Water Companies: Fines

Earl of Effingham Excerpts

Thursday 6th February 2025 Lords Chamber

[The Earl of Effingham (Con)]

My Lords, I thank the noble Baroness, Lady Grender, for securing this important debate. I also thank the noble Baroness, Lady Jones of Moulsecoomb, because she highlighted the work of Windrush Against Sewage Pollution. I had no idea she would make this reference, but the River Windrush runs through the village I live in.

I believe that under our watch we committed to cracking down on pollution by water companies. We continue to work collaboratively and constructively with the Government to help guarantee that the country has effective measures in place both to tackle water pollution and ensure that water companies are properly held to account when they do not abide by the rules.

It will not surprise the Minister to hear that we believe government can always do better, whether that is His Majesty’s Official Opposition or the current Administration. We are proud of our record. We increased the number of storm overflows monitored across the network from 7% in 2010, to 100% today. The Thames Tideway Tunnel is now complete—a £4 billion project that happened because we stood up to opposition to guarantee the scheme by an Act of Parliament.

Aided by improved monitoring, we took firm action against persistent polluters, delivering the strictest targets ever for water companies to reduce pollution from storm overflows. The Environment Agency can now use new powers to impose unlimited penalties for a wider range of offences. On that note, how does the Minister plan to ensure that the Environment Agency will chase all perpetrators? I understand, from a freedom of information request, that there remain outstanding around 465 illegal sewage charges that the Environment Agency is aware of, none of which has led to fines or enforcement action beyond warnings. Will the Minister commit to act on these?

We agree with His Majesty’s Government that much more must be done to tackle water pollution, which is why we have engaged constructively on both their Water (Special Measures) Bill and the wider review and legislation to which they have committed. My understanding is that the wider review will be completed this year and that the Government will bring forward the resultant legislation in 2026. Can the Minister confirm that this is still Defra’s expected timetable?

At this point, I should say that we are disappointed that we have been unable to secure agreement with His Majesty’s Government on the amendment put forward by the noble Lord, Lord Roborough, to strengthen parliamentary oversight of the remuneration and governance rules which will be established under the Water (Special Measures) Bill. I know that my noble friends Lord Roborough and Lord Blencathra will continue to work constructively with the Minister on that.

As mentioned by the noble Baroness, Lady Grender, my noble friend Lady McIntosh, the noble Baroness, Lady Jones of Moulsecoomb, and the noble Earl, Lord Russell, we established the water restoration fund in order to ensure that water company environmental fines and penalties are ring-fenced to directly improve our water system and prevent sewage overflows. Does the Minister agree that the water restoration fund, for spending on freshwater recovery, will help improve the quality of water in the UK? Can she please give a commitment today, as other noble Lords have requested, that all fines levied against water companies will go directly into the fund?

When this was debated in Committee on the Water (Special Measures) Bill, the Minister recognised that it was the previous Government that had established the fund in 2024 but she was unable to give your Lordships’ House more detail because the Government are still working on their spending review. Can the Minister please give the House an assurance that we will not be waiting much longer for these details?

The Environment Secretary from the other place has written to the chief executives and chairmen of every water company, setting out the performance improvements that he expects in 2025. Can the Minister say what percentage benchmark of improvement on sewage spills the Government will insist the water companies have to meet before they face fines and repercussions for non-compliance?

To finish, I thank the Minister for her tireless work to tackle this issue. We look forward to hearing her response on this most important subject.