Regulator examines £1.3m in payments to water boss

Yorkshire Water said the payments to CEO Nicola Shaw (pictured) had been noted in its annual reports published online

The government has asked the water regulator Ofwat to carry out an urgent review into £1.3m in payments to the boss of Yorkshire Water.

Last month, the firm defended the payments to Nicola Shaw, saying they were made by Yorkshire Water's parent company, Kelda Holdings. Earlier this year, Yorkshire Water was one of six firms banned from paying "unfair" bonuses to executives.

On Thursday, Environment Secretary Steve Reed told the House of Commons he had ordered an inquiry to find out the facts behind the payments, saying customers were "outraged".

Yorkshire Water said the fee had been noted in its annual reports, but acknowledged it should have been "more transparent" about the payments.

The company confirmed that in both 2023-24 and 2024-25, Ms Shaw had received payments of £660,000 for work such as "investor engagement, financial oversight and management of the Kelda Group".

A spokesperson said while the payments had been published on the company's website, it was "now committed to disclosing the value of any Kelda-related payments for our CEO and CFO as part of Yorkshire Water's accounts in future".

"We recognise the strength of feeling that the issue has generated," they added.

Reed told the Commons he had asked Ofwat to assess the legality of the payments "as a matter of urgency".

Responding to a question by Sally Jameson, Labour MP for Doncaster Central, he said: "I will not tolerate any company attempting to circumvent this government's ban on unfair bonuses."

Sheffield Council Leader Tom Hunt has criticised Yorkshire Water

Reed's comments came as the leader of Sheffield Council, Tom Hunt, told councillors that the bosses of Yorkshire Water, which announced a hosepipe ban for millions of users in July, were being "rewarded for failure".

Hunt said he had been told by the company that it did not have enough contractors to repair roads after water leaks had been fixed.

He said he was due to meet Yorkshire Water representatives in the autumn and his message to the firm's bosses would be to "sort this out".

"Residents are fed up with your poor service, fed up with sewage pouring into our rivers and fed up with you getting extremely high salaries every single year," he said.

Hunt said there had been 20 water leaks in his Walkley ward in the past two years.

"It is absolutely unacceptable the chief executive of Yorkshire Water received two additional undisclosed payments of over £650,000 each on top of her annual pay of £689,000.

"This comes at a time when customers face a 41% increase in bills, sewage is pouring into rivers and more and more of us are having to put up with pipes bursting and delays on our roads.

"What residents get so frustrated about is when they see Yorkshire Water coming out and often doing the very quick and immediate work to stop water pouring out of the broken pipe, but then leave the hole in the road for up to a week afterwards and fail to get it backfilled and the road surface restored quickly.

"I put this to directly to the chief executive who has admitted they don't have enough contractors on their books to be able do this work. It is not good enough."

A Yorkshire Water spokesperson said the company recognised "the strength of feeling the issue has generated"

A group of Yorkshire Labour MPs has written to the chair of Yorkshire Water to demand answers over "disgraceful" payments, meanwhile council leaders are due to meet the chair later this year.

A spokesperson for Yorkshire Water said: "Our focus remains on improving performance and delivering better outcomes for customers, communities and the environment.

"We know trust will be earned through actions and performance, and we intend to demonstrate that.

"Over the next five years, we will invest £8.3bn to improve service, reduce pollution and modernise Yorkshire's water network."

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