Water companies have collectively cut investment in wastewater and sewage networks by almost a fifth in the 30 years since they were privatised. They have collectively paid out more than £15 billion in dividends to shareholders since 2010 and their bosses have been paid more than £65 million in the past five years.
Ben Webster www.thetimes.co.uk
Water companies have collectively cut investment in wastewater and sewage networks by almost a fifth in the 30 years since they were privatised, according to analysis of official data.
Campaigners for cleaner rivers said the data showed some companies had chosen to dump raw sewage in waterways instead of investing adequately in treatment systems.
Average capital expenditure on wastewater and sewage networks fell from £2.98 billion a year in the 1990s to £2.4 billion in the past six years, according to data from Ofwat, the industry regulator, for the ten largest water companies in England and Wales.
The data was obtained via freedom of information requests by the Windrush Against Sewage Pollution campaign group and was first reported by the Financial Times. Ashley Smith, the group’s founder, said: “The data shows that some companies have become heavily reliant on being able to get away with illegal sewage dumping to prop up underinvestment in infrastructure.”
Raw sewage entered water courses more than 400,000 times last year and this was a reason why 84 per cent of rivers and lakes in England failed to meet the government’s target of good ecological status.
Last month the Environment Agency and Ofwat launched an investigation into more than 2,000 sewage treatment works after companies admitted they might have illegally released untreated sewage.
The government strengthened the environment bill, enacted last month, after facing a backbench rebellion over concerns that it was failing to be tough on water companies over sewage pollution. The new Environment Act requires the government to ensure that they progressively reduce the impacts of discharges from storm overflows.
Water companies have collectively paid out more than £15 billion in dividends to shareholders since 2010 and their bosses have been paid more than £65 million in the past five years.
Ofwat said overall investment had been broadly similar once other factors were taken into account, such as changes to accounting policies and spending on “nature-based solutions”.
A spokesman for the regulator said: “We continue to see huge investment going into the sector. The amount financed by investors has more than quadrupled since privatisation, while returns to investors have fallen over time, so more of the customer bill is going towards performance.”
A spokesman for Water UK, which represents water companies, said: “Private investment has brought more than £160 billion into an industry that was previously starved of cash. Meanwhile, bills have, in real terms, remained around the same level for over a decade and have fallen in both the last two years. The water industry is one of the most heavily regulated in the country with tight controls on company activity, including on the amount companies are permitted to invest each year.
“There is a widespread recognition that this is a critical decade if we are to tackle the many challenges we face. This is why we are pushing the government to encourage the economic regulator, Ofwat, to authorise schemes that meet government’s environment targets, including ending all ecological harm from overflows, ensuring resilient water supplies, and meeting our ambitious 2030 net-zero target while ensuring value for money, and great service, for customers.”