Future of Thames Water

James Naish Excerpts

Tuesday 6th January 2026 Westminster Hall

[Monica Harding (Esher and Walton) (LD)]

It is a pleasure to serve under your chairship, Mrs Harris. My constituency is a river community and has been badly affected by the failures of Thames Water, including sewage discharges into the River Thames and the River Mole. That goes to the heart of public trust in Thames Water, or the lack thereof, and exemplifies its failure, as well as the lack of regulation and accountability under the previous Government.

While my constituents bear a 31% increase in their bills, all that goes towards is servicing £17 billion of debt. Yet Walton Rowing Club and the 1st Molesey Sea Scouts found 5,000 colony-forming units of E. coli per 100 ml in Walton, and 12,000 per 100 ml in Thames Ditton. Anything above 900 is classified as unsafe. We need investment in infrastructure, but until the Government take Thames Water into special administration, that cannot happen.

I want to speak briefly about the lived experience of my constituents near Thames Water’s Lower Green sewage plant in Esher, which exemplifies its casual disregard for the public. For decades, residents have endured persistent and unpleasant odours from the site. One resident from Farm Road in Esher described being forced to keep windows shut and avoid outdoor spaces, and worrying about the long-term impacts on wellbeing, air quality and property values. Nobody was interested—not the previous MP, nor Thames Water.

Residents told me that for decades their only interaction was Thames Water vans being driven at speed through the housing estate that borders the treatment plant. Residents’ complaints over decades were met with delay, deflection or silence. That experience is symptomatic of a wider failure: a water company that too often acts only when sustained pressure is applied, and a political class that does not hold the operators to account.

Last year, I met Thames Water representatives directly at the site. Following that visit, the company identified the cause: septicity driven by faulty equipment, which allowed bacteria to build up and produce a foul smell. Repairs were eventually made and preventive measures were introduced. Spare parts have now been stockpiled so that if the fault recurs, it can be fixed immediately rather than after weeks of delay. That should have happened 30 years ago. Residents should not have to wait decades, or rely on “novel” political pressure, for basic maintenance to be carried out.

The issues do not stop there. There have been incidents of sewage appearing on the nearby children’s recreation ground due to hydraulic overload. Thames Water says that this has been driven by changing weather patterns and ageing infrastructure. Again, it needs investment. Investigations after the fact are not enough when people are living with the consequences. It shows a deeply troubling national picture. Thames Water has been rated as a one-star, poor-performing company by the Environment Agency, and this is a firm that serves 16 million people—nearly a quarter of the UK population.

[James Naish (Rushcliffe) (Lab)]

Will the hon. Lady give way?

[Monica Harding]

I have very little time.

Without structural reform, we will continue firefighting rather than fixing. So let us replace the regulator that has failed us, put Thames Water out of its misery and transform it into a public benefit company, putting people, nature and long-term resilience ahead of shareholder payouts.

--- Later in debate ---

[The Minister for Food Security and Rural Affairs (Dame Angela Eagle)]

It is a great pleasure to serve under your chairmanship, Mrs Harris. I do not know whether it is down to you, but it is now much warmer in this room than it was in the last Parliament when I was chairing such debates. I regularly left thinking that I had developed frostbite, so whoever has managed to make that change has done a good job. I thank the hon. Member for Oxford West and Abingdon (Layla Moran) for securing this debate, and thank all hon. Members on both sides of the Chamber for the manner in which they have, very eloquently, made their important points in this debate. It is a pleasure to respond to it on behalf of the water Minister, my hon. Friend the Member for Kingston upon Hull West and Haltemprice (Emma Hardy), who sadly is unable to be here today.

This Government are committed to the transformation of the water sector. As the hon. Member for Epping Forest (Dr Hudson) has just said, the industry is spending £104 billion of private investment on upgrading our crumbling sewage pipes and cutting sewage pollution. Is it not a pity that some of that investment did not happen many years ago? That was promised as one of the advantages of a privatisation that, as many people have said in their various eloquent ways during today’s debate, has essentially not worked. Through the Water (Special Measures) Act, we have driven meaningful improvements in the performance and culture of the water industry, as a first step—only a first step—in enabling wider transformative change across the sector.

Following Sir Jon Cunliffe’s report, we have announced our intention to do three things: establish a new single regulator, create a water ombudsman, and stop water companies from marking their own homework when it comes to pollution. The water reform White Paper, which—I have to tantalise hon. Members—is due very shortly, will set out our vision for the sector. Members will not have to wait very long; that is all I am going to say. That White Paper will form the basis of new water legislation, which we will introduce as soon as we get a place in the parliamentary programme to do so. The reforms will secure better outcomes for customers, investors and the environment, and will make the water sector one of growth and opportunity.

Turning to Thames Water, this Government will always act in the national interest, and we will work to ensure that Thames Water acts in the best interests of customers and the environment. We are working closely with Ofwat, which is in conversation with the London & Valley Water consortium, a group of Thames Water’s creditors. Ofwat will only agree to a plan that will ensure the best possible outcomes for customers and the environment.

[James Naish]

I think it was more a turn of phrase than anything else, but it was suggested earlier that customers were being treated as cash cows for servicing the debt of Thames Water. Will the Minister confirm that that is not the case, either for Thames Water or for other companies, because investment is ringfenced under the new legislation, and therefore customer money is being put into the infrastructure that matters?

[Dame Angela Eagle]

I can confirm that, and it was one of the first things that this Labour Government, when we were incoming, put on to the statute book as a priority, in order to prevent that particular abuse. Thames Water is now under a cash lock-up arrangement; only Ofwat can approve any further dividend payments. That restriction will remain in place until credit ratings improve. Nothing that is happening at the moment will allow the kind of behaviour that we have seen in the past, from this company and others, to continue.