Thames Water Under Scrutiny Over Executive Payments Amid Financial Instability
£1 million signing-on fee for finance chief Steve Buck drawn from emergency debt package as company flags 'material uncertainty' and misses environmental targets.
Carla Rooney
Thames Water faces intense scrutiny over executive remuneration as it grapples with significant financial instability.
Thames Water paid its finance chief, Steve Buck, a £1 million signing-on fee, drawn from a £3 billion emergency debt package agreed with creditors last year.
Executive Chris Weston secured a £99,000 bonus, even as Thames Water failed to meet environmental and customer service targets.
Thames Water claims this bonus was deferred from a previous year, predating Ofwat's ban on such payments for underperforming companies.
Thames Water stands as one of at least eight water companies banned from paying performance-related bonuses due to environmental failings.
Retention payments made to executives reportedly originate from emergency funding, not customer bills.
The money is understood to have come from emergency funding provided by Thames Water's lenders.
Sir Adrian Montague stated Thames Water pursued individual agreements with participants based on clear legal advice. He believed this approach would prove significantly cheaper and less disruptive than a court order.
Sir Adrian Montague explained that this strategy also offered the best opportunity for retaining relevant employees. He acknowledged customers might find it unjust for senior leaders to receive significant compensation amidst service deficiencies.
It’s unacceptable that one of the worst-performing water companies is handing out huge payments to its executives when it should be focusing on improving performance and rebuilding public trust.
Sir Adrian Montague stressed the necessity of retaining these senior leaders to continue progress on the turnaround. He noted the retention plan was implemented in April 2025 due to significant uncertainty surrounding Thames Water's future and the executives' employment.
Amy Fairman sharply criticised the situation, stating, "Thames Water is on the brink of financial collapse with a debt pile of £20 million of debt, rivers in their region are drowning in sewage and 571 million litres of water are lost every day."
Fairman added, "Yet there’s still £1 million for a finance chief’s signing-on payment when over a quarter of Thames Water customer bills go to servicing debt." She called for drastic action, asserting, "Put Thames Water into special administration and rebuild it to serve its customers, and clean up our rivers, not reward failure."
The Prime Minister’s official spokesman condemned the payments, stating, "It’s unacceptable that one of the worst-performing water companies is handing out huge payments to its executives when it should be focusing on improving performance and rebuilding public trust."
The spokesman further noted, "We’ve banned bonuses for polluting water bosses. We expect companies to follow both the letter and the spirit of the rules." He added, "We look forward to the outcome of Ofwat’s review, which will assess if and how these rules should be strengthened."
Thames Water is on the brink of financial collapse with a debt pile of £20 million of debt, rivers in their region are drowning in sewage and 571 million litres of water are lost every day. Yet there’s still £1 million for a finance chief’s signing-on payment when over a quarter of Thames Water customer bills go to servicing debt. Put Thames Water into special administration and rebuild it to serve its customers, and clean up our rivers, not reward failure.
Thames Water sought legal advice regarding these payments. The company claims its board made the deferred payment to Steve Buck following this legal counsel.
The seven-figure payment was reportedly not made until last month after the company had taken legal advice over its contractual obligations.
Buck's base salary increased to £630,000 in April. The Environment, Food and Rural Affairs Committee (Efra) was informed of the payment to Mr. Buck last week.
Regulator Ofwat would need to review any further changes to proposals concerning Thames Water. The company currently seeks to secure a rescue deal proposed by its senior creditors to avoid collapse.
Creditors who effectively control Thames Water have reportedly spent months negotiating to take formal ownership, contingent on regulators offering leniency on future fines.
These creditors also offered the government a “golden share” in the business in a last-ditch bid to avoid having their debts written down.
This financial turmoil unfolds against a backdrop of extreme weather. Sunday marked the 34th day this year with temperatures exceeding 30C in the UK, equalling the 1995 record.
The summer of 2026 included two record-breaking heatwaves in May and June, reportedly leading to over 2,800 excess deaths. July was the driest on record in England and Wales since 1836.