Water companies fail to splash out on improvements, especially SWW

Water companies have spent only three fifths of the £2.2 billion they could have to build wastewater infrastructure and tackle sewage being dumped in rivers.

South West Water is the second worst investor after Yorkshire Water. – Owl

Adam Vaughan, Environment Editor www.thetimes.co.uk

A minister described their performance as unacceptable as the head of Ofwat, the regulator, criticised the shortfall over the past two years and said he was amazed by how slowly some companies were investing.

The companies are regulated monopolies and Ofwat has limited what they can spend between 2020 and 2025.

Yorkshire Water performed worst of 11 wastewater companies, spending only 20 per cent of what it could. South West Water spent 39 per cent and Southern Water, which was reported yesterday to have discharged sewage more than 1,500 times last month, invested 56 per cent of what was allowed.

There is no legal requirement to spend the maximum, but there has been acute public pressure to tackle sewage spills into rivers and at beaches.

The companies have said that they are investing to deal with the problem, but figures published yesterday by Ofwat showed that, two years into the present five-year price control period, only £1.2 billion of £2 billion capital expenditure permitted so far for wastewater had been spent.

Rebecca Pow, the water minister, said: “Water companies must get their spending back on track to deliver the environmental standards that customers and government rightly expect.”

David Black, chief executive of Ofwat, said: “We’ve got some companies which seem to be well off the pace with the rollouts of their investment.”

The data showed a wide disparity between companies. United Utilities, the Welsh company Hafren Dyfrdwy and Northumbrian Water all spent their allowances, in contrast with Yorkshire Water and South West Water.

“They’ve both got significant issues,” Black said. “I find it absolutely amazing, actually, that they’re not moving fast to make the improvements that they’ve been funded to achieve.”

Alastair Chisholm, of the Chartered Institution of Water and Environmental Management, said the naming and shaming of companies showed that Ofwat was “flexing its muscles”. Ofwat is investigating the dumping of raw sewage by six companies, including South West and Yorkshire.

The areas of underspending included improvements to sewage treatment works and storm tank capacity, and reducing spill frequency.

Black said the figures called into question the industry’s readiness to deliver the £56 billion required by the government’s plan to cut sewage discharges near bathing sites, which he described as “a much more ambitious programme”.

Campaigners counted an average of 52.9 sewage spills a day last month by Southern Water in Hampshire, Kent and Sussex. Cowes on the Isle of Wight had 224, according to Whitstable SOS.

Water UK, which represents the industry, said the data covered only two years, including a year severely disrupted by Covid-19 lockdowns, adding: “What matters is that the industry delivers all of the environmental outcomes it has committed to by 2025.”

Southern said the increase in storm overflow spills last month was due to one of the wettest Novembers ever.

A spokesman for South West Water said: “This data does not include investment on base maintenance and operating cost, both of which are relevant in delivering our business plan and meeting our commitments. For the first two years of the period, our total spend, including base maintenance, enhancement and operating costs, was [circa] 99 per cent of the allowance.”