Independent Water Commission: Final Report

Tuesday 10th February 2026 Westminster Hall

[Relevant Documents: Second Report of the Environment, Food and Rural Affairs Committee, Priorities for water sector reform, HC1001; and oral evidence taken before the Environment, Food and Rural Affairs Committee on 17 June 2025, on Reforming the water sector, HC 588.]

09:30

[Edward Morello (West Dorset) (LD)]

I beg to move,

That this House has considered the Independent Water Commission Final Report.

I thank the Backbench Business Committee for granting the debate, and my co-sponsors across the House and the all-party parliamentary group on water pollution, of which I am an officer, for their support in securing this important debate. West Dorset is home to the world-famous Jurassic coast, a UNESCO world heritage site, as well as three of Britain’s unique chalk streams. Few issues matter more to me or the people of West Dorset than the state of our water.

This debate was originally intended to take place before the publication of the Government’s water White Paper, so that Parliament could scrutinise the findings of the Independent Water Commission and assess what steps the Government intended to take in response. Instead, we find ourselves in a position where we are able to examine the commission’s final report and the White Paper together to see where they align, diverge and, most importantly, fall short of what the public expect, and to see the scale of the crisis that the response demands.

[Steve Darling (Torbay) (LD)]

If people in Torbay check the Surfers Against Sewage app today as I did, they will see that eight sites are monitored where there could be overflows of sewage. Six overflows have occurred so far this year at six of those sites, with two ongoing. We have also suffered a cryptosporidium outbreak in the past 18 months. Does my hon. Friend agree that we need to stop tinkering with the system and have systemic reform to tackle such challenges?

[Edward Morello]

During my speech, I will outline some such recommendations. This is a good opportunity to thank Surfers Against Sewage for all its hard work. Like my hon. Friend, I use the app regularly before deciding whether to swim at my favourite beaches.

It is an understatement to say that the public’s confidence in the water sector has been damaged; it has been eroded by years of sewage pollution, repeated flooding, poor decision making, too little regulation, scattered legislation and a business model that has too often rewarded failure. This debate is more important than ever in the light of recent flooding, not just in West Dorset but across the south-west and the country as a whole.

Following Storm Chandra, communities again saw the devastating consequence of a system that has reached breaking point and that can react only after failure, rather than preventing it in the first place. Emergency services, whom I pay tribute to, have done an outstanding job, but residents were left dealing with sewage in their homes, damaged property and uncertainty about when it will happen again. In West Dorset alone, 84 homes in Yetminster experienced raw sewage flooding their properties. In Maiden Newton, one family has been flooded repeatedly since 2024, including just days after finally returning home following 15 months of repairs after the previous flood.

As the climate continues to change and extreme weather events become more frequent, that will only become a more common occurrence. Our infrastructure must become more resilient to deal with today’s problems and tomorrow’s.

[Lee Pitcher (Doncaster East and the Isle of Axholme) (Lab)]

As the hon. Gentleman knows, I am chair of the APPG for sustainable flood and drought management, and of the all-party parliamentary water group. On the White Paper, there is 25-year strategic planning, which is absolutely brilliant; regional knowledge and tactical interventions, which are absolutely brilliant; putting engineering capability at the heart of that strategic decision making; and a regulator that brings the economy and the environment together as one for the first time, which I think is important. Does he agree, however, that this is an opportunity to ensure that we do not miss out the maintenance of existing assets, as well as putting new ones in the ground with the extreme amount of investment that will go in over the next five, 10, 15 or 20 years? Does he also agree that we therefore need some sort of resilience standards to provide knowledge for the people applying such investment in the future?

[Edward Morello]

We as the Liberal Democrats always try to be a constructive Opposition, so I absolutely will identify where the White Paper makes steps in the right direction. I hope that the hon. Member will agree with some of our recommendations for where it can be improved.

The Independent Water Commission’s final report was a major and long-awaited milestone. It reflected unprecedented public engagement with more than 30,000 submissions from a public who are angry, frustrated and rightly demanding change. The report contains important proposals embedding public health into law, improving regional planning, strengthening monitoring, and replacing Ofwat with a new, integrated regulator. Those are steps in the right direction.

I want to put on record my thanks to the commissioners and the countless campaigners and volunteers, such as the River Lim Action group, Surfers Against Sewage and River Action, who have fought for cleaner rivers and seas for years. The report exists because of their continued pressure.

[Richard Foord (Honiton and Sidmouth) (LD)]

My hon. Friend mentions the River Lim Action group that works on the boundary between his West Dorset constituency and mine. The group has identified that the sewage treatment works at Uplyme cannot cope with the amount of sewage that occurs during high rainfall. Does he agree that South West Water needs to put in more storage for sewage during periods of heavy rain?

[Edward Morello]

My hon. Friend works tirelessly on River Lim issues. I agree there are essential works throughout the system that need to be done if we are to reduce sewage release, but we need to do them in a way that does not pass the cost on to residents and consumers.

[Mr Gregory Campbell (East Londonderry) (DUP)]

I congratulate the hon. Member on securing the debate. He itemised those that do an excellent job, such as Surfers Against Sewage and others, and there is also Feargal Sharkey from my city of Londonderry who has campaigned on and championed these issues for many years. All these people are doing a magnificent job, but we need to see a strategic response from the Government to deliver what we all want to see.

[Edward Morello]

The hon. Member is right to highlight the work of Feargal Sharkey and the many campaigners around the UK who give up their free time to raise awareness of the issues in their local areas.

The central question for this House is whether the commission’s recommendations and the White Paper that followed go far enough to meet the scale of the challenge we face.

[Jim Shannon (Strangford) (DUP)]

I commend the hon. Member for his perseverance and dedication to the subject matter. I also pay tribute to his party’s members who always turn up and do their bit. The Independent Water Commission’s final report refers to a “fundamental reset” to address failing regulations that have negatively affected customers and the environment. Does the hon. Member agree that Government, and particularly the Minister, must be prepared to take the helm to ensure that the reset actually takes place and is not simply a change in name?

[Edward Morello]

The hon. Member is absolutely right. I shall come on to some of the recommendations that we believe are necessary to make it more than just a reset in name only.

Let me start with the reality in my constituency. In 2024, West Dorset recorded 4,200 sewage spills and the discharging of raw sewage for nearly 49,000 hours from 90 storm overflows. I have no doubt that other Members can cite similar, if not worse, statistics for their constituency. Only 11% of our monitored river sites reach “good” ecological status. The River Lim is categorised as ecologically dead. Rare chalk streams such as the River Frome, Wraxall brook and West Compton stream are under severe pressure, as are Atlantic salmon populations.

Tourism in West Dorset, worth over £322 million a year and supporting more than 5,000 jobs, is threatened by our poor water quality. My constituents, their children, the visitors who support our communities, and families, including my own, love our beautiful world-famous waterways, but no one should have to check an app on their phone to see whether it is safe to swim that day. The final report continually underlines the lack of public trust. To change this, reforms must be visible, transparent and public facing. If people are to believe that things are changing, they need to see progress, understand the standards and know that failure has consequences.

We need blue flag-style standards for rivers and chalk streams. Clear standards, mandatory testing and visible ratings would help rebuild trust. Where standards are met, confidence grows. Where they are not, communities can hold companies and regulators to account. Recommendation 3 of the report proposes a comprehensive systems planning framework, with regional water authorities responsible for integrated planning, funding, setting objectives, monitoring and convening stakeholders. That approach recognises that water does not respect administrative boundaries and neither should planning. Housing growth, agriculture, flood risk, river health and water supply must be considered together across Government Departments. The bodies must be statutory, democratically accountable and empowered to make binding decisions. Without that authority, we would risk repeating the mistakes of the past: endless consultation without delivery.

When I have previously argued that water companies should be made statutory consultees in the planning system, the Government have resisted that change. The water White Paper now states that Ministers

“will also consider the role of water and sewerage companies in relation to planning applications”

as part of the reforms to statutory consultees. That is a welcome change, but simply considering it is no longer enough. Making water companies and national landscapes statutory consultees for major developments would be a preventive, low-cost reform that aligns planning decisions with environmental reality, reducing flood risk.

The commission is also right to highlight the importance of pre-pipe solutions. Recommendation 10 calls for legislative changes to expand pre-pipe solutions, so that we can stop pollutants and rainwater entering the system in the first place. In too many places, combined sewers are overwhelmed by rainfall that mixes with raw sewage and triggers spills. That is not sustainable in a changing climate.

