Water (Special Measures) Act 2025: Enforcement

Debate between Emma Hardy and Alistair Carmichael

Tuesday 20th January 2026 Westminster Hall

[Emma Hardy]

I have huge sympathy and support for the hon. Lady and her constituents in the situation that they have faced in the last few weeks and I understand the urgent need for compensation, not just for her residents, but many of the neighbouring constituencies. She mentioned that it is the first time that Ofwat has ever done an investigation into whether a company is still complying with its licence to operate. It is looking at the customer part of the operation licence to see whether or not the company is complying; that is the first time that has ever been done. The Consumer Council for Water is visiting the Tunbridge Wells area to hear direct testimony from people about how they have been treated and how the situation has impacted them. I share the love expressed in the Chamber for the Drinking Water Inspectorate, particularly for Marcus Rink and all the work he does, and the inspectorate is looking carefully into that matter as well.

One of the things that we promised in the Water (Special Measures) Act were powerful new customer panels to ensure that customers are at the heart of company governance. Some first accountability sessions will be held in spring 2026, requiring customers’ views to be taken into account in company decision making and allowing those customers to hold companies to account—one of the many things that was in that Act.

While we are on the situation that the hon. Member for East Grinstead and Uckfield (Mims Davies) faced, I will mention the hon. Member for Tunbridge Wells (Mike Martin), whom we spent rather a long time with over the last few weeks. It is outrageous; my heart sank when I saw Tunbridge Wells and its residents being impacted again after the awful situation that businesses faced in the run-up to Christmas. I am keen for them to receive compensation as quickly as possible. He is right to point out the concerns that we all had about the disinformation that was put out. The need for clear communication to everybody about what is happening is incredibly important.

There are many things from the water White Paper that I would like to highlight. I hope we get a chance in Parliament over the coming weeks to look at some of that in more detail. There is a section on debt at the bottom of page 26 of the White Paper that states:

“We will therefore consider how the regulator can work with companies and investors to ensure companies do not accumulate unmanageable levels of debt”.

There is a direct reference to debt in the White Paper. It is also worth pointing out what it says in the section called “Putting Customers First”. Page 31 mentions

“increasing public access to water for recreation and wellbeing”',

something that I know my hon. Friend the Member for Cannock Chase (Josh Newbury) is really interested in. That is because of the love that there is for the Tyne and how beautiful it is—we want to see people having access to it.

The White Paper mentions the powerful new customer panels as well, and also looks at regulators strengthening the “customer measure of experience”. That is one of the metrics used to judge water companies and we want to strengthen that metric of experience.

Another thing that comes up in debates on agricultural pollution is the effect that it has on the beautiful and stunning River Wye, and which I know is a huge source of concern for my hon. Friend the Member for Monmouthshire (Catherine Fookes). On page 35, we talk about how we will

“consult on reforms on how sewage sludge use in agriculture is regulated and whether this should be included in the Environmental Permitting Regime..”

One of the big focuses and challenges is what the difference would be, if these measures were all in place. One of the many key things is about prevention rather than cure—I know you will understand that analogy very well, Dr Allin-Khan. It is about getting companies to fix things before they break. Around the country, we have too many examples of things breaking before companies recognise that they should be fixed. The MOT work, the engineer and the resilience standards are all about understanding where the problems are and getting in there and fixing them first. Fundamentally, that is cheaper and better for customers, because it costs less to fix something before it breaks and creates a disaster somewhere.

[Mr Carmichael]

I am interested to get the Minister’s view on this subject of the relationship between the Department and companies. She may be aware that the Department is currently appealing to the first-tier tribunal a decision of the Information Commissioner requiring them to disclose information to Democracy for Sale, an organisation run by investigative journalists. DEFRA’s defence is that they have to have a safe space when talking to water companies about these things. I am not expecting her to comment on live legal proceedings, but will she reflect on that, and interrogate her officials when she returns to the Department about whether it is appropriate for the Department to defend such cases where, in this case, the party receiving the obvious benefit is Thames Water?

[Emma Hardy]

As the right hon. Gentleman has noted, I cannot speak about live investigations, but I will reflect on what he outlines.

The hon. Member for Epping Forest (Dr Hudson) mentioned livestock and its importance, something that came up a lot during our many calls. Yes, we need adequate water for people, but there have also been many animals in distress.

We will carry out pilots across the country to look at the new regional regulatory structure and how we are going to make it work. That is a massive opportunity for Members across the House to get involved.

