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Author: Molly Allen

ASA ruling exposes Red Tractor as greenwash – River Action demands supermarkets act

Posted on by Molly Allen
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New figures reveal staggering 19,000 breaches across 60% of inspected Red Tractor farms, exposing systemic failure behind the label’s “environmentally friendly” claims

River Action is calling on leading supermarket retailers including Tesco and Asda to stop relying on Red Tractor for environmental certification. The scheme has been exposed for serious environmental greenwashing in an Advertising Standards Authority (ASA) ruling.

Having filed the complaint in April 2023, the case is thought to be one of the longest investigations in ASA history.

 

ASA ruling: Red Tractor environmental claims ‘misleading’

The ASA has today upheld a complaint by River Action’s Chair and Founder, Charles Watson, ruling that Red Tractor – the UK’s largest farming assurance scheme – misled the public about its environmental standards and exaggerated the benefits of Red Tractor endorsement.

River Action challenged advertising for the Red Tractor scheme because of its concerns that environmental standards relating to pollution on Red Tractor farms were not being met – including the claim “When the Red Tractor’s there, your food’s farmed with care… from field to store all our standards are met”.

During its investigation, the ASA considered extensive evidence and arguments put forward by Red Tractor including that it was not an environmental certification mark specifically so “did not seek to replicate environmental law or even cover all aspects of pollution risks by farms”.

The ASA concluded that the evidence provided by Red Tractor to demonstrate compliance with basic legislative standards and a good environmental outcome was insufficient to substantiate the claim which “farmed with care… all our standards are met” conveyed to consumers. The advert breached BCAP Code rules 3.1, 3.2 (Misleading advertising), 3.9 (Substantiation) and 3.12 (Exaggeration).

 

Evidence of non-compliance and pollution

Red Tractor’s marketing claimed its farms take “a preventative approach to protect the environment”, citing reduced pesticide use, strict pollution controls, and rigorous soil management.

However, as part of its ASA complaint, River Action presented damning evidence – supported by Environment Agency (EA) data (2014 – 2019) – that Red Tractor farms are routinely linked to serious environmental harm:

  • Red Tractor farms were responsible for most agricultural pollution incidents in England over a five-year period.
  • 62% of the most serious pollution events (Categories 1 & 2) involved Red Tractor-certified farms.
  • Certified farms had worse compliance rates than non-certified farms (26% vs 19%).
  • In a North Devon case study (2016–2022), 87% of Red Tractor farms inspected by the EA were in breach of environmental rules.         

The EA rejected Red Tractor’s bid for “Earned Recognition” due to its failure to meet minimum environmental standards.

But more than two years on, River Action can now reveal – through Environmental Information Requests – that serious pollution and regulatory failures persist on Red Tractor–certified farms. The data covers the period January 2020 and July 2025 and reveals the following:

  • 7,353 Environment Agency officer inspections of farms claiming Red Tractor status. 
  • Alarmingly, 4,353 of these inspections (nearly 60%) identified at least one breach of environmental regulations.
  • A staggering 19,305 instances of non-compliance were recorded across failing Red Tractor assured farms.
  • Cattle farming accounted for just over 25% of non-compliance, with 13.2% from beef farms and 12.4% from dairy farms.
  •  1,373 follow-up inspections were required to address non-compliance.
  • Even when actions were completed by deadlines, a substantial number of farms still failed to meet environmental standards, with only 4,657 actions recorded as completed on time. 
  • This demonstrates that membership of the Red Tractor scheme does not guarantee compliance with environmental regulations.

 

Supermarkets: up your standards

River Action is now warning major supermarkets that by using Red Tractor to reassure customers they are buying food produced to basic environmental standards they risk complicity in misleading advertising, while pollution of the UK’s rivers continues.

Given their enormous market share and purchasing power, supermarket retailers wield significant influence over UK food supply chains and therefore have the opportunity to drive rapid action to address the environmental harm caused by the industry. 

For example, Tesco dominates the supermarket sector with nearly 30% of the market (28.1%), sourcing vast quantities of Red Tractor meat and poultry through suppliers such as Moy Park and Avara Foods.

According to a recent news report, Moy Park has been implicated in the devastating environmental catastrophe at Northern Ireland’s Lough Neagh, where recurring summer blooms of toxic blue-green algae threaten both wildlife and the health of the lake. 

Similarly, Avara Foods, owned by US agribusiness Cargill and linked to the ecological collapse of the River Wye, boasts on its corporate website: “You can trust that we do things ethically; all of our chicken is Red Tractor approved.”