We need a long-term national rainwater management strategy, with sustainable drainage systems being mandatory in all new developments, and a serious programme of retrofitting in existing communities. Rainwater harvesting should become the norm. We must bring ourselves in line with modern housing standards and our European neighbours, just as minimum solar requirements are being made mandatory, thanks to the private Member’s Bill introduced by my hon. Friend the Member for Cheltenham (Max Wilkinson). Those are low-carbon, cost-effective and resilient solutions. They would reduce pressure on sewers, lower flood risk and protect rivers, but the White Paper only gestures vaguely in that direction. Without clear, consistent standards and funding, progress will remain slow.

On regulation, the commission calls to replace Ofwat with a new integrated regulator, which is welcome and overdue. The Liberal Democrats have called for exactly that since 2022. Ofwat’s primary duty to ensure reasonable returns has shaped a culture that has tolerated pollution, debt loading and under-investment. A regulator with explicit duties to protect public health and the environment is a step forward.

I am glad that the White Paper has stated that the Government will commit to a new regulator by abolishing Ofwat and bringing together the relevant water system functions from existing regulators—Ofwat, the Drinking Water Inspectorate, the Environment Agency and Natural England—into one new body. But again, that alone is not enough. That body must have teeth: it must be properly resourced, independent and willing to enforce the law.

[Anna Dixon (Shipley) (Lab)]

The Public Accounts Committee recently had a hearing on environmental regulation with the Environment Agency and Natural England. Does the hon. Gentleman share my concern that the transition to a new regulator is a huge undertaking and that there is a risk while it is being set up? We must not take our eyes off the enforcement and regulation of water companies to ensure that we reduce the amount of their pollution in the meantime.

[Edward Morello]

I 100% share the hon. Lady’s concerns that water companies will exploit this moment in time. The public are calling out for firmer action, so the speed of the transition is vital.

Existing legislation already requires sewage to be treated effectively, and allows storm overflows only in exceptional circumstances, but the Government have admitted that overflows are being used far beyond their original purpose. Investigations have shown illegal discharge even on dry days. The Office for Environmental Protection has concluded that regulators have failed to comply with existing environmental law. The first task of the new regulator must be to enforce what is already on the statute book and to review permits across the system.

The commission also highlights the need for stronger customer protection. Recommendation 41 proposes strengthening the C-MeX—customer measure of experience—incentive and moving to a supervisory approach. That reflects the reality that customer experience has not improved, despite financial incentives. People paying their bills expect reliable service, timely responses and basic competence—not call centres that do not answer and complaints that disappear into the void.

That brings me to the question of accountability and ownership. The White Paper recognises the unsustainable debt levels created by the current model, and talks about attracting long-term, low-risk investors. It also introduces new performance improvement regimes. But there is a real risk of tinkering around the edges while leaving a fundamentally broken model intact. As long as water companies exist primarily to generate profit, decisions will be shaped by that motive alone.

Alternative models across Europe deliver lower bills, higher investment relative to debt, and fewer discharges. Both the commission and the White Paper fail to engage seriously with those models. In West Dorset, we are served by Wessex Water and in a small part by South West Water. My constituents see a pattern of rewarding failure across the water system that is impossible to justify during a cost of living crisis.

[Adam Dance (Yeovil) (LD)]

Last year, bosses of Wessex Water received £50,000 in extra pay—more than many people in Yeovil earn in a year—from the parent company, while constituents in Ilminster report that they cannot swim in their rivers without risking getting sick. Does my hon. Friend agree that the Government must now ensure that sewage dumping at bathing sites ends by 2030 and that water bosses get no extra pay until sewage spills stop?

[Edward Morello]

My hon. Friend is absolutely right to highlight the issues in his constituency. At a time when people are paying higher and higher water bills, there is understandably a sense of frustration with the outlandish bonuses being paid to executive bosses overseeing this failure.

Between 2020 and 2021, water company executives paid themselves £51 million in remuneration, including £30.6 million in bonuses. I am glad that the Government have started to take action on this behaviour in the Water (Special Measures) Act 2025, but it is not enough. In 2022 alone, water and sewage companies paid out £1.4 billion in dividends, nearly three times as much as the year before, while household bills rose and families were forced to make difficult decisions. All the time, sewage continued to be pumped into our rivers and beaches.

We need a proactive, evidence-based assessment of alternative ownership models before the water reform Bill is finalised. Water companies should be redesigned with public benefit and environmental protection as their core purpose. The Liberal Democrats are calling for a new ownership model, with water companies mutually owned by customers and professionally managed. The special administration regime exists to protect customers and the environment when companies fail. Thames Water is the clearest example of a company that has failed financially, operationally and environmentally. We need transparent criteria for when the SAR will be triggered and a clear plan for using it to transition companies to public benefit models where necessary.

Affordability must also be central to reform. It was not mentioned enough in the final commission report. Families are already under intense pressure from the cost of living crisis. Environmental improvement cannot be paid for on the backs of those least able to afford it. It must be paid for by those who caused the problem. Bills must be fair, and investment must be efficient, long-term and low-risk. Financial penalties must be ringfenced for infrastructure upgrades and nature-based solutions, not absorbed as a cost of doing business.

The commission’s call to end operator self-monitoring is welcome, as is the move towards open monitoring and near-real-time data. The speeding ticket-style fines previously introduced by this Government should also be welcomed. However, credibility depends on independent testing, frequent inspections and proper funding for regulators. Data must be accessible, understandable and trusted by the public.

We cannot clean up our rivers by focusing on sewage alone. Agriculture accounts for pollution in about 40% of water bodies. Farmers are essential partners, but are struggling in our current system of underfunding. The system must support prevention at source by supporting our farmers and helping them to tackle water pollution through better funding and guidance.

This is a huge opportunity for cross-party consensus, legislative reform and long-term thinking and change. The support across the House for it is a testament to the scale of the problem, but also to people’s willingness to collaborate on the future. The Independent Water Commission has laid important foundations, and the White Paper moves the conversation forward, but neither goes far enough on its own. Change must be public-facing, rooted in public benefit and focused on prevention rather than clean-up. It must restore trust—trust that politics can deliver change, that regulators will enforce the law, that legislation passed in this House will make a difference and can change the sector, and that water companies will finally put people and the environment before profit.

Communities such as mine in West Dorset cannot afford another decade of half-measures. Our rivers, our coastlines, our communities, our health and our homes are at risk. I hope we can seize this moment to deliver the transformational reform that the public rightly want.

[Several hon. Members rose—]

[Sir Jeremy Wright (in the Chair)]

Order. I remind all Members who wish to speak that they need to continue to bob throughout the debate, so that we know. If everyone sticks to about five minutes, we should get everybody in comfortably.

09:49

[Anna Dixon (Shipley) (Lab)]

It is a pleasure to serve under your chairship, Sir Jeremy. I congratulate the hon. Member for West Dorset (Edward Morello) on securing this important debate.

My constituents in Shipley, with the lovely River Wharfe and River Aire flowing through, have been outraged at the levels of water pollution in them. They face high bills, while leaking infrastructure causes damage to roads and homes. Companies such as Yorkshire Water have been failing us for years now. We suffered last year from a failure to invest in new reservoirs, with an almost year-long drought starting in the spring.

I very much welcome the fact that this Labour Government have come in with a determination to tackle those issues. I was pleased to vote for and support the Water (Special Measures) Act 2025, which made sure we took immediate action to clamp down on the obscene bosses’ bonuses, including those that the chief exec of Yorkshire Water was receiving. Very sadly, the Kelda holdings company, which owns Yorkshire Water, also paid her a sort of behind-the-scenes £1.3 million extra payment, which I and others have been urging her to donate or give back. I hope that in future the companies meet the spirit of the legislation.

I welcome the work of Sir Jon Cunliffe in bringing forward the Independent Water Commission. I put in a submission to the review, setting out some actions that I felt were necessary for fundamental reform of the water industry, so that it works better in the interests of customers and the public by clamping down on the illegal discharges of sewage, which are all too frequent. I am pleased to see that the Government have addressed quite a number of those issues in the water White Paper. I put on record my thanks to the People’s Water Commission, a group of campaigners, researchers and experts who came together to engage the public on their views about water. I particularly thank Becky Malby, a local resident who is involved in the Ilkley Clean River Group.

