Draft Water Industry (Special Administration) Regulations 2024 Draft Water Industry Act 1991 (Amendment) Order 2024

Wera Hobhouse Excerpts

Tuesday 6th February 2024 General Committees

[Wera Hobhouse (Bath) (LD)]

I hear what you say, Mr Vickers, but we are debating matters that touch on the wider issues in the water sector. The Liberal Democrats will also not oppose the statutory instrument, but I wish to express our wider concerns about the water sector and how it is regulated.

Water company regulation should have three aims. First, we need to protect the water needs of future generations; secondly, we should ensure that the costs of investment in achieving environmental standards are shared fairly; and thirdly, we must ensure accountability and good customer service. Water companies need greater regulation to stop them getting into an administration or insolvency position in the first place.

Government attempts to tackle consistent poor environmental performance from the water industry have not worked. They have failed to address the root cause of the underfunding and under-resourcing of the regulators. There must be a clearer regulatory framework, duties and purposes for regulators, increased funding and greater direction on solutions to protect customers and the environment. New regulations should also guarantee that any special administrator will continue to discharge a company’s environmental obligations, including investment commitments under the water industry national environment programme, catchment plans and infrastructure upgrades.

The proposals before us fail to talk sufficiently about the sewage crisis. There needs to be clarity on whether the Government will allow the special administrator to discharge environmental duties. Will the Minister confirm that the special administration order could be imposed as a sanction for sustained sewage pollution? We Liberal Democrats support a public benefit company model for water companies, so that they must consider explicitly economic and environmental policy objectives in particular. Water companies should also put a share of their profits into social tariffs. I have kept my remarks short. I support the statutory instruments, but whether they really tackle the wider crisis in the water sector is questionable.