Liberal Democrat MP Richard Foord has branded a decision to boost dividends to water investors as 'shameless.'

It follows a move by the Pennon Group, which owns South West Water, to increase its payouts to shareholders by 11 per cent.

The bumper payout came in spite of the fact the firm was responsible for 37,587 sewage overflows last year.

The dividend boost is worth £112 million to shareholders, and comes after the Pennon Group reported a pre-tax loss of £8.5 million.

Richard Foord slammed the decision, and called for tough government action to reform water firms - ensuring they work in the public interest, rather than for the CEO and shareholders.

Mr Foord said: "The news that shareholders are going to get bumper payouts is a slap in the face for communities across the South West. Many communities are living with a hosepipe ban, while some of our premier beaches and rivers are being poisoned with sewage.

"South West Water has repeatedly failed to fix their leaky pipes, continue to discharge raw sewage onto our precious coastlines, and are currently under investigation by the regulator Ofwat. Yet despite this record, they have decided to pat themselves on the back and award dividend payouts.

"The entire situation is a farce and shows that the current system is broken - with their execs being rewarded handsomely and shareholders being rewarded millions of pounds by a company that is destroying our environment. 

"What's worse is that this Conservative Government has been asleep at the wheel and allowing these polluting firms to get away with this shameless behaviour.

"We need tougher action from Ministers to crack down on profiteering and transform water firms into public benefit companies. This would enable us to put both customer service and environmental standards ahead of corporate profit and shareholder payouts.

"The public deserve answers on this unjustified payout."