Water Companies: Environmental Pollution

Lord Sikka Excerpts

Tuesday 19th July 2022 Lords Chamber

[Lord Benyon (Con)]

I will have a look at the lexicon we use. The real problem is illegal storm overflows. There have been overflows from our sewage systems into our rivers for centuries. It has reached an unacceptable level, which is why we have set out a clear plan for dealing with it. Perhaps we need to use better terminology. There are permitted storm overflows and there are illegal storm overflows.

[Lord Sikka (Lab)]

My Lords, Section 172 of the Companies Act 2006 requires directors to have regard to the interests of customers, the community and the environment. The UK does not have a central enforcer of company law, and Ofwat is not concerned with compliance with company law, so the buck must stop with the Government. Can the Minister explain when his department last investigated the conduct of water company directors and what the conclusions were?

[Lord Benyon (Con)]

Ofwat is the main regulator in this area, as well as the Environment Agency. The Government give very clear directions to Ofwat. In our strategic policy statement for Ofwat, we set out an expectation on water companies, including making

“a progressive reduction in the adverse impact of discharges from storm overflows”

including reducing their frequency and volume. The noble Lord made a point about the existing sanctions. We recently saw a fine of £90 million against one water company. We want to make sure that continued sanctions are going to bear down on this problem. That is why we have asked the Sentencing Council to carry out this work.