To ask the Secretary of State for Environment, Food and Rural Affairs, what assessment she has made of the impact of financial civil penalties on water companies' compliance levels.
23 March 2023
As monopoly service providers it is important that water companies are held to account on poor performance and drive improvements that benefit customers and the environment. The Government believes that financial incentives reinforced by a strong regulatory framework do make a positive impact on water company compliance.
During the 2019 price review (PR19), Ofwat set specific performance targets for water companies. In November 2022, Ofwat announced financial penalties of £132 million applying to 11 water companies, as a result of underperformance in areas such as water supply interruptions, pollution incidents and internal sewer flooding. This money will rightly be returned to customers through water bills in 2023-24.
Additionally, where companies have failed to meet their statutory or licence obligations, regulators can take more formal enforcement action.
The Government will launch a consultation on strengthening environmental civil sanctions in spring 2023.