Political opinion: At last Ofwat is holding water companies to account

At last this matter is being taken seriously and, the new government is arming Ofwat with stronger powers to hold the water companies to account which is resulting in more fines being handed out.

An Environment Agency report for 2023 showed there were 47 of the most serious pollution instances ever recorded and that more than 90% of them were caused either by Anglian Water, Southern Water, Thames Water or Yorkshire Water. Now fines totalling £168m have been awarded to Thames Water, Yorkshire Water and Northumbrian Water, but all 11 wastewater companies are now under close investigation. Southern Water was ordered to pay a record £126m package of fines and customer rebates over its poor sewage management and deliberately misreporting its performance back in 2019 and is still being closely monitored by Ofwat today.

Ofwat is currently negotiating with firms on their business plans for the years 2025-2030 and says customers should not be paying for the companies’ mismanagement of their income. Ofwat proposed a £19 a year increase in bills over this period to tackle the problems including sewage leaks. The new government also plans for tougher penalties for poor performance and the ability to block rewards for failure when annual bonuses and shareholder payouts are due.

Southern Water was planning to increase bills by almost 73% over the next five years to pay for new infrastructure.

David Black, Ofwat chief executive said: “Firms had routinely released sewage into our rivers and seas” - rather than only doing so in exceptional circumstances. It means all wastewater companies in England and Wales are subject to enforcement action, a fact that "demonstrates how concerned we are about the sector's environmental performance".

"This is the largest and most complex investigation Ofwat has undertaken. However, Ofwat is committed to concluding these cases as quickly as possible", he said.

"The level of penalties we intend to impose signals the severity of the failings and our determination to take action to ensure water companies do more to deliver cleaner rivers and seas. These companies need to move at pace to put things right and meet their obligations to protect customers and the environment," he further added.

Liberal Democrat spokesperson for Sussex Weald, Danielle Newson, said: “We are pleased the new Labour government also believes that the water industry needs to be much better controlled and that progress now needs to take place quicker and more effectively. Their plans to include tougher penalties for poor performance and the ability to block rewards for failure, when annual bonuses and shareholder payouts are due, is welcomed and will be fully supported by Liberal Democrat MPs. More than £11bn was handed out to industry shareholders in dividends alone in 2023, in addition to the payments of bonuses to company senior executives who failed to take adequate action to improve water quality. That money should have been invested in renewing the infrastructure they now want customers to pay for, which is totally unacceptable.

“New LibDem research has found that 8 in 10 dog owners will not let their dogs go into rivers or the sea and 37% say the prospect of sewage spills means they will not let their canine companions swim at all. 74% of Britons are now very wary of swimming in the sea or rivers themselves, because of the risk of untreated sewage in the water. I certainly would not want my dog to decide to go for a swim in a local river and I am sure most other dog owners feel exactly the same way,” she added.