Almost £160 million will be paid back to UK households as a result of water companies across the country failing to hit targets when it comes to pollution.
The targets, which also include goals when it comes to reducing leaks and stopping supply from being interrupted, were missed across the last year, industry regulator Ofwat said. It comes as satisfaction with water companies continues to fall across the United Kingdom.
In Ofwat's annual report, no water company in the country achieved the regulator's top category of 'leading'. Anglian Water, Welsh Water and Southern Water fell into the lowest category of 'lagging' while the remaining 10 were rated 'average'.
What has Ofwat ruled?
Ofwat judges the performance of water companies in England and Wales each year against the 'stretching' targets they set in 2019 for a five year period until 2025.
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If they fail to meet these, Ofwat restricts the amount of money they can take from customers. Ofwat said the figures are provisional until it completes a review process.
Despite water companies committing to reduce pollution incidents by 30 percent, there has only been a two percent reduction.
David Black, chief executive of Ofwat, said: “This year’s performance report is stark evidence that money alone will not bring the sustained improvements that customers rightly expect.
“It is clear that companies need to change and that has to start with addressing issues of culture and leadership. Too often we hear that weather, third parties or external factors are blamed for shortcomings."
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Mr Black added: “Companies must implement actions now to improve performance, be more dynamic, agile and on the front foot of issues. And not wait until the Government or regulators tell them to act.
“As we look towards the next price control, the challenge for water companies is to match the investment with the changes in company culture and performance that are essential to deliver lasting change.”
Water companies told to pay back customers and how much they'll hand over
- Thames Water - £56.8 million
- Anglian Water - £38.1 million
- Yorkshire Water - £36 million
- Southern Water - £31.9 million
- Welsh Water - £24.1 million
- South West Water - £17.4 million
- South East Water - £8 million
- Wessex Water - £5.3 million
- Affinity Water -£5.2 million
- Bristol Water - £1.9 million
- Portsmouth Water - £1.1 million
- South Staffs Water - £700,000
- Hafren Dyfrdwy - £200,000
How will I be given back my money and how much will I get?
You wont be given it. Rather, it will be deducted from your bill across 2025/26 as a rebate.
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Given that everyone pays for water, your share of the fund wont be huge.
With 13 companies giving out the money, it'll work out at around £3 per person, on average. Your exact amount will be calculated in December before you're told by your water company what you'll get to the exact penny.
Growing pressure
The penalties are separate to an ongoing Ofwat investigation into all 11 of England and Wales’s water firms, which ordered three companies to pay £168 million in fines in August, in the first results of the probe.
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It comes against a backdrop of mounting public and political fury at the privatised water sector which is under fire over sewage spills, proposed bill rises and executive bonuses. Years of under-investment by the privately-run firms combined with ageing water infrastructure, a growing population and more extreme weather caused by climate change have seen the quality of England’s rivers, lakes and oceans plummet in recent years.
Some water utilities are also creaking under high levels of debt or face criticism over dividends to shareholders and executive bonuses.
Labour has said it wants the sector to reduce spills and has even proposed sweeping new laws which could see bosses face up to two years in jail if they obstruct regulators.
Topics: UK News, Money, Cost of Living
Tom Earnshaw