Sir Jon Cunliffe report: Independent Water Commission review predicts 30% water bills rise as Ofwat faces axe
A major review has said it's time for radical reform 💧
- Water bills in England and Wales are set to rise by 30% over the next five years
- Average bills to jump £123 this year alone — the biggest hike since privatisation
- Government-commissioned review calls for Ofwat to be scrapped and replaced
- Proposed shake-up includes new ombudsman and nine local water authorities
- Public anger grows over rising costs, sewage spills, and executive bonuses
Water bills in England and Wales are set to rise by 30% over the next five years, piling further financial pressure on households already grappling with the cost of living crisis.
That’s according to Sir Jon Cunliffe, the author of a major government-commissioned review into the water sector, who also called for a complete overhaul of how the industry is regulated.
The average bill is expected to increase by £123 this year alone, marking the biggest year-on-year hike since the industry was privatised 36 years ago.
And the long-term picture looks just as grim: once inflation is taken into account, households could be paying over a third more for water by 2030.
Sir Jon says the rises are driven by a combination of factors — including climate change, population growth, stricter environmental standards, and the urgent need to replace ageing infrastructure.
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But the spike in costs is also a consequence of years of underinvestment, he argues, with households now expected to foot the bill for "massive" upgrades.
“There are some inescapable facts here,” Sir Jon told the BBC. “The cost of producing water and dealing with wastewater is going up... The problem comes when you suddenly go from not investing for a long period to massive investment in order to catch up.”
What else did the water sector report say?
Sir Jon’s 217-page review, published today (July 21), doesn't just forecast higher bills — it calls for radical reform, including the abolition of Ofwat, the regulator that sets water bills and oversees investment.
Sir Jon labelled the current system “fragmented and overlapping,” and argued that a single, powerful new regulator should replace Ofwat, the Drinking Water Inspectorate, and some functions of the Environment Agency and Natural England.
The proposal follows a wave of public anger over issues ranging from sewage spills to generous executive bonuses, despite poor service levels and environmental damage.
More than 50,000 members of the public contributed to the review, reflecting widespread frustration with how water companies are held to account.
Environment Secretary Steve Reed backed the report’s findings, saying: “Ofwat is clearly failing.”
He is expected to announce the creation of a legally binding water ombudsman to handle customer complaints, alongside plans to halve sewage pollution by 2030 through £104 billion in investment.
The Government also plans to replace the current regulatory patchwork with nine local water authorities – eight in England and one in Wales – tasked with tailoring water infrastructure projects to the needs of local communities.
What happens next?
The planned hikes and regulatory shake-up are likely to stir further backlash. Water companies have already been under fire for increasing bills while failing to prevent sewage discharges and rewarding top executives with large pay packets.
Sir Jon stressed that restoring public trust must be central to any reform, saying: “Trust that bills are fair, that regulation is effective, and that water companies will act in the public interest.”
He also acknowledged the need for targeted support for vulnerable households as prices rise, and called on regulators to ensure water firms operate more efficiently.
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