Environmental Audit Committee chair calls for fines to go to river restoration not Treasury

Chair of the Environmental Audit Committee Philip Dunne has called for “balance” to be found at PR24 between improving wastewater treatment, securing drinking supply and keeping bills low.

Moving a motion last week that the House consider the Government’s strategic priorities for Ofwat, he urged: “With the rising cost of living, none of us wishes to see bills rising sharply, but equally, if water rates are set so low as to preclude necessary capital investment in water quality, we will simply kick the can down the road for another five years and the problem will be harder to solve and more expensive to fix. Given that the current cost of capital is still at historically low interest rates, over a multi-decade investment cycle water companies remain well placed to fund significant capital investment.”

During his comments, Dunne made two further calls for action to support sewage pollution reduction: that fines paid by water companies for breaching environmental standards be ring fenced for water quality improvement, rather than go to the Treasury. Other MPs supported the notion of this, via some kind of river restoration fund. And that the opportunity presented by the Levelling-up and Regeneration Bill, which had its Second Reading last week, be used to empower local authorities to require developers to contribute to meeting the cost of the infrastructure required for water and wastewater connectivity of new developments.

Water minister Rebecca Pow responded positively: “We are working on a holistic plan for water; it is an interesting concept [ring-fenced fines], and I hear what he says on that. He also talked about development consents and local authorities having no power to include infrastructure relating to water. Again I hear those comments; that is another valid point which I am happy to discuss further with him. In short, he has raised some important points in addition to the [EAC] inquiry’s recommendations and, as ever, the door is open for us to consider them.”