The water regulator Ofwat has launched an investigation into £13m in payments made to Yorkshire Water chief executive Nicola Shaw through an offshore parent company. The payments, which were routed via a Jersey-based entity, have sparked concerns over transparency and executive remuneration in the UK's utilities sector.
Offshore Payments Raise Eyebrows
Documents reveal that Shaw received the substantial sum over several years through Kelda Holdings, Yorkshire Water's parent company registered in Jersey. While such arrangements are not illegal, they often attract scrutiny due to potential tax advantages and lack of transparency.
Regulator Steps In
Ofwat confirmed it is examining whether the payments comply with regulatory requirements and if they represent good value for customers. A spokesperson stated: "We're looking into these payments to ensure they align with our expectations for transparency and accountability in the sector."
Growing Concerns Over Executive Pay
The investigation comes amid increasing public and political scrutiny of water company finances, particularly regarding:
- Executive pay packages during a cost-of-living crisis
- Dividend payments to shareholders
- Investment in infrastructure versus profits
Yorkshire Water serves over 5 million customers in northern England and has faced criticism in recent years for its environmental record and service performance.
Company Response
A Yorkshire Water spokesperson defended the payments: "Nicola Shaw's remuneration reflects her significant contribution to the company and is in line with industry standards for executives of comparable organisations." They emphasized that all tax obligations had been met.
The outcome of Ofwat's investigation could have wider implications for how executive pay is structured across the UK's privatised water industry.
