Foord slams 'shameless' South West Water payout

Devon's Liberal Democrat MP has hit out at the decision by the Pennon Group, who own South West Water, to increase their dividends payout by almost 11% this year.

The decision to reward investors with an increased shareholder dividend, announced today, represents a 10.9% increase in the payout. This is despite the company's profits plunging and the ongoing probe into its alleged failure to report sewage leaks.

The 42.73p-a-share dividend amounts to a total of £112m. This leaves the Pennon Group, who recently reported a pre-tax loss of £8.5m, with just £144m of cash reserves - significantly lower than the almost £2.7bn they had two years ago.

Local communities have been left grappling with hosepipe bans and water outages in recent weeks, as a result of the companies failure to patch up it's leaking pipes, and sewage continues to be discharged into rivers and onto beaches across the South West.

Richard Foord MP has branded the payout as 'shameless' and called for tougher action from the Government to reform water firms into “public benefit companies” - where environmental goals are put ahead of CEO bonuses and shareholder profits.

Commenting, Tiverton & Honiton MP Richard Foord said:
"The news that shareholders are going to get bumper payouts is a slap in the face for communities across the South West. Many communities are living with a hosepipe ban, while some of our premier beaches and rivers are being poisoned with sewage.

"South West Water has repeatedly failed to fix their leaky pipes, continue to discharge raw sewage onto our precious coastlines, and are currently under investigation by the regulator Ofwat. Yet despite this record, they have decided to pat themselves on the back and award dividend payouts.

"The entire situation is a farce and shows that the current system is broken - with their execs being rewarded handsomely and shareholders being rewarded millions of pounds by a company that is destroying our environment.

"What's worse is that this Conservative Government has been asleep at the wheel and allowing these polluting firms to get away with this shameless behaviour.

"We need tougher action from Ministers to crack down on profiteering and transform water firms into public benefit companies. This would enable us to put both customer service and environmental standards ahead of corporate profit and shareholder payouts.

"The public deserve answers on this unjustified payout."