THE LATEST privatised water company to be hit with a multimillion pound fine for poor performance is more proof that utilities must be renationalised, Labour and campaigners said today.

Britain’s biggest water utility Thames Water was slapped with a £55 million fine for failing to prevent leaks.

The company also agreed to pay £65m back to its customers, or about £15 each over the next two years.

Regulator Ofwat found Thames Water’s board and management “did not pay enough attention to reducing leakage” and “underestimated the significance of its underperformance.”

Ofwat chief executive Rachel Fletcher said Thames Water had “failed its customers,” while Thames Water boss Steve Robertson said: “We let our customers down and for that we're sorry.”

Labour has pledged to bring privatised water companies back into public ownership, which it estimates would save households £100 per year.

Shadow business secretary Rebecca Long Bailey has previously pointed out that water companies have paid 1,000 times more in dividends to their shareholders than in tax in the last decade.

Responding to Ofwat’s announcement, which came on the same day energy giant SSE was fined £1m for misleading customers, Ms Long Bailey said: “Britain’s utility markets are fundamentally broken.

“Last week SSE announced a price hike, adding £76 a year to average bills, now it emerges they are being fined for misleading the most vulnerable energy customers.

“The water companies are no better. In the last 10 years they have paid 1,000 times more in dividends to their shareholders than tax and allowed vital infrastructure to reach breaking point through chronic underinvestment.”

She said Labour would “fix their broken markets” and save households large sums of money by renationalising Britain’s utilities.

Labour’s London Assembly environment spokesperson Leonie Cooper said she had heard “appalling accounts of how Londoners have been affected by leaks, from having their properties flooded, to having their water supply cut.

“This small compensation is the least customers deserve given the inconvenience and upheaval many have endured.”

Neil Clark from the Campaign for Public Ownership said Thames Water having to fork out yet more cash for poor performance was just the latest account of the failures of privatisation.

“We have always argued that the model which we have got, the neoliberal model of having a regulator trying to work for consumers, is not the right solution.”

Mr Clark said there was “incredible public anger” at privatisation, which has seen “water bills shoot up far and ahead of inflation,” while Thames Water paid out “£1.16 billion in dividends from about 2006 to 2015.”

Mr Clark said that renationalisation was not “something theoretical — we had publicly-owned water up until privatisation” in England and Wales in 1989.

“It’s not as if we would be going into the unknown. Nationalisation delivered lower bills, much better investment and fewer leakages. We only have to look back at how it was.”

Even arch-Tory Environment Secretary Michael Gove criticised privatised water companies in a speech to the industry in March.

He blasted Thames Water for paying “no corporation tax for a decade” while its boss “gets £960,000 a year — five times the Prime Minister’s salary.”

A recent investigation by union GMB and Corporate Watch had found that nine water company fat cats pocketed an eye-watering £58m in salary, bonuses, pensions and other benefits over the past five years.

While the water barons were paid an average of £1,254,000 in 2017, consumer water bills in England and Wales have increased by 40 per cent above inflation since the industry was privatised in 1989, according to the National Audit Office.