Water (Special Measures) Bill [Lords]

Anna Dixon Excerpts

2nd reading
Monday 16th December 2024 Commons Chamber

[Tim Farron]

I thank the hon. Gentleman for his service in a previous life, as well as in this one. He makes a very important point, to which I will turn in a moment. There is no point having great regulatory powers if we do not have a regulator with the resources to do the job that it needs to do. Nevertheless, regulation could be made better.

Water industry regulation is split between the Environment Agency and Ofwat, and that plainly does not work. We have two inadequately resourced regulators, with inadequate powers, being played off against each other by very powerful water companies that are far better resourced and able to run rings around the very good, but very harassed people whose job it is to hold them to account. I welcome the concession made in the Bill requiring Ofwat to contribute towards meeting the targets of the Environment Act 2021 and the Climate Change Act 2008. That is a step in the right direction because I believe it will be the first time that Ofwat will have proper environmental obligations, alongside its business obligations.

We have received promises, as the Secretary of State set out from the Dispatch Box earlier, that this Government will strengthen Ofwat’s powers in ways that we do not see on the face of the Bill. For instance, Liberal Democrat peers asked the Minister to confirm that the Government would ban water company bosses getting bonuses when their company had had a major category 1 or category 2 sewage incident the year before, and the Minister in the other place said:

“These are the type of circumstances in which it would be highly inappropriate for a bonus to be awarded.”—[Official Report, House of Lords, 20 November 2024; Vol. 841, c. 247.]

That is very welcome, but it is not on the face of the Bill.

I pay tribute to my Liberal Democrat colleagues in the other place, who forensically engaged with the Bill to make it much better. I also pay tribute to the collegiate and constructive manner in which the Minister, Baroness Hayman, worked with them. To be clear, though, the Liberal Democrats would go even further and create a unified and much more powerful regulator, the clean water authority, absorbing the regulatory powers of Ofwat and the Environment Agency, but with many additional powers, including revoking the licence of poorly performing water companies swiftly, forcing water companies to publish the full scale of their sewage spills, reforming water companies to put local environmental experts on their boards, and putting robust, legally binding targets on sewage discharges.

On the issue of discharges, we welcome the change to require data from emergency overflows to be published within an hour of a discharge. That will require companies to monitor all emergency sewage overflows and to ensure that data is reported to the Environment Agency within the hour. To pursue the point made by the hon. Member for Newcastle-under-Lyme (Adam Jogee), my concern is that the Environment Agency is already massively overwhelmed. In my constituency, I see good people working very hard, but with Coniston, Windermere, the River Eden and the River Kent competing for time, attention and resource, as well as the ongoing work of building flood defences in Kendal, it is hard for them to be able to focus.

[Anna Dixon (Shipley) (Lab)]

The hon. Gentleman talks about the Environment Agency being under-powered and under-resourced. With rivers like the River Wharfe, it has clearly failed to address illegal discharges and to enforce the law. Does he, like me, welcome the fact that the Bill will introduce more support for enforcement by allowing the Environment Agency to recover the cost of any enforcement from the offending water companies?

--- Later in debate ---

[Anna Dixon (Shipley) (Lab)]

Anyone who has visited Shipley will know that the River Aire and the River Wharfe flow through the beautiful dales countryside of my Yorkshire constituency, and indeed that of my neighbour, the hon. Member for Keighley and Ilkley (Robbie Moore). I grew up paddling in the Wharfe, and as an adult I enjoy a regular dip. It was therefore a bit of a shock to learn that raw sewage was being regularly dumped in our rivers—some 1,753 times in 2023. I do not think that that is quite top of the poops, but it is not far off.

I pay tribute to the local activists who have done so much to expose this scandal and campaign to protect our environment. The Ilkley Clean River Group has been at the forefront of the campaign to end the sewage scandal. Formed in 2018, through citizen science it has shown that untreated sewage was being dumped in our rivers even at times of low rainfall. The group worked very hard to secure bathing status in 2020—the Wharfe was the first river to do so in the UK—and the group highlighted the public health risk to bathers, but it should not have needed brave local residents to challenge the water companies. The regulators have failed in their job. That is why I am so proud that the Bill will require more frequent and accurate monitoring, and introduce fixed monetary penalties so that companies do not get away with it any longer.

Under the last Government, our water was catastrophically mismanaged. Regulation was weakened, there was a failure to invest in infrastructure, and record levels of sewage were pumped into our rivers and seas. Meanwhile, bosses creamed off the profits and paid themselves in bonuses. Along with others, I call on the Yorkshire Water chief executive officer to hand back her £371,000 bonus. It is clear that change is needed, and change is coming with the Bill. It is long overdue that water companies are held to account and that we put in place the mechanisms to restrict executive bonuses. Many of my constituents, though, feel dismayed that it falls on them to pay the price, quite literally, for water companies’ failures. Customer bills are due to rise 18% next year in the Shipley constituency. Despite having no debt when privatised in 1990, Yorkshire Water has since accrued £6.5 billion of debt; today 19% of customer bills are spent just on servicing that debt.

Under-investment has left my constituency with creaking infrastructure, high bills and polluted rivers. I am pleased that the Government have set up an independent commission on water. To undertake fundamental reform, it is vital that that includes in-depth analysis of the finances and governance structures. Our once beautiful rivers, such as the Wharfe and Aire, are now awash with sewage, and our water infrastructure is leaking. I welcome the Bill, and the measures that it sets out to deal with the crisis in our water industry.