural Affairs Committee on Tuesday about their response to the multiple supply interruptions in Kent and Sussex.
Tunbridge Wells suffered a sustained outage in November and December, with around 24,000 properties in and around the Kent town left without drinkable water for almost two weeks.
Then thousands of properties in Kent and Sussex saw their supply disrupted for days in January, with South East Water (SEW) blaming the outage on Storm Goretti causing burst pipes and power cuts.
Customers were left with no tap water, unable to shower or bathe and could not flush their toilets, while a number of schools were forced to close.
Chairman Chris Train told MPs that the company “failed on the basic objective of delivering water to customers and therefore that is a failure and we recognise that failure”.
“We failed our customers,” he continued. “We worked very hard to rectify that situation, and since the events and independent review, we have undertaken a lot of actions to improve the resilience of the operations.”
Committee chairman Alistair Carmichael asked Mr Train to score his team’s performance out of 10, arguing that customers deserve that degree of accountability from a non-executive director.
The chairman refused to do so, saying the situation is “complex” but added: “That degree of accountability is that we accept that we failed in our primary duty and we could have done better with all of the factors.”
Challenged on why it is important for customers that the chairman understands the extent of the firm’s failure, Mr Train said: “Failure is failure, and we have failed, and what’s important is that we as an organisation learn from that in order that we don’t fail at any point in the future.
“It is absolutely untenable for customers to be without water,” he said.
Chief executive David Hinton was also asked to give a score out of 10 for the company’s response to the January outages after he previously marked it as eight out of 10 for the November incident.
Mr Hinton also refused to do so but admitted that the performance was “disappointing” after many vulnerable customers were left without an alternative supply of water.
“My expectation is that we deliver to all priority service customers and that the bottled water stations are completely resourced the whole time, and customers can get access to alternative water at all times.
“So whenever we do not meet that particular yardstick, then I’m disappointed.”
The chairman later revealed to the committee that chief executive David Hinton, who receives a £400,000 salary, has surrendered any bonus the board may have chosen to pay him this year.
However, MPs went on to repeatedly question Mr Train on why there had been no changes in the leadership team, highlighting the major failings as well as criticism from the Prime Minister, its shareholders, customers and a whole range of public and private bodies.
Asked how bad performance would need to get to change the company’s leadership, Mr Train said: “We have looked as you would expect us to do at what the appropriate leadership of the organisation is going forward.
“The board has given its commitment and its backing to Dave and the executive team going forward as the right solution for delivering what is best for South East Water customers.”
He added that the firm is “bolstering” the executive with a number of external hires that will cover a “broader spectrum of leadership across the organisation”.
Pressed repeatedly on customers no longer having confidence in the company’s leadership, he continued to defend the team.
He said: “We are accountable for where we are. We as a board, we have to step back and ask the questions that you’re asking.
“We have to look at the broad context of the organisation.
“We have to look at the context of the industry and the sector and we have to do what we think is best in the best interest of South East Water customers.”
Labour MP Jenny Ridell-Carpenter said: “We might be asking the right questions but you’re coming up with the wrong answers.”
It comes after Ofwat announced in March that it plans to fine SEW £22 million over water supply failures between 2020 and 2023 impacting more than 286,000 people.
The watchdog said the firm “lacked ownership” for fixing the root cause of supply failures and did not maintain important infrastructure.
Its investigation found that the company’s response to these issues was “slow and disorganised” and highlighted shortages of bottled water, saying said there were “not enough tankers or support for vulnerable customers”.
Mr Hinton was grilled by MPs in for his company’s handling of the November and December supply failure.
But days later, Mr Carmichael said he and his colleagues remained “deeply sceptical” about SEW’s version of events presented to MPs.
