Principal Economist Cost Assessment

We are Ofwat, the Water Services Regulation Authority, a non-ministerial government department responsible for regulating the water sector in England and Wales.

We have an opportunity for a Principal Economist to join our Cost Assessment Team within Price Review Directorate.

The water sector is entering a new chapter. Following the Independent Water Commission’s final report, the UK government has set out a bold new direction – one that brings together expertise from across the sector to deliver better outcomes for customers and the environment.

Ofwat will be working in collaboration with the government and other regulators to help establish a new body for England, combining our strengths with those of the Drinking Water Inspectorate, the Environment Agency, and Natural England. We’re also continuing to engage with the Welsh Government to support future decisions for Wales.

While these changes take shape, our mission remains the same: to hold water companies to account, drive performance, and ensure the sector delivers real value for customers, communities, and the environment. If you’re passionate about making a difference, this is a unique moment to join us and help shape the future of water, and together we can continue to make a positive impact.

You can find out more about why you should join Ofwat, our strategy, values and our framework for success in the attached Information for Candidates Pack.

We’re looking for a Principal Economist to join our cost assessment team. The role is full of influence and exciting challenges.

The cost assessment team plays a pivotal part in shaping the next price review, setting expenditure allowances, and developing policy in areas such as incentive design and improvements to the regulatory framework. As Principal Economist, you will take a leading role in developing our approach to setting base expenditure allowances at the next price review, including related policy development. You will work closely with principals, senior associates, and graduate associates, and collaborate across teams. You will:

• Play a lead role in the development and implementation of our approach to assessing base expenditure at the next price review, drawing on lessons from PR24 and the recommendations of the Independent Water Commission (IWC).
• Contribute to policy development in areas such as incentive design, cost benchmarking, and wider improvements to the regulatory framework.
• Work with colleagues to ensure robust, evidence-based recommendations for expenditure allowances.
• Engage with stakeholders across the sector, including water companies, other regulators, and internal teams.

Base expenditure covers wholesale and retail activities and includes:

• routine, year-on-year costs, which companies incur in the normal running of their businesses to provide a base level of good service to customers and the environment;
• expenditure on maintaining the long-term capability of assets;
• expenditure to improve efficiency; and
• expenditure to comply with current legal obligations

This is an exciting time to join the team, with many opportunities to learn, develop, and shape the future of economic regulation, ultimately improving outcomes for customers and the environment. For example, two key recommendations in the IWC report are the introduction of a supervisory approach to setting expenditure allowances (IWC18) and the separation and ringfencing of opex and capital maintenance expenditure allowances (IWC19).