Ofwat hires its former star Cathryn Ross to tackle tough times

Ofwat has turned to a star alumna to lead the water regulator, which is facing one of the most testing times in its 24-year history.

Cathryn Ross has been poached back from the Office of Rail Regulation, where she was executive director of markets and economics. She held a similar role at Ofwat between 2008 and 2011. As the chief executive, Ms Ross will lead negotiations with the water companies over their business plans for the next regulatory review period, 2015-20, as consumers become increasingly vocal over rising bills.

Households are expected to pay an average of £388 for their water from April this year to March 2014, an increase of around £13, though Thames Water's hike is the highest at 5.5 per cent.

There is also the pressing matter of the Water Bill, which was presented to Parliament last month and is designed to open up monopolised areas to competition. Ofwat will need to shake up its rules and regulatory model in the wake of changes that will allow water retailers to provide services to businesses across many regions rather than only the one they operate in.

Ms Ross acknowledged she was returning to the organisation at a "key time", though she will not start until October. The current Ofwat boss, Regina Finn, resigned earlier this year after six years at the helm.