Ofwat to be abolished as water sector faces criticism

The government plans to abolish Ofwat following intense scrutiny over water companies' practices.

England and Wales water regulator set for abolition

The government will announce plans to abolish Ofwat, the current water regulator for England and Wales, as part of a move to address mounting public criticism of the water industry. A review led by former Bank of England deputy governor Sir Jon Cunliffe found Ofwat has struggled to prevent sewage spills and high shareholder payouts while managing ballooning debts in the sector. The review, set to conclude next week, recommends creating a new regulatory body to improve oversight in an industry criticized for underinvestment and mismanagement. Thames Water, burdened by £20 billion in debt, is in precarious negotiations to avoid a state takeover, highlighting the urgent need for reform in water governance.

The planned abolition of Ofwat signals a shift in how water regulation may be approached, reflecting growing public discontent and concern over environmental impacts. Critics have long argued that the existing framework lacks coordination and has allowed several companies to prioritize profits over infrastructure investment. Experts warn that a hasty scrapping of existing structures without a solid plan could lead to confusion and further issues in a sector already facing significant challenges.

Highlights

The fate of the water industry relies on the upcoming changes and how they are implemented.