'Brits exposed to more than dirty water': Ofwat reforms are a start but government must do more

23 October 2024, 13:50 | Updated: 23 October 2024, 14:55

The new Labour government's decision to review Ofwat marks an important first step in addressing Britain's water crisis.

After years of sewage spills and crumbling infrastructure, there's finally recognition that fundamental reform is needed.

The story of how we got here is painfully clear. While water company executives pocketed huge bonuses and shareholders received £78 billion in dividends, our rivers became dirtier, our infrastructure deteriorated, and industry debt reached £64bn. Now customers face even steeper bills - with Thames Water proposing a staggering 59% increase.

Today's announcement of an independent commission under Sir Jon Cunliffe shows Labour understands the urgent need for reform. But this review also presents an opportunity to go further and put clear blue water between this government's approach to regulation and that of its predecessor.

At Unchecked UK, our research shows how the systematic weakening of regulatory protections has left the British public exposed - not just to dirty water, but to unsafe food, dangerous workplaces and failing infrastructure. The previous government's Growth Duty, which forces regulators to “have regard” to economic growth, remains a particular obstacle to effective oversight.

The British public understands what's at stake. Recent polling shows that 79% of voters believe regulations are important for creating a stable economy and secure society. Even among Conservative voters, 85% think the economy needs more regulation. Across every region and demographic, people want strong protections for the things that matter in their daily lives.

Labour now has a chance to channel this public appetite for change into real reform. While reviewing Ofwat is welcome, they could go further by replacing the Growth Duty with a Protection Duty that puts people and the environment first. This would signal a clear break from the approach that has dominated the past decade.

The solutions are within reach. In the short term, reforming Ofwat and freeing regulators from the Growth Duty straightjacket would demonstrate real commitment to change. Longer term, Britain needs a fundamental reset of how we protect the things that matter - proper funding for enforcement, regulators with real teeth, and a clear legal duty to protect the public interest across the board.

This isn't just about clean rivers and safe drinking water - though these are vital. It's about rebuilding a regulatory system that delivers the protections people want and deserve. Sir Jon Cunliffe's review could mark the beginning of real change in how Britain approaches regulation.

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Carum Basra is Deputy Director of Unchecked UK.

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