South West Water: Performance

Ruth Jones Excerpts

Tuesday 28th February 2023 Westminster Hall

[Ruth Jones (Newport West) (Lab)]

It is a pleasure to serve under your chairmanship once more, Sir George. I am grateful for the opportunity to speak in the debate. I congratulate the hon. Member for East Devon (Simon Jupp) on securing it and for raising such important issues in his opening remarks. I also congratulate the hon. Member for Tiverton and Honiton (Richard Foord) on raising important points, and I welcome him as a new friend to the Opposition Benches.

In a nutshell, we have a water crisis in this country. People up and down England are simply and rightly sick and tired of the impact that sewage discharges continue to have on our streams, rivers, seas and local economies. They are sick and tired of leaks, burst pipes and poor-quality water. It is clear to all of us that Ministers need to get a grip of this crisis—sooner rather than later.

Today, we have had the opportunity to look at and address the evidently poor performance of South West Water. Colleagues will know that Ofwat—the regulator—and the Environment Agency publish annual reports measuring water companies’ performance against their performance level commitments and environmental obligations. In their most recent reports covering performance in 2021, both regulators gave South West Water their lowest performance rating. As we have already heard, that is a matter of huge concern for the hon. Member for East Devon. It is also of concern to my right hon. Friend the Member for Exeter (Mr Bradshaw) and my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard). They who would have liked to have been here but, due to prior commitments, they are unable to attend.

South West Water was also criticised for a lack of capital investment, as has been mentioned. Across the water sector, poor planning, a lack of investment and neglect of our vital infrastructure has left us with a system that leaks more than a trillion tonnes of water every year and spills raw sewage into our natural environment hundreds of thousands of times a year. As a result of Ofwat’s assessment, South West Water will be required to pay a fine of £13.3 million in the form of lower bills for consumers. The repeated and unacceptable failures of water companies are devastating whole regions in England, our coastlines, and the livelihoods and health and wellbeing of our people.

[Richard Foord]

Let me show the scale at which this affects the region. Does the hon. Lady know that there are more than 350,000 hours of dumping in South West Water’s areas, including on to our prestigious blue-flag beaches, three of which are among the 10 most affected beaches in Devon?

[Ruth Jones]

I did know those figures, but I am grateful that the hon. Gentleman has put them on the record so that I do not have to.

Last week, we had an urgent question in the House from the right hon. Member for Romsey and Southampton North (Caroline Nokes). Again, we had Ministers making empty promises and the same old tired excuses. The failure of Ministers to act means that the water companies know that they can laugh all the way to the bank. Why? Simply because the Government are not stepping up to show the required leadership. All the while, local people are suffering, whether that is because they cannot enjoy their local beauty spots or take a walk down the river, or because of the effect on the coastal businesses that are reliant on seasonal tourism to provide jobs, opportunities and livelihoods.

[Anthony Mangnall]

I can think of 56 billion reasons that show that the Government have acted on this issue: they have required £56 billion of investment from our water companies. I will not be the first to defend water companies, but does the hon. Lady not think that goes further and faster than the action any other Government have taken in the last 20 years, let alone the last 50 years?

--- Later in debate ---

[Ruth Jones]

I gently say to the hon. Gentleman that there has been 13 years of Tory government.

[Anthony Mangnall]

Is that enough?

[Ruth Jones]

I am just saying to him that it has been 13 years, and what have we seen? We have not seen the improvement we need, which is why we are scrutinising the situation. That is our job and we will be doing that diligently.

Local people are on the frontline. They are the folk who have to manage the effects of Tory Ministers’ inaction, which is important because water shortages are exacerbating over-stressed and polluted water suppliers. The system is creaking at the seams with over 1,235 Olympic-sized swimming pools-worth of water leaks last year alone. Plugging the leaks will require £20 billion of investment and Ministers must make the water companies, including South West Water, act now.

The hon. Member for East Devon talked about what the Environment Agency can do and its need for more resources. I am glad that he has recognised that need because a lack of resources has left the Environment Agency unable properly to scrutinise the practices of water companies. I hope the Minister will to touch on how she thinks the scrutiny of their practices can be improved.

It is unforgivable that rivers in England are essentially being used as open sewers. Not one river is in a healthy condition, with none meeting good chemical standards and only 14% meeting good ecological standards. That is the record of 13 years of Tory government. The people of the south-west deserve action but, more than that, they need and deserve clean water. The Minister’s Department is full of brilliant civil servants, but, with a lack of ministerial direction, no progress has been made on delivering good ecological status in 75% of English water bodies by 2027.

I am grateful to the hon. Member for East Devon for bringing this matter to the House and I say to him that, in the Labour party, he has an ally in calling for action and real change. Under a Labour Government, we will see the water companies held accountable and services improved. We are watching, and we are waiting for action. If the Tory Ministers will not act, they need to get out of the way, because we will.

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

It is a pleasure to serve under your leadership today, Sir George. Of course, I would like to begin by thanking my hon. Friend the Member for East Devon (Simon Jupp) for bringing the subject of the performance of South West Water to us today. I know that many colleagues have been waiting to express their views, and we have heard them very clearly from Members today. There are others, I know, who could not make it, but who would very much reiterate some of the things that we have heard. I also must thank my hon. Friend for approaching the issue in an incredibly measured way. It is very serious, so I thank him for that.

