Steve Reed has said he is “furious” about the average 36% rise in water bills in England and Wales. The increase will be phased over five years, with some households facing price hikes of more than 50%.
The environment secretary said he could not rule out further above-inflation rises in future, but insisted that “root and branch” reform of the industry would bring billions in investment and prevent such large increases from happening again. He blamed the previous government for leaving bills to rise after years of underinvestment in infrastructure.
Six water companies have complained to the Competition and Markets Authority, arguing that the current settlement is insufficient to meet regulator targets. Reed said any decision on further increases would be a matter for regulators.
Ministers are expected to announce a consultation on creating a new water regulator, with a review likely to confirm that Ofwat will be abolished. Critics have said Ofwat presided over a culture of underinvestment and financial mismanagement since its creation in 1989. Thames Water, the UK’s largest water company, is burdened with £20bn in debt.
Reed also criticised a pay rise for Southern Water’s chief executive, Lawrence Gosden, which nearly doubled his income, calling it “outrageous”. He said he would resign as environment secretary if the government failed to halve sewage pollution in rivers by 2030, though his target would allow 225,199 spills by then, compared with Ofwat’s 204,893.
