Water company fine should be used for environmental investment

8.23.00am UTC (GMT +0000) Thu 10th Apr 2008

Water running into a bath from taps

Water company Severn Trent faces a £35.8m fine by Ofwat, the biggest penalty ever imposed by the water industry regulator, and pleaded guilty to two fraud charges this morning. That means the company could be hit by a further sizeable fine next month. Severn Trent's chief executive, Tony Wray, admitted mistakes but blamed a "previous regime" at the firm. He apologised to the company's eight million customers and said the firm would cut bills by £10.6m, equivalent to £2.40 per household.

This fine is completely justifiable. Not only has Severn Trent Water failed to offer its customers a decent service, but it also tried to use deception to get out of a tricky situation. The company's deliberate misreporting of its performance and failure to provide decent customer service is unacceptable. Rather than lining the coffers of the Treasury, this money should be used for environmental investment, such as rainwater harvesting, water efficiency measures and sustainable drainage systems.