Water UK

October 2007

Investment in water infrastructure

Continued future investment in water infrastructure must be prioritised to meet society’s needs and remain affordable.
 

Modern society demands reliable and high quality water services that are vital to the health, well-being and economic viability of communities.

Since privatisation the industry has invested heavily in a massive and long-overdue improvement of the water service asset base. The result is: a huge improvement in the quality and reliability of drinking water; much improved customer service; rivers and beaches that are now cleaner they have been in decades; but also significant increases in water charges.

Water customers will not accept continuing major increases in water charges, particularly if this does not result in visible improvements to service.

This, coupled with the increasing reality of climate change, means that we have to refocus our priorities for future water investment.

What this means for WFD implementation

There is a political and economic limit to the costs that water customers can continue to afford.

While the water sector recognises its duty to protect the environment, further improvement to meet long-term WFD goals should not be at the expense of the key national priorities for water investment.

These are those that:

 • maintain and secure the existing high levels of service, particularly the quality of drinking water, and current levels of environmental protection
 • deal more effectively with the increasing risk of flooding
 • provide more secure water resources to deal with the threat of drought.

This is likely to mean that much investment to further improve the environment may have to be postponed or environmental targets reduced using the allowable exemption provisions in the Directive.

It is clear that new national strategies to deal with increasing flooding risk will be necessary. The water industry will play its fair part in this but it has to be recognised that the costs will be significant and reduce further the available finance for other aspects of the WFD.

The threat of drought, particularly in some parts of the country, is increasingly real. The industry will continue to drive down leakage levels and promote water efficiency but the need to create sustainable new water resources is becoming increasingly clear.

 
Supporting information

The existing scale of the water infrastructure needed to support this service is already massive at a total value of £288 billion.
This amounts to assets worth nearly £4,500 for every man woman and child in England and Wales.
By the end of the 20-year period from privatisation the industry will have spent £69 billion on improvement of the water service asset base and is continuing to invest at a rate of £3.36 billion every year.
Water service costs comprise a growing proportion of household income particularly for low income families.