Campaigners have attacked water companies after they admitted that their £10 billion pledge to stop sewage spills into Britain’s rivers and seas would add to consumer bills.
The industry has apologised for pumping sewage into the nation’s rivers and promised the greatest infrastructure modernisation since the Victorian era.
It is a victory for The Times Clean It Up campaign but Feargal Sharkey, a prominent campaigner, said it was “nothing to celebrate” and urged the industry to apologise for its “greed, profiteering and neglect”.
Ruth Kelly, chairwoman of Water UK, the industry body, said in an article in The Times: “We are sorry. We get why people are upset and they are right that we should have given this issue much more attention . . . Rivers and beaches are often not at the standard the public rightly expect; we are sorry for the part we have played in that.”
Kelly credits this newspaper’s campaign, and the role of activists including Sharkey and Paul Whitehouse, for putting sewage pollution at the top of the national agenda, which she says had been a “chastening experience”.
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Sharkey told BBC Radio 4’s Today: “I think conspicuously what’s missing is the apology for the £72 billion worth of our money that they have taken out of these companies and paid to shareholders; the £1.4 billion in dividends they paid themselves last year; the environmental damage they have caused; an apology for their corporate greed, profiteering and neglect.
“And what I’m hearing is no apology for the fact we have paid them for a service we haven’t got. They are now suggesting we should pay them for a second time for a service we haven’t had.
“We should have an apology for the suggestion they are going to put bills up by £10 billion for their incompetence, their greed. This is nothing to celebrate whatsoever. What they should be saying is, ‘We messed this up, we’re terribly sorry, we’re going to compensate you all £10 billion. It’s the least we could do.’ This is just another outbreak of moral panic.”
Kelly confirmed that bills would rise to fund repairs. “We will be asking all the water company shareholders to put down a massive multibillion-pound downpayment to start fixing our Victorian sewage system,” she said. “For that, of course we recognise that there may be upward pressure on customer bills. Customers over the length of the asset start to pay that money back through customer bills.”
She defended multimillion-pound pay packages for water company executives. “We need people to be attracted to the industry,” she said.
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The Clean It Up campaign calls for faster investment and tougher regulation to improve the state of the country’s rivers, lakes and beaches. It has also demanded beefed-up powers for the Environment Agency.
Pollution from water companies is one of the leading causes of rivers failing to reach “good ecological status”, second only to that from farms. Only 16 per cent of waterways in England reach the standard, the same proportion as in 2017.
While the number of spills of untreated sewage into rivers from storm overflows fell last year, the government said much of the decline was due to dry weather. There were still more than 800 spills a day on average last year, provoking anger among communities around the country.
Kelly, a former Labour minister who took up the role at Water UK two months ago, says the industry wanted “to put things right”.
Water companies in England are promising to spend £10 billion by 2030 on reducing storm overflow spills, by building new storm tanks and other infrastructure. The money is in addition to the £3.1 billion they are investing between 2020 and 2025.
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“It’s a good number. It’s a significant increase from current levels and puts investment in line with government targets to meet tough storm overflow spill reductions,” Dominic Nash, an analyst at Barclays, said.
He expects that the extra investment could add about £30 a year to the average annual household water bill of £448 in England. Other experts suggested that the increase could be lower. The investments this decade are part of the £56 billion companies are expected to spend by 2050 to meet government spill reduction targets.
Surfers Against Sewage, a charity that is holding protests across England on Saturday against pollution, said the new investment must be shouldered by water companies. “This investment must come out of water company profits, not from the bill payer,” Izzy Ross, the campaign manager, said. She welcomed the apology and investment but said that companies should have acted years ago.
River Action, a charity that helps the local river campaigners, said the new pledges were welcome and would help to restore trust. “Honest recognition of the problem will be seen as a positive indicator of humility and responsibility, especially if repeated with meaning by all water company CEOs,” James Wallace, the charity’s chief executive, said.
Rebecca Pow, the water minister, said: “This apology by the water industry is not before time and I welcome it.”
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However, Ed Davey, the Liberal Democrat leader, said: “This apology and plan just don’t go far enough. This announcement does nothing to match the billions water firms have paid out in dividends to overseas investors, or stop their CEOs being handed multimillion-pound bonuses.”
In the past fortnight, the bosses of three of the ten sewage companies operating in England have waived bonuses worth hundreds of thousands of pounds over pollution concerns.
More detail is expected this summer when companies lay out their approach in a national overflows plan. The onus will then be on the regulator, Ofwat, as the companies will only be able to make the investment if it approves business plans submitted in October.
Water UK said its members would also create a map showing near real-time spills across England, which it said would be a world first.
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The Times is demanding faster action to improve the country’s waterways. Find out more about the Clean It Up campaign.
