Thérèse Coffey ‘complacent’ in dealing with water companies, peers say

<span>Photograph: Anadolu Agency/Getty Images</span>
Photograph: Anadolu Agency/Getty Images

Thérèse Coffey has been “complacent” in dealing with water companies, risking water shortages as well as extreme environmental consequences, a House of Lords committee has said.

In a letter to the environment secretary, the peers criticised her department’s “dismissive brevity and complacent tone” in response to their report published earlier this year, which found water companies had been too focused on maximising financial returns at the expense of the environment.

During an inquiry into Ofwat, the water regulator, the House of Lords industry and regulators’ committee found a “lack of leadership and deep-rooted complacency” in the government, which was leading to failure by water companies to protect supply and the environment.

The letter sent to Coffey said: “We object to the apparent insinuation that our conclusions and recommendations were outside the scope of our inquiry, which appears to be an attempt to avoid parliamentary scrutiny.”

The committee also said in the letter that underinvestment in water infrastructure would have serious long-term consequences for the environment and the security of water supplies, risking the possibility of future water shortages.

Though the Department for Environment, Food and Rural Affairs (Defra) published its plan for water earlier this year, the committee found it lacking and said it would not solve the problems plaguing the environment and consumers.

The inquiry indicated that water bills needed to rise to tackle underinvestment, which has caused leaky pipes and sewage spills, but recommended that a single social tariff for those who would struggle to pay bills was implemented so people did not fall into debt.

In the letter, the peers wrote: “The plan for water includes the acceleration of £1.6bn of new water company infrastructure but provides little information on how the government intends to tackle the trade-off between infrastructure investment and customer bills, instead expressing its hope to deliver ‘significant new investment’ without ‘disproportionately large increases to customer bills’.” The peers added that they were disappointed the government had dismissed the idea of a single social tariff.

Noting that “under present plans, the UK will not have built a single new major reservoir between 1991 and 2029”, the committee expressed alarm that the government did not seem to be planning to secure the water supply sufficiently to avoid shortages. It said: “Although the plan for water sets out proposals for reducing water demand, we share concerns that these policies are likely to be insufficient to meet the government’s targets.”

Clive Hollick, the chair of the industry and regulators’ committee, said: “While the government has begun to set out its vision for the sector, our cross-party committee has concluded unanimously that there is insufficient policy or drive to meet the government’s targets. Sadly, the only thing that is becoming clear in the murky, polluted waters of the sewage crisis is a lack of leadership and deep-rooted complacency.

“The government must therefore provide firmer policy detail and greater guidance to regulators, who cannot be left to resolve these huge challenges by themselves. In particular, the government must give clear guidance on the trade-off between much-needed investment and the level of customer bills. We look forward to the response from the secretary of state, setting out how she intends to do this.”

A Defra spokesperson said: “We take our oversight of the water industry incredibly seriously and firmly disagree with these conclusions.

“We are delivering increased investment, stronger regulation, and tougher enforcement right across the sector. This includes being the first government to set ambitious targets for water companies to address storm overflows, which the high court has ruled go even further than existing law.

“We agree that more needs to be done. That’s why we are introducing unlimited penalties for polluters, driving the largest infrastructure programme in water company history, and have set clear expectations for water companies to deliver the changes that we all want to see.”