Southern Water boss pay rise 'outrageous', says environment secretary
He said: "Trust between the customers and the water companies is at the lowest point probably ever and, by paying their senior executives rises of that kind, what message are they sending to their customers?"Asked whether Mr Gosden should turn down the pay rise, Mr Reed said: "I think it would be right if he did.""I don't think Southern Water has performed well enough for that kind of pay increase to be merited," he added.
Southern Water was banned from paying bonuses last month over a so-called category 1 sewage spill in the New Forest, Hampshire, in August 2024.Under new rules, companies are banned from paying bonuses if they do not meet environmental, consumer or financial standards, or are convicted of a criminal offence.Southern Water has insisted the payment to Mr Gosden is not a bonus but part of a long-term incentive plan set up in 2023, and would be paid directly by shareholders.A company spokesperson said its chief executive's pay and benefits were decided by a remuneration committee "following protocols and rules set out by Ofwat and in accordance with the law".They added: "Lawrence Gosden's 2025 package includes a relocation allowance and long-term incentive plan paid by shareholders, which marks improvements made during the delivery of our turnaround plan. "Both of these payments represent common industry practice."
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