Water Companies: Licences

Lord Cormack Excerpts

Monday 24th April 2023 Lords Chamber

[Lord Benyon (Con)]

It allows us to make comparisons between good and bad performers and to ensure that they are able to operate in the open market and borrow on the capital markets in a regulated way. Dividends are really important because they pay for investment, and very often they are paid to pension companies that invest in these companies. The average dividend is around 3.8%, which is not massive, but we want to make sure we get that balance right. Competition is also in the customers’ interest. Evidence shows that if it had not been for the kind of competition that we have created in the water industry, there would be higher bills for households and less money spent on infrastructure.

[Lord Cormack (Con)]

My Lords, week after week we read about the Wye and other beautiful rivers—they are sewers, in some cases. The question we are constantly being asked is: when can we expect our rivers to run clear and pure? Is it 2040, 2050 or 2030? When can we expect this?

[Lord Benyon (Con)]

We have set out dates by which we will expect to see different levels of improvement. We are requiring water companies to spend £56 billion, and most of that is being front-loaded. The date of 2030 is the first by which my noble friend will be able to see how successful we have been at that front-loading. On rivers such as the Wye, it is not just the water companies but farming that is the problem—a particular type of farming. We have had this debate many times, and action is being taken through the Environment Agency and grants that we are now offering through our environmental land management schemes to correct some of the issues that have gone wrong. We also need to look at planning, which has been part of the problem.