£45bn funding gap leaves England short of legally binding waterway targets

A £45 billion funding hole needs to be plugged for England to meet legally binding targets relating to the country’s waterways.

Without the funding commitment, the Office for Environmental Protection (OEP) has warned that England is on course to miss a string of legally binding targets.

In particular, the OEP warns that England is on track to miss targets agreed to under the European Commission’s Water Framework Directive “by a considerable margin”, due to the lack of funding coupled with failings from government and regulators.

Its assessment of regulatory targets estimates that just 21% of surface waters will achieve good ecological status by 2027, against the legally binding target of 77%.

The OEP assessed whether plans – including River Basin Management Plans – to improve England’s waterways would be enough to meet the environmental objectives set out in the Water Environment Water Framework Directive regulations stipulated in 2017.

These underpin goals for clean and plentiful water in the government’s 2023 Environmental Improvement Plan and targets set under the 2021 Environment Act.

The environmental watchdog said that “insufficient investment in measures to address all major pressures” was largely to blame for the lack of progress.

The OEP report adds that the Environment Agency has calculated it will cost £51 billion to meet the environmental objectives set under the Water Framework Directive regulations, but only £6.2 billion (12%) of funding has so far been confirmed.

Within the report, the OEP states that significant further investment by water companies has been outlined to reduce discharges from storm overflows for 2025-30. However, it adds that the “amount, pace and contribution” of how this will meet environmental objectives is “not yet fully known”.

“Moreover, other major sources of pressure, such as agriculture and transport, are not receiving the same resources or attention. Overall, we do not yet see a picture of the necessary resources being directed to all major pressures to meet the environmental objective,” the report adds.

As well as flagging concerns about the investment gap, the OEP report also raises “deeply concerning” failures by government and the Environment Agency which it claims are putting English waterways at risk.

The OEP report concludes that government and the Environment Agency “may not have” met regulatory requirements relating to the setting of environmental objectives for water bodies.

It raises concerns about “a lack of specific information showing when and how objectives for individual water bodies will be met; the justification of approved exemptions from the objectives in the regulations; and issues of public participation and consultation”.

“We have found that, while the relevant law here is broadly sound, it is simply not being implemented effectively,” chair of the OEP Glenys Stacey said.

“This means it is not delivering as intended and, as a consequence, most of our open water is likely to remain in a poor state in the years ahead unless things change. This is deeply concerning.”

Stacey called on government to “ensure substantial funding for a wider range of specific action, at pace and with ambition” to support the work underway to improve waterways and the environment.

“There is a significant need to strengthen how environmental law on water is applied to make sure it is effectively and contributing as its needs to achieving Government’s wider goals and targets,” Stacey said.

“There is a particularly urgent need for additional measures to be in place and for measures to be targeted at a local level, if there is to be any hope of achieving the 2027 targets. Government must speed up and scale up its efforts to protect and improve our waters.”

A government spokesperson said: “We are confident that the River Basin Management Plans are compliant with the current regulations and we have already committed to reforming these plans and delivering tailored long-term proposals to improve all water bodies in England. This is alongside our work to fast-track investment and hold water companies more accountable – including consulting on a ban on bonuses and bringing in a four-fold increase in inspections.”

They added that government will consider in detail the recommendations made in the report to go further on its work to protect and restore waterbodies.

The OEP was formed two years ago to bridge the gap left by leaving the European Union to ensure central and devolved governments were meeting statutory commitments and have sufficient work underway to meet future targets.

Its first investigation, launched in 2022, was into the roles of Ofwat and the Environment Agency in monitoring and regulating discharges from wastewater company assets. Earlier this year, the OEP said it was close to concluding this investigation, which it hoped to resolve swiftly.

Last year, the OEP also called out Defra for missing deadlines to complete legally required reviews of environmental laws. Reviews must be carried out within a set period after new legislation has been introduced, however the OEP found these were not completed for 49 out of 56 laws Defra was due to review.