Is Regionalism The Best Way To Manage Britain’s Water?

Commercial water users will already have noted the new rules the government has brought in to tighten up on the water sector. But future plans, as set out in a white paper, can best be achieved by taking a regionalised approach, according to a new report.

After taking office in 2024 on a manifesto that contained several measures to tackle issues in the water industry, the government passed legislation to provide stronger regulations to bring errant water companies to heel.

This included allowing the regulator Ofwat to block bonuses, a power that was used to block £4 million of payments in the first year that it was in operation.

Other measures included a football-style ‘fit and proper person test’ for new executive appointments and a requirement for water firms to show that their infrastructure is up to scratch.

However, these measures were just the start. The government has also been looking at longer-term plans. Some of that includes adding capacity by seeking to push ahead with plans for nine new reservoirs across central and southern England.

What Are The Government’s Long-Term Plans For Water Regulation?

In February, the government published proposals for wider reform of the water industry, something that will impact domestic consumers, business water customers and business water suppliers alike.

Recognising that some serious planning is required to deal with future needs as a rising population and new industries like AI increase water demand just as climate change alters rainfall patterns, the government published a white paper on water in February.

Titled ‘A New Vision For Water’, key points included:

• More long-term planning
• A new water regulator, whose remit will include making sure that regulation is “targeted to the specific needs of each water company to improve performance”.
• Attracting increased investment
• A new water ombudsman
• Stronger monitoring of environmental performance to curb pollution through ‘sewage dumping’
• Improved water security through reduced leaks and greater water efficiency

Although Ofwat will be replaced under the plans, the organisation still welcomed the white paper, commenting: “The creation of a new water regulator for England will bring a renewed focus, improve the sector for customers, investors and the environment, and rebuild trust.”

What Would Be The Benefit Of More Regionalised Water Regulation?

As ever with a white paper, the devil is in the detail and many qualified organisations and interested parties have had months to examine it. One of them is the Foundation for Water Research (FWR), which has now published its own response.

This proposes that to make the government’s plans work, there needs to be a major focus on regional water planning, alongside the increased use of data.

It believes that having regional planners will address the problem of a ‘missing middle’ between different interested parties, including water companies, ‘existing catchment partnerships’ and the government. 

According to this recommendation, having regional planning will help to “better balance local priorities with national outcomes”.

This recommendation highlighted the past success of catchment partnerships, which have “demonstrated their ability to bring together local knowledge and expertise across sectors to support the implementation of solutions.”

Further details of this recommendation included:

• Regions should be clearly defined
• Their roles and responsibilities should be very clearly defined
• The roles should have a statutory basis so that planners have “an effective mandate to deliver change”.

Furthermore, the report called for regional planners to be “equipped to support the delivery of multiple benefits”.

Details of this role would include:

• A “core role in integration and co-ordination across different sectors and stakeholders”
• Decision-making that is in line with ‘relevant’ legislation and policy, such as environmental laws
• A major role in supporting nature restoration

These points about the virtues of regional decision-making were only part of the proposals the FWR offered, alongside better data use, an outcomes-based approach to achieving a vision for the water system, and solutions-focused monitoring plans.

How Would Regionalised Water Regulation Affect Business Water Customers?

Nonetheless, the regional ideas may be of particular interest, not least as business water customers will be aware that their situation may be affected by what region they are based in. This is partly due to varied performances by existing providers, but also to the climate.

For instance, those in drier areas like the East of England may have a greater concern about water supply resilience than those in the north, where winter rainfall still tends to fill up reservoirs in the hills and mountains, even if some dry summers can follow.

This may also focus on pollution problems that are worse in some regions than others, requiring a more concerted approach to tackle them.

In its white paper, the government did briefly mention the regional angle, promising reforms to bring about a “better joined-up regional water planning function”. However, that was not fully fleshed out in the way that the FWR has proposed.

Will Regionalised Water Regulation Appeal To The New Prime Minister?

That may change with a new man in at Number 10. Having gained enough Labour MPs’ nominations to rule out a contest, Andy Burnham will be walking through Britain’s most famous door later this month.

Mr Burnham has already spoken more about devolving more power and being less Westminster-centric, even going as far as proposing a ‘Number 10 of the north’ to operate out of Manchester.

For this reason, he may be very keen on legislation that has a stronger element of regional decision-making, with more statutory power behind it.

For business water customers, however, the key issue will be whether the decision-making, be it regional or national, has a significant qualitative effect on the things that matter, such as water security, pollution, leaks and the standard of service provided.

In the meantime, there is always the option to switch now if you are unhappy with the service or price your business is receiving.