 

Other major retailers in the frame

Tesco are not alone. River Action is also calling on Aldi, Lidl, Morrisons, Asda, and others to stop relying on Red Tractor as a mark of environmental standards and protection:

  • Asda – 11.9% market share; told Farming UK: “We continue to source all our other fresh primal chicken from UK Red Tractor Assured farms.” Its website states, “The Red Tractor badge is a standard of excellence….It’s about producing the best possible product in an environmentally friendly and sustainable manner.”  
  • Aldi – 10.9% market share; major buyer of Red Tractor products and states that “…you can trust the products you buy when you see the Red Tractor logo…..Red Tractor….(covers) animal welfare, food safety, traceability and environmental protection. Food and drink bearing the Red Tractor logo has been produced responsibly to some of the most comprehensive and respected standards in the world.”
  • Morrisons – 8.4% market share; states that “100% of the fresh pork, beef, lamb, poultry, milk and cheddar cheese we sell in our stores comes from farms certified by Red Tractor, or an approved equivalent scheme, giving customers assurance on food safety, hygiene, animal welfare standards and environmental protection.”
  • Lidl – 8.1% market share;  publically state that “we work closely with Red Tractor to ensure that our British meat, poultry, fruit and veg is responsibly sourced to strict food hygiene, animal welfare and environmental standards”.
  • Sainsbury’s, once a Red Tractor buyer, has already distanced itself from the scheme. In 2014, then-CEO Justin King called it “the refuge of scoundrels” and criticised it for setting a “low bar that frankly anybody could use.”

 

What Tesco says

Celebrating 25 years of Red Tractor, Natalie Smith, Tesco Head of Agriculture, said last month: “We’re proud to support British agriculture and the thousands of farmers and producers who provide us with quality, affordable, sustainable products year-round. Certification schemes play a key role in providing reassurance for customers, and over the past 25 years, Red Tractor has established itself as a mark of quality, standing for food safety standards, animal welfare and environmental protection.

“We recognise there is still more to do, and it’s essential we continue to work in partnership with Red Tractor to improve standards, and take quick action to drive forward change, strengthening the farming industry for generations to come.”

The Tesco website proudly states, “We require the majority of our meat, dairy, fruit and vegetable products produced in the UK to meet the Red Tractor standard, or an appropriate equivalent. The Red Tractor standards ensure that the production of these products does not have an adverse impact on the environment. For example, pesticides and fertilisers must be applied and stored in ways that minimise pollution of soil and groundwater; it also provides extensive guidance on manure management.”

 

River Action responds

Chair and founder of River Action Charles Watson said, “Red Tractor farms are polluting the UK’s rivers, and consumers trying to make environmentally responsible choices have been misled. This ASA ruling confirms what we’ve long argued: Red Tractor’s claims aren’t just misleading – they provide cover for farms breaking the law. The time has now come for our major food retailers to lay out credible plans as to how they will move away from this busted flush of a certification scheme and support farmers whose working practices are genuinely sustainable.

“Supermarkets and their suppliers now face serious reputational risk if they hide behind Red Tractor greenwash. By selling products linked to pollution, they deceive customers, undermine trust, and fail in their duty to ensure supply chains obey the law.”

 

Consumers want confidence, not greenwashing

River Action says that supermarkets need to use assurance schemes that give consumers genuine confidence that the products they buy are not linked to lawbreaking or environmental harm. At present, Red Tractor fails to provide this. An assurance scheme should be meaningful. Supermarkets already have credible models in place for fresh produce, so the same rigorous standards should be applied to livestock.

River Action has written to all the major supermarkets, calling on them to:

  • Publicly acknowledge the ASA ruling and findings by informing their customers of the misleading labelling and committing to driving change both within farming and food standards and within food certification.
  • Publish a clear and transparent roadmap showing how they will certify the environmental standards of all their food produce – including eggs, poultry, dairy, and fresh produce. This roadmap should set out rigorous environmental requirements, be backed by independent inspections, and ensure full public reporting, so customers can see and trust the standards behind the food they buy.

 

Red Tractor’s own data shows that its logo appears on approximately £18bn worth of food sold annually, meaning this greenwash reaches deep into Britain’s shopping baskets. Jim Moseley, Red Tractor’s CEO, has also boasted that consumer trust in the scheme is tracking at 74%.

Martin Lines, CEO of the Nature Friendly Farming Network, added: “Consumers and farmers want real sustainability, not a sticker. They want confidence that the British produce they buy does not harm the environment or our rivers. 

“Supermarkets and fast-food chains hiding behind Red Tractor need to sort out their suppliers or face low consumer confidence and difficult questions about the environmental violations in their supply chains that are damaging our rivers. Farmers committed to nature-friendly practices must be properly rewarded, or the system will continue to incentivise damaging methods”

Hugh Fearnley-Whittingstall said, “As someone who will always support farmers who work positively with nature, protect the environment and feed the nation, I am deeply concerned by the ASA’s ruling exposing Red Tractor’s persistent greenwashing. For years, consumers have trusted the logo as a sign of environmentally responsible farming, yet the evidence shows widespread environmental breaches that are causing ongoing pollution all over the UK. 

