Committee publication · Correspondence · 13 May 2025

Correspondence to Nicola Shaw, CEO, Yorkshire Water regarding Reforming the water sector inquiry, dated 13 May 2025

From: Environment, Food and Rural Affairs Committee

Summary

The Environment, Food and Rural Affairs Committee writes to Nicola Shaw, CEO of Yorkshire Water, requesting detailed information on three areas: remuneration models and dividend policies; spending on legal fees and advertising; and asset replacement rates. The Committee seeks cross-industry understanding of practices it views with concern, particularly regarding bonuses, dividend payments, and bill payer money spent on litigation against regulators.

Key findings

Committee remains concerned about culture of bonuses and dividend payments, with varying standards applied across the water industry
Committee seeks breakdown of bill payer money spent on advertisements and legal action against Ofwat, the Environment Agency, and the Drinking Water Inspectorate over the past five years
Committee has heard evidence that asset replacement rates may be insufficiently high across the sector and seeks Yorkshire Water's specific replacement rates for Asset Management Period 7
Committee requests information on remuneration committee selection and composition, senior executive bonus policies, and dividend payment policies as they relate to company performance
Committee requests details of how remuneration, dividend, and replacement rate policies have changed over the past five years

Tone

Procedural

Topics

water-industry-regulationexecutive-remunerationdividends-and-returnsinfrastructure-investmentcorporate-governance

Key actors

Nicola Shaw, Yorkshire Water, Environment, Food and Rural Affairs Committee, Ofwat, Environment Agency, Drinking Water Inspectorate

Notable line

“My Committee remains concerned about the culture of bonuses and paying dividends and the varying standards being applied.”

Key Quotes

“My Committee remains concerned about the culture of bonuses and paying dividends and the varying standards being applied.”
— Environment, Food and Rural Affairs Committee · expressing concern about remuneration practices in the water sector

“My Committee is also concerned about bill payer money being spent on advertisements and legal· action against Ofwat, the Environment Agency and the Drinking Water Inspectora te.”
— Environment, Food and Rural Affairs Committee · raising concerns about regulatory litigation and advertising expenditure

“My Committee has heard that replacement rates for assets may not be sufficiently high across the sector.”
— Environment, Food and Rural Affairs Committee · expressing concern about infrastructure investment levels

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Source · parliament.uk record ↗