I sit on the Public Accounts Committee; I do not know whether that is part of my entry on the Register of Members’ Financial Interests. The Committee has recently undertaken two reports, the first on water regulation and the second, not yet published, on environmental regulation. I will briefly quote findings from the first report:

“Ofwat has failed to prevent companies taking excessive dividends, increasing levels of debt and setting up complex company structures, all of which have reduced their financial resilience. The sector’s risk profile has risen and customers must now pay investors higher returns as a result.”

To illustrate the point, my own Yorkshire Water bill shows that 23% is just to finance debt, while 17% is spent on infrastructure investment. How can that be? Unfortunately, there is no end in sight for the bill payers being made to pay that debt. I urge the Minister to say how she will change the gearing of those companies that are so indebted. Despite the figures of £104 billion in investment and, for Yorkshire Water, £8.3 billion, it does not seem as if the shareholders are actually putting their hands in their pocket. It is the customers who will have to pay for the infrastructure upgrade and for the past failure of companies to invest.

I would like to draw attention to a couple of other points on which I would welcome the Minister’s reassurance. I warmly welcome the creation of a new regulator, as the Public Accounts Committee has recommended. How will we ensure that it has the right skills and resources? The previous Government cut funding to the Environment Agency, which meant that it failed to do its job of prosecuting some incidents; I am pleased that under this Government we now have many cases in hand. The regulator needs skills to take action on the finances, given the complex structures.

How will we ensure that customers’ money is going where they want? How will the regulator take action on pollution and work with the Environment Agency on how farmers, who face many regulations, can play their part in cleaning up our rivers and seas? I urge the Minister to take all the actions in the water White Paper to make sure that companies such as Yorkshire Water are properly held to account in future.

09:55

[Dr Ellie Chowns (North Herefordshire) (Green)]

It is a pleasure to serve under your chairship, Sir Jeremy. I thank the hon. Member for West Dorset (Edward Morello) for securing this debate. He shares my passion for tackling water pollution, which is why we work together on the all-party parliamentary group on water pollution, which I set up when I joined this place to represent the interests of my constituents and citizens across the country who are passionate about the issue. I did so in recognition of the fact that, unfortunately, the all-party parliamentary water group has a secretariat run by the water industry. It was therefore vital to get citizens’ voices into Parliament on this issue.

[Lee Pitcher]

I am chair of the all-party parliamentary water group. It is managed in-house; it was all brought in-house, so there is absolutely no external body. That is why we did it: because we wanted the APPG to be totally independent.

[Dr Chowns]

I thank the hon. Member for that clarification, and I am delighted to hear that in this Parliament that has been changed. Historically, it was run by the water industry, which is why it was necessary to set up a new group.

I will confine my comments today to the two elephants in the room: ownership and agriculture. They are effectively missing from the Independent Water Commission. They are effectively missing from the water White Paper. That is frankly extraordinary. Why did the Government prevent the Cunliffe commission from looking at those two crucial issues? Without addressing them, we cannot tackle the problems in the water sector.

Privatisation of water has comprehensively failed. Privatised water companies have paid £85 billion in dividends to shareholders since privatisation, and they have racked up debts of £65 billion. All the while, leaks have been proliferating, infrastructure has been crumbling, there has been a failure to build reservoirs, and customers have been paying hand over fist for poorer and poorer service. It is completely unacceptable.

Nearly every river in England is polluted. England’s bathing water quality is the fifth worst in Europe. England’s surface water quality is the seventh worst in Europe. Over 1 trillion litres of water were leaked in 2024. I have already mentioned the £85 billion paid to shareholders and the £65 billion of debt. Privatisation will cost customers a further £22 billion over the next five years, because that is the return on capital that has been set by Ofwat. Around a third of customer bills now service corporate debt, and Ofwat allowed bills to go up by 26% this financial year alone—an average of £123 per household.

That is a failing water system. No other country in the democratic world has privatised its water system to the degree that we have in this country. It is clear that a market-based approach to the water sector simply does not work. Water is a natural monopoly. Customers have absolutely zero choice. Water is a public good and should be in public hands, so that it works for public benefit. Why did the Government prevent the Independent Water Commission from even looking at that question?

[Helen Maguire (Epsom and Ewell) (LD)]

The Rye brook in Ashtead, which runs past local schools, has suffered loads of raw sewage leaks. It feeds into the River Mole, which has seen 3,000 hours of storm overflows in January 2026. The run-off pollutes local chalk streams as well. The hon. Lady might be interested to know that, while the report also ignored reforming water companies, it mentioned chalk streams only twice. Does she agree that privatisation is not working and that we need to bring water companies into mutually owned public benefit companies and end the sewage scandal for good?

[Dr Chowns]

We need to bring water companies into public ownership, because only by running water for public good will we tackle the scandal that has been caused by privatisation in recent decades. Some 82% of the British public want water to be in public ownership. That is more than the percentage who want the railways to be in public ownership, so why are the Government so opposed to it? They are very fond of citing completely imaginary figures about the supposed cost of doing so, but Thames Water, for example, apparently has a market value of £4 billion, judging by the last market offer, and faces a repair bill of £23 billion, so in effect its value is nil. We could take it into public ownership at zero cost and run water for public benefit.

The second lacuna in the work of the Independent Water Commission and the water White Paper is agriculture. Why did the Government prevent the Independent Water Commission from looking at agricultural pollution? We know that diffuse agricultural pollution is half the problem, so we cannot ignore it. It is another elephant in the room, and we have to focus on addressing it, together with farmers, who are crying out for support to do that.

To give the Independent Water Commission some credit, it did actually look at the issue and mentioned it in its conclusions. It says on page 20 of the final report that

“agriculture has the most significant environmental impact on water bodies in England and Wales.”

In fact, almost the very next sentence cited the River Wye in my North Herefordshire constituency, where problems relating to diffuse agricultural pollution have led to huge economic, social and environmental problems.

A few pages later, the Independent Water Commission said that the Government’s water strategy

“should be cross-sectoral, setting out in one place the requirements on all the sectors impacting on or interacting with the water environment…including agriculture”.

Yet on only one of its 50 pages did the Government’s White Paper talk about agriculture. That is not a comprehensive, joined-up strategy.

As the Independent Water Commission pointed out,

“achieving a future environmental target for water…will depend more and more upon reducing the contribution of agricultural pollution.”

We must work with our farmers—the stewards of our land—to tackle this problem. It is more than half the issue, and the Government can no longer ignore it. I beg the Minister to please give it the same attention that we rightly give to the water and sewage companies. Without a comprehensive approach, we will simply fail to clean up our rivers, lakes and seas.

[Several hon. Members rose—]

[Sir Jeremy Wright (in the Chair)]

Order. I gently remind Members that if they cannot stick to five minutes or less, those at the end of the list will get a lot less.

10:02

[Josh Newbury (Cannock Chase) (Lab)]

It is a pleasure to speak in this debate with you in the Chair, Sir Jeremy.

I thank the hon. Member for West Dorset (Edward Morello) for securing this important and timely debate on the Independent Water Commission’s final report and the Government’s White Paper, which will move forward with many of the commission’s recommendations. I put on the record my thanks to and respect for the Minister for setting up the commission. I also thank Sir Jon Cunliffe and his team for their forensic assessment of our water industry—many recognise its fundamentally flawed, if not completely broken, state.

Since being elected, I have heard from constituents about flooding, sewage discharges and water infrastructure failures. I have heard from families worried about river pollution, from businesses concerned about the resilience of supply, and from residents frustrated that the problems they see locally are addressed so slowly. For too long, the sector has been characterised by fragmented planning, overlapping regulation and ageing infrastructure, so the proposal to establish a single integrated regulator, alongside setting out a clearer long-term strategic vision for the sector, is an important step forward in restoring public trust and delivering the resilient water system our country desperately needs.

As a member of the Environment, Food and Rural Affairs Committee, I am particularly conscious that reform has to be judged not only on its intent but on delivery. As Sir Jon did, the White Paper is right to identify the historical lack of joined-up, long-term planning as a central weakness. About 60% of water mains were built before 1981, and a significant proportion are now more than a century old. I have seen the effects of that in my village of Norton Canes, and in Rugeley, where water companies have struggled even to work out who owns the broken pipes.

