The UK government is set to grant mayors enhanced authority over water companies as part of a broader plan to increase public control of utilities, according to details revealed ahead of an official announcement. This move, expected to be unveiled within Prime Minister Andy Burnham’s forthcoming “10-year plan,” will establish nine regional bodies tasked with overseeing major water firms in England and Wales.
These new entities will include local political leaders alongside public health officials, customers, and environmental representatives. The boards will be responsible for setting company objectives and holding executives accountable for issues such as billing, water shortages, and sewage discharges. The initiative aims to address growing public dissatisfaction driven by chronic underinvestment in water infrastructure, which has led to frequent sewage spills, burst pipes, and leaking systems.
Criticism of water company management has intensified in recent years, particularly concerning substantial executive pay packages amid rising customer bills and service disruptions. During the Makerfield by-election, Burnham raised investor concerns when he voiced support for full nationalisation of certain water companies, including Thames Water. However, since assuming office, he has shifted rhetoric toward advocating for "greater public control" without pursuing outright state ownership, which would entail significant government expenditure.
The regional oversight bodies are also intended to improve customer engagement. They are expected to manage consultations using feedback mechanisms similar to those employed by Transport for London, designed to gather public input on service proposals. This approach follows recommendations made by Sir Jon Cunliffe, former deputy governor of the Bank of England, who authored a review of the water industry commissioned by the current Labour government in June. While the government has accepted some of Cunliffe’s proposals—such as abolishing the existing regulator Ofwat in favor of a “super regulator”—it has not yet endorsed his recommendation for regional system planning boards composed of diverse stakeholders including mayors, engineers, farmers, and health officials.
Creditors of Thames Water, which is reportedly nearing financial distress, have expressed support to the Department for Environment, Food and Rural Affairs for regional regulatory arrangements as a preferable alternative to full nationalisation. Investor optimism hinges on hopes that these reforms will restore public trust and strengthen water companies’ ability to attract private capital by reducing executive autonomy.
A government spokesperson emphasized the need for stronger oversight in the water sector, stating, “Our water industry has not been working for people for far too long. We’re bringing in tougher regulation, stronger enforcement and greater accountability, so water companies deliver for customers and the environment.” The announcement of the new regulatory framework is widely anticipated as a key component of Burnham’s broader strategy to increase state involvement in essential services.