Water regulators and the government have failed to provide a trusted and resilient industry at the same time as bills rise, the state spending watchdog has said.
Public trust in the water sector has reached a record low, according to a report from the National Audit Office (NAO) on the privatised industry.
Not since monitoring began in 2011 has consumer trust been at such a level, it said.
At the same time, households face double-digit bill hikes over the next five years.
The last time bills rose at this rate was just before the global financial crash, between 2004-05 and 2005-06.
Regulation failure
All three water regulators – Ofwat, the Environment Agency and Drinking Water Inspectorate – and the government department for environment, food and rural affairs (Defra) have played a role in the failure, the NAO said, adding they do not know enough about the condition or age of water infrastructure and the level of funding needed to maintain it.
Since the utilities were privatised in 1989, the average rate of replacement for water assets is 125 years, the watchdog said. If the current pace is maintained, it will take 700 years to replace the existing water mains.
Water firms have grappled with leaky pipes and record sewage outflows into UK waterways in recent years, with enforcement action under way against all wastewater companies.
Despite there being three regulators tasked with water, there is no one responsible for proactively inspecting wastewater to prevent environmental harm, the report found.
Instead, regulation is reactive, fining firms when harm has already occurred.
Financial penalties and rewards, however, have not worked as water company performance hasn’t been “consistent or significantly improved” in recent years, the report said.
‘Gaps,…
