Many now highlight that England is running out of water and with it the illusion that privatised utility systems can serve the public good. What began in 1989 as an experiment in market-led efficiency has deteriorated into a national scandal marked by leaking pipes, polluted rivers, and companies teetering on financial ruin.
As climate issues continue and infrastructure crumbles, England’s water sector is approaching a breaking point both ecologically and politically.
A System in Decline
The warning signs are becoming clearer as water quality is deteriorating, and vast quantities of water are being lost daily. In 2023 alone, untreated sewage was dumped into England’s rivers and coastal waters for an astonishing 3.6 million hours. Meanwhile, nearly:-
3 billion litres of clean water leak from aging pipes every single day.
The government has responded, belatedly, by approving the construction of two new reservoirs in Lincolnshire and East Anglia. There are the first major water storage projects since 1992.
But the scale of the challenge dwarfs these efforts.
By 2050, the Environment Agency projects a daily shortfall of 5 billion litres of water.
Without decisive action, large parts of England face an era of increasing scarcity.
Is Privatisation a Root Cause?
There is a deeper story, however and this lies not just in environmental change but in economic ideology. In 1989, Margaret Thatcher’s Conservative government privatised England’s ten regional water authorities, promising efficiency, innovation, and investment. The actual transaction told a different story:
£5 billion in debt was written off, another £1.5 billion handed out in public subsidies, and the companies sold off for just £7.6 billion.
Since then, the newly privatised water firms have paid out:-
more than £75 billion in dividends to shareholders
Many argue that this money could have been reinvested into infrastructure, sustainability, or service improvement. Instead, water bills have soared by over 350% in real terms, while the system itself has decayed.
Executive Pay at Major UK Water Companies
Thames Water
- CEO: Chris Weston (appointed January 2024)
- Base Salary: £850,000
- Bonus Potential: Up to 156% of salary (~£1.3 million)
- Total Potential Package: Approximately £2.3 million
- Recent Bonus: £195,000 for three months’ work in early 2024
(These figures have been taken from numerous different media outlets incl, The Guardian, Smart Water Magazine, The Standard, Sky news, The Times, east Devon watch and BBC.)
Severn Trent
- CEO: Liv Garfield
- 2023–24 Total Pay: £3.2 million, including a £584,000 bonus
- Note: Despite a 33% increase in sewage spills, Garfield’s compensation rose, making her one of the highest-paid executives in the sector
(These figures have been taken from numerous different media outlets incl, The Guardian, Smart Water Magazine, The Standard, Sky news, The Times, east Devon watch and BBC.)
Yorkshire Water
- CEO: Nicola Shaw
- 2023–24 Total Pay: £657,000 in salary and benefits, plus a £371,000 bonus
- Note: The bonus was awarded despite the company facing criticism for service failures
(These reported figures have been taken from numerous different media outlets incl, The Guardian, Smart Water Magazine, The Standard, Sky news, The Times, east Devon watch and BBC.)
Pennon Group (South West Water)
- CEO: Susan Davy
- 2023–24 Total Pay: £562,000 in fixed pay, plus £298,000 from a long-term incentive plan
- Note: Davy declined her annual bonus amid public backlash over water quality issues
(These reported figures have been taken from numerous different media outlets incl, The Guardian, Smart Water Magazine, The Standard, Sky news, The Times, east Devon watch and BBC.)
Anglian Water
- CEO: Peter Simpson
- 2022 Pay: £1.3 million, including a £337,651 bonus
- Note: The bonus was awarded despite the company’s poor pollution record
(These reported figures have been taken from numerous different media outlets incl, The Guardian, Smart Water Magazine, The Standard, Sky news, The Times, east Devon watch and BBC.)
Northumbrian Water
- CEO: Heidi Mottram
- 2023–24 Total Pay: £842,000, including a £234,000 bonus
- Note: This represents an 8.8% increase from the previous year
(These reported figures have been taken from numerous different media outlets incl, The Guardian, Smart Water Magazine, The Standard, Sky news, The Times, east Devon watch and BBC.)
South East Water
- CEO: David Hinton
- 2021–22 Base Salary: £271,620
- Note: Additional compensation details for this period are not publicly disclosed
(These reported figures have been taken from numerous different media outlets incl, The Guardian, Smart Water Magazine, The Standard, Sky news, The Times, east Devon watch and BBC.)
Industry-Wide Trends
- Total Executive Bonuses (2023–24): £9.1 million across English and Welsh water companies
- Total Executive Compensation: Over £20 million, including base pay and pension contributions
To put these figures into context they need to be discussed in relation with record levels of untreated sewage discharges into UK waterways.
Looking at the Case of Thames Water
What company better illustrates the systemic failure than Thames Water. Responsible for supplying millions of people across London and the southeast, Thames Water is now £18 billion in debt with more than half of that linked to inflation, worsening its financial vulnerability in a high-interest environment.
