‘Labour must prove it understands public anger over water company failure – and act on it’

Like many Labour MPs I have had a lot of emails encouraging me to watch “Dirty Business”, the Channel 4 docudrama on the water company sewage scandal. The UK public will tolerate many things, but they will not tolerate an obvious injustice. And they will not tolerate being taken for mugs which is exactly how the water industry has treated them.

In 2024, Labour won an election on a promise of ‘change’. This wasn’t tucked away in the middle of our manifesto. It was on the front of every leaflet. It was the hashtag on every social media post. Every ‘out card’.

READ MORE: ‘Thames Water creditors’ sewage deal will not wash with customers’

Labour’s current troubles are because people don’t believe we have delivered that change. And where they accept we have, they currently think it has been change for the worse.

Change, fairness and clarity

Nowhere is this clearer than on the issue of water.

People look particularly at a company like Thames Water, the largest in the country, who also serve my constituency. This is a company that has abused its monopoly. Infrastructure has been left creaking while bosses took out loans to pay dividends to shareholders. Now it is drowning in debt, and it is still polluting our rivers, streams, and beaches with sewage.

Yet last year, under a Labour government, they were allowed to increase bills by £250. This is a lot of things, but nobody can claim that it is fair.

To most people, this is not just mismanagement. It is a violation of the basic British belief in fairness.

People do not expect perfection. But they do expect that companies entrusted with essential services should not be allowed to pollute, profiteer, and then plead poverty to bill payers who are unable to switch suppliers.

Thames Water’s collapse into dysfunction is not an accident. It is the predictable outcome of a political choice to let private companies treat essential infrastructure and bill payers as a cash machine. And when they fail, it is the public who are forced to cough up.

The company is staggering under nearly £20 billion of debt — the legacy of decades of financial engineering that prioritised extraction over investment.

Meanwhile, the pipes leak. The rivers choke. The bills rise. And sewage still ends up in our rivers and on our beaches. Is it any wonder that people are angry?

The cost of living tops every poll of issues that the public are concerned about. And the government has recognised this by taking welcome steps on energy, rail fares, prescription charges and childcare.

But when a bill that (unlike some of those things) everyone in the country has to pay – namely water, is allowed to increase after a company has behaved as shoddily as Thames Water, then the public are entitled to ask if a government elected on a mandate for change really gets it.

A Survation poll of 4,300 people found a majority want water run in the public sector, not by private companies that have repeatedly failed to deliver. New research from 38 Degrees shows overwhelming support for renationalising key services, including water, because voters are sick of “high costs, declining services, scandal-hit companies, and eye-watering bonuses.

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These numbers reflect a public that believes fairness has been broken. For all that Labour has passed legislation in this area; the reality is that the public do not believe it goes anywhere near far enough.

Nationalisation may not be the answer

Government estimates put the cost of bringing water utilities into public ownership at around £100 billion. This is not a trifling sum and when there are so many other competing priorities it is right that other options are explored.There are steps short of nationalisation that would show the public that we get the scale of their anger.

We should block companies from paying any dividends until infrastructure investment is delivered.

We should impose penalties that reflect the true scale of environmental harm.

We should force rapid restructuring of companies that fail basic standards.

And, like with COVID fraud, we should get billpayers at least some of their money back.

These are not radical demands. The measures taken so far in the Water (Special Measures) Act simply do not meet the scale of public anger and desire for change. 

That is the same for other things that the government has done. This is not about opening up the cheque book or about ripping up the fiscal rules. It is about calling time on those who have rigged and milked the system for far too long.

This crisis is not just about water. It is about whether the government believes fairness applies to vested interests that screw over hard-working people.

Polling shows the public has already made up its mind; they want a system that treats water as a public necessity, not a private cash machine. 

That doesn’t have to be publicly owned but it must be unambiguously public serving.

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