Ofwat Chief Executive to Step Down Amid Abolition of Water Regulator

Strategic Insights -

The chief executive of Ofwat, David Black, will step down at the end of the month, following the government's announcement to abolish the under-fire water regulator for England and Wales. Black's departure comes after intense scrutiny of water companies and their regulators, particularly in recent years over issues such as sewage spills and underinvestment in infrastructure. The government and environment secretary, Steve Reed, are preparing for the biggest overhaul of water regulation since the industry was privatised in 1989.

Key Takeaways:

  • David Black, chief executive of Ofwat, will step down at the end of the month, marking the end of an era at the water regulator.
  • Black's departure comes amid the government's abolition of Ofwat, a decision made after a review by Sir Jon Cunliffe found the sector to be "broken".
  • The regulator's abolition will lead to the combination of powers from four regulators, including Ofwat, into one.
  • Ofwat has faced intense scrutiny over issues such as sewage spills, underinvestment in infrastructure, and excessive pay for water company executives.
  • The new interim chief executive will face urgent issues, including leniency talks with Thames Water and scrutiny of pays for water company executives.
  • The decision to abolish Ofwat comes after last year's green light for water companies to raise average bills by 36% over five years to pay for upgrades.
  • Black led the regulator for four years, during which time it backed an investment programme of £104bn and a further £50bn investment in new water resources.
  • Iain Coucher, Ofwat's chair, thanked Black for his tireless efforts to bring about transformational change in the water sector.

Statistics:

  • £104bn: Investment programme backed by Ofwat for water companies
  • £50bn: Further investment in new water resources to drive improvements
  • 36%: Average bill increases for water companies to pay for upgrades
  • £1.3m: Previously undisclosed pay for Yorkshire Water boss Nicola Shaw
  • 1989: Year in which the water industry was privatised

Sources:

  • "Ofwat chief executive to step down amid abolition of water regulator" by Jasper Jolly and Anna Isaac, The Guardian
  • "Review of the water industry" by Sir Jon Cunliffe
  • "Ofwat's Strategic Framework" by Ofwat