Rather than maintaining and upgrading its network, it is reported Thames has used complex financial structures to inflate asset values, avoid taxes, and conceal dividend payouts. These tactics have not gone unnoticed: the company has been fined approximately £180 million since 2010 for environmental breaches yet continues to pollute and underperform.
Owned in part by foreign sovereign wealth funds, Thames Water now faces possible collapse unless regulators approve higher consumer bills and guaranteed investor returns. The public is effectively being held hostage for example it is pay more or watch the taps run dry?
An Industry in Crisis
Thames Water is not the only one. Across the privatised water industry, similar patterns persist:
- High debt and low investment
- Foreign ownership with limited accountability
- Profit-driven models prioritising shareholder returns over public need
Water companies operate as regional monopolies across England, meaning customers cannot switch providers if dissatisfied. This lack of competition has enabled systematic financial extraction while leaving essential services to suffer.
Meanwhile, the regulatory bodies meant to safeguard the public interest like Ofwat and the Environment Agency have proven largely ineffective. Fines and public rebukes have done little to deter bad behaviour, and enforcement powers remain weak compared to the entrenched power of multinational shareholders.
The Human and Environmental Cost
The consequences of these water company failure are widespread:
- Public health is at risk from contaminated rivers and beaches.
- Communities are enduring rising bills and unreliable services.
- Water workers face outsourcing, job insecurity, and stagnant wages.
- The environment continues to suffer from over-extraction, pollution, and habitat loss.
The situation is particularly dire for working-class and rural communities, where infrastructure is often older and more neglected, and where resilience against climate impacts is lowest.
Political Paralysis
Despite the mounting crisis, political will for structural reform remains elusive. While public opinion appears to increasingly favours nationalisation, successive governments both Conservative and Labour have shied away from reversing privatisation. Labour, once committed to public ownership of utilities, recently dropped its pledge to re-nationalise water, citing cost and feasibility concerns.
Reclaiming Public Ownership
Calls for public ownership are growing louder and many says for good reason. Water is a natural and essential resource. Many are now advocating that it should not be treated as a commodity for private profit. These advocates argue that a publicly owned water system would:
- Reinvest profits into infrastructure and climate resilience
- Ensure democratic accountability and local control
- Improve environmental performance and transparency
- Support fair wages and working conditions
Public ownership does not mean bureaucratic stagnation. It means treating water as a common good, managed for long-term sustainability, not short-term gain.Countries like Scotland, where water remains in public hands, seem to offer models for effective water governance, investment, and environmental stewardship.
Is that a true statement about Scottish ownership, This will be debated in Part 2 of ‘England’s water supply is facing an escalating crisis?’
A Troubled History: England’s Water Supply and Welsh Reservoirs
Long before privatisation, the politics of water in England have been fraught with controversy especially when it comes to Wales and England. As early as the 19th century, England began looking westward for reliable water sources to support its rapidly growing industrial cities. The abundant rainfall and mountainous terrain of Wales made it an ideal place.
One of the most contentious episodes came in the 1960s, with the creation of the Tryweryn reservoir in north Wales. Built to supply water to Liverpool, the project covered up the Welsh village of Capel Celyn, despite opposition from Welsh MPs and local communities. Carried out under a private bill in Parliament that many in Wales believed bypassed Welsh concerns, became a symbol of alleged English exploitation of Welsh resources and deepened nationalist sentiment in Wales.
The legacy of such projects continues to fuel resentment. Today, major cross-border pipelines still transfer water from Welsh reservoirs such as Lake Vyrnwy and the Elan Valley to English cities, including Birmingham and parts of the northwest. While legal agreements govern these transfers, critics argue that the system disproportionately benefits England. However, this is a contentious issue due to Devolution and the creation of the Welsh Assembly with an English equivalent.
In the context of environmental stress and growing scarcity, these long-standing tensions risk flaring up again. As England’s southeast becomes increasingly water-stressed, proposals to extract more water from Wales or build new inter-regional infrastructure are likely to spark renewed political and environmental conflict. The future of UK water management may depend on striking a fairer, more democratic balance between areas particularly where historical issues still cast a long shadow.
A Watershed Moment
England’s water crisis is more than a policy failure and it presents as symptom of a deeper ideological collapse. For over three decades, privatisation has delivered wealth to investors and arguably hardship to the public. Now, with environment pressures rising and infrastructure aging, England faces a stark choice:
Double down on deregulated decay or reclaim water as a public entity
Stephen Morris, General Secretary of the Workers of England Union, said “Rebuilding public trust, restoring environmental health, and ensuring water security for future generations will require more than tweaks to regulation or temporary fixes. It will require structural change and a new vision and one that puts people, not profit, at the centre of essential services.
The time to act is now. England cannot afford to let its most precious resource be bled dry by failing firms and failed ideologies. The future of water with England needs attention.”