Friday, December 27, 2024

The water industry is in crisis. Can it be fixed?

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Our loos flush and water comes out of our taps. In that sense, the water industry in England and Wales works. In just about every other way, it’s a mess.

The most visible sign of that mess comes after those loos have flushed. Last year England’s privatised water firms released raw sewage for a total of 3.6m hours, external, more than double the amount recorded the year before.

Millions of customers, surfers and bathers have joined a chorus that former pop star Feargal Sharkey has been singing for years – that the sector is a “chaotic shambles”.

It’s not just our rivers, lakes and coastlines. Some communities have been told to boil tap water to make it safe, others have seen their water supplies cut off for days or even weeks.

Environment Secretary Steve Reed told the BBC some parts of the country could face a drinking water shortage by the 2030s and plans to build new homes have been jeopardised by water supply problems.

Faith in these companies has never been lower and it’s not hard to see why.

There are some common denominators causing stress on the system that will take radical reform to tackle. The government knows this – which is why it has just announced a major new commission to conduct the biggest review of the sector since privatisation 35 years ago.

The independent commission will be led by former Bank of England Deputy Governor Sir Jon Cunliffe and will report back with recommendations next June. Options on the table include the reform or abolition of the main regulator Ofwat.

To critics like Sharkey, the former lead singer of the Undertones who nowadays is vocal about the state of UK’s rivers, it’s an admission that the privatisation of essential monopolies has been a failure. Recently, he described, external this as “possibly the greatest organised ripoff perpetrated on the British people”.

So how did we get here, how might it be fixed and what will that mean for customers and their bills?

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