Public confidence in the sector continues to be shaped by the visible impact of pollution and sewage discharge. My constituency is served by Severn Trent and South Staffs Water, and performance across the sector demonstrates both areas of progress and ongoing public concern. Although Severn Trent has achieved long-term strong performance ratings in some operational areas, data shows that in 2024 there were more than 450,000 hours of discharge in its area alone. That contrast illustrates why stronger transparency, oversight and accountability are essential if reforms are to rebuild public confidence. I therefore welcome proposals to move towards open monitoring, to ensure that companies are no longer effectively marking their own homework.

As has been said, agricultural run-off contributes significantly to water pollution in some catchments. That has to be part of any long-term strategy if we are serious about improving river health and water quality, but it needs to be tackled in partnership with farmers, rather than characterising them as wilful polluters of the waterways that they rely on. The move towards integrated regional water planning could be a significant step forward in that respect. In constituencies like mine, effective co-ordination when it comes to flood prevention, agricultural practice, environmental regulation, planning and economic growth is essential. Regional planning could deliver more preventive and nature-based solutions, but it will require clarity about governance, accountability and its relationship with water company investment decisions.

On accountability, as a member of the Co-operative party I was glad that the Government make powerful customer panels a key plank of last year’s reforms. For too long, customers have felt completely disempowered, but with the incredible work of citizen scientists, and the action taken by the Government, that is starting to change. I note that the commission’s final report was lukewarm about the mutual model for water companies, because of a perceived risk to customers, but I hope the Minister will continue to look at ways we could incorporate co-operative principles into reforms to the sector, up to and including mutual ownership if that would resolve some of the issues.

Before I conclude, I cannot speak on this topic without referring to executive bonuses, given the galling payments we have seen for senior figures in failing water companies, despite the action taken by the Government in the Water (Special Measures) Act 2025. It is shameful that we have got to a point with the water industry where the Government cannot trust bosses to follow the spirit of the law, and instead have to take further action because bosses who would not earn performance-related bonuses would rather spend their time cooking up creative ways of re-labelling bonuses with their legal teams, or re-routing bonuses with their accountants, than spend their time cleaning up the filth that our constituents are paying through the nose for. If they will flout the spirit of the law, the letter of the law will have to change. I am glad we have a Government who are decisive about the need to do that.

The Independent Water Commission has provided a clear diagnosis of the challenges facing our water system. The Government’s White Paper sets out an ambitious pathway for reform in many areas, and I welcome its focus on long-term planning, stronger regulation and improved environmental outcomes. Clearly, the task ahead is to ensure that reforms translate into real-world improvements that our constituents can see and feel.

[Lee Pitcher]

It is important to put on the record that lots of the people who work for the water companies and lots of farmers out there are feeling the reputational hit from what is going on. Accountability needs to be held at the decision-making level. Does my hon. Friend agree that we need to recognise the people who are out there on the frontline day in, day out, and in the offices, making sure that pollution incidents do not occur and that leaks are fixed, and that it is not their fault at all? They are working really hard, including by leaving their families late at night, to try to make things better.

[Josh Newbury]

I could not agree more with my hon. Friend. The Environment, Food and Rural Affairs Committee has often heard from water company bosses that the criticisms of their companies are impacting morale on the frontline, but we point out that if any bonuses are available to people on the frontline, they are certainly not of the order of those the bosses are receiving. I absolutely agree that we need to respect those people and make sure their voices are heard as we reform the sector.

As I was saying, we need to see safer waterways, more reliable infrastructure and a water system that is fit for the future. I am grateful for the opportunity to have spoken in the debate.

10:08

[Rachel Gilmour (Tiverton and Minehead) (LD)]

I thank my hon. Friend the Member for West Dorset (Edward Morello) for securing the debate. I also thank my many constituents who, quite rightly, have grave concerns about this matter and have written to me about it.

My party has made its dissatisfaction with the White Paper clear, and my colleagues are making the case strongly again today. We have been leading the charge in calling for a comprehensive approach to tackling what is nothing short of a crisis in the water sector. The Government made tackling this crisis an important pillar of their election campaign, so it is deeply disappointing that the reforms set out in the water White Paper fall far short of what the situation demands. The system is in dire straits and requires a complete overhaul, but instead the Government offer only the lightest of plans that fail to beef up regulations in a meaningful manner or provide funding provision for enforcement. Although the abolition of Ofwat is welcome, the uncertainty around its replacement is unhelpful.

Farmers need proper support to tackle agricultural run-off, which accounts for around 40% of water pollution. As stewards of the land, they are inevitably stewards of our water as well. How can it be that we have allowed corporate greed to run rampant, and allowed these companies to have presided over the routine pumping of filth into the waterways of this land? It is quite remarkable. All the while, the good people of the west country have seen their bills soar, some by as much as threefold. The Government offer only the lightest of plans: weak regulation, no meaningful enforcement and no funding to ensure compliance.

As my constituency straddles the Somerset-Devon border, we are in the unenviable position of having two water companies: Wessex Water and South West Water. I think it is fair to say that I have made my views on South West Water clear before, and I will once again direct my ire at South West Water, because its behaviour, inertia and refusal to acknowledge the gravity of situations of its own making has been pitiful. Just a week ago, I raised the matter of my poor constituents at Bawdens bakery in Bampton, who have been forced to close and sell up because their property has flooded so many times. I had a most unhelpful meeting with the director of South West Water, who showed only his complete complacence and, I have to say, arrogance, to such an extent that I had to ask him and his staff to leave.

The public health implications are grave. I have heard horror stories from constituents whose children have fallen seriously ill after swimming in local rivers. The beaches at Dunster and Blue Anchor now carry the dreaded brown flag status. It is a shameful state of affairs. Is it really too much for the British public to expect clean water as a basic right?

At the risk of being blunt and somewhat crude, suffice it to say that the Tiverton sewage works absolutely reek every time it rains—and anyone familiar with the west country will know how often that is. It is inexcusable and utterly foul. It is a stench and a situation more in character with the 12th century, certainly not the 21st. I could be more colourful with my description, but I will spare colleagues and preserve my own sanity.

[Sir Jeremy Wright (in the Chair)]

With noble exception of the hon. Member for Tiverton and Minehead (Rachel Gilmour), we have not been entirely successful at sticking to five minutes. I must ask those remaining to keep to below four minutes so that we can try to get everybody in.

10:11

[Rachael Maskell (York Central) (Lab/Co-op)]

It is a pleasure to see you in the Chair, Sir Jeremy. I congratulate the hon. Member for West Dorset (Edward Morello) on securing the debate. We inherited the most dysfunctional water system imaginable. The governance was not there and there was no accountability in the system. Labour came in to put that right. Although we have gone so far on that journey, and I congratulate the Minister on the legislation we have passed and the legislation to come, there is clearly so much to do.

My city of York is based on two rivers that flood and, with all the pollutants in the water, it is a crisis when that occurs. In 2023, there were 16,357 hours of sewage releases on the River Ouse and another 3,254 hours on the Foss. We now know that the Foss has the worst levels of pharmaceutical pollutants—which we have not heard about in this debate—of any river in Europe. I draw the Minister’s attention to the work being undertaken by the University of York in its Ecomix project, which is looking at 1,000 different chemicals—whether from agriculture, pharmaceuticals, cleaning products, personal care products or things like tyre additives—in order to raise standards. We have to know what is in our rivers so that we can address the issues.

Although we have come so far with the excellent report by Sir Jon Cunliffe, there is clearly more to do. I again draw the Minister’s attention to the work of the University of York—it is such a leader in the field—and its action for quality aquatic environments project, which is drawing citizens into the science project to detect chemical and biological pollutants in order to put things right in the future. That mass community research enables communities not only to own their rivers but to press for change. They pressed me to take part in this debate, and I am grateful for that.

We must move forward. This country had the reputation of being the “dirty man of Europe”. That changed, particularly under the last Labour Government, and yet standards have slipped back so much over the last 14 years that we are getting that reputation again. It is important that we maintain those standards, and we should be adopting the principles of European legislation—the urban wastewater treatment directive—into our legislation, ensuring that we close that gap on pollutants and move forward so our water can be safe again. We must also move to ban the dangerous forever chemicals that are finding their way into our waterways. There is too much flexibility about the chemicals that people have been using, and keeping our waterways safe is really important.

