news
Despite a recent ban on performance-related pay following criminal pollution convictions, the former chief executive of Wessex Water, Colin Skellett, received a £170,000 bonus from its parent company, YTL Utilities (UK), last year.
Bonus Awarded Amidst Controversy
According to accounts up to June 2025, Skellett’s total remuneration from YTL Utilities (UK) reached £693,000, including the bonus. This payment has drawn criticism, with the Liberal Democrats stating the government’s bonus ban is “nowhere near strong enough.” The bonus comes after Wessex Water was criminally convicted in November 2024 for a sewage pumping station failure six years prior, an incident that resulted in the death of over 2,000 fish and a £500,000 fine.
In June, the government banned bonuses for the chief executives and finance bosses of Wessex Water and five other companies. More recently, Wessex Water was issued another £11 million fine last month for further sewage failures.
Bonus Justification
While a bonus ban was in place, Ofwat, the water industry regulator, stated Skellett was eligible to receive the payment because it was linked to a separate part of the parent company’s business. YTL is currently involved in developing a large-scale project, Brabazon New Town, encompassing housing, offices, and an arena north of Bristol. A spokesperson for Wessex and YTL confirmed the bonus “entirely relates to his new role and was entirely funded by YTL,” stating Skellett is responsible for YTL UK group businesses, including the Brabazon development.
Skellett stepped down as chief executive of Wessex Water in July 2024 after 36 years with the company, receiving £157,000 for three months of work. He remains chief executive of the parent company, continuing to earn a substantial salary. Over the last decade, Skellett has received £8.4 million in pay from YTL Utilities (UK), including £3.4 million in bonuses – double the £4.2 million he received for his role at Wessex Water Services, bringing his total earnings over ten years to £12.6 million.
Calls for Transparency
Concerns over transparency in executive pay within the water industry have been raised by MPs and Ofwat. Reports surfaced in August revealing that Nicola Shaw, the boss of Yorkshire Water, received £1.3 million in undisclosed extra pay through an offshore company, a payment also permitted by Ofwat as it was not deemed a performance-related bonus. Shaw acknowledged to the BBC earlier this month that hiding the payments was a “mistake,” but did not commit to refusing the additional pay.
The reporting on these payments has prompted Ofwat to consult on changes requiring water companies to disclose all remuneration from related companies starting next year.
Frequently Asked Questions
What prompted the government to ban bonuses for water company executives?
The government banned bonuses after Wessex Water and five other companies were found to have committed sewage pollution failures, with Wessex Water receiving a criminal conviction in November 2024.
Why was Colin Skellett able to receive a bonus despite the ban?
Ofwat determined the bonus was not related to the regulated water company activity but to Skellett’s role within the parent company, YTL Utilities (UK), and its development of the Brabazon New Town project.
What is YTL doing to address concerns about transparency in executive pay?
Ofwat is consulting on changes to require water companies to reveal all payments made to executives from related companies, starting next financial year.
As regulatory scrutiny intensifies and public concern grows, what further measures might be necessary to ensure accountability and transparency within the UK water industry?
