It’s 1989, and the Thatcher government is feeling confident. The Tories are riding high off the back of a rare electoral hattrick, and still command a majority of more than 100 – an impressive feat after a decade in charge. The miner’s strikes feel like a long time ago, and in the eyes of her supporters, Thatcher’s radical economic reforms are bearing fruit.
A central pillar of these reforms is privatisation, and by the end of the 1980s, the government had proven that it could implement the policy successfully – having already passed companies including British Telecom, British Aerospace, and Jaguar into private ownership. De-nationalisation had come to take on an almost mythical status among the party faithful, and many were now viewing it as a sort of economic panacea.
Following a convincing victory in the 1987 election, the Conservative’s program of mass sell-offs was aggressively accelerated, and implemented with a level of confidence that bordered on the hubristic. The Icarus moment came on July 6th, 1989, when the government decided it would privatise that most basic of human resources – water.
Whatever the merits of earlier deals, this was a major misstep. Privatising monopolies is very risky, especially when dealing with essential resources. If your local water provider ratchets up your bills, emits huge amounts of pollution, or offers poor customer service, you can’t just turn on a different tap. You’re stuck with them, and they know it. As would soon become apparent, the passing of the 1989 Water Act opened the door to parasites, both in and out of the water.
“The 1989 Water Act opened the door to parasites, both in and out of the water.”
36 years into this experiment, and the results are clear. Over this period, the water companies have paid out more than £50 billion to their shareholders and taken on £60 billion in debt, all while underinvesting in infrastructure and dumping millions of tons of raw effluent into our waterways. As the shareholders lined their pockets, we sunk to last in Europe for water quality. In today’s Britain, only 14% of the country’s rivers meet ‘good’ environmental standards.
This brings us to South West Water. The MP for Bridgwater and West Somerset recently referred to them as “a company of ruthless, money-grabbing cowboys that make Al Capone look like an angel.” Without the Flak jacket of parliamentary privilege, I will steer clear of his hyperbole, but there’s no disputing that the company’s record is highly concerning.
In March last year, an Environment Agency report labelled South West Water “the worst performing company for pollution incidents in the Environment Performance Assessment’s 13-year history.” In 2023 alone, it dumped sewage into local waterways for a total of 530,737 hours – an 83% increase on the previous year.
In September 2023, the company was hit with a £12 million fine for poor performance and appeared before Plymouth’s Magistrates Court last April facing 30 charges of breaching environmental permits and illegal water discharges, 5 of which it pleaded guilty to.
“In 2023 alone, it dumped sewage into local waterways for a total of 530,737 hours – an 83% increase on the previous year.
For the last ten years running, South West Water has been rated red by the regulators. It has taken on nearly £2 billion in debt, and faulty piping means it loses an estimated 127 million litresper day. It’s likely that this faulty piping, the result of underinvestment, was the cause of last summer’s outbreak of cryptosporidium in Brixham, which left over 100 people infected with the diarrhoea-inducing illness and thousands without drinkable water for weeks.
The company told Exeposé that “delivering improvements in our environmental performance remains our top priority. We recognise that further improvement is required. We have always been clear: one pollution is too many.” If this is the case, then it has a long way to go, considering that it committed 194 such incidents in 2023 – again, the worst performance in the market.
The company also told us that it “continue[s] to be open and transparent” on its environmental record, a claim directly contradicted by the Environment Agency, who last year accused them of dishonesty with the regulators.
After last summer’s Brixham outbreak, the CEO of the group owning South West Water, Susan Davy, admitted that they had “fallen significantly short.” Yet within weeks, South West Water had increased its dividend payout by a further 3.8%, meaning another £116 million was paid out to shareholders, while customers stared down the barrel of further price hikes.
And in the same year that the company doubled its sewage output, was hit with millions in fines and faced criminal charges, Davy was awarded a 58% pay rise, taking her total salary from £534,000 to an eye-watering £860,000. When challenged on this by Exeposé, the company emphasised that this related to her work for the entire group, not just South West Water, and that Davy could have claimed a bonus on top of this, which she declined.
A match made in Devon – The University and South West Water
University Vice-Chancellor Lisa Roberts (pictured below alongside Davy) has previously described the relationship between the University and South West Water as “flourishing.” Indeed, ties between the two go back a long way. The company has previously sponsored University events, and frequently collaborated on research projects.
Susan Davy (left) and Vice-Chancellor Lisa Roberts (right) (University of Exeter Press Office)
When contacted by Exeposé, the University declined to criticise South West Water’s record, but emphasised that they “share the concerns of the public regarding any pollution in our waterways.”
The most significant collaboration between the two has been the co-funding of the multi-million pound CREWW centre, which you can find opposite the Harrison building, emblazoned on the side with a large South West Water logo.
In fairness, the purpose of the CREWW building is to facilitate research into improving our water supplies, and its inhabitants surely do commendable work. The University says that through this research, it seeks “to support and enable water companies to continually reduce their impact on the environment.”
The University is right to encourage South West Water to improve, but at the end of the day, its influence is limited. What is truly, desperately required is a major tightening of the regulation. The 1989 experiment would not have failed so catastrophically if the market had an effective watchdog. Unfortunately, over the last 36 years, Ofwat has proven itself to be anything but.
Companies that exist in a private, profit-driven market are naturally disinclined to do anything that hurts their bottom line. Turkeys don’t vote for Christmas. If the Labour government is serious about cleaning up our waterways, they can’t rely on the goodwill of the private water companies. A major overhaul of the industry’s regulation is required, and time is of the essence.
