There have long been concerns about the impact of pollution on Lake Windermere (Image: Getty)
Water regulator Ofwat “acted unlawfully by hiking customers’ bills to pay for past failures, campaigners have claimed.
River Action said households have been forced to foot the bill for decades of infrastructure neglect, as opposed to investors.
The water campaigners have taken the first step in a legal challenge against Ofwat, claiming it acted unlawfully in its Price Review 2024 determination for United Utilities.
The firm confirmed a 32% increase in bills over the next five years.
The challenge focuses on funding allocated for wastewater treatment works and pumping stations in and around Lake Windermere.
Emma Dearnaley, head of legal at River Action, said: “We believe Ofwat has acted unlawfully by approving these funds without ensuring they are spent on genuine improvements to essential infrastructure. Instead, this so-called ‘enhanced funding’ is being allowed to be used to cover up years of failure.
“Effectively, Ofwat has signed off on a broken system where customers are being charged again for services they have already funded—while water companies continue to mark their own homework and pollute for profit.
“This scandal must be addressed. The cost of fixing the UK’s crumbling water infrastructure should fall on the companies and their investors—not on the British public.”
River Action said that instead of funding essential new water and sewage projects, these price rises—approved in last year’s Ofwat price review—could be being misused to fix long-standing issues that should have been addressed years ago.
The group claimed that Ofwat unlawfully approved “enhanced funding” from customers without a mechanism to ensure the money will be used solely to improve sewerage services; rather than bring services into compliance when that should have already happened under past schemes.
This means there is nothing to stop customers paying twice for services that have not yet been delivered.
River Action is not looking to overturn the ruling in Ofwat’s recent price review or reduce investment levels.
Leigh Day solicitor Ricardo Gama said: “Ofwat has said again and again in public that it won’t let price rises be spent on fixing historic issues which are leading water companies to breach their permits.
“They’ve said in black and white terms that customers won’t be expected to pay twice. But in documents seen by River Action it looks like Ofwat hasn’t done its homework in checking whether the money it’s letting United Utilities take from customers will actually be used for that purpose.
“River Action believes that this is reflective of a broader lack of due diligence by Ofwat over the decades, which has led to money not being spent on infrastructure improvements and instead being diverted to investors’ pockets.”
An Ofwat spokesman said: “We reject River Action’s claims. The PR24 process methodically scrutinised business plans to ensure that customers were getting fair value and investment was justified.
“We agree that customers should not pay twice for companies to regain compliance with environmental permits, and have included appropriate safeguards in our PR24 determinations to ensure this which we will monitor closely, taking action if required. We will respond to their letter in due course.”