Thames Water has been slapped with a historic £122.7 million fine following repeated sewage discharges and unlawful dividend payments. This substantial penalty has sparked demands for a fundamental overhaul of the water industry from Sarah Gibson, Liberal Democrat MP for Chippenham.
Gibson criticised Thames Water for years of poor performance, stating the company had “failed to invest, failed to maintain, and failed to deliver,” while customers in areas like Royal Wootton Bassett faced steep bills, inadequate services, and environmental harm.
“With people struggling under soaring living costs, Thames Water increased bills by 35% and still challenges the regulator for more,” Gibson said. “Enough is enough. It’s time to remove water services from shareholder control and prioritise the public interest.”
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The fine, confirmed by the regulator Ofwat, follows two investigations into Thames Water’s operations. The first uncovered widespread failures in wastewater treatment management, including excessive use of storm overflows and poor sewer network maintenance. These violations caused significant environmental damage and inconvenience to customers.
As a result, Thames Water received a £104.5 million fine—the largest single penalty ever issued by Ofwat—and faces an enforcement order demanding corrective action or further sanctions.
A separate probe revealed the company broke rules by paying out £37.5 million to its holding company in October 2023 and another £131.3 million in March 2024, despite ongoing poor performance. This led to an additional £18.2 million fine.
Ofwat confirmed the fines must be paid by Thames Water and its investors, with no ability to pass the costs onto customers.
In response, the Liberal Democrats are calling for Thames Water to be transformed into a Public Benefit Company and for Ofwat to be replaced by a stronger, independent regulator empowered to hold water companies accountable and prevent environmental pollution.