Callum, Online Editor in Chief, has written for Exepose since his first year. His articles range from coverage of local issues to high profile interviews with figures such as Alastair Campbell and Suella Braverman.
South West Water: Past and Present
It’s 1989, and the Thatcher government is feeling confident. The Tories are riding high off the back of a rare electoral hattrick, and still command a majority of more than 100 – an impressive feat after a decade in charge. The miner’s strikes feel like a long time ago, and in the eyes of her supporters, Thatcher’s radical economic reforms are bearing fruit.
A central pillar of these reforms is privatisation, and by the end of the 1980s, the government had proven that it could implement the policy successfully – having already passed companies including British Telecom, British Aerospace, and Jaguar into private ownership. De-nationalisation had come to take on an almost mythical status among the party faithful, and many were now viewing it as a sort of economic panacea.
Following a convincing victory in the 1987 election, the Conservative’s program of mass sell-offs was aggressively accelerated, and implemented with a level of confidence that bordered on the hubristic. The Icarus moment came on July 6th, 1989, when the government decided it would privatise that most basic of human resources – water.
Whatever the merits of earlier deals, this was a major misstep. Privatising monopolies is very risky, especially when dealing with essential resources. If your local water provider ratchets up your bills, emits huge amounts of pollution, or offers poor customer service, you can’t just turn on a different tap. You’re stuck with them, and they know it. As would soon become apparent, the passing of the 1989 Water Act opened the door to parasites, both in and out of the water.
36 years into this experiment, and the results are clear. Over this period, the water companies have paid out more than £50 billion to their shareholders and taken on £60 billion in debt, all while underinvesting in infrastructure and dumping millions of tons of raw effluent into our waterways. As the shareholders lined their pockets, we sunk to last in Europe for water quality. In today’s Britain, only 14% of the country’s rivers meet ‘good’ environmental standards.
This brings us to South West Water. The MP for Bridgwater and West Somerset recently referred to them as “a company of ruthless, money-grabbing cowboys that make Al Capone look like an angel.” Without the Flak jacket of parliamentary privilege, I will steer clear of his hyperbole, but there’s no disputing that the company’s record is highly concerning.
In March last year, an Environment Agency report labelled South West Water “the worst performing company for pollution incidents in the Environment Performance Assessment’s 13-year history.” In 2023 alone, it dumped sewage into local waterways for a total of 530,737 hours – an 83% increase on the previous year.
In September 2023, the company was hit with a £12 million fine for poor performance and appeared before Plymouth’s Magistrates Court last April facing 30 charges of breaching environmental permits and illegal water discharges, 5 of which it pleaded guilty to.
For the last ten years running, South West Water has been rated red by the regulators. It has taken on nearly £2 billion in debt, and faulty piping means it loses an estimated 127 million litres per day. It’s likely that this faulty piping, the result of underinvestment, was the cause of last summer’s outbreak of cryptosporidium in Brixham, which left over 100 people infected with the diarrhoea-inducing illness and thousands without drinkable water for weeks.
The company told Exeposé that “delivering improvements in our environmental performance remains our top priority. We recognise that further improvement is required. We have always been clear: one pollution is too many.” If this is the case, then it has a long way to go, considering that it committed 194 such incidents in 2023 – again, the worst performance in the market.
The company also told us that it “continue[s] to be open and transparent” on its environmental record, a claim directly contradicted by the Environment Agency, who last year accused them of dishonesty with the regulators.
After last summer’s Brixham outbreak, the CEO of the group owning South West Water, Susan Davy, admitted that they had “fallen significantly short.” Yet within weeks, South West Water had increased its dividend payout by a further 3.8%, meaning another £116 million was paid out to shareholders, while customers stared down the barrel of further price hikes.
And in the same year that the company doubled its sewage output, was hit with millions in fines and faced criminal charges, Davy was awarded a 58% pay rise, taking her total salary from £534,000 to an eye-watering £860,000. When challenged on this by Exeposé, the company emphasised that this related to her work for the entire group, not just South West Water, and that Davy could have claimed a bonus on top of this, which she declined.
A match made in Devon – The University and South West Water
University Vice-Chancellor Lisa Roberts (pictured below alongside Davy) has previously described the relationship between the University and South West Water as “flourishing.” Indeed, ties between the two go back a long way. The company has previously sponsored University events, and frequently collaborated on research projects.
When contacted by Exeposé, the University declined to criticise South West Water’s record, but emphasised that they “share the concerns of the public regarding any pollution in our waterways.”
The most significant collaboration between the two has been the co-funding of the multi-million pound CREWW centre, which you can find opposite the Harrison building, emblazoned on the side with a large South West Water logo.
In fairness, the purpose of the CREWW building is to facilitate research into improving our water supplies, and its inhabitants surely do commendable work. The University says that through this research, it seeks “to support and enable water companies to continually reduce their impact on the environment.”
The University is right to encourage South West Water to improve, but at the end of the day, its influence is limited. What is truly, desperately required is a major tightening of the regulation. The 1989 experiment would not have failed so catastrophically if the market had an effective watchdog. Unfortunately, over the last 36 years, Ofwat has proven itself to be anything but.
Companies that exist in a private, profit-driven market are naturally disinclined to do anything that hurts their bottom line. Turkeys don’t vote for Christmas. If the Labour government is serious about cleaning up our waterways, they can’t rely on the goodwill of the private water companies. A major overhaul of the industry’s regulation is required, and time is of the essence.
Callum Martin
Callum, Online Editor in Chief, has written for Exepose since his first year. His articles range from coverage of local issues to high profile interviews with figures such as Alastair Campbell and Suella Braverman.
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