I appreciate there is considerable, ongoing lack of public trust in the water industry with some calling for it to be renationalised and I understand the frustrations many people are feeling as household bills continue to rise, amid ongoing cost of living pressures, under this Labour Government.
The difference between water providers and, for example, energy providers in which it may be possible to switch provider to save money is that, under the current system, household customers are not able to change their water supplier or sewerage service provider. The water or sewerage company that supplies your property will depend on where you live and, as a result, is an area we have very little choice over.
There are currently 11 regional water and wastewater companies in England and Wales (i.e. companies providing sewerage services), and a further five water-only companies with domestic customers usually being served by their regional supplier. I understand there are also some specific geographical areas served by small, limited companies (new entrants). Some customers receive water and wastewater services from different companies.
Historically, the privatisation of the water sector has delivered around £200 billion of investment through private finance; a level of investment this country simply would not have seen if the water industry were in public ownership. Pre-privatisation, the water industry was starved of investment as it was forced to compete for funds directly with schools, hospitals and policing, for instance. Quite simply, the water industry was not high up the list of priorities for Ministers. I am, therefore, of the belief that renationalisation would be a backward step that would cost the taxpayer and, given the current challenge to public finances, reduce investment and stifle innovation.
Privatisation has delivered a range of benefits to customers and the environment, including world-class drinking water, excellently classed beaches and improved customer satisfaction, as well as two-thirds reduction in leakage. Since 1989, supply interruptions to customers have decreased five-fold, leakage has been cut by a third, and pollution in our rivers has significantly decreased, with 80 per cent less phosphorous and 85 per cent less ammonia. In addition, our bathing waters continue to improve, with 93 per cent being classified as “good” or “excellent”, which is an increase from 76 per cent in 2010.
I am absolutely not saying that all is rosy in this realm, however, and I hope the Labour Government works to increase these percentages.
As you may be aware, the Government's independent review of the water industry was published on 21 July 2025. The review outlines 88 recommendations and represents one of the most detailed examinations of the water sector since privatisation.
There is much in it that I cautiously welcome, including the merger of the regulators. To echo the comments made by my colleague, Robbie Moore MP, Shadow Defra Minister, in response to the publication, His Majesty's Official Opposition stands ready to work with the Government on serious reform. We will support any action that genuinely holds water companies to account, delivers cleaner waters and protects the public from paying the price of corporate failure.
However, disappointingly, since entering office the Secretary of State for Environment, Food and Rural Affairs has watered down the ambition set by the last Government. For example, the Government has announced that it will cut sewage spills by 50 per cent by 2030 against 2024 levels. However, plans submitted by the last Government were already set to cut sewage spills by 45 per cent against 2021 levels, a tougher reference base. The Government’s new pledge would therefore actually see an additional 20,000 discharges of sewage in our rivers, compared with existing plans. The Secretary of State has failed to explain why, after 88 recommendations and a year-long review of the sector, he has watered down sewage reduction targets rather than massively ramping them up.
Finally, to further mislead the public, the Government is claiming that this Government introduced a ban on bosses’ bonuses. That is simply incorrect. The previous Government introduced the ban on bosses’ bonuses, which the current Government needlessly restated in the Water (Special Measures) Act 2025. Criminal investigations into water companies are directly a result of the last Government’s action in introducing this measure and quadrupling the number of water company inspections.
As you may know, all water companies have a statutory duty to provide a secure supply of water for customers, efficiently and economically and set out how they plan to continue to supply water to their customers through Water Resources Management Plans (WRMPs). These plans are statutory and set out how each company will continue to meet this duty and manage water supply and demand including leaks, sustainably for at least the next 25 years.
In the UK, we use around 14 billion litres of water per day, and it is projected we will need four billion more by 2050. I understand that over half of this will need to come from reducing our demand for water. I fully recognise that water is a precious resource, and we must all do what we can to use water responsibly and reduce unnecessary waste of water.
To that end, the last Government published its Plan for Water in 2023 which set out the importance of ensuring a clean and plentiful water supply in England. The plan committed to a twin track approach to improving water supply resilience, with action to reduce water company leaks and improve water efficiency, alongside investing in new supply infrastructure.
The Labour Government must ensure it prioritises improving water resilience, which will need to include improving water efficiency and reducing leaks. Furthermore, I hope the Government recognises the importance of investment in new water supply infrastructure, including new reservoirs. This will be essential to manage the mass housebuilding projects and population growth being imposed on rural constituencies like ours in Sussex, where water scarcity is already a serious issue, placing enormous pressure on the county’s landscapes, its communities and its future prosperity.
This Labour Government will be held to account on its actions. However, after a year in office, I am extremely concerned they have made almost no new progress on the many issues facing the water industry.
