Defra response to OFWAT action on Thames Water

Environment Minister Ian Pearson has responded to the action taken by water industry economic regulator Ofwat over Thames Water's failure to meet leakage targets.

Mr Pearson said:

“It is right that the consumer does not bear the burden of the increased investment needed for Thames Water to deal with its failure to meet its leakage targets.

“The cornerstones of Government policy on regulation of the water supply industry are value for money for consumers and environmental sustainability. We welcome the fact that the powers extended in the 2003 Water Act have given the Regulator the necessary weight to take action against companies who are not serving those interests.

“£150 million of additional investment in replacing leaking mains – more than double the maximum imposable fine - which comes from the shareholder and not the bill payer, added to a more stringent leakage target by the end of the review period - 2010 - stands squarely behind those principles."

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