I want to raise the issue of our infrastructure and modernising our sewerage system, which is predominantly still based on the Victorian infrastructure of the past and does not segregate rainwater from sewage. That is causing so many problems. We need those investments to come at pace. We need to ensure that, locally, we are measuring and reporting the scourge of what is happening in our waterways.

As has already been mentioned, Yorkshire Water has failed. Bills have gone up and accountability has gone down, and the chief executive is taking eye-watering sums of funding. We need better governance and, with all these failing contracts, we need to move water into public ownership again.

10:15

[Dr Roz Savage (South Cotswolds) (LD)]

It is a pleasure to serve under your chairship, Sir Jeremy. I thank my hon. Friend the Member for West Dorset (Edward Morello) for introducing this important debate—I have to say, it feels like the nth debate that we have had on this issue. I am getting a very strong sense of déjà vu from standing here and in the Chamber and speaking about water. Sadly, I suspect I will stand here and speak on this subject many more times over the coming years.

I know the Minister is passionate about this subject. There are some aspects of the White Paper that I welcome, but I feel that it does not go far enough. I will come on to specifics in a moment, but right now I want to share a mental image. In my constituency, at least 16 sewage outflows are spewing sewage into our rivers—just picture that. With the current stuck weather system and more rain expected, that is set to continue. I find that really distressing and I am sure that everybody here does too.

The central problem is that the water system is now built around profit. The privatised model has failed. That is a serious market failure, and it needs to be remedied. I am not here to defend Margaret Thatcher’s vision—far from it—which was that we would go from being a nation of shopkeepers to a country of shareholders. The somewhat foreseeable consequence of that was that people—individuals and private share owners—would sell their shares, and so we have ended up with big institutions owning our water companies and exploiting them as vehicles purely for profit. That profit motive does not sit well with a vital public utility.

I will point out four recurring failures in the Government’s approach, on this issue and possibly on others: they lack the courage to truly grasp the nettle on failing systems; they are overlooking nature-based solutions, despite strong evidence that they work; they are misunderstanding farming, as the hon. Member for North Herefordshire (Dr Chowns) referenced, and ignoring the dual role that farmers play as part of the problem and as a big part of the solution; and they are failing to unleash people power.

Nature-based solutions are still being treated as an afterthought, despite evidence that constructed wetlands can remove 60% to 90% of nitrates and phosphates. Nature can be a great ally in this, and there is no downside to using nature-based solutions. The approach on agriculture is piecemeal and inadequate. Agriculture accounts for about 40% of water pollution in English rivers, but the proposed action is seriously underpowered. We need environmental land management funding to be better targeted at water outcomes, and we need to include farmers to unleash what they know about their land. To restore faith in the water industry we need transparency and accountability. We could unleash the power of citizen science to monitor water, as residents are the people most motivated to track water quality.

Finally, I return to the fundamental issue of water company ownership. The Liberal Democrats are calling for Thames Water to be converted into a public benefit company, or possibly a mutual company owned by its customers. Changing ownership of Thames Water is the only way to solve this problem for the long term. I thank the Government for where they have gone, but I beg them to go so much further.

10:19

[Amanda Hack (North West Leicestershire) (Lab)]

It is a pleasure to serve under your chairship, Sir Jeremy, and I thank the hon. Member for West Dorset (Edward Morello) for giving us this opportunity to speak about water today.

My constituents have written to me pretty consistently since I came to this place about the water industry with concerns about sewage discharges, bonuses paid to water bosses, flooding and their bills. I do feel that their concerns—in emails and conversations through casework, surgeries and a specific roundtable—have been heard and fed into this this consultation. Our White Paper, published as a response to the Independent Water Commission’s final report, will tackle some of these issues head-on, by bringing forward, strengthening and streamlining regulation.

I will focus my speech on sewage discharges and flooding, and the impact they have on my constituency. Leicestershire has again had significant rainfall, and a flood warning is still in place today on the northern edge of my constituency. Coupled with that, sewage has poured into our waterways in North West Leicestershire for 15,000 hours. That is not just physically, but mentally challenging for my constituents.

I have spoken about residents in Whitwick before, but today I will speak about another set of residents who were flooded just before Christmas. The desperation that people experience when sewage water enters their property is really difficult for them to bear; indeed, it is visible on their faces. We must do better for them, and the water industry really needs to clean up its act. I visited Mary, who has a smallholding in Donington le Heath. She became so frustrated by the outflow release on her smallholding that she collected a bag of sewer debris from a recent release and popped it on the table during a meeting we had with representatives from Severn Trent Water. They were left with no doubt about her feeling that the company consistently drops sewage on to her land. Such is the frustration of local people.

Sir Jon Cunliffe’s report recommends a review into key legislation about urban waste water treatment, reducing pollutants and tackling sewage releases that went unaddressed for 15 long years under the previous Government. My constituents will be reassured that our White Paper will set out ambitions to tackle sewage misuse, prevent sewer blockages, help maximise sewer capacity, and reduce pollution incidents and therefore sewage flooding. That is a core example of constituents raising concerns, a direct report being commissioned to find solutions, and a Government listening to people.

On a separate note, it is encouraging to see water companies finally investing in ageing infrastructure. However, constituents are often frustrated by their water bills going up and about how, for example, the long-awaited improvements in Coalville, which could address the issue in Donington le Heath, are still four years away. I would welcome the Minister firmly reassuring my constituents that they will see improvements, and the necessary re-establishing of trust between consumers and water companies off the back of the final report.

Since being elected, I have engaged whenever and wherever possible with efforts to strengthen the water sector, and I was proud to sit on the Water (Special Measures) Bill Committee. Building on our work here in Parliament, I was pleased to see the Environment Secretary confirm that the water White Paper will be followed by a transition plan and a water reform Bill, and I look forward to hearing the Minister’s remarks on that.

I also thank Sir Jon Cunliffe. I do not think anybody could be as passionate about the water sector as he is. It is quite clear from the things he has said, and from the way that he has addressed this real problem for the UK, that he has a passion and indeed a vision for change, which matches our Government’s ambition. I will just take this opportunity to thank Sir Jon for his work.

10:23

[Jeremy Corbyn (Islington North) (Ind)]

I congratulate the hon. Member for West Dorset (Edward Morello) on securing this debate, which is timely and very important. The Cunliffe report is seriously flawed, in that it did not consider public ownership of the industry or agriculture, which is a major polluter, as other colleagues have already pointed out.

Privatisation of water has been an absolute disaster from the very beginning, when many of us at the time warned against it. It has resulted in £72 billion being taken out of the industry in dividends and profits, and fantastic levels of executive pay. It has left behind pollution and flooding, with the cost of the pollution, flooding and foul water being borne by the public—our constituents—who are increasingly angry about it.

By any standard, river quality is appalling right across the country and is one of the worst anywhere in Europe. That is caused by the mixing of rainwater with sewage waste, and by agricultural run-offs that have a devastating effect. The River Wye is just one example of how awful the rivers can become, because of agricultural waste run-offs—hon. Members who drew attention to that are absolutely right. The waste of water from leaks is a huge problem, and I think I am right that the totality of leaks across the whole country would fill the whole of Loch Ness every year.

Therefore, instead of calling for new reservoirs to be built, should we not look at much better water management, rainwater retention and water distribution across the country? In England, the biggest water consumers are in London and the south-east, which is, broadly speaking, the driest part of the country. The wettest part of the country is the midlands and the north-west. Clearly, moving water from one part to the other makes a lot of sense. Can we not have some sense surrounding the organisation of water distribution?

[Anna Dixon]

Does the right hon. Gentleman recognise that under the previous Government, light-touch regulation left our infrastructure crumbling? It is right that there will be asset mapping under the new proposals, so that we can finally know the state of the infrastructure and whether these investments are actually fixing the leaks.

[Jeremy Corbyn]

Absolutely. The state of the infrastructure does need to be examined. Like many Members, my constituents have endless complaints about that. Thames Water is one of the most frequent visitors to my constituency; it digs up the roads frequently. With the resulting road closures—which are absurd—Thames Water is much better at traffic management than Transport for London, actually.

I would also ask that we look much more seriously at river basin management. I remember visiting York with the hon. Member for York Central (Rachael Maskell) during the flooding at that time. We had a long discussion with the Environment Agency about planning for flooding, which would involve restoring peatlands, upland planting, reintroducing beavers and others into rivers—that has an effect on a small scale, with lots of rivers and streams—and restoring floodplains. Those sorts of things are some of the most important things we can do.

