Labour’s new powers for customers to hold water companies to account are a “stitch-up”, campaigners have said, as utilities firms have been advising on how to implement it.
The Consumer Council for Water (CCW) is creating what the government referred to as “powerful consumer panels” so the public can question the executives of their local water company and get redress for problems they face from sewage and water companies in England and Wales.
But documents reveal that the CCW has asked water companies to advise on how they wish to be held to account by consumers.
Ministers promised last year to set up water boards for consumers that would allow them to air complaints such as about water shortages and sewage backing up into people’s homes.
Large areas of south-east England have faced days on end without water due to faults at treatment centres. Meanwhile, there have been hosepipe bans across the country for months as water companies have failed to invest in reservoirs, and companies continue to dump sewage in waterways. Water bills also continue to rise.
Water customers currently find it difficult to get companies to respond and properly compensate them when they are left without water. Signing up to the CCW is voluntary for water companies and it is often left to local MPs to solve complaints.
The new “Water Voice” panels have been established to give consumers a say on how their bills are spent and the problems they face at the hands of water companies. This is part of sweeping changes announced after the general election, aimed at fixing the broken water industry and giving more power to the customers of the monopolies who run the industry.
Documents released under freedom of information laws reveal the CCW has been consulting water companies on how to set up the new consumer boards that would hold them to account. It said it had “set up an industry advisory group to get ideas, feedback and advice from water companies”.
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Feargal Sharkey, the former Undertones frontman turned water campaigner, said: “This is a stitch-up. If water companies are involved in setting this up customers will not get any redress. The people who are important in all of this are the customers who have been extorted by these companies. The CCW is asking the extorters what should be happening to the victims, this is an outrage and a scandal.”
He added: “It sounds like this scheme will be equally inept and dysfunctional.”
The consumer group said complaints about water companies were rising. It received ۸۰% more complaints in ۲۰۲۵-۲۶ than the previous year, yet had no increase in resource.
Andy Burnham, the prime minister, is under pressure to take Thames Water under public control as the company is running out of money. However, this plan has faced delays as government officials fear a legal challenge by the company’s creditors if it is forced into administration, and the Treasury is concerned about the costs.
He is also due to introduce a new water bill to parliament, which will include the regulatory changes that are supposed to give new powers to crack down on water companies.
As part of this, Ofwat will be replaced by a regulator with supervisory powers, similar to the oversight of banks after the financial crash. Experts would be appointed to work inside water companies and ensure they are obeying the law and improving the environment.
A CCW spokesperson said: “It is a complete misrepresentation to suggest that CCW consulted water companies on how they would like to be held to account. CCW has engaged with water companies to work through the practicalities of how we could ensure their full engagement in the panels. For example, giving them enough lead time to ensure their chief executives were able to attend the accountability sessions and making sure action plans were produced in good time.”
A Department for Environment, Food and Rural Affairs spokesperson said: “We know the water industry hasn’t been working in the public interest for far too long. That’s exactly why this government is looking at how to give the public more control and keep bills as low as possible.
“We’re not satisfied with the current system, so we’re also introducing a new, independent and impartial water ombudsman to strengthen customer protection and make sure complaints are taken seriously and resolved quickly. It’s the least the public can expect, and one of our first steps to building a water system that works.”
