The water regulator Ofwat is expected to be scrapped next week following a government review that concluded it is not fit for purpose. The review, led by former Bank of England deputy governor Sir Jon Cunliffe, recommends abolishing the regulator, which employs about 300 people.
Environment secretary Steve Reed is expected to announce a "root and branch" reform of the water industry, stating that "regulation has failed customers and the environment." He will promise that "hardworking British families will never again face huge shock hikes to their bills like we saw last year," according to The Times.
The review comes after years of underinvestment in England's ageing water system, leading to widespread flooding, supply issues, sewage pollution, and leakages. Public anger has grown over the state of rivers, lakes, and coastal waters, as well as rising bills, high dividends, debt, executive pay, and bonuses at privatised water firms.
The Environment Agency reported that serious water pollution incidents rose by 60 per cent last year, with Thames Water, Southern Water, and Yorkshire Water responsible for 81 per cent of cases. Thames Water alone accounted for 44 per cent of serious incidents. The agency blamed the spike on persistent underinvestment in infrastructure and poor asset maintenance.
Labour MP Clive Lewis criticised the move, saying abolishing Ofwat "would not clean up rivers or lower bills." He called for water to be brought into public ownership, arguing that the real problem is a privatised model prioritising shareholder payouts over public good. Downing Street said it will wait for the final report before responding.
