In a bold move, a cross-party group of nearly 40 MPs has called on the water regulator, Ofwat, to prevent any increase in water bills until significant performance improvements are made by water companies. This call to action comes in response to the companies’ proposals under the ‘PR24’ price review, which could see customer bills rise by an average of 40% between 2025 and 2030, with Southern Water proposing a staggering 70% hike.
In an open letter to Ofwat, the MPs expressed their frustration over the poor performance and mismanagement by water companies. They highlighted egregious incidents such as the recent report revealing that United Utilities discharged 10 million litres of sewage into Lake Windermere after a fault went unreported for 10 hours. The MPs’ letter, which comes ahead of Ofwat’s imminent decision on price rises, underscores a widespread dissatisfaction with how water companies have operated since privatisation.
New research from the University of Greenwich further inflames the debate, showing that shareholders have extracted over £85 billion from water and sewerage services since privatisation, without reinvesting in the necessary infrastructure. This lack of investment has led to repeated sewage spills, causing significant illness, worry, and inconvenience for the public.
The MPs are urging Ofwat to block any above-inflation price rises until 2030 and to ban dividend payments until shareholders fund agreed infrastructure improvements. They argue that further price hikes will unjustly harm consumers who are already suffering from the consequences of the companies’ failures.
Voices from Parliament
Clive Lewis, Labour MP for Norwich South who spearheaded the letter, voiced strong criticism of the current state of affairs:
“When it comes to water, the public versus private argument has been decided by the public. The era of price-gouging, sewage spewing, rip-off water companies paying huge dividends to themselves and failing to invest, must now end. With the very real prospect of climate change-related floods and droughts set to dramatically increase, we need this critical resource run as efficiently as possible. That means prioritising public need over private greed and it starts by capping this latest excessive price rise.”
Caroline Lucas, Green Party MP for Brighton Pavilion, echoed these sentiments, emphasising the need for systemic change:
“People are rightly outraged that after years of allowing sewage to pour into our rivers and seas, the water companies want us to pay more for their failures. Water is a public good and should never have been privatised. We’ve got to end the legalised scam of privatisation and bring water back into public hands. As a first step to fixing our water sector, shareholders must no longer be allowed to use customers as a cash cow while failing to invest their own money.”
Academic Insights
Experts in the field support these calls for action. Professor David Hall from the University of Greenwich highlighted the financial extraction by shareholders:
“In 33 years, the shareholders of the private water companies have invested less than nothing of their own money but have extracted over £85 billion in dividends and capital withdrawals. That could have financed all the missing capital investment. They cannot now ask us to pay billions more, which they will see as a source for more dividends.”
Professor Ewan McGaughey, University of Cambridge, critiqued the extreme nature of water privatisation in England, pointing out that it has led to high bills and poor water quality, with watchdogs like Ofwat failing to hold companies accountable.
Advocacy for Public Ownership
Matthew Topham of We Own It and Lena Swedlow from Compass emphasised the broader implications and public sentiment against privatisation. Topham said that any new funding required for infrastructure improvements should not come from higher bills but from the shareholders who have benefited from the system. Swedlow pointed to the growing cross-party consensus on the need for public ownership of national resources to address the climate crisis and rising inequality.
The call from MPs to freeze water bills is a critical response to years of mismanagement and neglect by water companies. With the public and political will converging on the need for reform, the push for public ownership and greater accountability in the water sector is gaining momentum amongst members of the public. The forthcoming decision by Ofwat will be pivotal in determining whether water companies will be held to account and forced to prioritise the public good over private profit.
This article is from a press release rewritten by ChatGPT and edited by East Anglia Bylines
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