The former chief executive of Wessex Water, Colin Skellett, accepted a substantial bonus from its parent company last year, despite a government ban on performance-related pay for bosses at the convicted water firm.
A Controversial Payout Amid a Bonus Ban
Colin Skellett received a £170,000 bonus from YTL Utilities (UK), the Malaysian-owned parent company of Wessex Water. This payment was part of a total pay packet of £693,000 for the financial year up to June 2025. The bonus was issued despite a clear prohibition on such rewards for executives at Wessex Water, which came into effect after the company was found criminally responsible for a serious pollution incident.
In November 2024, Wessex Water was convicted for a sewage pumping station failure that occurred six years earlier. The incident killed over 2,000 fish and led to a £500,000 fine for the company. Following this, the government imposed a ban on bonuses for the 2024-25 financial year for the chief executives and finance directors of Wessex and five other water companies.
The 'Technicality' That Allowed the Payment
The water regulator, Ofwat, stated that Skellett was permitted to keep the bonus because it was legally justified on a technicality. The payment was not classified as being for his work at the regulated water utility. Instead, YTL stated the bonus "entirely relates to his new role" overseeing other UK group businesses, including the development of the Brabazon New Town, a large housing and office project north of Bristol.
However, scrutiny of company records reveals that Skellett's position at the parent company is not new. He has been a director of YTL Utilities (UK) since May 2002. Over the past decade, he has received £8.4 million in pay from this role, including £3.4 million in bonuses. This is separate from the £4.2 million he earned as CEO of Wessex Water Services during the same period, bringing his total decade-long remuneration to £12.6 million.
Political Outcry and Calls for Transparency
The payment has ignited significant political criticism. Anna Sabine, the Liberal Democrat MP for Frome and East Somerset, condemned the bonus, stating it was "absolutely disgusting" that it was allowed on a technicality after the company's "reckless and blatant disregard for nature." She argued the government's bonus ban was "nowhere near strong enough."
This case highlights a broader issue of transparency regarding payments to water company executives from associated group companies. The Guardian previously revealed that Yorkshire Water's boss, Nicola Shaw, received £1.3 million in undisclosed pay via an offshore entity. These revelations have prompted Ofwat to consult on new rules that would force water companies to disclose all remuneration from within their corporate groups starting next year.
Skellett stepped down as CEO of Wessex Water in September 2024 after 36 years, receiving £157,000 for his final three months in that role. He remained as chief executive of the parent company, YTL Utilities (UK). The company, whose principal subsidiary is Wessex Water, reported that the vast majority of its £1 billion annual revenue comes from water-related business.
A spokesperson for the Department for Environment stated the government had created "the toughest enforcement framework the sector has ever seen," including powers to ban unfair bonuses which blocked £4 million in payments this summer. Ofwat reiterated that its new rule had a positive impact and that Wessex Water did not award any performance-related pay for its regulated activities.
