Campaign group River Action is taking legal action against water regulator Ofwat, alleging that it unlawfully permits water companies to charge customers twice for over £100bn in sewage pollution investment. The case, to be heard at Manchester Civil Justice Centre on Tuesday and Wednesday, argues that bill increases approved by Ofwat mean households are paying again for improvements that should have been covered by previous bills.
Under Ofwat’s PR24 decision, water companies are injecting £104bn to tackle record sewage pollution, with average household bills rising by £123 a year. Customers of poorly performing firms face steep hikes: Thames Water bills rise 35% to £588, Southern Water 53% to £642, and United Utilities 32% to £535. Lawyers contend that repairing historic underinvestment should be funded by shareholders, not customers, as Ofwat rules only permit charges for new infrastructure.
Using Windermere as an example, River Action argues that past failures mean degraded infrastructure continues to pollute rivers. Emma Dearnaley, River Action’s head of legal, said: “It is fundamental that the public should not be made to pay twice for water companies’ past failures to invest in improvements to stop sewage pollution.” She added that Ofwat must ensure billions result in legal compliance and fair charges.
Ricardo Gama of Leigh Day, representing River Action, said: “Our client believes that this case shows that Ofwat has failed to make sure that water bills are used for infrastructure upgrades.” He noted that money for essential upgrades is now gone, and customers face a second bill.
An Ofwat spokesperson rejected the claims, stating that the PR24 process scrutinised business plans to ensure fair value and justified investment. They said customers should not pay twice for regaining compliance, and appropriate safeguards are in place, but declined further comment due to the ongoing hearing.
