Wessex CEO hits out at executive pay  

The outgoing chief executive of Wessex Water has said executive pay should reflect company performance and accused some investors of “stripping out cash”.

Colin Skellett was speaking at the GMB union’s annual congress, where he took aim at industry bosses receiving bonuses when their companies have underperformed.

He said the “buck stops” with the chief executive of a company, and they therefore have to take responsibility. “We get a lot of money,” he said, “If we don’t deliver what we should deliver we shouldn’t get that money.”

The Wessex boss earned £280,000 last year but forwent his bonus. He described executive pay as a “lightning rod” to the public, which needed addressing amid customer dissatisfaction.

He added: “We need 25 year plans for investment. All shareholders should get is the fair return as set by a regulator.”

Skellett did however defend the role of private investment in the sector, but cautioned against short-term investors and those who did not share the vision for the water industry.

“Why the hell would you let someone in who has a reputation for asset stripping?” Skellett asked the Bournemouth Congress.

He said investment in water companies, when done properly, could enable projects that would not have been possible when funded publicly, such as upgrades to meet European Union directives that prompted privatisation in 1989.

“These should be natural investments for pension funds, not for those who want immediate capital growth,” Skellett said.

Wessex Water has been owned by Malaysian infrastructure investors YTL for 20 years.

Skellett, who has run the water and sewerage company since 1988, is handing over the reins to Ruth Jefferson from September. He will remain with the YTL Group, moving into the running of its UK Construction business.