Cheap apologies over sewage from water firms contrast with rising bills for customers: Andy Brown

Few of us who live in Yorkshire have any choice about who supplies us with the basic essential of clean water and we are also forced to assume that Yorkshire Water will comply with the law and dispose of our sewage appropriately.

The law on sewage disposal is very clear. It is only legal to release sewage into rivers in exceptional circumstances when the weather is so extreme that there is no alternative and when the large quantities of rain that is falling maximise the chance of the unpleasant substances being washed out to sea.

In 2021 raw sewage was released into the River Aire on 4,085 different occasions. For the Calder it was 4,055 times whereas the Ouse received 2,099 separate releases. That meant that three of the worst 10 rivers in the country were in the Yorkshire area. Channel 4 recently filmed releases of sanitary towels and wet wipes on the River Wharfe a few hundred metres above an officially declared river bathing area in Ilkley. It was happening on a dry day.

Releases which are made frequently or when no rain is falling are hard to classify as occasional events happening because of unusual weather.

So the Chief Executive of Yorkshire Water has apologised, said that “we should have acted more quickly to change this situation” and declined any bonus for this year. The company is also to invest £180million on more storage capacity by March 2025.

All of which sounds pretty good. Until you ask the most basic of questions. Who is going to pay for that £180 million investment?

The answer seems very clear. It will go onto the bills of customers. So the company messed up. On a huge scale. Systematically and for years. Yet you will be asked to pay for the investment to cure the problem.

This is particularly curious as the whole idea of privatising the monopoly water companies was that it was meant to increase investment by bringing in private sector finance. What has happened instead is very different. A great deal of money has been sucked out of the business, debts have been loaded onto the companies and some extraordinarily high dividends have been paid out whilst the service has been starved of investment.

More than 70 per cent of all water companies in England are owned by international investment funds, private equity banks and the like. The outstanding debts those companies have taken on is a staggering £53.9 billion. That is well over £1,000 of extra debt for every single customer in the country. All of that debt has been acquired since privatisation and we customers are paying 20 per cent of our bills just to service it.

Which might be fine if that money had been properly invested and had achieved the modernisation of the network that we were promised would materialise if we allowed a monopoly of a vital industry to be handed over to the private sector.

Instead billions has been frittered away on paying out high dividends that inflate the share price. The water companies have been left with huge debts which the public will have to service for decades to come.

Choices have been made over three decades to fail to invest adequately and far too much money has been sucked out of the service whilst what has been invested has not kept pace with changes like new housing estates.

Bills have risen at an alarming pace but the service has modernised at a snail’s pace. That is the reason why our rivers are full of sewage.

At this point it is important to be clear about nationalisation and the private sector. I happen to be someone who thinks that the private sector often does a really good job and that competition can be a serious spur to innovation.

But the problem with the water industry is that it is virtually impossible to organise it as anything other than a monopoly. It makes no sense at all to have rival companies running different water pipes up your street and installing competing networks of sewage farms.

In such circumstances the company in question has huge monopoly power. Unless that power is properly controlled and regulated the potential for exploiting customers is obvious.

Unfortunately the tendency in recent years has been to strip away staffing from the Environment Agency and to reduce the controls it can meaningfully exercise over the industry. Inspections have reduced in number and that has allowed sloppy practices that make a lot of money to prevail.

It costs little for water companies to offer an apology. It will cost customers a great deal if they are allowed to issue it casually and then put bills up to pay for past errors that are no fault of the customer. We need to restore strong regulatory controls over these monopolies before we are taken for mugs again.

Andy Brown is the Green Party North Yorkshire Councillor for Aire Valley.