How can the UK secure reliable, sustainable water supplies under growing climate and population pressures? That was the question at the heart of a recent Prospect roundtable put together in collaboration with Southern Water.
The event—part of a new series bringing together policymakers, industry leaders and experts to explore what Britain can do to strengthen its resilience in the face of today’s most urgent challenges—was convened less than 24 hours after the government had published its white paper with a promise to deliver a “once-in-a-generation plan to transform the water system for good”. To put that goal into sharp relief, without urgent action England faces an estimated five-billion-litres-a-day shortfall of public water supplies by 2055.
So what is required of the industry, its investors, policymakers and wider society? During a wide-ranging discussion, participants were asked to consider both supply-side measures—introducing new infrastructure including reservoirs, pipelines, desalination and recycling—and demand-side measures such as leakage reduction, smart metering and effecting behavioural change.
On the supply side there is much that might be done, and the government has secured £104bn of private investment for infrastructure. For a sector where around 60 per cent of water mains were built before 1981, and 13 per cent are over 100 years old, the money is welcome. But how should it be spent? One commentator urged the industry to show “bravery” when investing the money, rather than the “risk aversion” that sometimes characterises public infrastructure projects. Another encouraged greater “creativity”. That means re-examining customer consumption and need and subsequently devising novel solutions based on both. She noted, for example, that the UK is “really, really bad at capturing rain water. If we got better at that we would have many more options to address water security.”
From a business-user perspective, creativity might mean coming up with bespoke site-based solutions. Consider that just 1 per cent of businesses in England account for 15 per cent of all water use. As one participant—a specialist in national preparedness—pointed out, the UK is one of very few countries in the world that allows data centres to connect to the public drinking water supply. As a result, there is little incentive for those businesses to innovate away from a water-based cooling solution, or to use other sources of water.
Any supply-side initiative must incorporate planning for climate change, urged another contributor, before making a strong plea for minimum water efficiency standards for products. Elsewhere, there was a plea for realism to sit alongside the calls for creativity and bravery. Honest conversations are needed about supply timescales and costs, this industry insider argued. Expectations must be managed. Another said there needs to be more transparency about how, in times of stress, water should be distributed. Despite public perceptions of water as “an infinite resource on our rainy island”, too little consideration is given to a “hierarchy of demand”.
On getting the balance right between supply and demand, most participants recommended taking an agile approach. How much policymakers should push a supply- or demand-side lever changes over time, by customer type and by region, too. For example, there are communities where the majority of households are unmetered which, in turn, makes it difficult to encourage changes in behaviour. Multiple voices around the table urged flexibility. “The demand- and supply-side balance is not static,” noted one participant.
Other issues emerged during the discussions, not least the need for the water industry to recruit and retain the right people with the right skills. In anticipation of a talent deficit, participants identified three areas of concern. First, the number of highly experienced scientists, engineers and other skilled professionals entering the final years of their careers. An estimated 16 per cent of the water industry workforce (13,700 people) are forecast to retire by 2030. The result? A substantive loss of institutional knowledge. Second, there is a growing trend for those trained within the industry, from graduate level upwards, to move to other sectors early or midway through their careers. Third, there are would-be employees put off from joining in the first place because of negative external perceptions of the industry.
Any initiative must incorporate planning for climate change
A Westminster voice present called for “more noise” to raise the profile of the problem. He observed how those in other industries were making their feelings known. “I’ve not once heard anybody talk to me about the water industry and its skills shortage.”
Towards the end of the conversation, attention turned to a central pillar of the government’s water white paper—the introduction of a single regulator for the industry, a body that can take an integrated view of both economic and environmental performance. The move was broadly welcomed by those in attendance. One noted that the status quo—Ofwat, the Drinking Water Inspectorate and the water environment functions of the Environment Agency—may have been designed to inject “creative tension” into the supervision process, but over time that purpose has “ebbed away”. It has left, he said, “different regulators becoming quite entrenched in their respective positions and as a result you end up with a lot of dysfunction.”
The restoration of faith in the industry was another theme that ran through the conversation. “Building back trust with the public is absolutely critical,” said one participant. It’s critical, not least, for two of the issues already explored—encouraging talent into the industry and inspiring behavioural change needed to meet the new realities of supply. The relationship between government and the industry needs to be bolstered, too, as does the relationship between the industry and its investors. All require a concerted effort to engage, or to re-engage.
Take consumer engagement, for example. As one contributor argued, it is time to move away from “a leaflet with the bill” or a consultation meeting in a “drafty town hall that my retired dad might attend but no one in their 20s would ever consider”. Instead, the industry should think about applying “a dose of humour” to its messaging in the spirit of Denver’s “Use only what you need” and Sydney’s “Turn it off, Bob” advertising campaigns.
Meanwhile, others made a robust case for an industry as it exists, one that has a good working relationship with those it serves. An industry voice described a “silent majority of customers who appreciate the challenges we face and the value of service that they get.” Another participant added that the “water industry has become dehumanised” to the extent that it’s only when people see what those who work within it are prepared to do—going out at four in the morning to get water running again or to address a pollution issue—that they appreciate what’s involved.
This conversation took place under the Chatham House Rule
