Government to launch new water ombudsman to boost consumer protection
The changes, which will expand the role of the Consumer Council for Water (CCW), will bring the sector into line with other utilities by creating a legally binding consumer watchdog.
It will also provide a single point of contact for consumers with complaints, instead of leaving them uncertain about where to go.
The Department for the Environment, Food and Rural Affairs said the new watchdog would help 're-establish partnership' between water companies and consumers.
In May, a survey by the CCW found trust in water companies had reached a new low, with less than two-thirds of people saying they provided value for money.
Only 53% said they thought what water companies charged was fair, even before the impact of a 26% increase in bills that came into effect in April.
CCW chief executive Mike Keil said he welcomed the move to create a mandatory ombudsman, saying it had been a 'key ask' of his organisation 'so people can have absolute confidence that when they complain, they have robust protection'.
The new ombudsman is part of Mr Reed's wider plans for a 'root and branch reform' of the water industry, set to be unveiled alongside a major review of the sector on Monday.
Following publication of the review, he is expected to say: 'The water industry is broken. Our rivers, lakes and seas are polluted with record levels of sewage.
'Water pipes have been left to crumble into disrepair. Soaring water bills are straining family finances.
'Today's final report from Sir Jon Cunliffe's Independent Water Commission offers solutions to fix our broken regulatory system so the failures of the past can never happen again.'
The key recommendation is expected to involve scrapping Ofwat and creating a new regulator, which could incorporate the work of the CCW.
Shadow environment secretary Victoria Atkins said stronger consumer protections were 'welcome in principle' but only 'part of the serious long-term reforms the water sector needs'.
She said: 'We all want the water system to improve, and honesty about the scale of the challenge is essential. Steve Reed must explain that bill payers are paying for the £104 billion investment plan. Ministers must also explain how replacing one quango with another is going to clean up our rivers and lakes.
'Public confidence in the water system will only be rebuilt through transparency, resilience, and delivery.'
Liberal Democrat environment spokesman Tim Farron called for Ofwat to be scrapped, saying the sector needed 'fundamental change, not another layer of bureaucracy'.
He added: 'If Ofwat remains in either name or nature, then the Government will have let the public down.
'Simply scrapping Ofwat but retaining a balkanised and weak regulatory framework will only be window dressing, so we are interested in the Government's proposals but the jury is still out as to whether they'll make much difference.'
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