Shock as Southern boss quits

THE boss of water and sewerage group Southern Water has suddenly quit the company. Southern said managing director Stuart Derwent was 'standing down' immediately from the role and his other directorships with the firm.

A spokeswoman refused to say why Derwent, who has been with the company for 32 years and became managing director in 2001, had left. 'We don't have any further details to give at this time,' she said.

The Worthing-based group has about 2,000 staff and supplies water and sewerage services to up to 2m households in Kent, Sussex, Hampshire and the Isle of Wight. French group Veolia, the Royal Bank of Scotland and other investors bought it in 2003 from First Aqua.

Staff at the company are believed to be unhappy about a recent reappraisal of pay rates and job roles. About 500 of them have been told they are 'overpaid' and will not receive a salary rise this year - and only 50% of any pay deal agreed thereafter - under proposals due to come into force next month.

Staff are also said to be concerned about the job implications of the group's outsourcing strategy, under which it has contracted out work such as pipe repairs.

Trade union Unison, which has about 650 members at Southern Water, said: 'There have been difficulties at Southern Water in the last 12 months and we have been working with the company and its staff to try to resolve them.'

Southern said chairman Bob Thian, who took up his post following the takeover by Veolia and RBS, would assume some of Mr Derwent's responsibilities until a replacement is found.