DISGUST with the privatised English water industry is burgeoning. The “boycott” movement works to channel that anger to win change. 

Customers can make a powerful impact with relatively simple measures. The water industry is cash-strapped. Withholding or delaying payment, or just threatening this, can help tip companies into administration, forcing them to be taken back under public control. Boycotting also sends the message that it is not on to return the industry to private hands after losses have been socialised. 

Public opinion is on our side. A We Own It poll showed that 69 per cent supported renationalisation, including 62 per cent of Tory voters. Recent government announcements of tougher penalties for operators’ breaches recognises growing public discontent. Water campaigners can take some credit for this.

Margaret Thatcher handed ownership of the English water industry to private investors on a plate in 1988. Some £5 billion of debt was written off before the handover. England is an aberration, one of a tiny number of countries where water is not publicly owned. Scottish Water, founded in 2002, is accountable through the Scottish government. 

Welsh Water became a not-for-profit organisation with no shareholders in 2001. Even in the US, a land synonymous with “free enterprise,” 95 per cent of the industry is in public hands. 

Part of the rationale for privatisation was that the private sector is best placed to raise the huge sums needed to restore the sector’s crumbling infrastructure. On this measure alone, privatisation has failed. There has been gross underinvestment. Leakage from aged pipes remains a huge issue, and new reservoirs are desperately needed, not least because of climate change and population growth. The last one to open was Carsington, Derbyshire, in 1991. Planning started in the 1960s, long before privatisation. 

Perhaps the issue which arouses the greatest ire is the illegal discharge of raw sewage into our waterways. The impact on nature has been catastrophic. Repeated fines have had little impact. Criminality is built into the business model. Consumers effectively pay for fines through their bills. 

Campaigns have sprung up around the country, often initiated by individuals literally sickened by noxious wastewater fly-tipped into our rivers and seas. Surfers against Sewage, founded in Cornwall in 1990, was one of the first and is now a major environmental charity. Boycott Thames Water, founded at the end of 2023, is a relative newcomer.

Thames Water has received more attention than the other privatised companies. With 16 million customers, it is by far the largest. But Thames isn’t just one rotten apple. All the privatised companies prompt similar concerns. These all stem from the socially reckless decision to grant monopolies over a vital natural resource to private companies motivated solely by profit. It was entirely predictable that each one would put shareholders’ interests above those of customers or the environment.

Ironically, these monopolies were created by free-market zealots. Their answer to this obvious contradiction was to set up a regulatory regime. It presently comprises the Environment Agency, Ofwat and the Consumer Council for Water (CCW). 

The ever-worsening financial and environmental crisis throughout 35 years of oversight is evidence enough that they have failed in their respective roles.

The regime’s ineffectualness is compounded by a revolving door of executives between water companies and regulators. A Lib Dem investigation in 2023 identified six senior staff members who had moved jobs between the Environment Agency, Ofwat and water firms. No wonder companies can run rings round the regulators. 

In June 2024 former Tory minister Richard Wilson was appointed chairman of CCW. One of his memorable remarks was “Don’t be a bad loser” when questioned about homelessness in his constituency. CCW proclaims on its website that it is the “champion of the consumer.” In practice, when I and others have complained to them about illegal sewage spills in our local waterways, they say they cannot help.

Ofwat also has no credibility. Under its watch Thames Water spillages have mounted. From being debt-free it has accumulated debts totalling £16.5 billion. Borrowing has been engineered to extract dividends for shareholders. Interest on these loans is included in customers’ bills. Despite the massive debt, Thames paid two dividends totalling £158 million in March this year. It knew it could get away with it.  

Two key reports were published on July 11. One was Ofwat’s draft determination on water company regulation for the next five years. It includes proposals for a hike in bills, and tougher environmental targets. It is mirrored in the simultaneous publication by Environment Secretary Steve Reed of “initial steps towards ending the crisis in the water sector.”

An early test of its credibility came around the end of July when Thames bonds were downgraded to “junk” status by Moody’s and S&P. This puts Thames in flagrant breach of its licence conditions. Reed stated on July 28 that Thames will not be temporarily nationalised because it remains “financially viable,” despite the fact it is trading while insolvent. 

On August 7 Ofwat appointed an independent financial monitor. The idea is to nurse the company back to health at our expense. But, without a meaningful threat to take away licences, companies have good reason to believe they can continue to act with impunity.

The next few months are critical. Thames asked for an increase in bills to an average of £627 from the current average of £436. Instead, Ofwat propose average bills will be £535 by 2029/30. That’s still a whopping 22 per cent on top of inflation. Before Ofwat’s final decision in December Thames will no doubt be lobbying for higher increases while seeking new funds from investors.  

This is a golden opportunity for boycotters to send a powerful message that Thames Water is uninvestable. The first step is to cancel any direct debit arrangement. It costs nothing and carries no risk.

One group, Take Back Water, aims to secure support from a critical mass of people willing to withhold payment simultaneously. They are successors to the Don’t Pay campaign founded in 2022. Every boycotter should sign up.

Those wanting to engage more actively now can adopt the tactics of national groups such as Boycott Water Bills or Don’t Pay for Dirty Water, a subgroup of Extinction Rebellion, or local campaigns such as Boycott Thames Water.  

We tell our water company that we are not paying for the wastewater element of our bill, approximately half, and lodge a complaint. Confidence comes from the fact that operators have no legal power to cut off domestic supply. Provided a dispute is maintained they should not take recovery action. Their decisions can be appealed to the regulators. Some boycotters have  prolonged their complaints for many months by maintaining a dispute this way. The Boycott Water Bills website (www.boycottwaterbills.com) includes template letters and other resources.

The only risks for a boycotter are that an operator will eventually take recovery proceedings, or report non-payment to a credit agency. Operators should give plenty of warning before doing either. Any boycotter who gets cold feet can pay up, and then start again. It is sensible to set aside any withheld payment to cover this eventuality.

Many already struggle with water bills. Disgracefully, neither of the July 11 publications include consideration of affordability for consumers. The proposed hike applies to all, regardless of means. There is no social tariff. Benefit provision is only available to those with exceptional medical needs. 

On July 25 Chancellor Rachel Reeves said on Radio 4 nationalising water “doesn’t stack up against our fiscal rules.” Yet the proposed hike is a levy on all customers for the failure of our water companies — a poll tax in all but name. We cannot afford not to take water back. Shareholders do not deserve compensation. The public should not bail out bond holders for bad lending decisions.

It is no coincidence that the poll tax was imposed at the same time water was privatised. The time is ripe to invoke the spirit that defeated the poll tax to reverse the madness of water privatisation.

Paul Kaufman is a founder member of Boycott Thames Water.