Water Companies: Pollution

Baroness Hayman of Ullock Excerpts

Wednesday 2nd November 2022 Lords Chamber

Asked by

[Baroness Hayman of Ullock]

To ask His Majesty’s Government what assessment they have made of the decision by Ofwat on 3 October to penalise 11 water companies for failing to meet their targets, including on pollution incidents.

[The Minister of State, Department for Environment, Food and Rural Affairs (Lord Benyon) (Con)]

My Lords, the Government welcome this robust regulatory response from Ofwat where water companies are underperforming. It provides a great example of strong environmental and economic regulatory frameworks in action. The penalties to these 11 water companies were the result of missed performance commitments on areas such as water supply interruptions, pollution incidents and internal sewer flooding. The Government will continue to work with regulators to hold companies to account on their environmental and other commitments.

[Baroness Hayman of Ullock (Lab)]

My Lords, the Minister just mentioned that the 11 companies fined by Ofwat missed targets in a number of areas: water supply interruptions, pollution and internal sewer flooding. The problem is that these performance commitments do not set the bar particularly high, which makes it extremely worrying that so many companies are falling short, some by a considerable distance. Does he believe that the current sanction, which sees failing companies having to repay customers a proportion of their bills in future years, is enough to bring about the improvements that we so desperately need? With this in mind, how does he respond to the suggestion by Ofwat’s newly appointed chair, Iain Coucher, that the regulator should be granted powers to debar the directors of egregious water companies?

[Lord Benyon (Con)]

I take what the noble Baroness says about the level these sanctions are set at. If she thinks that there are areas that could be improved on, we will work with Ofwat to do that. She talks about this as though it is the only area of enforcement. Where water companies have failed to achieve their environmental standards and illegally pumped sewage into rivers, enormous fines have been applied, which have had a dramatic impact on the amounts of dividends that they have been able to award.