Ofwat is reviewing water bosses' retention payments and pay rises, and Banbury MP Sean Woodcock backs it. Anyone can send views to the regulator by 10 December.
The water regulator Ofwat is reviewing whether water company bosses are getting round the ban on bonuses by paying them under another name, and people in Banbury can tell it what they think until 10 December. Banbury’s MP Sean Woodcock has welcomed the review, which the Government announced this week.
Overview
- What: a review of water executives’ pay by Ofwat, looking at retention payments and large rises in base pay.
- Why: concern that some bosses’ overall pay has gone up despite poor performance, which could undermine the bonus ban.
- Have your say: Ofwat’s call for evidence opened on 12 November and closes on 10 December 2026. Anyone can respond, customers included.
- Local view: Sean Woodcock, MP for Banbury, says local people are “rightly frustrated” by pollution incidents while executives are rewarded.
What Ofwat will look at
Under the bonus ban, water companies cannot pay their senior leaders performance-related bonuses. The review will examine two things that the Government says risk undermining the spirit of that ban: retention payments, and significant increases in base pay.
Ofwat’s own consultation page describes it as an “accelerated review” of the rule, which will decide “what, if any, potential reforms are needed”. It also asks how Ofwat can reduce the risk of water companies undermining the rule.
What the bonus ban has stopped so far
According to Mr Woodcock’s office, the ban has stopped more than £10 million being paid to water bosses since June 2025. In the last financial year alone, £6.5 million in potential bonuses was blocked, and total chief executive pay has fallen by 12.5 per cent.
What Sean Woodcock said
“Local people are rightly frustrated when they see pollution incidents continue while water company executives receive excessive rewards,” Mr Woodcock said.
“This review will help ensure water bosses cannot escape accountability through loopholes in the system, and that failure is no longer rewarded.”
What the Environment Secretary said
Dame Angela Eagle, the Environment Secretary, said she had asked Ofwat for the review.
“People are sick of seeing water bosses profit while rivers are polluted and customers are repeatedly let down,” she said.
“I have asked Ofwat to do a wide-ranging review because failure should never pay, whatever name the payment goes by.
“The bonus ban was the first step. Where there are loopholes, I will close them. I want them closed.”
How to have your say
Ofwat says the call for evidence is open to everyone, including customers, companies, campaign groups, investors, trade bodies and regulators. Responses must reach it by 10 December 2026.
- Online: through the Ofwat call for evidence on executive pay, where the full document can also be read.
- By email: remunerationgovernancerules@ofwat.gov.uk
- By post: Call for evidence: executive pay, Ofwat, Centre City Tower, 7 Hill Street, Birmingham B5 4UA.
What happens next
The findings will feed into the Government’s wider changes to how the water industry is held to account. Those include plans for eight new regional water councils and a strengthened Water Bill, which the Government says will give communities a stronger say in how water companies operate.
Have your say