THE company that provides water to thousands of businesses across the south has come under fire from the environment Agency over its pollution record.

Southern Water today made a public apology in the wake of the damning findings - and vowed to do more to tackle the problem with a £635m upgrade programme.

Managing director Stuart Derwent said: "We very much regret any pollution incidents and apologise for them.

"They are unacceptable and we are determined to do something about them."

A report by the environment watchdog shows that businesses in the south are mostly meeting their environmental responsibilities.

Pollution incidents from industry nationally last year were down 12 per cent on 2002, and by 43 per cent over the last two years.

According to the Environment Agency, the south has the second fewest major prosecutions for pollution offences in the country.

But it singled out Southern Water as having the "most disappointing performance".

As well as having the fourth highest total fines of all businesses in the country, Southern Water was the highest and most frequently fined water company.

The Spotlight on business report includes all companies that have been fined more than £10,000 last year, with Southern Water fined a total of £73,200.

Agency regional director Howard Davidson said: "Southern Water's performance has been disappointing, but sadly reflects the general performance of the industry."

However, he gave local firms a pat on the back for helping to achieve environmental best practice.

Meanwhile, Southern Water went on the offensive following the public criticisms.

It is proposing to spend £635m in a widescale programme to upgrade ageing sewage treatment works and sewers to help tackle pollution incidents.

The company also stressed that this latest rebuke should be weighed up against major improvements in the quality of water in rivers and off beaches.

It said every beach in the company's region of Hampshire, the Isle of Wight, Sussex and Kent met European water quality standards.

Of the prosecutions brought by the agency, four were caused by equipment failure, with the remainder due to random bursts or blockages.

Mr Derwent said: "All of the incidents in the agency's report were short-lived and all but one did not result in any long-term environmental damage."

Incidents involving Southern Water included an inlet blockage at Lyndhurst treatment works and a collapsed sewer at Waltham Chase, which led to fines of £30,000 and £5,000 respectively.