29-05-2025
There should be no such thing as a drought in modern Britain
I wrote last week how absurd it is that a rainy island nation like ours is worrying about water, and how the real culprit was not privatisation but our absurd planning system. The Government's latest action on reservoirs is more evidence for that thesis.
Faced with the ridiculous prospect of Britain having shortages of drinking water by the mid-2030s, ministers have wrested control over the fate of several reservoir projects away not from the water companies, but from councils.
Two projects, in East Anglia and Lincolnshire, have been declared 'nationally significant', granting the Secretary of State power to speed them through the planning process and get JCBs in the ground.
Credit where credit is due: this is the right decision. In fact, the hard question for the Conservative Party is why it wasn't done sooner.
The powers Labour is now using to drive forward 'nationally significant' infrastructure projects are found in the Planning Act 2008. It has been on the books, unloved and underutilised, for the Tories' entire period in office.
It isn't that there has been a clear need for it. Section 27 of the PA08 sets out the minimum volume for a reservoir to be deemed 'nationally significant' and Thames Water's long-delayed project in Abingdon – the cause celebre of we pro-reservoir types – is planned to be no less than five times as capacious.
Nor is it an isolated case. Bristol Water received in 2014 permission for a £100m reservoir, only to scrap it in the face of furious resistance just four years later. In 2019, Scottish councillors vetoed a billion-gallon reservoir with integrated hydro-electric project – a double-whammy against British water and energy security.
The basic problem is that local government is the worst place possible to vest authority for planning. Councillors answer to the angriest and most energetic third, on average, of local voters, and have no incentive to take national need into account when making their decisions.
Whatever one's views on housing, it makes no sense to administer essential infrastructure – reservoirs, power plants, pylons, railways, you name it – like some latter-day Holy Roman Empire, with companies forced to buy off petty margraves and bishoprics along their entire route.
This latest story also highlights another aspect of the problem: our deep distaste for actually paying for things. One criticism levelled at these reservoirs is that they are going, in the short term at least, to push up people's water bills.
Some frustration is understandable at a time when the cost-of-living crisis is biting. But not only would bills get much higher (before rationing kicked in) if we don't build new reservoirs, but paying for them out of water revenue is the best way to ensure they are actually built.
As I pointed out previously, the reason investment in water infrastructure has been much higher since privatisation is that the money is ring-fenced. Water companies have to re-invest much of their revenue in making our water network better.
Under nationalisation, revenue from water bills flowed into the Treasury, where it had to compete with pensions, welfare and the NHS for every scrap of reinvestment. It should surprise nobody that the network was left to moulder.
Of course, we could have avoided a crunch period of higher bills if we had been consistently investing in and constructing new reservoirs over the past 30 years. Sadly, we missed that chance. But the second-best time to start dealing with this problem is now – and delaying will only mean an even more painful crash course somewhere down the line. That or water rationing, of course.
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