Thank you, Mr Deputy Speaker. I have, of course, saved the bulk of my responses for you and the House this afternoon. With permission, I would like to update the House on the Government’s plans to reform the water sector.
The water industry is clearly failing. Our rivers, lakes and seas are polluted with record levels of sewage, and water pipes have been left to crumble into disrepair. I share customers’ fury at rising bills. Right now, hosepipe bans are in place across the country because not a single new reservoir has been built in over 30 years, and the lack of water infrastructure is blocking economic growth. Water companies have been allowed to profit at the expense of the British people when they should have been investing to fix our broken water pipes. They got away with this because of a broken regulatory system that has failed both customers and the environment. The public expressed their fury in last year’s general election and voted for change. That change will now come.
In just one year, we have put in place the building blocks for change. First, we restored accountability by giving the regulators more teeth and introducing a ban on unfair bonuses, severe and automatic penalties for breaking the law, and jail sentences for the most serious offences. Secondly, we are investing £104 billion of private sector funding to rebuild the water network, upgrading crumbling pipes, repairing leaks, building new sewage treatment works and digging out new reservoirs. It is the single biggest investment in the history of the water sector, and it allows me to make a new commitment to the country: this Government will cut water companies’ sewage pollution in half by the end of the decade. That is the most ambitious commitment ever made by any Government about water pollution, and it is just the start. Over a decade of national renewal, we will restore our rivers, lakes and seas to good health.
The third building block for change is today’s final report from Sir Jon Cunliffe’s Independent Water Commission. I express my thanks to Sir Jon, his officials, and all those who have contributed to this outstanding piece of work. I agree with Sir Jon that water regulation has been too weak, too complex, and ineffective. Having four separate regulators with overlapping and conflicting remits has failed both customers and the environment. Ofwat has failed to protect customers from water companies’ mismanagement of their hard-earned money, and it has failed to protect our waterways from record levels of pollution. Today, I can announce that this Labour Government will abolish Ofwat. We will bring water functions from four different regulators into one—a single powerful super-regulator responsible for the entire water sector, with the teeth it needs to enforce the high standards that the public rightly demand.
The new regulator will stand firmly on the side of customers, investors and the environment and prevent the abuses of the past. For customers, it will oversee investment and upgrade work, so that hard-working British families are never again hit by the shocking bill hikes that we saw last year as customers were left to pay the price of failure by the previous Government. For investors, it will provide the clarity and direction required for a strong partnership between Government, the sector and investors to attract billions of pounds of new funding. For the environment, it will reduce all forms of pollution to clean up our rivers, lakes and seas for good. We will work closely with the Welsh Government to devolve the economic regulation of water to Wales.