Harsher penalties introduced in crackdown on water companies

Water companies that flout environmental rules now face penalties of up to £500,000 in the latest set of reforms to improve the UK’s waterways. 

As part of the government’s overhaul of the water system, the Environment Agency will see its powers strengthened and expanded. 

Previously, the regulator was limited in its ability to impose financial penalties for frequent, minor and moderate offending – such as breaches of a licence or permit. This was because it needed to prove an offence to the same high legal standard used in criminal courts, often making penalties too expensive and time-consuming to pursue. 

In future, the regulator will be able to use the lower civil standard of proof – meaning more financial penalties, delivered quicker in a move that ensures those who violate the rules have nowhere to hide. 

A £500,000 cap will be introduced to variable monetary penalties that are proved to the civil standard of proof. There will also be the introduction of new automatic penalties – like a speeding ticket – for clearly defined breaches. This would involve a £10,000 payment, which would double if the company failed to pay within 28 days.

Environment Secretary, Emma Reynolds, said: “This government has been clear that polluting water companies and bosses will face the consequences of their actions. The introduction of automatic penalties will give the Environment Agency the teeth it needs to deliver cleaner rivers, lakes and seas.

“This is just one of the actions we’re taking to clamp down on water companies including the introduction of a more powerful water regulator, no-notice inspections, MOT-style checks of water company assets and banning bonuses for polluting bosses.”

The Environment Agency will continue to pursue criminal prosecution for the most serious offences. The size of the penalty will be dependent upon the size of the water company, meaning penalties cannot simply be factored into the cost of doing business.

Environment Agency Chair, Alan Lovell, said: “We care deeply about protecting our waterways and welcome measures that will deter pollution incidents and other harmful permit breaches.  

“These changes complement our current enforcement powers, including criminal prosecution, and will further our aim of delivering quick and proportionate punishment where failures happen.  

“We now have more people, better data and increased powers to drive better company performance and achieve a cleaner water environment for us all.”

Modelling, based on water company performance in previous years, suggests the changes could cost the water sector between £50m and £67m annually. Water companies cannot pass the financial penalties onto customer bills.