Water should be taken back into public ownership—not old-style public ownership, with a board of governors or directors appointed by the Government, but a popular form of public ownership that would involve the brilliant workforce in all those companies, and their knowledge. The directors would come from them, and from local communities, businesses, local authorities and unions, so we would have a locally and popular-based water industry in our society. We could do it. Why don’t we try that?

[Sir Jeremy Wright (in the Chair)]

I call Charlie Maynard, but the bad news is that I can only give him three minutes.

10:28

[Charlie Maynard (Witney) (LD)]

It is a pleasure to serve under your chairship, Sir Jeremy. I thank my hon. Friend the Member for West Dorset (Edward Morello).

I am going to move very quickly. I thank Sir Jon Cunliffe and all the campaigners in my constituency. I note that Blake primary school had to close on Friday because of sewage—the fourth time in the last two and a half months. Bills have gone up: we are paying 9.75% interest with Thames Water. I thank Alex Lipp and Jonny Dawe for putting together sewagemap.co.uk—a fantastic website that tracks what is going on and where.

The “ultimate controller” definition is mentioned 16 times in the Independent Water Commission’s final report. I welcome the proposal in paragraph 700, which would allow an enforceable undertaking against ultimate controllers. However, that will work only if Ofwat is doing its job properly and recognising companies as ultimate controllers. As the Minister knows, the equity of Thames Water is now zero, with most of the investors having written down their equity investment in full, and some having taken away their board representation nearly two years ago. That leaves the debt holders—the class A creditors—holding the majority of the company’s debt. They have now set up the London & Valley Water consortium to co-ordinate their interests.

The water sector is a regulated sector, with the ultimate controller designation being critical. To meet that definition, an entity only has to

“materially influence the policy or affairs”

of Thames Water. There is no limit on how many entities meet that criterion or whether there are equity or debt holders. Clearly, the consortium more than meets that definition as it is, in effect, the only significant party left standing across either Thames Water’s debt or equity structure.

As per the regulation, Thames Water must inform Ofwat even of potential changes in its ultimate controllers. Ofwat then requires water companies to obtain legally enforceable undertakings from each of their ultimate controllers. That has not happened in the case of the class A creditors, and I believe this is a rig-up between the Treasury, the Department for Environment, Food and Rural Affairs, Ofwat, Thames Water and the class A creditors. That is not good enough. It is in contravention of our regulations.

I have repeatedly asked Ministers to explain, in the main Chamber, in the Business and Trade Committee, in this Chamber and in the press, why they believe that the class A creditor consortium does not meet the ultimate controller test. I have received either no answer— most recently from the Minister three weeks ago, when she refused point-blank to give me an answer in the main Chamber—or obfuscation. Please, will the Minister now answer the question? Does she consider the London & Valley Water consortium to meet the ultimate controller test with regard to its material influence over Thames Water, and if not, why not?

[Sir Jeremy Wright (in the Chair)]

I am grateful to the hon. Gentleman and to all Back-Bench colleagues for their co-operation. We now come to the Front-Bench speeches, beginning with that of the Liberal Democrat spokesperson.

10:31

[Tim Farron (Westmorland and Lonsdale) (LD)]

It is a pleasure to serve under your guidance, Sir Jeremy. I thank everyone who has taken part in this debate so far, which has been interesting and thoughtful, but especially my hon. Friend the Member for West Dorset (Edward Morello) for securing another really important debate on this broad issue.

As a party, we made this issue the centrepiece of our campaign in the 2024 general election, so all of us on the Liberal Democrat Benches feel that we are here with a mandate to fight for change. It is a joy and a pleasure to work alongside others from all parties in trying to achieve that. It was an honour to meet and present evidence to Sir Jon Cunliffe as he put together his report, and to work with the Minister and others, whom I enjoyed spending time with on the Water (Special Measures) Bill Committee—I suspect a sequel to come, and we all look forward to it.

We all agree that—as the Independent Water Commission’s final report correctly identifies—the system is very badly broken, not only in the performance of water companies but in the basic, deep injustice of a water industry that seems to be self-serving, not serving the community. In 2024, 3.6 million hours of sewage dumping took place in our lakes, rivers and seas. At the same time, Ofwat failed to enforce a single fine over a four-year period.

Water companies are getting collective bonuses worth £20 million in the last full year of data, and yet those are not rewards for success, because only 14% of our rivers are meeting a healthy standard, with more than half a million sewage spills into our waterways just last year. Bills are rising and yet, as we have heard from others, in so many cases a massive chunk of those bills—11% if people live in the United Utilities area in the north-west of England, in my constituency—is going to pay off service debt. In the Thames region, people pay more than 30% of their bill just to service the debt.

While the Government have often taken action to try to ban bonuses, the water companies shamelessly shimmy their way around that. We have heard a couple of examples today already: Southern Water’s chief executive had his pay double to £1.4 million, largely through a two-year, long-term incentive plan; and we heard the outrageous story of the chief executive of Yorkshire Water, paid £1.3 million through the company’s holding company. That is breaking the ban in spirit, and surely in reality, too—certainly in the eyes of our constituents.

In my communities of Westmorland, water matters massively. We are home to Windermere, Ullswater, Coniston, Grasmere and Rydal Water, and to many rivers, but from the Eea to the Eden, from the Crake to the Kent, last year alone we had 5,000 sewage discharge incidents and 55,000 hours of raw sewage pumped into our rivers, lakes and coastal areas. The commission has mostly been on the money, so to speak, when it has assessed the problem. This is an industry that performs appallingly on the pollution of our waterways, and it behaves appallingly in response to its own failure.

We agree with much of what is in the final report. We agree with having a single regulator, for which the Liberal Democrats have been calling for years. We should merge Ofwat, the regulatory parts of the Environment Agency, and others to create a powerful regulator that the water companies will actually be afraid of, and that the public respect. We would call it the clean water authority. We hope that the Government will copy our homework further.

Some failures and submissions, however, we are deeply concerned about. The Government fail to grasp that while stronger regulation is really important, ownership is also important. The failure of Thames Water, a cause which my hon. Friend the Member for Witney (Charlie Maynard) champions—as do many others—is an outrage, but it is also a massive opportunity for the Government to use the special administration regime and move that company into a mutual form of ownership, so that it is owned by its customers. That could create a new model of ownership for the whole industry—one that leverages capital investment to ensure that environmental and social concerns, and clean water, are absolutely at the pinnacle of the purpose of those companies, not rapacious profiteering.

Such a model would provide the opportunity for water campaigners and environmental groups to find their way on to those boards. In my community, there is the Save Windermere campaign, the Clean River Kent campaign, the Eden Rivers Trust and the South Cumbria Rivers Trust, but citizens, societies and volunteers across all of our constituencies would have a part to play in those new, mutually-owned water companies. That would make a difference.

The Government have made no attempt, either in the White Paper or through the report, to look at the problem with volume that we are all concerned about. We often talk about the number of hours of discharge into our lakes, rivers and seas, and that is an important measurement, but the reason we mention that and not volume is because we are not allowed to know the volume. The Liberal Democrats believe passionately that volume should also be measured, but the water companies do not want that, which is a reason to ensure that we force it to happen.

On bathing waters, the Government should have a mandate to end the sewage dumping in bathing sites by 2030, and we should be testing them throughout the year and more regularly—not just the often inaccurate snapshots that we have at the moment. On bonuses, we call for the law to be strengthened further, so that water company bosses cannot carry on dodging losing their bonuses via the back door.

The commission’s final report rightly identifies many of the problems that our constituents believe are serious and need to be addressed. However, while it contains many worthwhile proposals, such as a united regulator, it does not face up to the desperate and obvious need for a transformation of the ownership model, for deeper and stronger regulations, and for a bonus ban that actually bans bonuses.

When Water UK, the industry body that represents the water companies, comes out as it did to endorse the Government’s approach to water reform, that is all the proof we need that this Government’s approach continues to be, I am afraid, a bit wet. We need a plan for a radical transformation of the water industry, but so far, I am sad to say, this is not it.

10:37

[Blake Stephenson (Mid Bedfordshire) (Con)]

It is a pleasure to serve under your chairmanship, Sir Jeremy, on my first outing on behalf of His Majesty’s official Opposition. I congratulate the hon. Member for West Dorset (Edward Morello) on securing this important debate, and I join Members who have welcomed the work of Sir Jon Cunliffe. I thank local action groups across England that are campaigning hard and cleaning up our waterways, and the employees in our water industry working hard, day in, day out, to make a difference within the framework that they operate in.

