The new strategic policy statement (SPS) to Ofwat that sets government priorities for the 2024 price review will be formally laid in parliament today.
The draft SPS, published in July 2021, had a heavy focus on reducing the reliance on combined sewer overflows (CSOs) and improving the water environment.
Water companies will be challenged by Ofwat to show they are being more ambitious to protect the environment, whilst also getting the basics right in the SPS, which will inform the framework for PR24.
It will also ask Ofwat to give more focus to addressing unsustainable abstraction, protecting vulnerable chalk streams and ensuring improved flood resilience.
Ahead of its presentation to parliament, environment minister Rebecca Pow said of the SPS: “Water quality is an absolute priority. We are the first Government to set a clear expectation that Ofwat should prioritise action by water companies to protect the environment and deliver the improvements that we all want to see. I have been very clear of my expectations of water companies and where they do not step up we will take robust action.
“The priorities that we are setting out today build on the work that we have already undertaken to reduce harm from storm overflows, improve monitoring and reporting of pollution incidents making this more transparent, to tackle run-off from agriculture, and protect the health of our rivers and seas,” Pow added.
In the draft SPS, the Department for environment, food and rural affairs (Defra) instructed the regulator to make environmental planning and pollution reduction top objectives for the coming price review and beyond. It was criticised for lacking clarity on ambitions and running the risk of vital investment being delayed until a future price review by Water UK.
The SPS must lay in parliament for 40 days without objection before it will come into effect. Ofwat must then follow the statement, and detail how major decisions will support the delivery of the SPS in the methodology for PR24.