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Thames bungles its way to £3million cut in fine
Jonathan Prynn, Consumer Affairs Editor17 Apr 2008
The fine imposed on Thames Water for poor service and misreporting was reduced by nearly £3million today when watchdogs decided the firm's processes were so bad it was unaware it had breached rules.
Ofwat said it would cut the penalty from £12.5 million to £9.7 million - 0.7 per cent of Thames Water's annual turnover - having found that the group unintentionally misreported regulatory information.
Thames Water will pay £8.3 million for failing to provide adequate information, down from £11.1million, but its fine for poor customer service remains at £1.4 million, as announced last September.
Thames Water is one of severalwater firms to be hit by hefty penalties. Severn Trent was fined a record £35.8 million earlier this month and Southern Water was told to pay £20.3 million for deliberately misreporting information.
Ofwat said it did not find any evidence of purposeful misreporting at Thames Water, but blasted the group for its failings. Regina Finn, Ofwat chief executive, said: "Thames Water's systemsand processes were inadequate and customers lost out.
"The penalty reflects the importance we attach to reliable, accurate and complete information and gives a clear signal to both the company and the water sector that non-compliance is not a cheap or easy option."
Thames Water welcomed today's decision to reduce the fine. It said last year that it would challenge the level of the penalty, which it described at the time as "totally disproportionate".
David Owens, the company's chief executive, said: "This is still a high figure considering that the failures were unintentional rather than deliberate, but we welcome the reduction.
"Although all the misreporting took place under previous ownership and management, we always acknowledged the company should be held accountable for these failings, but argued any penalty should be proportionate to the harm done to our customers and the efforts we had taken to make amends.
"We not only accepted responsibility for the errors, alerting Ofwat as soon as we became aware of them, but also voluntarily took all appropriate steps to investigate and rectify the failings and to compensate customers."
Reader views (3)
Fantastic, so by that logic, if I were to gamble but be inept at it bookies will refund me a percentage of my wager because I'm a bit rubbish?
It beggars belief, if the company is as inept as they sound then should there not be an investigation by OFWAT into their structuring and then a strict period over which they are overseen to make sure that they are on track and not losing track again?
- Ian Ept, Finsbury Park, 18/04/2008 12:16
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So if I slip up and make a mistake going through a speed camera site too fast, will I get a reduced fine?
What a joke, sounds so nice and cosy to me.
- M, Hempstead, 17/04/2008 19:02
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Once again, this is quite absurd!
If Thames Water's "processes were so bad it was unaware it had breached rules" then it should have its "operating licence" revoked!
It also begs the question as to what exactly the Watchdogs & Regulators have been doing since Thames Water was originally granted its operating licence? Would "nothing" be the correct answer here?
Have any Thames Water officials received "bonuses" in recent years? If so, then "they should be made to pay them back" as Thames Water's processes have now been confirmed as being "so bad" that they clearly couldn't have warranted the "bonuses" in the first place.
It would seem that the company is corporately negligent and incompetent!
- Fraser, Telford Park, 17/04/2008 15:31
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