Ofwat: Strategic Priorities

Part of the debate – in the House of Commons at 4:06 pm on 9th June 2022.

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Photo of David Johnston David Johnston Conservative, Wantage 4:06 pm, 9th June 2022

It is an absolute pleasure to follow my hon. Friend Danny Kruger. I want to speak in support of the strategic priorities that Ofwat has been given, as I think they are right, from protecting and enhancing our environment to using markets to better deliver for customers.

It frustrates me as a point of principle that I cannot change my water supplier. I can change my gas, electricity, broadband and mobile phone suppliers, but I cannot change my water supplier. That is a problem, because whenever we have a monopoly, the chances are that the quality of what it does not will not be as good as when there is genuine competition. That makes regulation especially important. Regulation is important in all areas, but in a scenario in which there is only one choice for regions of the country, it is especially important, as we have heard this afternoon, that that job is not being done effectively enough. So I support what the Government have said to Ofwat: it should push water companies to be more ambitious in what they do to protect the environment; it should push them to do a better job on customer service and how they handle complaints; and it should be better promoting competition. I agree with all those things.

Thanks to the Government’s Environment Act 2021, we will have annual reports on storm overflow data; we will have these companies pushed to reduce the harm of this; and by 2030 they will have to show how they are going to achieve zero serious pollution incidents. All of that is very important at the macro level of what is going on in the country as a whole.

However, like a lot of us, I will look at what is happening locally. There are three areas in which I will look at the role of Ofwat, as well as at that of the Environment Agency and others. Some of them have been touched on, because this is going on in other people’s constituencies. The first is this issue of releases of sewage into the water, and Members would expect me to start there. In 2021, Thames Water released sewage into the waterways around Oxford for more than 68,000 hours. I do not represent Oxford—I am an Oxfordshire MP—but those waterways are flowing through my constituency as they are through the constituencies of every other Oxfordshire MP and plenty of other constituencies beyond that. What Thames Water did is completely unacceptable and totally against what it should be doing according to its licence. This should be a rare occurrence with very heavy rainfall, but it is anything but that.

The second, related issue is to do with housing. We have had huge numbers of houses built in my constituency. The largest towns have grown by huge percentages population-wise—the biggest one by 42% in 10 years, and the second by 59%—but the infrastructure has not improved. We want Grove station reopened, improvements on the A420 and A34, more GP appointments and so on. But as other Members have mentioned, we also have the issue of the water and waste connections that go to these new developments, some of which are huge. Thousands of people are moving in there. There are two estates in Didcot, one built and one being built, and 18,000 more people. These are big-scale developments, and, too often, what happens is that these systems are not built strongly enough in the first place, and they are easily overwhelmed. Those costs are then very often passed on by management companies to the people who have bought those homes, which is a subject for a separate debate. Again, this should not be happening, and we must get a lot better at tackling it.

My third issue is a much more local thing. I do not think that any other Member who has spoken in this debate is facing it in the same way. For 30 years, Thames Water has been proposing to build a massive reservoir in my constituency. Despite the fact that that proposal has existed for 30 years, Thames Water is still unable to show why it is needed, why it is better than the alternatives, what the environmental impact will be, and what the cost is likely to be. We know, thanks to GARD—the Group Against Reservoir Development, the dedicated local campaign group—that some of the assumptions that Thames Water used when it tried to make the case about water demand and so on are wrong. We know from Thames Water’s own website that 24% of the water that it supplies leaks, which leads to many of my constituents saying, “Well, actually, perhaps we wouldn’t need this reservoir if you fixed your leakage problem.”

When I think about Ofwat and its big strategic priorities, I am specifically looking at this proposal. As a stand-alone regulator, it should be holding Thames Water to account and getting it to answer the big questions that we are posing about the proposal. It should also do so through RAPID—the Regulators’ Alliance for Progressing Infrastructure Development, which is the alliance with the Environment Agency and the Drinking Water Inspectorate, and about which we have not heard much this afternoon—to make sure that Thames Water cannot behave, as many people feel that it is behaving, as though this is an inevitability. It seems that, whether or not Thames Water can answer our questions, it will just build the thing, but there is, understandably, very strong resistance to the proposal. The proof of the pudding will be in the eating. These are the right priorities for the Government to have set, but, as we have heard this afternoon, Ofwat will have to do a lot better to persuade all of us and our constituents that it is doing them to the highest standard possible.