Thames Water faces row over £1m payment to finance chief

Thames Water has paid its chief financial officer, Steve Buck, a £1m signing fee despite intense scrutiny of Britain’s biggest water company’s finances as it tries to avoid being taken into public control.

The utility revealed that it made the payment last month, in a letter sent last week by Sir Adrian Montague, its chair, to MPs on the environment, food and rural affairs select committee, Sky News first reported.

Thames is one of at least eight water companies banned from paying performance-related bonuses because of continued environmental failings from its creaking infrastructure. The company, which provides water and sewage services to 16 million customers in London and the Thames valley, has been on the verge of collapse for more than two years.

Andy Burnham has previously indicated that the government should take control of Thames in order to write off debts worth billions of pounds. However, the creditors who effectively control Thames have spent months negotiating to take formal ownership, if regulators will give leniency on future fines. The creditors have offered the government a “golden share” in the business in a last-ditch bid to avoid having their debts written down.

Yet the continued payments of millions of pounds to executives will probably strengthen calls for the government to step in and take formal control via a special administration regime.

The payment to Buck was made at the end of last month, after Thames took legal advice over its obligations.

The payment was drawn from a £3bn emergency debt package agreed last year with creditors. That money is designed to keep Thames running while it tries to negotiate a longer-term takeover by its creditors, more than two years after its shareholders effectively walked away from the business.

Cat Hobbs, the director of We Own It, a campaign group calling for nationalisation of the water industry, said: “The Thames Water saga is beyond a joke a this point – they are completely taking the mickey. Andy Burnham must step in immediately and take back the company … the shareholders have walked away, and the debt can be drastically cut and refinanced more cheaply in public hands. It’s criminal to let this rip off continue with 16 million households paying the price.”

The payment to Buck was deferred from April 2025, when he joined Thames Water from Pennon Group, the owner of South West Water. Buck had worked at Anglian Water before that.

The payment would come on top of total pay for Buck of £591,000 in the financial year to 31 March. That included a £491,000 base salary, as well as a £25,000 discretionary payment to “support his appointment and facilitate his timely onboarding, recognising costs incurred in connection with his recruitment”. However, the extra £1m payment was not detailed in its annual report, released last month.

Thames Water had previously disclosed that “as part of Steve’s offer of employment, Thames Water agreed that he would receive a retention payment in June 2026, subject to his continued employment”. It did not reveal the size of the payment and added that it was “paused” while it considered the terms of the bonus ban.

Buck’s base salary was also increased to £630,000 in April. Chief executive Chris Weston’s total pay for the year to 31 March rose to £1.2m.

Sky News also reported that Thames has reached settlements over retention payments to 14 other executives, including two who have now left the company. Those settlements were reported to be for lower sums than originally planned under the retention scheme.

Thames last month disclosed that it had paid £4.1m in bonuses for senior managers.

Although retention payments paid to executives come from the emergency funding, from creditors rather than customer bills, executive pay is still understood to be a matter controlled directly by Thames Water’s remuneration committee.

Thames Water and the creditor group declined to comment. The environment committee was approached for comment.