Ofwat Interim Chief Executive, David Black has written an open letter to water customers telling them that If the regulator finds that water and wastewater companies have done wrong, Ofwat will hold them to account.

Setting out the background to investigations by Ofwat and the Environment Agency into water companies following recent reports about sewage discharging into rivers, Black explains that “new checks on wastewater treatment plants have led to some companies admitting that they may not be treating all sewage in the way they should be.”

In the letter, which begins with “Dear Water Customer” the Ofwat Chief says that the reports “have understandably, caused widespread public alarm and concern.”

Ofwat’s investigation is looking at how companies manage and report the performance of their wastewater treatment works, “especially in light of commitments they give us each year that they have all the resources they need to do their jobs effectively,” the letter says.

The Environment Agency is investigating separately whether companies are breaking environmental law by not complying with the permits for their treatment works.

The letter explains that Ofwat has written to the companies concerned asking them to provide information on the following key issues:

• the performance of their works
• whether all their plants are working to permitted standards
• whether they have released unpermitted spills into the environment
• how the boards of water and wastewater companies check their company is meeting its environmental obligations and how they take account of this when deciding on executive pay and dividends.

Saying that if Ofwat finds that water and wastewater companies have done wrong, “we will hold them to account”, David Black cites Southern Water as an example – in 2019 the regulator ordered the water company to pay £126 million of penalties and payments to customers following serious failures at its wastewater treatment sites and for deliberately misreporting its performance.

He goes on to explain that Ofwat is currently at the early stages of its investigation and that

how long it takes will depend on what Ofwat finds and whether it needs to gather further information. In addition, some information will stay private for longer because publishing it could prevent Ofwat or the Environment Agency from taking enforcement action which could lead to financial penalties for companies or criminal prosecutions.

The letter concludes:

“Our investigation will identify any wrongdoing: it is up to water and wastewater companies to rebuild customers’ trust. Customers and CCW, who speak on their behalf, will expect companies to be honest and open about what's happened and, if they have broken the law, to explain how they will put things right for customers and the environment.”

Ofwat has asked for the water companies to provide their plans to address any wrongdoing by the 22 December, including how they will put things right for customers.