'People are sick of excuses': Four UK water firms handed one-star environmental ratings - as bosses bonuses blocked

Four UK water companies have been handed a one-star environmental rating as regulators accuse bosses of failing customers and the environment. South West Water, Southern Water, Thames Water and Yorkshire Water all received one-star ratings - the lowest possible score - in the Environment Agency’s latest annual assessment. The bosses of the four companies will automatically be barred from receiving bonuses under rules introduced last year, following poor performance ratings for 2025.

The report found that pollution incidents across England and Wales remained a major concern , with 2,991 recorded in 2025. Of those incidents, 84 were classified as serious. Read more: Thames Water accused of 'horrendous' pollution spike ahead of crunch credit decision Read more: South West Water owner Pennon calls on investors to help fund overhaul This comes as water regulators have released their first combined assessment of the industry, combining data on drinking water, sewage pollution, customer service and environmental performance.

Although the quality of drinking water remains high, with 99.97% of tests meeting required standards, the sector is still falling short on wastewater and environmental protection, the report found. The Environment Agency (Defra) said its overall ratings for water and sewerage companies had fallen to 16 out of a possible 36 stars, with just one company achieving the highest four-star rating. Environment Secretary Dame Angela Eagle said that the case for reform was clear based on the findings.

"Water companies have let the public down time and time again, and today's report is further proof that root-and-branch reform cannot wait. "People are sick of excuses. They want clean rivers, lakes and seas, and the certainty that every pound they pay is being invested wisely, not wasted. She says she is “demanding answers” from the failing companies and will be highlighting the “worst offences around the country”. Bosses of the underperforming companies are expected to be summoned to Whitehall by ministers to pull together a plan for how to improve.

The Government also says it will consider strengthening restrictions on executive bonuses, amid fears that bosses at persistently underperforming companies continue to be rewarded.