As hon. Friends and Members will know, I make absolutely no secret about my disappointment with the poor performance of South West Water and the impact that it has had on the environment. It is very serious, and I met with the CEOs of all of our lagging water companies—basically those with poor performance—back in December, and had a specific meeting with the chief executive officer of South West Water in January. I have made it very clear that we need to see rapid improvement in their performance. We have all the data, whether it is about pollution incidents, storm sewage overflows, leakage, and so forth, so, rest assured, I am in really regular contact over this issue, and I do think we are making some progress.

The data is stark. South West Water has been one of the worst-performing water companies due to its high levels of total pollution incidents, which were, as has been pointed out, significantly above the industry average for total pollution incidents in 2021. It is completely unacceptable in this day and age, and I have made it very clear that urgent steps must be taken to tackle that.

I did want to say, though, that, actually, there are some positive actions being taken by South West Water, and indeed all of our water companies. We need them to be effective, and doing the job they are there for, to provide clean and plentiful water. I must say that I welcome South West Water’s steps to deliver its WaterFit project. That is a £45 million shareholder investment launched in April 2022 to reduce storm overflow discharges, alongside its existing £330 million investment in waste water.

I recognise, also, its success in putting in 100% of its event-duration monitors to track storm sewage discharges in the south west. That is something that we have asked all water companies to put in, but it is ahead of the game, so we will know exactly what is happening. Data is all, in this situation.

I would also say that it is all very well for Members of the Labour party to stand up there, and be seen to be more righteous than others, but, in fact, their record on putting in any kind of monitoring was virtually non-existent. Some 5% of monitoring for storm sewage overflows went in place in 2016, started by this Government. It is 90% covered now, and it will be at 100% by the end of this year, so we will really be able to see what is going on, and then action can be taken.

[Ruth Jones]

I thank the Minister for giving way. While we all agree that data is crucial, there is the “So what?”—never mind the Ofwat—question. With all the data, what are the Government doing about it? It is action, not data, that we need.

[Rebecca Pow]

I thank the hon. Lady for that. I was going to mention it later, but what I was going to say was that it is a shame that the Labour party does not actually look at what is going on. It has been referred to by all of our colleagues. In the water industry we have the most significant project and spend that has ever taken place, directed by this Government, to tackle this whole issue once and for all. I am happy to share the very extensive list of things that are taking place and that will set us absolutely on the track we need to be on.

Also, however, I am a little concerned that we do not want to mislead the public. There are some wonderful bathing waters around the south-west and I, too, love swimming off the coast there. Last year, 93% of our bathing waters, which are mostly off the coast, were classed as good and excellent. That is an excellent record, and it has only improved under this Government. We should not forget that. Obviously, we have to make them all perfect, but this Government have a good record.

To go back to the Labour party, it is all very well for Labour Members to spout on about what they would do and what we are not doing, but the EU took the Labour Government to court over the state of water and they still failed to act. We need to look back at others’ records—we are the Government putting things right.

South West Water has now committed to reducing its average number of discharges through overflows to 20 per year by 2025. That is definitely a step in the right direction, but the public clearly want to ensure that that happens, and we will be on its case. I have also been assured that by continuing on its current trajectory, the company will deliver the absolute lowest number of pollution incidents in the sector by the end of this year. Innovative solutions are being brought forward to include drought resilience in the south-west, which has also been touched on. That is clearly very important.

To be clear, we need our water companies to improve in the way that we need them to, and to be successful, because we want them to stand as successful businesses that people want to invest in. We need that huge investment in the industry, so we want to see the companies operating correctly. That is why we have all the strict measures and Ofwat as the competent regulator, which I will get on to in a minute. Where performance does not improve, the Government and the regulators will not hesitate to hold water companies to account, including South West Water.

The Environment Agency is focusing on South West Water permit compliance. It is prioritising high-spilling storm overflows for investigation. South West Water has now installed the event-duration monitoring I mentioned on all its sites, bar six or seven complicated ones, which will be under way. Since 2015, the Environment Agency has brought 56 prosecutions against the water companies more broadly, securing fines of more than £142 million. As the House is aware, following South West Water’s guilty pleas, on 29 March it will be sentenced for 13 criminal offences that took place between 15 July 2016 and August 2020. It is certainly being held to account.

Ofwat, as the economic regulator of the water industry, will play its role in holding companies to account for not meeting their commitments. Rightly, since South West Water has been shown to be such a poor-performing company, Ofwat required it to present its improvement plan setting out steps to improve performance. As touched on today, South West Water will have to return £13.3 million to customers as a result of not meeting water performance commitments, including those on pollution incidents.

The hon. Member for Tiverton and Honiton (Richard Foord) made a blatant comment along the lines of, “Let’s get rid of Ofwat”, but that is too simplistic. As was said by my hon. Friend the Member for Newton Abbot (Anne Marie Morris), we need to ensure that the regulator, too, is functioning absolutely to its right capacity. Given that, in our strategic policy statement last summer, we put the environment at the top of the agenda, Ofwat has to ensure that clean and plentiful water is provided, and to demonstrate that that is not have an adverse impact on the environment. Customer service is obviously right up there as well.

In 2019, Ofwat asked companies to link executive pay to delivery for customers—yes, we might have thought that that was there already, but it is now. Similarly, Ofwat is exploring ideas and other options relating to dividends and pay. That includes changes to companies’ licences or ensuring that fines for misdemeanours come out of dividends and do not impact customers. I think that is what my hon. Friend was getting at. This is all on the radar, and she is absolutely right that it has to be fully functioning.