Live Scrap Ofwat, major water review recommends
Sir Jon Cunliffe, who was tasked with leading the Independent Water Commission, has recommended 88 changes to the industry which he said was 'failing' customers.
They included abolishing Ofwat, which oversees how much water companies in England and Wales can charge for services and the Drinking Water Inspectorate, which ensures that public water supplies are safe.
The report, published on Monday morning, recommended far-reaching changes to the way the water system is regulated as it found the current landscape 'fragmented and overlapping'.
It also advised removing the regulatory roles of the Environment Agency and Natural England, which monitor the sector's impact on nature, such as companies illegally dumping sewage into waterways.
Sir John also said that previous governments were partly to blame, telling Times Radio 'it's the failure of government to balance out all the different pressures on water'.
Steve Reed, the environment secretary, will give a speech this morning promising that 'the failures of the past can never happen again'.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Independent
24 minutes ago
- The Independent
Chancellor ‘must raise taxes to help plug £40bn-plus gap to meet fiscal rule'
The Chancellor must resort to 'moderate but sustained' tax rises to help repair Britain's battered public finances as she faces missing one of her fiscal rules by more than £40 billion, an economic think tank has warned. The National Institute of Economic and Social Research (Niesr) said weaker-than-expected recent economic activity, U-turns on welfare cuts and forecast-beating borrowing have combined to create a 'worsening fiscal outlook'. Rachel Reeves is now set for a £41.2 billion shortfall on her 'stability rule' in 2029-30 and has been left with an 'impossible trilemma' of trying to meet her fiscal rules while fulfilling spending commitments and upholding a manifesto pledge to not raise taxes, it said. She will need to raise taxes or cut spending in the autumn budget to plug the gap, Niesr cautioned. This comes despite Niesr nudging up its economic outlook for the UK, with growth of 1.3% now pencilled in for 2025, up from 1.2% forecast in May. But the group cut its prediction for next year – to 1.2%, down from 1.5% previously expected. Niesr has urged the Government to look at addressing the public finance woes by building a 'large fiscal buffer via a moderate but sustained increase in taxes'. It said: 'This will help allay bond market fears about fiscal sustainability, which may in turn reduce borrowing costs. 'It will also help to reduce policy uncertainty, which can hit both business and consumer confidence.' Niesr also said the UK was in store for higher-than-forecast inflation, averaging around 3.5% this year and edging back only slightly to 3% in the second quarter of 2026 due to higher wages and Labour's measures in last autumn's budget. Professor Stephen Millard, Niesr's deputy director for macroeconomics, said: 'With growth at only 1.3% and inflation above target, things are not looking good for the Chancellor, who will need to either raise taxes or reduce spending or both in the October budget if she is to meet her fiscal rules.' Despite the inflation pressures, Niesr expects the Bank of England to cut interest rates from 4.25% currently to 3.5% at the beginning of 2026. The Chancellor has set herself two fiscal rules – the 'stability rule', which ensures that day-to-day spending is matched by tax revenues so the Government only borrows to invest, and the 'investment rule', which requires the Government to reduce net financial debt as a share of the economy. Shadow chancellor Sir Mel Stride said: 'Experts are warning Labour's economic mismanagement has blown a black hole in the nation's finances which will have to be filled with more tax rises – despite Rachel Reeves saying she wouldn't be back for more taxes. 'Labour will always reach for the tax rise lever because they don't understand the economy.'
The Independent
24 minutes ago
- The Independent
The government ‘black hole' which could see your taxes start to rise
The National Institute of Economic and Social Research (NIESR) has warned that Chancellor Rachel Reeves faces a £41 billion shortfall in public finances. This deficit, projected by 2029-30, is attributed to Labour's policy reversals, increased borrowing, and sluggish economic growth. NIESR suggests the Chancellor must either raise taxes, cut public spending, or abandon her fiscal rules to address the 'impossible trilemma' of balancing commitments. Tax increases are considered the more probable solution, with NIESR highlighting that the poorest 10 per cent of households have already experienced a 1.3 per cent drop in living standards under Labour. The think tank also noted that the Chancellor's current £9.9 billion financial buffer is insufficient and proposed a potential rewrite of the government's fiscal rules.
