Thames Water fined £122.7m in biggest ever penalty

Thames Water has been fined £122.7m for breaching of rules relating to its wastewater operations and dividends payments.

It is the biggest ever penalty issued by the water regulator Ofwat.

The regulator said the fines followed its “biggest and most complex investigation” and confirmed it would be paid by the company and its investors, not by customers.

A Thames Water spokesperson said: “We take our responsibility towards the environment very seriously.”

The fine issued by the water industry watchdog has ordered Thames Water to pay a £104.5m penalty for breaches of rules connected to its wastewater operations.

That is on top of an additional penalty of £18.2m for breaches relating to dividend payments.

Thames Water is currently in “cash lock up” and no further dividend payments can be paid without approval from Ofwat.

It comes as Thames continues to face heavy criticism over its performance in recent years following a series of sewage discharges and leaks.

The company is also struggling under a huge £20bn debt pile, but secured an emergency £3bn in March to stave off collapse.

The supplier serves about a quarter of the UK’s population, mostly across London and parts of southern England, and employs 8,000 people.

It had expected to run out of cash completely by mid-April before it secured a rescue loan and the government has been on standby to put Thames into special administration.

David Black, the chief executive of Ofwat, said the fines were a result of a “clear-cut case where Thames Water has let down its customers and failed to protect the environment”.

“Our investigation has uncovered a series of failures by the company to build, maintain and operate adequate infrastructure to meet its obligations,” he added.

“The company also failed to come up with an acceptable redress package that would have benefited the environment, so we have imposed a significant financial penalty.”