Parasite outbreak part of £36m bill for South West Water owner

A parasite outbreak in Devon contributed to a nearly £40m bill for South West Water owner Pennon, the company has said.

The May 2024 outbreak left some people in hospital after cryptosporidium, which causes sickness and diarrhoea, contaminated the water supply in the Brixham area.

Pennon said it was facing costs of about £36m owing to the incident, as well as its “reshaping and transformation programmes”.

In a Commons committee session last month, chief executive Susan Davy apologised to customers over pollution incidents, including the “devastating” Devon case.

The cost of the outbreak was up from about £20m in the first half of its year, when it revealed more than £16m was paid out for the Brixham issue after compensating affected customers, together with a further £4m for its overhaul programme.

Despite the rising financial toll, the firm said its underlying earnings would be “broadly flat” compared with the first half and on track with its own expectations for the full year to 31 March.

About 17,000 households and businesses in the Brixham area were issued with a “boil water” notice following the outbreak.

The notice, instructing them not to use tap water for drinking without boiling and cooling it first, remained in place for eight weeks for some households.

Ms Davy faced criticism after it was revealed her pay package jumped 58% to £860,000 a month following the incident, after she picked up a long-term share award.

She also told the MPs in the committee session that her base salary was rising from £494,000 to £511,000.

SWW customers will see their bills increase by 23% over the coming five years, helping the company pay for improvements to its infrastructure and reduce pollution incidents.