In a major regulatory shakeup, the British government has announced plans to establish a new water industry watchdog that will replace the current system of overlapping oversight by multiple bodies. The proposed changes, outlined in the upcoming Water White Paper, aim to enhance accountability, strengthen infrastructure resilience, and improve customer service across the water sector.
Under the new proposals, water companies will be required to conduct regular “MOT-style” checks on their infrastructure to proactively identify and address issues before they lead to major failures, such as the recent pipe bursts that left thousands of homes without water supply. A chief engineer will be embedded within the new regulator to provide hands-on assessments, ensuring that companies are not “marking their own homework.”
The government has also pledged to establish dedicated teams for each water company, replacing the “one-size-fits-all” approach. This will allow the regulator to better understand the operations of individual firms and implement tailored “performance improvement regimes” to address shortcomings more effectively.
Additionally, the new watchdog will be granted “no-notice” powers to scrutinise water companies’ security and emergency preparedness, ensuring they are equipped to handle events like infrastructure attacks or supply disruptions.
The planned reforms come in response to public outcry over rising bills, sewage pollution, and large executive bonuses in the water industry. Ofwat, the current regulator, has faced intense criticism for its oversight during a period when companies paid out to shareholders and accumulated significant debt, while aging infrastructure deteriorated and sewage spills escalated.
Environment Secretary Emma Reynolds emphasized that the “once-in-a-generation reforms” will ensure water companies “have nowhere to hide from poor performance” and that customers receive the service they deserve.
However, the transition to the new regulator is expected to be a complex process, with Ofwat unlikely to be formally abolished before 2027. The government has promised to outline a clear transition path in the coming months, as well as introduce a new water reform bill to enable the necessary legislative changes.
While the proposed measures have been broadly welcomed, some experts, such as the Liberal Democrats’ environment spokesperson Tim Farron and the chief executive of River Action, James Wallace, have called for even bolder reforms, including exploring new ownership models and more ambitious action to tackle agricultural pollution.
As the water sector braces for a major overhaul, the government’s focus will now shift from diagnosis to delivering the promised changes, with the aim of restoring public trust and ensuring a more resilient and sustainable water system for the future.