The Independent
24 minutes ago
- The Independent
Reeves warned she must raise taxes or cut spending to plug £41bn black hole
Rachel Reeves must raise taxes or tear up her flagship borrowing rules to fill a £41bn black hole left by Labour U-turns, higher borrowing and sluggish economic growth, top economists have warned. The National Institute of Economic and Social Research (NIESR) – a leading economic think tank – said the chancellor could also look at spending cuts in the autumn Budget as a way to raise the money needed by 2029-30 to remedy a £41.2bn shortfall on her 'stability rule'. Its report said the chancellor has been left with an 'impossible trilemma' of trying to meet her fiscal rules while fulfilling spending commitments and upholding a manifesto pledge not to raise taxes on working people. But after a swathe of spending cuts squeezing departmental budgets at the last spending review, tax rises are the more likely option. The chancellor is under increasing pressure to raise income tax or consider a wealth tax on the rich. The think tank's forecast warned that the poorest 10 per cent of people – amounting to 2.8 million households – have seen their living standards fall 1.3 per cent under Labour, some 10 per cent lower than pre-Covid levels. Professor Stephen Millard, NIESR's deputy director for macroeconomics, said a 'credible, sustained increase in taxes' would be required due to the 'worsening fiscal outlook', not helped by Labour's U-turns on welfare cuts. He warned that a large part of this would need to happen in the first year to signal to the markets that the Treasury is committed to further increases down the line. Speaking at a press conference on Tuesday, Prof Millard warned that the £9.9bn buffer the chancellor has set out for herself is 'really way too thin', and a 'slight change in fiscal circumstances' would wipe it out entirely. 'With growth at only 1.3 per cent and inflation above target, things are not looking good for the chancellor who will need to either raise taxes or reduce spending or both in the October Budget if she is to meet her fiscal rules,' he added. It comes despite the think tank nudging up its economic outlook for the UK, with growth of 1.3 per cent expected for 2025, up from 1.2 per cent forecast in May. But it cut its prediction for next year – to 1.2 per cent, down from 1.5 per cent. Prof Millard also suggested the chancellor could rewrite her fiscal rules with a new framework that looks at the long-term direction of travel of debt, rather than judging debt based on a point five years in the future, as the current rules dictate. He told The Independent the government should base its financial projections on current levels of taxation and spending, rather than planned increases or decreases. The latest warnings come despite the chancellor's promise not to come back for more major tax rises after she unveiled a £40bn package of increases in her first budget last year. NIESR's findings will pile pressure on her to come up with innovative solutions ahead of her budget in the autumn. In July, Ms Reeves is said to have told the Cabinet that plugging gaps would be a 'big challenge' as there is no longer any 'low-hanging fruit'. Last month, the government's embarrassing climbdown on planned welfare cuts saw Labour's benefits reforms gutted almost entirely, with savings from the bill slashed from £5bn to nothing. Meanwhile, fresh figures from the Office for National Statistics published in July showed that borrowing – the difference between public spending and income from taxes – rose to a higher-than-expected £20.7bn as debt interest payments soared. Responding to the NIESR report, shadow chancellor Mel Stride said: 'Experts are warning Labour's economic mismanagement has blown a black hole in the nation's finances which will have to be filled with more tax rises, despite Rachel Reeves saying she wouldn't be back for more taxes. 'Labour will always reach for the tax rise lever because they don't understand the economy. Businesses are closing, unemployment is up, inflation has doubled and the economy is shrinking. And Labour are refusing to rule out more damaging tax rises on investment. 'Only the Conservatives, under new leadership, believe in sound money and low tax.' The chancellor has set herself two fiscal rules – the 'stability rule', which ensures that day-to-day spending is matched by tax revenues so the government only borrows to invest, and the 'investment rule', which requires the government to reduce net financial debt as a share of the economy.
