Torbay Weekly: Devon enters drought status

Last month Devon officially entered drought status. This felt like a long time coming given the sweltering summer we have had. Driving around the constituency, it’s shocking to see how parched everything is – the landscape yellow and brown rather than bright green. It’s no wonder farmers are concerned about how they will feed their animals this winter.

But climate change is not solely to blame for our predicament. Our water industry, which has prioritised shareholder dividends over infrastructure improvements for decades, is also at fault.

South West Water (SWW), alone, loses millions of litres of water every year through leaks in their system. Specifically, in 2024/25, the company lost 39,347 million litres – that is the equivalent of 107.8 million litres every day, enough to fill an Olympic-sized swimming pool 43 times over.

To make matters worse, SWW is not even the most egregious leaker. Eight other companies, covering Wales, London, Yorkshire, East Anglia, and elsewhere, are all more prolific. It just shows that the water industry is failing to deliver right across the country.

This failure was on the cards the moment Thatcher’s government privatised water in 1989. Sold for a meagre combined £6.1 billion, the Conservatives created regional monopolies overnight, where companies could focus on wealth extraction in the absence of any competition.

This is an opportunity they have not passed up. With customers captive, water companies have increased charges by over 40% since 1989. At the same time, they have shelled out roughly £78 billion in dividends to shareholders, many of whom are based overseas, and fattened up exorbitant pay and bonuses handed to CEOs overseeing a declining industry held in contempt by the public.

I am sure no one in South Devon will forget that SWW’s former CEO Susan Davy saw her pay increase by £300,000 weeks after the cryptosporidium outbreak in the Brixham area. She also received a £270,000 bonus for the year the outbreak occurred.

This level of greed is both staggering and entirely predictable. The Conservatives created an industry with zero competition, where the raw material literally falls from the sky and is an essential resource needed for survival. No one should be making money from our water. Privatisation has abjectly failed, and the government has got to step in.

To rub salt into the wound, Ofwat, the water regulator in name only, gave some companies the green light to hike up bills yet again to pay for the improvements in infrastructure they have ignored for years. In response, the Prime Minister said customers cannot be treated like a blank cheque. I agree; I hope those words translate into strong action sooner rather than later.

Around this time last year, after the publication of the Cunliffe Review, the Starmer government said the water industry was broken. It promised a range of long overdue measures, starting with replacing Ofwat with a regulator capable of holding rogue water firms to account.

Over a year on, we have seen precious little progress. Lots of talk with next to no action typified the last Labour government. Let us hope Andy Burnham, who has had a lot to say about water, will provide the urgency this issue demands.

The Liberal Democrats plans are clear: we want to see water companies become mutually owned by their customers. This would remove the profit incentive, ensuring that any money earned would go back into the industry, not the pockets of overseas shareholders.

It is a bold move, but the crisis is such that boldness is required. We cannot allow the status quo to continue. Nothing we have seen since 1989 suggests we can trust these companies to act in the public interest.