Millions of pounds of fines imposed on water firms will fund environmental schemes to protect the country’s waterways after fears the money would be diverted to the Treasury.
The water restoration fund was set up by the Conservative government to ensure that polluting water firms paid for the damage they caused. The fund received £11m in fines and penalties from April 2022 to October 2023.
It was reported in January that the Treasury was looking to keep money earmarked for projects across the country. River trusts have submitted bids to improve and monitor the health of a number of rivers, including the River Derwent in Derbyshire and the River Waveney on the Norfolk-Suffolk border.
Successful applicants to the fund will be notified on Monday, with work due to start this year. Projects will focus on improving the water environment in the same regions where the water company fines and penalties were issued.
Environment secretary Steve Reed said: “After years of failure, our rivers, lakes and seas are awash with pollution. The sewage scandal ends now.
“This government has already placed failing water companies under tough special measures through the water act, with new powers to ban the payment of bonuses for polluting water bosses and bring criminal charges against lawbreakers. This week we’re going even further, investing millions of pounds of funding from water company fines into cleaning up our rivers, lakes and seas.”
The announcement of the money for the restoration schemes comes after the Water (Special Measures) Act was passed last month to ensure firms are held to account. New laws will strengthen regulation to ensure water bosses face personal criminal liability for law breaking. Water firms will also be required to install monitors at every sewage outlet, with data independently scrutinised by regulators.
Environmental campaigners wanted an amendment in the new bill to ensure all future fines imposed on water firms would be ringfenced for restoration projects. The amendment was not included in the new bill and ministers have been repeatedly challenged over how future criminal fines and civil penalties will be used.
Charles Watson, chair of the charity River Action, said any money for restoration was welcome but £11m was a small amount compared with the billions of pounds paid out in dividends. He said: “Every pound that is given to local communities to restore rivers is welcome and we are grateful for that, but the money in this fund is just a rounding error compared to how shareholders and lenders have been paid out by the water firms.”
An independent commission into the water sector is carrying out the largest review of the industry since privatisation. Ministers says this will help shape further laws to attract the investment needed to clean up our waterways and restore public confidence in the sector.
