There is no guarantee that any fines imposed on water companies for pollution under a new law will be allocated to Wales, according to Wales’ climate change minister, Huw Irranca-Davies. He stated that discussions are ongoing with the UK Government regarding this issue, and they are progressing positively. This comes as tougher pollution regulations are set to be implemented to hold water companies accountable for their environmental impact and customer services. The proposed bill will grant regulators enhanced authority to swiftly address instances of environmental harm caused by water companies and address failures in service provision.
The legislation will introduce stricter penalties, potentially including imprisonment for water company executives who impede investigations or fail to cooperate. Bonuses for executives could be withheld if companies do not meet set standards to safeguard the environment, consumers, and their financial stability. The bill aims to introduce severe and automatic fines for various offences, allowing regulators to levy penalties more efficiently without prolonged investigations. Additionally, it seeks to prevent the payment of bonuses to water executives if they fail to meet high standards for protecting the environment, consumers, and their company’s financial health.
During a Senedd committee hearing, Conservative MS Janet Finch-Saunders raised concerns about the allocation of funds from pollution fines, highlighting the possibility of revenue returning to the UK Treasury. Minister Irranca-Davies emphasised the Welsh Government’s efforts to retain generated revenue in Wales, reflecting ongoing discussions with the UK Government on this matter. Plaid Cymru’s Delyth Jewell drew attention to evidence from Natural Resources Wales regarding fine allocation, prompting the minister to acknowledge the need to ensure that funds resulting from prosecutions are reinvested in Wales.
Chair of the climate change committee, Llŷr Gruffydd, questioned the bill’s alignment with Welsh Government policies. Minister Irranca-Davies affirmed that the bill is coherent with Welsh Government objectives and provides an opportunity for collaboration on a UK level, highlighting the importance of adapting measures to suit Welsh Water’s non-profit structure. The bill’s endorsement of automatic penalties for specific offences was supported by Conservative MS Janet Finch-Saunders, who expressed frustration at delays in responses to pollution incidents by Welsh Water and NRW.
The bill also proposes amendments to standard enforcement procedures, shifting the burden of proof from beyond reasonable doubt to the balance of probabilities for civil sanctions in the water industry. Labour Senedd member John Griffiths raised concerns about Wales not being included in a requirement for pollution incident reduction plans, particularly given Welsh Water’s performance on water pollution. In response, Minister Irranca-Davies indicated a shift in stance and commitment to lobbying for an amendment extending this requirement to Wales.
Given the bill’s implications for devolved powers, the Senedd will make a decision on its consent. The bill’s significance lies in its potential to reform the regulatory framework governing water companies to enhance environmental protection and service delivery standards throughout the UK. The ongoing discussions between the Welsh and UK governments aim to ensure that any fines imposed on water companies for environmental breaches contribute to Wales’ environmental initiatives and sustainability efforts, reflecting a collaborative approach to safeguarding natural resources and upholding regulatory standards.