Water sector investment plans ‘still fall short’ on action needed – green groups

The water sector’s plans to invest in solutions that tackle England’s water crisis “still fall short” of the action needed, campaigners have warned.

A coalition of nature groups, including Wildlife and Countryside Link, Rivers Trust, The Wildlife Trusts and Angling Trust, analysed water company business plans for the next five years.

It comes after years of underinvestment, a growing population and extreme weather caused by climate change have led to intense pressure on England’s ageing water system, causing widespread flooding, supply issues, sewage pollution and leakages.

Industry watchdog Ofwat recently gave draft approval of the water companies’ plans to spend £88 billion from 2025 to 2030.

Ofwat has told water companies that over the next five years they can spend £35 billion on initiatives to tackle pollution as well as boost water quality, climate change resilience and customer service.

The money is triple the level of investment in the previous five years and almost all companies have pledged to achieve zero serious pollution incidents by 2030.

The campaigners welcomed the commitments and funding increases included in the proposals.

But they said they are disappointed that under the plans, spills from storm overflows will still affect 38% of bathing waters and 53% of protected nature areas by 2030.

There are also concerns over company plans relying heavily on expensive concrete infrastructure investment to tackle pollution, water quality and resilience, they said.

The campaigners criticised how only £2 billion of the £35 billion has been proposed for natural infrastructure, such as the creation of reedbeds and wetlands that help to clean up pollution and reduce flooding.

The groups cited research that shows nature-based solutions can be up to 50% cheaper and provide 28% better value for money than traditional “grey” infrastructure.

Elsewhere, the campaigners called for much stricter fines for serious pollution incidents, adding that this money should then be ringfenced for a Water Restoration Fund.

They also urged the Government to introduce a new “green duty” for regulators, meaning the delivery of environmental targets becomes a main driver of their work and decision-making processes.

Ellie Ward, senior policy officer at Wildlife and Countryside Link, said: “Water companies must pay for the pollution they have caused and get our waterways back on track – as homes for wildlife and places where we can relax and keep healthy.

“These business plans still fall short on the action rivers, lakes, streams and coastlines need.

“The Government’s upcoming review of the water sector must help remedy this through tougher monitoring and enforcement, ringfencing fines for nature recovery to ensure water polluters really do pay, and accelerating the use of nature-based solutions to meet environmental targets.”

Ali Morse, water policy manager at The Wildlife Trust, said: “The coming five-year period is a critical one for nature’s recovery, so we need companies to step up their plans.

“This includes working with regulators to ensure more investment in the natural solutions that we know are a truly effective way of cleaning up our waters.” 

Mark Lloyd, chief executive of The Rivers Trust, said: “The report is clear that we are still left largely in the dark about how water company investments will actually add up to improving the state of our rivers, lakes, and seas.

“This cannot continue and we will be calling on the industry, regulators, and Government to be more transparent about how these plans will contribute to achieving our nature and climate targets.”

An Ofwat spokesperson said: “We have received responses on our 2024 Price Review draft determinations from many organisations, including water companies, customers, environmental and consumer organisations, and investors.

“Inevitably these reflect a diverse range of views on the proposals we have made.

“We will consider all of these responses carefully over the coming months and set out our final decisions on December 19.”

A Water UK spokesperson said: “We share campaigners’ view on the importance of using nature to end sewage entering our rivers and seas. In many cases, natural solutions can achieve the same, or better, results than grey infrastructure while enhancing the environment and costing less.

“We want Ofwat to give water companies more flexibility to deploy natural solutions where the evidence suggests they will work better.”

The Environment Department (Defra) said: “This Government has reset the water sector to clean up our rivers, lakes and seas for good.

“Our Water (Special Measures) Bill will create a level playing field through stronger regulation and help secure £88 billion of private sector investment to upgrade our crumbling infrastructure, boost economic growth and create thousands of good, well-paid jobs right across the country.”