I took note of the rivers that were mentioned during the debate: the River Lim in West Dorset, plus two chalk streams that I am afraid I missed; the Rivers Wharfe and Aire in Shipley; the River Wye in North Herefordshire; and the Rivers Ouse and Foss in York. We are all agreed that they need to be cleaned up. Ensuring that we have a plentiful supply of clean water and waterways across England matters to us all, including my constituents in Mid Bedfordshire. Like many places across England, Mid Bedfordshire is having to adapt to a growing population, dry summers and increasingly wet winters, all with ageing infrastructure.

Having grown up spending many an hour playing in my local river, a tributary of the River Test in Hampshire, I enjoyed a childhood that many simply cannot enjoy today, with the latest assessments showing that no rivers in England are in good or high overall health. Nature is also in grave danger. Freshwater habitats cover less than 1% of the earth’s surface but support more than 10% of global species. Since the 1970s, freshwater species have declined by 85%, far outpacing declines in terrestrial and marine systems.

England’s globally significant chalk streams, which make up 85% of the world’s total, are among the habitats most affected by pollution and abstraction, and I was pleased to hear many passionate advocates for our chalk streams in this debate. But what did this Government do when Opposition Members tabled amendments to the Planning and Infrastructure Act 2025 to restore and protect those habitats? The amendments were ignored, citing care for our environment and countryside as blockers against so-called progressive builders. That all illustrates, in the first 18 months in government, a level of arrogance that will do absolutely nothing to secure our future and clean up our waterways.

The problems with the water sector have been known for a long time and are well reported. The Environmental Audit Committee’s report, “Water quality in rivers” dating back to January 2022 provides a clear picture of the concerns, and the previous Government went on to help to identify the scale of the problem. When Labour left power in 2010, only 7% of storm overflows were being monitored; by 2023 it was 100%. That unveiled the severity of the situation facing the water industry, with water company storm overflows spilling into England’s rivers, lakes and seas for a record 3.61 million hours in 2024—although I take the point made by the hon. Member for Westmorland and Lonsdale (Tim Farron) about us needing to understand the volume, not just the hours. There is much more to do.

The previous Government’s plan for water introduced the water restoration fund, which channelled environmental fines and penalties into projects that improve the water environment. Ministers in the previous Government also took action to ban water company bosses’ bonuses for illegal action. Sir Jon Cunliffe’s independent review was a serious undertaking, running to 460 pages and 88 recommendations, much of which His Majesty’s official Opposition have cautiously welcomed. For example, we know that, as it stands, the regulators are not working as they should, and that creating a single joined-up regulator is a sensible recommendation. However, I am concerned at both the speed at which the Government are moving and some of the proposals in their White Paper, which may see bills rise for families. Can the Minister confirm how many of Sir Jon’s 88 recommendations were accepted by the Government and included in the water White Paper?

On water bills, what assessment has the Minister made of how smart metering may impact the average family’s water bills? Secondly, after the benefits of water metering, what additional hit to disposable income does the Minister expect that increasing bills will have on families, coming, as it will, on the back of record tax rises by this Government? Thirdly, can the Minister tell us how much taxpayer and bill-payer money has been allocated to their White Paper, and over what timeframe those taxes and bills will be used to pay for the work in it?

To reduce the root causes of pollution, the Government have announced that they intend to implement pre-pipe solutions—which have been discussed in this debate—but have not yet provided any examples of how those will be implemented. Can the Minister provide further details on the implementation, and particularly how it will be integrated into the planning system? The Minister knows that since being elected, I have been calling for schedule 3 of the Flood and Water Management Act 2010 to be enacted, first in my Adjournment debate on flooding in Bedfordshire, and also through the Environmental Audit Committee, which recently recommended doing so. The Minister at first seemed sympathetic to the arguments, but now seems to consider that there are other ways to achieve the same outcome. Could the Minister highlight what those other ways are?

Our infrastructure is ageing and needs investment. That is abundantly clear to communities in the south-east now suffering repeated and unacceptable supply disruptions. How will the Minister make sure that the infrastructure is upgraded to ensure that those catastrophic failures, such as those seen under South East Water in the last two months, do not happen again? A glaring gap in the Government’s rhetoric on water is conserving and ensuring water security. That means improving supply. How and when will the Government improve water security?

It is important that in the efforts to reform the water sector, all stakeholders are engaged in the process. That includes farmers, and I was pleased to hear hon. Members today talk about the importance of engaging with farmers. Early last year those farmers had the rug pulled from under their feet when the Government suddenly halted applications to the sustainable farming incentive scheme. The SFI scheme rewarded farmers for adapting land management practices to reduce pollution, manage water flow and improve water quality. We are almost a year on from the closure of the SFI, and the Government—despite promising details on a new scheme last summer—only announced in January this year that a new scheme would open in June. Does the Minister not appreciate that farming is an occupation that requires long-term planning and certainty, particularly when so many other aspects, such as the weather, are left to chance?

In another potential blow to farmers, the Government have confirmed that they are considering whether environmental permitting should be extended to cattle farming, when this was not included as a direct recommendation in the independent review. As National Farmers Union vice-president Rachel Hallos said:

“Such a change would have a direct impact on farm business growth”.

The beef sector is already struggling with increasing costs and higher taxes imposed on them by the Chancellor, so how does the Minister intend to ensure that it does not face another new cost pressure? Is she engaging with it to listen to its concerns?

Many of my constituents care deeply about water quality and security. They are quite simply fed up that their water bills are increasing while water companies are failing to clear up their waterways. Given the Government’s habit of missing their own deadlines in the first 18 months of this Parliament, will the Minister give an iron-clad commitment that the transition plan will be published in parliamentary time this year? Will she clarify how long the transition will take? As she knows, and may well repeat to me, people voted for change and expect it, especially in our water sector. They demand that the Government move faster.

10:44

[The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Emma Hardy)]

It is a pleasure to serve under your chairmanship, Sir Jeremy. I thank the hon. Member for West Dorset (Edward Morello) for securing this debate, and I am grateful to everybody who has spoken in it. I welcome the hon. Member for Mid Bedfordshire (Blake Stephenson) to his place. I enjoyed listening to his first contribution from the Front Bench.

Before I get into the debate about water, I want to say a few words about flooding. There is obviously still a major incident classification in Somerset—I am going there after this debate—and that remains a concern. There are reports of flooding to about 300 properties, mostly in Somerset, Dorset, Devon and Cornwall. The Environment Agency flood defences have helped to protect about 16,200 properties from flooding, but it is still a difficult situation. There is still heavy rain across England, and it has continued in the south and south-west. I want to put on the record my thanks to the Environment Agency, the emergency services and everybody else, and I give my absolute sympathy and support to anybody impacted by the flooding.

As a trade unionist, I echo the comments made by my hon. Friend the Member for Doncaster East and the Isle of Axholme (Lee Pitcher). The anger that the public feel towards water companies must never be directed at the people working for those companies, who are often the ones out there fixing the broken pipes and dealing with the sewer overflow. I remain concerned by reports from the unions about how they have been treated by some. Anger at the industry should never be directed at the people working for it.

I am delighted to say that we have set out our vision for water through the White Paper, which was published last month. It outlines how we will work together with water companies, communities and the environment to transform our water sector and ensure a sustainable water system for future generations. It will drive forward the transformatory change that we need.

I pay tribute to the passion of my hon. Friend the Member for Shipley (Anna Dixon) on this topic. She lobbies me not only publicly, but over coffee in the Tea Room and in the corridors, too. She is genuinely committed to this, and I thank her for her work. She is right to say that we have banned £4 million of bonuses, and she spoke about the Public Accounts Committee’s report, which highlighted regulatory failure. The White Paper mentions sustainable debt and what that might mean. The regulator is bringing the economic environment together. My hon. Friend rightly highlighted the need for skills; we are looking at how to appoint the people we need. She is right that statutorily those organisations need to continue to do their job and hold companies to account, but we need to create a shadow organisation working at the same time. Until we actually change the law, those organisations will still have all the powers.

I look forward to meeting the hon. Member for North Herefordshire (Dr Chowns) to talk about the River Wye. I will come on to talk a little more about the environment.