My hon. Friend the Member for Hexham (Joe Morris) was talking about rural communities being supported and ensuring that we have emergency provisions for livestock. In relation to the River Tyne in particular, I encourage him to speak to his water company and find out exactly when it will upgrade those storm overflows, so that he can see tangible progress in his area.

We have also doubled the funding for catchment partnerships, which is great news where we have those, particularly in rural areas. I thank my hon. Friend the Member for Monmouthshire for her work on the Bill Committee and for the work that she continues to do in championing the River Wye. She is quite right that rivers do not obey geographical boundaries, so we have to work together. I put on record my thanks to the Welsh Government for all the work they have done. We have worked together on many different measures and will continue to do so.

I also thank my hon. Friend the Member for Cannock Chase for his work on the EFRA Committee. He is right that there should be clear consequences for failure, and he will be pleased to know that following the Water (Special Measures) Act, the Environment Agency is on track to deliver 10,000 inspections in the year ’25-26. That is a massive increase on the previous year’s 4,600 inspections; we are more than doubling inspections of water companies. We are also doubling compensation because, sadly, we have seen that the doubling of compensation for customers who face supply outages or receive boil notices is desperately needed.

I would like to be in a situation—as we will be when we implement all these measures—where we do not need to compensate customers because we are not continually seeing failure. But until that moment, I will continue to work hard, push on and deliver the changes that the industry so desperately needs.

Financial Inclusion: Rural Areas

Debate between Emma Hardy and Alistair Carmichael

Wednesday 11th December 2024 Westminster Hall

[The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Emma Hardy)]

I congratulate the hon. Member for Frome and East Somerset (Anna Sabine) on securing her first Westminster Hall debate on such an important topic. Debates like this are very conversational; it is always nice when lots of people agree on the same thing. It is heartening when lots of people intervene and everybody agrees, so I thank the hon. Member for drawing attention to these important issues that really matter to the lives of all our constituents.

Ensuring that individuals have access to the appropriate financial services and products that they need, when they need them, is a key priority for the Government. It is an essential part of improving household financial wellbeing and ensuring that everyone is able to participate in the economy and benefit from the Government’s inclusive growth agenda. I recognise that tackling financial inclusion issues is particularly important for residents living in rural areas who face specific geographical challenges in accessing financial services. In today’s debate, we have had good examples of the particular challenges that people face.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

We tend to think of the issue as being principally about people having access to cash, but in communities like mine, where a lot of cruise ships come in the summer, tour guides get tipped in dollars, euros and other currency. For that, they need access to a bureau de change, which in our case is effectively the post office. Having a full range of post office services is particularly important so that they can pay their money in. When the Minister talks to her colleagues in the Department for Business and Trade about the future of Crown post offices, will she remember the range of potential impacts on local communities?

[Emma Hardy]

The right hon. Gentleman has made a good pitch for a cruise ship to visit his constituency. It was a good advertisement, and he made an important point about the role and importance of the post office. I am sure that it will be noted by the Department.

I know that many rural constituencies are concerned about the availability of cash, especially when they rely on it to pay for essential goods and services. We recognise how important that is for many vulnerable people. Arguments have been made by some—not by the Government—that people are using digital more and more, so there is less need for cash. However, we recognise that for some people it is the only way of paying bills and accessing funds. It is important that we continue to have it, because many rely on it for essential goods and services.

Although it is positive that data from the Financial Conduct Authority shows that over 98% of people in rural areas are within three miles of free-to-use withdrawal facilities, I understand the importance of ensuring that cash remains available for those who need it. The Financial Conduct Authority introduced its regulatory rules to protect access to cash on 18 September. In fact, under a previous Government I was on a Bill Committee debating that very issue, so I am pleased that we mandated access to cash.

The rules require the UK’s largest banks and building societies to assess the impact of the closure of a relevant cash access facility and put into place a new service if necessary. That ensures appropriate access to cash for those who need or choose to use it.

Lots of people asked about banking hubs. I should probably declare that I am getting a banking hub in my own constituency soon, which is very exciting. How do people get a banking hub in their constituency? I completely agree about face-to-face banking services. It is not just about accessing cash; it has a wider role to play. If someone is accessing banking facilities, it can be a way to spot financial crime and financial coercion as well, so it is important to have that.

The locations are independently determined by Link, the largest provider of the ATM network. When a cash service such as a bank branch closes, or Link receives a request directly from a community, Link assesses a community’s access to cash needs. A couple of people mentioned how they were not successful in their appeal for a banking hub. If people have already made a community request to Link and it has decided that no banking hub is needed, they can ask Link to review the decision within 28 days of the original assessment, stressing their concerns and evidence. I urge people to take advantage of that appeal process.