The Independent Water Commission published their Interim Report on the water sector – ahead of its final analysis due in the summer
By Jordan Rowse, Account Director for Water at Copper Consultancy.
The call for regulatory reform
Sir Jon Cunliffe, the man behind the review, has made clear the sector must change. To succeed, a move away from a “chaotic and incoherent” system of regulation is an absolute necessity; Cunliffe calls it “a huge part of the answer” and something which “needs to change”. Firm words from a civil servant.
The interim report sets out that, if the water sector is to do this, more leadership is needed from Government, with more coherent and effective regulation of water companies. Companies have their part to play too, with greater engagement and consultation with local communities, and a clear focus on securing sustainable, long-term investment into the sector.
Restoring public trust
In his foreword, Cunliffe says “restoring public trust is paramount” – it is an obvious point, but a critical one nonetheless . Towards the end of 2024, working alongside the Future Water Association, Copper published a report looking at public attitudes to water, and how the sector needs to restore societal trust as it heads to Asset Management Period 8 (AMP8). Collaborating with FWA further, we co-founded the Insights Steering Group made up of representatives from across the sector – looking at how we can have an open and honest conversation about the industry, and how we can improve public trust.
Short-termism on policy and strategic planning has dominated the water sector, with an often overfocus on reactive measures to appease regulators, politicians, the public and media. The results are expensive, and rely on more steel and concrete.
Embracing nature-based solutions
Even this morning, for instance, Cunliffe talked positively around nature based solutions, and the need to think more holistically about water management. This will be of vital importance to a future thriving water sector.
There has never been a stronger case for a National Rainwater Management Strategy, for example, which would mean, for the first time, a forensic look is taken at managing rain, and where it lands, better. By doing this, companies can keep it out of the system to avoid the sewers getting overwhelmed, which inevitably lead to storm overflow pills. It’s an example of how more strategic thinking can lead to long-term benefits.
The catch-22 for water companies
Water companies have been doing their bit and are currently beginning the process of reviewing their respective Drainage and Wastewater Management Plans. But they can only plan in accordance with guidance from Defra and the regulators. In many cases, they want to go further and faster, with more holistic approaches to catchment management, but that doesn’t deliver the quick optic wins many want to see. It encapsulates the Catch-22 situation water companies have, through their own making, created – and now need to solve.
Planning for the future
Through Copper’s work in the water sector, we’re aware a strong focus is needed on planning for the future: new major water infrastructure, current and future AMPs, and strategic water management. The interim report provides hope that greater resilience in the face of climate change must be treated not as a technical afterthought but as a strategic imperative. We need better alignment of strategic plans and more encouragement for innovation. The ingredients for change are there.
The recommendations from the Cunliffe Review have been widely anticipated and on the minds of most within the sector. How far will he go? What will he recommend? What does reform in the sector actually look like?
Well, this morning the interim report certainly whet the appetite and set out the foundations for change. Change is required, but it must come with certainty and stability.