Ofwat’s chief executive will step down from his position at the end of this month, the regulator has confirmed.
The Water Services Regulation Authority (Ofwat), which oversees the water sector in England and Wales, stated that David Black has decided the time is right to “pursue new opportunities.”
This announcement follows last month’s government statement outlining plans to replace Ofwat with a new watchdog as part of a broader industry overhaul designed to address existing shortcomings.
Mr. Black, who assumed the role of chief executive in April 2022, expressed his best wishes to the team, saying he wished them “every success as they continue their important work.”
Ofwat has indicated that an interim chief executive will be selected “in due course.”
Iain Coucher, chair of Ofwat, acknowledged Mr. Black’s “tireless” efforts to “bring about transformational change in the water sector.”
This decision coincides with widespread criticism directed at water companies regarding issues such as leaking pipes and sewage spills, with pollution incidents in England reaching a new high.
A comprehensive report on the industry, released last month, presented 88 recommendations for reforming the water sector. These included significant increases in bills to fund investment, the mandatory implementation of smart meters, and the disbanding of Ofwat.
Following the report’s publication, Environment Secretary Steve Reed confirmed the forthcoming abolition of Ofwat.
The report, authored by Sir Jon Cunliffe, a former Deputy Governor of the Bank of England, attributed the current state of the industry to failures on the part of Ofwat, the government, and the water companies themselves.
Throughout the report, comparisons are drawn to Ofcom, the media regulator, which is perceived to have performed better by consistently prioritizing investment in improved infrastructure over time.
The commission responsible for the report found that Ofwat has faced insufficient accountability for its decisions, while also criticizing the government for “providing no detailed guidance to help Ofwat balance its objectives and manage trade-offs.”
The report further criticized water firms for self-reporting on sewage spills and raised concerns about shareholder payouts.
Since privatization in 1989, water companies have distributed at least £54 billion to shareholders, including overseas investment funds.
“There are legitimate questions about whether companies have, in some cases, issued dividends at the expense of their own financial resilience,” the report stated.
The government faced criticism for limiting the scope of the report to exclude the possibility of renationalizing the water industry in England and Wales.
Secretary Reed stated at the time that the government lacked the financial resources to nationalize the industry.
The firm agrees to fund improvements after Ofwat discovered “excessive spills from storm overflows”.
The Welsh government is to take on Ofwat’s job amid major changes to how water is regulated.
A major review of the water industry also suggests compulsory smart meters and scrapping the regulator Ofwat.
The wide-ranging review was launched amid growing public concern about sewage spills and rising bills.
The Cunliffe report has proposed reforms that are deep and wide, but they will take time to take effect.