The Rivers Trust has welcomed the prioritisation of the environment for the first time in Defra’s latest Strategic Policy Statement for Ofwat – but expressed concern that the SPS is not yet ambitious enough, and still lacks clarity.

According to the Trust, for too long Ofwat has been “too narrowly focused on keeping costs down in the short-term, with little regard for long-term impacts on the environment and the legacy for future generations.”

However, the new emphasis on long-term thinking, innovation, and partnership working to drive improvements across water catchments gives hope that the water sector will play a stronger role in environmental improvement and nature recovery.

But the Rivers Trust went on to say it still has concerns that the SPS is not yet ambitious enough, and still lacks clarity on how Ofwat should regulate a fundamental shift in trade-offs.

Mark Lloyd, CEO of The Rivers Trust, said:

“We welcome that the protection and enhancement of the environment is now at the top of the list of OFWAT’s priorities. This will not be achieved by simply spending more money on traditional approaches by the water companies alone. We also therefore welcome the emphasis in the SPS on nature-based solutions and catchment-based partnerships with other sectors, which will deliver wider benefits to society and best value to customers.

“To make this a reality, we need better data to drive consensus about the pressures on the environment. We need a clear governance structure to set priorities and identify opportunities at a local level which can then bring together multiple streams of funding at a regional and national scale. This statement is encouraging, but the objectives will only become a reality if the government joins up the many plans into a more coherent and focussed collective sense of purpose.”  

In the view of Rob Collins, Director of Science and Policy at the Rivers Trust, the expectation of greater transparency and data sharing by water industry was to be welcomed but clarity is required as to the mechanisms for achieving that. In addition, successfully achieving the strategic priorities would require Ofwat to establish timelines and quantifiable targets against which progress can be measured.

Christine Colvin, Director for Partnerships and Communications, said that while it was clear that pollution, particularly from sewage, will no longer be tolerated, some of the language in the SPS was a concern. She explained:

“There is too much focus on Ofwat ‘challenging’, ‘encouraging’, and ‘pushing’ the water sector for change. Ofwat is the regulator, not a cheerleader for water companies. We need more specifics on enforceable mechanisms.”

SPS - provides no direct guidance around investment gaps in failing/ageing infrastructure

Amina Aboobakar, Commercial Director for The Rivers Trust, criticised the SPS, saying it needed to be more ambitious. ”It fails to specify the need for transformational change, provides no direct guidance around investment gaps in failing/ageing infrastructure and how this is to be addressed through the Price Review, and for the need for water companies to drive more environmental resilience,” she added.

The Rivers Trust said the key specific points that have fallen short of response in the consultation period (which was jointly submitted under the Blueprint NGO coalition of Wildlife and Countryside Link) include:

Climate change: the Trust had asked in its response for climate change adaptation and mitigation to be included as a strategic priority in their own right. However, there is no explicit mention of climate change or the climate emergency as a top strategic priority.

Net zero: the Trust had asked for a much clearer indication of what the Government and Ofwat expect the sector to deliver to meet its short and longer-term priorities, including by specifying outcomes, as for example, challenging the sector to go beyond its “net zero by 2030” commitment, by taking action on scope 1,2 and 3 emissions, and to play a leading role in helping wider society reduce emissions (4-5% of UK emissions are from use of product the sector sells).

Storm overflows: while the language around storm overflow reduction is clearer in this version of the SPS, in the Trust’s view it does not go far enough in specifically prioritising the reduction of overflows that do most harm or impact the most sensitive and highest amenity sites, which it had asked for in its response.

Per capita consumption: the SPS expects Ofwat to “hold companies to account for their contribution towards reducing personal water consumption to 110 litres of water per head per day (l/h/d) by 2050”. In its response Blueprint was calling for a more ambitious target, for companies to adopt a target of 100 l/p/d by 2050 – a level of consumption already achieved across many European countries.

Biodiversity: the Trust had asked for target calling for 20% biodiversity net gain – which had not been included.

Markets: the Trust welcomed the use of markets to drive ecosystem services and nature-based solutions, but in the consultation response it had challenged the inclusion of “Use markets to deliver for customers” as a key strategic priority. Markets should be enablers of the other priorities and not a strategic priority in their own right.

Partnership working: according to the Trust, in order to maximise market opportunities, especially for ecosystem services and nature-based solutions, and to deliver value for customers, share data in a more transparent way, more ambition was needed around partnership working, which it described as “yet another key message missing in the current document.” The Rivers Trust said competition through markets isn’t always the right way to drive more customer value and environmental gain, especially when considering co-funding and collaborative opportunities. According to the Trust, there must be a bigger ambition for partnership working - “encourage water companies to work in partnership” isn’t strong enough.

Nature-based solutions: in its response the Rivers Trust had wanted more ambition around water companies adopting NBS as a matter of course, such as in protecting raw water quality and reducing flood risk to assets and customers. Although the SPS now expects to see an increase in NBS, the expectation is still around “where appropriate” – according to the Trust this is still not ambitious or specific enough in providing the mechanisms by which this can be achieved.