England and Wales’s water industry requires “fundamental reform” to address the problems that have dogged the sector, a new review has found.
A new official report into the water sector, just released, is recommending a swathe of new measures, including new regional water authorities with responsibility for ‘integrated and holistic water system planning’.
The Independent Water Commission has found that a fundamental ‘reset’ of the water sector is needed, to raise standards across the industry, in a 465-page report which just landed.
One of the commission’s most important recommendations is the creation of a new integrated water regulator for the sector in England, and a single water regulator in Wales. These new bodies would replace Ofwat, the criticised regulator which the Guardian reported on Friday was to be abolished. The new integrated regulator in England would combine the functions of Ofwat, the Drinking Water Inspectorate, as well as taking on the water functions from the Environment Agency and Natural England.
The government has confirmed that it will create a water ombudsman with legal powers to protect customers in disputes with their water company, as the Guardian reported last night.
Sir Jon Cunliffe, the former civil servant and central banker who led the commission, is warning this morning that “no single, simple change” will fix the water industry, which has been beset by underinvestment, rising pollution incidents, soaring customers bills and meaty shareholder payouts.
Cunliffe says: "This sector requires fundamental reform on all sides – how we manage the demands on water, how the system is regulated, how companies are governed and how we manage the critical infrastructure on which we all rely."
He also calls for “a long-term, cross-sector strategy for water”, explaining: "It may sound academic, but it is profoundly important. A clear set of national priorities for water – covering the water industry, agriculture, land-use, energy, transport, housing development – is essential. Without it, we will continue to be dogged by inconsistency, short termism, unintended consequences and risk willing the ends without ever fully understanding the means required."
Cunliffe’s report has 88 recommendations in total, which include:
• a long-term, cross-sector strategy for water
• the modernisation of the legal framework for water regulatory changes, including a new integrated regulator for water
• greater transparency in areas such as operator self-monitoring and scrutiny of water company reporting
• the introduction of a single social tariff, to improve affordability and customer service
• changes to the economic regulation of water companies, including “a company-specific supervisory function” that would feed into the current price review structure
• and new national resilience standards for infrastructure, to help guarantee the maintainance of underground pipes and other water and wastewater assets.
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