Water Companies: Regulation and Financial Stability

Jim Shannon Excerpts

Wednesday 23rd October 2024 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

It is a real pleasure to serve under your chairship, Mr Pritchard. First, I thank my friend the hon. Member for Westmorland and Lonsdale (Tim Farron) for tabling this debate. I think it is fair to start my contribution by also welcoming the Labour Government’s statement today in the House. It is certainly a step in the right direction, and we should welcome it and the objectives behind it. The Minister will be glad to know that I am going to give a Northern Ireland perspective. She has no responsibility for Northern Ireland, so I require no response from her, but I make the point anyway, because what has happened in Northern Ireland is very similar to what is happening to the hon. Member for Westmorland and Lonsdale, and I want to make that comment for Hansard.

In Northern Ireland, we have a very different system. Northern Ireland Water is actually a Government-owned company. Though we have a different system, we have the same issues. The Government-owned company says it does not have enough funding and needs a massive uplift to function. Measuring the funding needed to bring things up to scratch feels like turning a tap on—it just seems to run forever and we are never sure we can get to the end of it.

Where are we with this issue in Northern Ireland, and why is it important that we in Northern Ireland unfortunately share the problems that have been identified in this debate? The water and sewerage network in Northern Ireland needs some £1.2 billion in capital investment; that cannot be achieved in the short term. We have approached the Government—though that is a debate for a different day—on Barnett consequentials to ensure that we get the same funding equation as they do in Wales, for example, which would give us extra money to identify the issues. The Department for Infrastructure has indicated that some half a billion pounds has to be found for 2024-25. That is a big target.

The hon. Member for Westmorland and Lonsdale underlined the issues. Northern Ireland Water reported a £185 million shortfall in funding. Some 19,000 new properties, or nearly 50% of all applications, have not been connected to the main sewer system, which means that development companies and housing associations have to find the money to do that themselves.

What really annoys me is the large bonuses and the dividends for shareholders. I believe them to be obscene and immoral. The failures of water companies to deliver a reasonable service must be highlighted in this debate. It is important that we understand the nature of this debate and how it affects devolved matters, for different reasons and with different accountability.

The news that United Utilities repeatedly dumped millions of litres of raw sewage into Lake Windermere illegally is shocking, yet we are not really surprised. Only 31% of surface waters in Northern Ireland are classed as having good ecological status. That may be better than in some parts of England, but it is still not good enough.

We must tighten controls, but we must also try to ensure better value for money, as it is clear that the way things are in our water services throughout this great nation cannot continue much longer. When the Minister responds, I ask her for cognisance of the need for a UK-wide solution that includes the devolved nations. When there is crisis and that crisis is developing, it is important to find a solution. We take our clean water for granted in the UK, but we may not be able to do so for much longer unless we give this issue the priority it deserves. That must start today, in this House.