Water Companies: Duties and Accountability

Lord Sikka Excerpts

Monday 4th April 2022 Lords Chamber

Asked by

[Lord Sikka]

To ask Her Majesty’s Government what consideration they have given to changing water companies’ (1) duties, and (2) accountability.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Benyon) (Con)]

My Lords, this Government have made it clear that improving water quality is a priority. We have taken significant steps to deliver this, including introducing new duties for water companies through the Environment Act: to modernise water resource planning, reduce harm from storm overflow discharges and make drainage planning statutory. Companies’ licences now require them to meet Ofwat’s board principles to ensure accountability. We will not hesitate to go further if we do not see the improvements that we expect.

[Lord Sikka (Lab)]

My Lords, I am grateful to the Minister for his reply. He may be aware that on 1 March 2018, Environment Secretary Michael Gove said that water companies had

“avoided paying taxes … rewarded the already well-off, kept charges higher than they needed to be and allowed leaks, pollution and other failures to persist”.

Some 49 months later, water companies are still dodging taxes, ripping off customers and polluting rivers. Can the Minister give a date by which these abuses will be completely stopped?

[Lord Benyon (Con)]

The noble Lord will no doubt be pleased by the recent statutory policy statement by Ofwat. It is through the regulator that we ensure that companies perform well, that we do not reward bad behaviour, that we reflect proper accountability for such things as remuneration, and that where bad behaviour is found out, companies receive fines. Those fines do not hit the customer but hit those who would otherwise have received bonuses, and shareholders.