The troubled supplier forked out more than £4 million in bonuses and boosted its chief executive pay to £1.2 million, new figures have shown.

Britain’s biggest water firm – which has been left on the brink of nationalisation as it struggles under a £20 billion debt pile – revealed in its annual report that bonuses of £4.09 million were paid to “key management personnel” as part of its so-called management retention plan.

It said the bonuses were made to board members and executives over the year to March 31, up from £2.8 million the previous year, and included performance-related and retention awards.

READ MORE: Thames Water profit, debt and bills all rise

The report also showed chief executive Chris Weston’s total pay rose to £1.16 million in the year to March 31, up from £1.04 million in 2024-45 after he picked up a £99,000 retention payment deferred from a previous year.

His basic pay was also hiked by 14 per cent from April 1 this year to £995,000.

Environment Secretary Emma Reynolds took aim at the Thames Water pay-outs, saying it adds to evidence that suppliers are side-stepping bans on bosses’ bonuses.

She said: “It’s outrageous that one of the worst-performing water companies is handing out bonuses and inflation-busting pay rises to its executives.

“It flies in the face of basic fairness, and the British public are right to be furious.

“We’ve banned bonuses for polluting water bosses and will be taking action to prevent bonuses by any other name.”

Last year’s Water (Special Measures) Act allowed regulator Ofwat to ban performance-related bonuses for bosses at utilities failing customers and the environment as part of the Government’s wider response to cracking down on the ailing sector.

Mr Weston said his £99,000 retention bonus was awarded before the Water (Special Measures) Act came into effect in June last year and the group confirmed he did not receive a performance-related pay-out for 2025-26.

But the firm has already caused controversy over retention payments to senior executives, seen as evading the ban.

It agreed last December amid outcry to pause £2.46 million of these payments to 21 top bosses – not thought to include Mr Weston – until further notice, having already paid out a similar amount earlier in the year.

In its annual report, Thames Water’s remuneration committee said: “The committee fully accepts and complies with the legal and regulatory position on performance-related pay but is concerned that the constraints now operating materially limit the extent to which the scale and challenge of the transformation being delivered can be reflected in total remuneration.

“The committee believes this creates a real risk to the retention of experienced leaders with the capability to deliver this transformation in exceptionally challenging circumstances.”

KAREN JOY BACUDO

Finance Editor

Ecommpay has urged merchants to check whether their Buy Now, Pay Later providers meet new UK regulatory requirements as full Financial Conduct Authority supervision begins for interest-free instalment products.

Lenders offering Deferred Payment Credit must now be authorised by the FCA or registered under the Temporary Permissions Regime to continue operating legally. Although the rules apply directly to lenders rather than retailers, they will affect how BNPL products are presented and managed at checkout.

Under the new regime, lenders must carry out affordability checks on every transaction, with the depth of those checks linked to risk. Purchases under £50 are no longer exempt. Lenders must also give customers clear upfront information on payment dates, amounts and the consequences of missed payments.

New arrears rules require prompt contact with customers who miss payments, reasonable notice before enforcement action, and signposting to free debt advice. Consumers with eligible complaints about Deferred Payment Credit agreements can also take their cases to the Financial Ombudsman Service.

Ecommpay warned merchants not to assume they are insulated from the consequences of a lender failing to meet the new standards. Problems involving a BNPL option can still damage the retailer’s customer experience and brand.

“BNPL has always been credit – regulation is simply catching up,” said Alpa Jotangia, Head of Compliance at Ecommpay.

“And critically it isn’t just a technical change for BNPL providers; it changes the checkout conversation for everyone. The reality is that consumers don’t separate the lender, the payment provider and the retailer in their minds. They remember the checkout experience, the refund experience, and how they were treated when something went wrong. If a BNPL partner falls short, it’s the merchant’s brand that’s likely to be impacted.”

Merchant checks

Retailers using BNPL at checkout should verify that each provider is either FCA-authorised or registered under the temporary regime. They should also review the customer journey to assess how repayment terms are displayed, how affordability checks are handled, and what happens when a customer returns an item or falls into arrears.

Merchants should also ask lenders how they meet their regulatory duties, including disclosure, refund handling and support for vulnerable customers. Ecommpay presented those steps as practical checks for retailers reviewing their existing payment setup.

The changes mark a significant shift for a market that expanded quickly under lighter oversight. BNPL products have become a common feature of online checkout in recent years, particularly for lower-value retail purchases, and the move brings them more closely into line with other forms of consumer credit.

For lenders, the rules introduce operational demands around underwriting, disclosures and arrears management. For merchants, the concern is less about direct regulatory exposure and more about whether a provider’s compliance processes introduce delays, confusion or disruption at the point of sale.

Jotangia said the sector would need to balance consumer safeguards with a simple user experience.

“The payments industry has spent years removing friction from checkout, but friction is not always failure when it comes to offering credit – sometimes it’s protection,” she said.

“The winners in the regulated BNPL market will be the providers that make responsible credit feel clear, intuitive and proportionate, and that’s where payments expertise matters. Payments service providers like Ecommpay can help merchants ensure their payment journeys work smoothly alongside compliant BNPL offers, delivering a checkout that converts. The next phase of BNPL won’t be defined by who has the most prominent button at checkout – it will be defined by trust.”

Administrators shut down the Oxford brand at the Westgate centre in April, one of 33 that shut down nationwide.

Best known for its premium leather footwear and handbags, Russell & Bromley fell into administration earlier this year with debts of £59.3 million and losses reaching £20 million over the past two years.

The historic retailer, founded in Sussex in 1880, operated stores nationwide but its financial pressures proved insurmountable, according to administrators Will Wright and Chris Pole of Interpath Advisory, who were appointed in January.

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A spokesman for Interpath Advisory said: “Following the announcement regarding the sale of the Russell & Bromley brand and certain assets to Next plc, the joint administrators can confirm that a phased closure programme for the remaining Russell & Bromley stores is now complete.

“All stores that did not transfer to Next as part of that transaction closed.

“Regrettably, these closures mean that the majority of employees working in the non-transferring stores have been made redundant.

“The administrators and their teams are engaging closely with all affected staff and will be providing support throughout the process, including assisting individuals in submitting claims to the Redundancy Payments Service.”

At the time of administration, Russell & Bromley owed £59.3 million.

A total deficiency of £35.7 million is estimated, with assets totalling £8 million available for preferential creditors and £5.6 million for unsecured creditors.

The company also owed £3.2 million to HMRC.

Administrators described the final years of the business as deeply challenging.

The administrators said: “The group was relatively highly loss-making, with these losses due to a combination of falling sales, increasing operational costs and a relatively high fixed cost base.

“Further to this, the wider UK market has been difficult for retail businesses with challenging trading conditions characterised by high inflation and suppressed consumer demand.”

In an effort to fund continued trading, Russell & Bromley had sold off several freehold properties.

However, even these measures could not stem the mounting losses.

The company had drawn £2.1 million on a trade finance facility before entering administration.

NatWest exercised its set-off rights immediately upon appointment of the administrators, using the company’s remaining cash to clear its outstanding debt with the bank.

Most of the company’s 36 stores did not survive.

Only three stores—two in London and one in Kent—were included in a pre-pack deal with Next, which acquired the brand name and select assets.

The closure resulted in 400 job losses.

Interpath anticipates that a dividend may eventually be paid to unsecured creditors but has not yet determined the potential value.

The administrators said: “Based on current estimates, we anticipate that unsecured creditors may receive a dividend.

“We have yet to determine the amount of this, but we will do so when we have completed the realisation of assets and the payment of associated costs.”