OFWAT QUERY SPARKED – Thames Water pays £37.5m dividend amid debt pile and pollution fines

Thames Water has been asked to explain a £37.5m dividend payment made to a parent company.

Ofwat, the water regulator, asked the firm to explain how the sum does not break rules designed to protect customers and the environment.

They added they are investigating whether the dividend was in line with company licence requirements.

Ofwat said after receiving notification that the firm paid a dividend to shareholders, they “requested Thames Water provide more information to demonstrate how, specifically, the dividend payment meets the licence requirement to take account of service delivery for customers and the environment, as well as investment needs and financial resilience”.

“We will review any additional information the company provides and decide whether there is a case for further action,” they added.

Ofwat has not yet opened a formal enforcement case against Thames Water.

Thames Water said the money was simply being moved to a parent company to help pay its debts.

They added that no dividends have been handed to “external shareholders”.

Thames said it was working with the regulator “to provide further context and clarification”