I thank my hon. Friend the Member for Cannock Chase (Josh Newbury) for his work on the EFRA Committee. He is right that we need more of a joined-up approach. Asset health is a massive issue, as people in Tunbridge Wells know only too well. I was shocked when I came into this role and was told that companies do not even know where some of their assets are. That is absolutely basic.

The right hon. Member for Islington North (Jeremy Corbyn) and my hon. Friend the Member for Cannock Chase talked about environmental pollution, which is a huge issue. On 27 January, I met members of DEFRA’s Addressing Pollution from Agriculture programme, which I have mentioned in this Chamber before. They include representatives from farming, environmental groups and water companies. My idea was to bring everybody together so that they could hear from one another—the environmentalists from the farmers, and the farmers from the water companies—on the question of how we are going to address the challenge of environmental pollution.

For some farmers, I think there is a question around education and understanding the right way to do things. I do not think they go out there to cause pollution deliberately. The question is, how do we work with them to solve this issue? On 27 January, I met them side by side with the Farming Minister, my hon. Friend the Member for Wallasey (Dame Angela Eagle), to talk to them about this issue. Every four weeks until the summer, they will meet to say, “What can we do about agricultural pollution as one of the main sources of pollution?” Rather than me talking to the environmentalists and the Farming Minister talking to the farmers, we prefer the collaborative approach of having everyone talking to one another about how we solve the problem. That is the approach we have taken. When there is more to say on the outcomes of the group, I will report that back to the House.

I know that my hon. Friend the Member for York Central (Rachael Maskell) is passionate about this issue. In fact, my very first visit as Minister was to see the River Foss barrier. I am so pleased that she mentioned the issues around chemicals and the increasing awareness of PFAS—per- and polyfluoroalkyl substances—what is happening with chemicals and the need to look at the thresholds for levels of chemicals in the water. I will definitely ask the University of York to send me information on its Ecomix work and its AQuA project to see how it is doing that.

My hon. Friend the Member for North West Leicestershire (Amanda Hack) brought to life horrific experiences of flooding and how devastating flooding is for people’s mental health. We need to look at what can be improved. Obviously, if there are any concerns about water companies not giving her the information on what will be improved in her area and where, I am more than willing to follow up on that.

People who know me know that I get very excited about regional planning, and this Chamber is the place to be excited about regional planning. The White Paper talks a bit about what we are going to do, but I will give Members a heads up on what I am doing tomorrow: I have the first meeting of the steering group looking at regional planning. The group comprises catchment partnerships, the Environment Agency, local authorities, Ofwat, National Highways—of course, one of the concerns with water pollution is run-off from our highways—the NFU, Wildlife and Countryside Link, water companies, the Rivers Trust, Blueprint for Water and internal drainage boards. I have probably missed one.

We are bringing everybody together to determine where around the country we will have the early roll-out of out some of these measures. We want to determine how Sir Jon Cunliffe’s regional planning model will apply to different catchments, depending on whether they are coastal and whether they include rivers, and how this will work in practice. I cannot remember which Member it was, but someone said that we do not seem to be in favour of nature-based solutions. Clearly, they have never heard me talk about my passion for nature-based solutions, because that is simply not true. The idea is that we are looking at the pre-pipe stuff—the nature-based solutions—in regional areas. In different areas around the country, those boards will have slightly different compositions, depending on the type of catchment.

[Anna Dixon]

Will the Minister assure the House that the regional planning for water catchments will have a strong citizen voice embedded in it, as well as drawing on evidence and expertise?

[Emma Hardy]

Absolutely—evidence and expertise. We are yet to work this out. As I said, the composition will depend on the catchment. In the White Paper, we referred to “community voices”, which we want to represent.

[Alison Bennett (Mid Sussex) (LD)]

Will the Minister give way?

[Emma Hardy]

With respect to the hon. Lady, I do not believe that she was in this debate from the start.

[Sir Jeremy Wright (in the Chair)]

I am grateful to the Minister. It is of course up to the Minister to give way to whoever she wishes to, but she is perfectly right. The hon. Member was not here for the vast majority of the debate, and it is not courteous to the House, to this Chamber or to those who have participated in the entirety of the debate for her to seek to intervene at this late stage.

[Emma Hardy]

I turn now to regulation and the case for establishing a new single water regulator. As mentioned, that has to go alongside continuing what we have at the moment. Fundamental reform of water regulation is required, bringing together the economic and environmental planning, and looking at a singular accountable improvement body and enabling a whole-firm view of water company performance. The Liberal Democrat spokesperson, the hon. Member for Westmorland and Lonsdale (Tim Farron), called it phase 2 or round 2 —I am not sure what the right phrase is, but we will be back with further legislation. This is absolutely what we need. We are looking at a chief engineer being embedded in the new regulator, ensuring companies focus on fixing crumbling pipes, treatment works and on engineering expertise—it is shocking that we have not had engineering expertise. We are looking at greater stability, transparency and protection for customers.

Until then, existing regulators must retain their full legal powers and responsibility. However, the Government are determined to ensure that the future regulator does not inherit the problems of the past. Leadership appointments for the new regulator, including a chair designate, will therefore be made at the earliest opportunity, and they will drive the design and direction of the new regulator to support a smooth transition. Before that, early steps are now being taken to look at joining up regulatory activity, particularly between Ofwat and the Environment Agency, until the new regulator is established.

[Charlie Maynard]

We have four minutes to go, including a wind-up speech. I wonder whether the Minister is going to get to my point.

[Emma Hardy]

I will, but I would like to say— I hope this is felt by all Members across the House—that I am extremely accessible as a Minister and always willing to meet people, so I do not like having my integrity questioned. The hon. Gentleman should know that I responded to a letter from him on that very issue on 12 January. If he has not received it, he is welcome to come and see me, but to imply that I have ignored his request is false.

[Charlie Maynard]

I apologise.

[Emma Hardy]

Thank you. Where was I? We are putting customers first. We want to end the steep, huge hikes that we have seen in bills and make sure that that never happens again. We have introduced our customer panels. We have just seen the first of those happening in South West Water, and they are being run by the Consumer Council for Water. We are listening to customer voices and making sure that they are at the heart of water companies. We need to do more. The water ombudsman will help to restore the balance, but fundamentally, we want customers to feel that they are listened to, are at the heart of this and are important. Having the customer panels and strengthening the ombudsman will make the processes around customers’ experiences much better.

On bills, we are about to respond to our consultation on WaterSure. How do we make water more affordable for people with disabilities, with large families, and for people who have a health need and therefore need to use more water? We are doubling the social tariff support and holding companies to the commitment to end water poverty by 2030.

Water meters were mentioned, and they can help huge numbers of people save money. I encourage everybody to talk to their constituents about that. I remember speaking to an elderly lady who was on her own, and she told me that she was really worried that her bill would go up with a water meter. I said, “How many bedrooms do you have?” She said, “Three. It is a family home, but the kids have moved out.” I told her that her bill would be less if she got a water meter. The great thing about water meters is that they can not only save money, but help us think about our water use, and they can support the environment.

There is a section in the White Paper on water security—it is an important issue for us—that looks at making sure we deal with the growing demands being placed on our system. How much water do we need for the homes that we want to build and for businesses and growth? How much water do we have? How do we address the gap? There are exciting things around thinking about sustainable urban drainage, water use, building regulations and how we use grey water harvesting. All these things must inform our thinking. In fact, tomorrow I am talking to the Lords Environment and Climate Change Committee about drought, and water management is one thing that is related.

This Government are committed to delivering lasting change, restoring confidence and ensuring resilient, sustainable water systems that work for customers, the environment and future generations.

[Sir Jeremy Wright (in the Chair)]

I call Edward Morello, who has less than one minute.

10:59

[Edward Morello]

Thank you, Sir Jeremy, for your excellent chairing of this debate. I thank all hon. Members who have spoken today—too many to name in the time that I have. It is clear that everybody is echoing the same thoughts: the public anger at the dividends and bonuses, anger at the lack of investment and anger at the high water bills. Everybody has raised the ownership structure, which needs reform, and additional support for farmers. I thank the Minister for her response and for going straight from here to Somerset. I again extend an offer for her to visit West Dorset at her earliest convenience.

Question put and agreed to.

Resolved,

That this House has considered the Independent Water Commission Final Report.