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Britain’s water industry is under renewed scrutiny as Ofwat investigates executive pay at six major water companies. The probe follows public outrage over pollution incidents and undisclosed offshore payments.

As reported by Reuters, Ofwat has contacted Thames Water, Yorkshire Water, Anglian Water, Wessex Water, United Utilities, and Southern Water, requesting details on executive remuneration after the government banned bonuses for the 2024/25 financial year due to environmental failures.

According to Sky News, the investigation intensified after it was revealed that Yorkshire Water’s parent company, Kelda Holdings, paid CEO Nicola Shaw over £1 million in undisclosed fees over two years.

A spokesperson for Ofwat stated that “where we find evidence that a company has breached the rule, we have powers to direct companies to take remedial actions which, if not complied with, can result in companies facing enforcement action – including financial penalties”.

Sky News also reported that new legislation allows Ofwat to retrospectively block bonuses for executives at firms found guilty of serious breaches. However, companies may still increase base salaries to offset lost bonuses.

Since 2014, water company executives have received £112 million in bonuses, though the 2023/24 figure dropped to £7.6 million. Critics argue such payouts are unjustified given the sector’s environmental record and rising bills.

Environment Secretary Steve Reed welcomed the crackdown, stating “undeserved bonuses will now be banned as part of the government’s plan to clean up our rivers, lakes and seas for good”.