Untreated sewage pouring into coastal waters around England is far from the only crisis afflicting the UK in this worrying summer. But there could be few more dispiriting signs of the state we are in than the fact that holidaymakers on some of our most popular beaches are being warned to stay out of the sea because of the risks to health from swimming with faeces, while the majority of rivers are on “red alert”. In some locations, including Littlehampton in West Sussex, there are no working monitors, meaning that there is no way to measure pollution.
Rightly, the water companies and Ofwat, their ineffective regulator, are coming in for heavy criticism. And the headline figures and facts that sum up the sector’s dismal performance are worth repeating. Between 1991 and 2019, English and Welsh water companies paid out £72bn in dividends, and took on around £55bn in debt. But the investment in infrastructure that was supposed to follow privatisation never came. Not one new reservoir has been built in 30 years, while Scottish Water, which remains publicly owned, has invested 35% more per household. On a host of measures, from leaks to river water quality, the UK’s performance is poor, with leaked data showing that at current rates it will take 2,000 years to replace the pipe network.
Yet the rewards paid to company bosses have continued to expand – even as their reputations collapsed – turning the principle of performance-related pay on its head. In the last three years, 12 chief executives took home £58m between them, with several taking lucrative second jobs advising other companies on pay. In 2021, bonuses rose by 20% despite most companies missing pollution targets and despite the Environment Agency describing overall performance as “the worst we have seen for years”. Corporate social irresponsibility on a disgraceful scale has been enabled by regulatory weakness. Ofwat has been outgunned and outwitted by businesses whose purpose is to maximise rewards for their owners, including sovereign wealth funds and private equity investors. Money has taken priority over the stewardship of water – one of our most precious resources.
But serious as the regulator’s failings have been, the buck does not stop there. As we reported this week, the government tied its own hands by cutting the Environment Agency’s funding. Specifically, £24m was removed from the budget for environmental protection and surveillance, including sewage monitoring, between 2014 and 2017. Given that Liz Truss was environment secretary for most of this period, she bears direct responsibility for the tide of filth now lapping at English shores, harming marine life and sabotaging tourism in some of the places that most depend on it – including seaside towns well known to be in need of levelling up.
To its credit, the Environment Agency has spoken out against the behaviour of the water companies – which in Southern Water’s case includes proven criminality. The agency’s head, James Bevan, told MPs last year that restoring funding to its previous level “would make a massive difference”. He has also called for an end to the failed policy of allowing the water companies to mark their own homework, by relying on them to report incidents of pollution.
The key question now is who will clean up the mess that a disastrous privatisation has created. Unquestionably, grassroots groups, including surfers and anglers, have proved far more effective champions of the public interest than Ofwat – or the Tory MPs who supported an austerity agenda that included cuts to environment budgets, despite the climate emergency and all the risks that it brings with it, such as droughts and floods. More recently, they rejected Labour’s efforts to place stronger obligations on water companies. Ms Truss and her colleagues have questions to answer, and filth all over their hands.
