West Country supplier fined £18.2 million in Ofwat dividend ruling
The fine comes amid the water regulator confirming a rise in bills of 36% over the next five years
Last updated 19th Dec 2024
A West Country water supplier has been fined millions of pounds for breaking dividend payment rules - on the day they've been allowed to hike customers bills.
Ofwat has confirmed Thames Water, which provides the resource so Swindon, parts of Wiltshire and sections of Gloucestershire, will have to pay £18.2 million for the 'unjustified' break in the payment rules.
It comes as Thames Water is to be allowed to hike consumer bills by 35% by 2030 following a decision by the industry regulator.
The average annual bill will rise to £588 by 2030, Ofwat said, up from current levels of £436.
The ruling falls well short of the 59% Thames Water had said it needed in the run-up to the decision, as the embattled water company tries to negotiate a bailout.
The company, which serves about 16 million people in London and the South East, is in the grip of a funding crisis and needs a £3 billion loan from creditors to keep operating beyond March.
Ofwat said the £18.2 million fine was for paying £158.3 million in dividends to shareholders which it said were not justified.
The regulator said it will claw back £131.3 million of the payments so it does not come out of customer bills.