- South East Water must fund a £30.5 million redress package after repeated supply failures.
- More than 286,000 customers were affected by outages between 2020 and 2023, with further disruptions hitting up to 70,000 homes this year.
- The package will be paid by shareholders, not customers, and includes investments to improve water resilience.
South East Water has been ordered to fund a £30.5 million redress package after repeated water supply failures left hundreds of thousands of customers across Kent and Sussex without running water over several years.
The enforcement action follows three separate Ofwat investigations into the company's performance. The regulator said the package includes a previously proposed £22 million penalty for supply failures between 2020 and 2023, when more than 286,000 customers experienced prolonged interruptions.
A second investigation examined further outages between November and January, when up to 70,000 homes in Tunbridge Wells and other parts of Kent and Sussex lost their water supply. A third inquiry began after Moody's downgraded South East Water's credit rating in May, placing the company in breach of its licence conditions.
Years of disruption lead to tougher oversight
Ofwat said thousands of households were left unable to access drinking water, shower or flush toilets during the winter outages. Schools closed, some parents reportedly missed work because of childcare issues, and vulnerable customers struggled to manage medical conditions.
The regulator also found South East Water failed to communicate clearly with customers during the incidents and did not provide sufficient bottled water to affected households.
Helen Campbell, Ofwat's Executive Director of Delivery, as quoted in a news report, said the company must now focus on rebuilding customer confidence, adding that supply interruptions on such a scale had happened far too often.
As part of the settlement, an independent monitor will oversee South East Water's performance improvement plan and wider turnaround programme. The cost of the monitor will be met separately by the company and is not included in the £30.5 million package.
Shareholders to foot the bill
Ofwat said the full package will be paid by South East Water's shareholders, rather than through higher customer bills.
The funding includes £5 million to provide free water butts for households, £5 million to accelerate smart meter installations for business customers and £5 million for on-site water storage to improve supply resilience during periods of high demand.
A further £13 million will support the company's turnaround plan, while £1 million has been allocated for storage and infrastructure improvements at vulnerable sites across the region.
According to Ofwat, the package reflects the full extent of the company's failures identified during the investigations and is intended to strengthen the resilience of the water network while improving customer service
