MP Bob Seely has welcomed an announcement by the water regulator that rules on dividends paid out by water companies will be tightened.
The new powers - made possible through the Government’s landmark Environment Act - mean that Ofwat will be able to stop the payment of dividends in certain circumstances. The regulator is now modifying licences to require water companies to take account of environmental performance and customer delivery when deciding whether to pay dividends. They will also be required to hold a strong credit rating and dividend payments could be stopped if their financial health is at risk.
Reacting to the news, Mr Seely said: “I welcome the announcement by Ofwat that rules on water company dividends will be tightened. This has been made possible because of the government’s ground-breaking Environment Act which is enforcing higher standards for water firms and nature protection.
“On the back of that Act I was able to persuade Southern Water to prioritise the Isle of Wight as an example of national best practice. Southern Water is now investing millions of pounds into a programme designed to significantly reduce sewage and storm overflows and improve the rivers, beaches and seas in and around the Island.
“Works worth over £30 million are planned, which includes £13.5 million to improve Sandown Water Works, plus there are community schemes happening to reduce driveway and road rainwater run-off.
“The investment is happening in both big and small schemes. Improvements are not going to happen overnight, but work has already started.
“The scheme Islanders may already be familiar with is the one currently taking place Gurnard where Southern Water is distributing free slow-release water butts to households to help alleviate pressure on their water systems. I hope that residents in Gurnard will take up the offer in the same way Havenstreet residents did when it was trialled there last year. Soon the scheme will move to Fishbourne and Wootton, and then on to Yarmouth, Freshwater, and East Cowes.”
