The privatised companies are talking of building 10 new reservoirs even though they have not managed to construct one in the past 30 years
When it comes to long-term planning, few things matter more than ensuring the plentiful and safe supply of water. Privatisation in the 1980s was supposed to ensure greater levels of investment in ageing infrastructure.
The industry says unprecedented amounts of money have gone into the system, more than had it remained in state hands. To attract the additional funding it is necessary to pay premiums to investors, something to which clean water campaigners object. The real issue is whether they have been too generous to shareholders while failing to spend enough on cleaning up rivers, mending leaks and stopping sewage outflows into the sea.
The experience of recent years indicates they have got the balance hopelessly wrong, and the companies have apologised for doing so. They have now published a £96 billion infrastructure plan and are expecting households to pay for it. Bills will rise by more than £150 a year – a 35 per cent rise by 2030.
The idea that the consumer should pay is perfectly justified except that many will feel they have already forked out for this work, only for it not to happen. Perhaps Ofwat, the regulator, might conclude that shareholders should take a bigger hit this time. There is also an unreality to some of these proposals. The water companies are talking of building 10 new reservoirs even though they have not managed to construct one in the past 30 years.