“Supermarkets should not hide behind environmental certification that fails both the planet and honest producers. They have enormous influence and must use it to drive genuine progress that benefits the environment.  That means paying farmers properly for sustainable practices, supporting nature-friendly food production, and leading the way in either rigorously reforming or, if necessary,  completely dropping Red Tractor as a mark of environmental standards.

“Customers deserve more than misleading labels. They deserve assurance that their food supports farming that regenerates soils, protects wildlife, and respects the environment. It is time for supermarkets to step up, take responsibility, and make sustainability a real priority, not a fake one.”

River Action’s complaint to the ASA was prepared with the expert support of Leigh Day solicitors — Ricardo Gama, Carol Day, Julia Eriksen and Lily Hartley-Matthews — together with counsel Tom de la Mare KC and George Molyneaux of Blackstone Chambers. Their advice and representation were instrumental in securing this ruling.

Leigh Day partner Ricardo Gama, who represents River Action, said, “After a two and half year investigation, River Action is delighted that the ASA has finally ruled that Red Tractor was likely to mislead consumers when claiming that its certification scheme ensures high environmental standards. 

“The length of time of the investigation was a result of the contested nature of the case, with both River Action and Red Tractor arguing tooth and nail for their positions. This should set a precedent for other advertisers, including those in the food industry, that misinformation will not be tolerated.”

 

Consumers: demand better

River Action is urging the public to pressure supermarket retailers into telling their customers the truth about Red Tractor-labelled produce.

Support the campaign: Tell your supermarket to expose Red Tractor
If you shop at these supermarkets, tell them to clean up their supply chains and stop profiting from environmental harm. For more information and to find out how you can support the campaign, visit www.upyourstandards.riveractionuk.com.

 

 

Notes to Editor
The source for supermarket market share figures is a Kantar article published on 24 June 2025, which you can read here.

An assessment carried out by the Environment Agency (EA) in 2020, revealed that between 2014 – 2019 Red Tractor-assured farms were responsible for the majority of instances of agricultural pollution over a five-year period. The assessment revealed that of a total 4,064 pollution incidents RT farms were responsible for 62% of category 1 and 2 incidents and 56% of category 3 incidents. Significantly, the report concluded that RT farms were less compliant (26%) with EA inspections compared to non-RT farms (19%). As a result of this assessment, a request by Red Tractor for its assured farms to benefit from EA “Preferred Status” was denied.

When we received the data from the Environment Agency, they advised that many farms include more than one livestock or crop type. As a result, category totals may not add up precisely to the overall inspection figure.

Our research indicates that we could not find any ASA case that took longer to resolve than our complaint against Red Tractor. On its website, the ASA notes that, “A small number of our most complex cases can take six months or more to complete if, for instance, we need to appoint independent experts to help us assess evidence.”

At a webinar in April 2024, Red Tractor CEO Jim Moseley told the Tenant Farmers Association that the Red Tractor logo features on £18 billion worth of food sold each year. He also claimed that public trust in the Red Tractor scheme stands at 74% (watch from around 9 minutes 31 seconds).

ASA ruling of 15 October 2025:

  • River Action challenged a 2023 advert for Assured Food Standards’ Red Tractor Scheme because of its concerns that environmental standards relating to pollution on Red Tractor farms were not being met. 
  • The ASA considered extensive evidence and arguments put forward by Red Tractor, including its own claims that environmental protection was not its primary focus and that RT was not an environmental certification mark specifically so “did not seek to replicate environmental law or even cover all aspects of pollution risks by farms”. 
  • The ASA assessed how the notional average consumer, who was reasonably well-informed and reasonably observant and circumspect, was likely to view the ad. This included the claim “When the Red Tractor’s there, your food’s farmed with care… from field to store all our standards are met”, highlighting the use of Red Tractor labelling across all aspects of food production and farming. The ASA considered that at least some consumers would expect that, in giving assurances about high standards of farming and food production, Red Tractor’s standards would include measures to manage and mitigate environmental risk that arose through farming practices. The ASA also considered that consumers would expect that such standards incorporated compliance with or reflected at least basic legal requirements concerning food safety, animal welfare and environmental protection, and that measures were in place to help produce a high standard and quality of food (in line with the objectives of the Red Tractor scheme, which included environmental measures, as explained on Red Tractor’s website).
  • In reaching its decision, the ASA looked at Environment Agency (EA) reports and data which showed “around half of RT farms being not fully compliant” and led the EA to conclude “The evidence gathered through this project indicates that Red Tractor membership is not currently an indicator of good environmental performance”.
  • The ASA concluded that the evidence provided by Red Tractor to demonstrate compliance with basic legislative standards and a good environmental outcome was insufficient to substantiate the claim which “farmed with care… all our standards are met” conveyed to consumers. 
  • The advert therefore breached BCAP Code rules 3.1, 3.2 (Misleading advertising), 3.9 (Substantiation) and 3.12 (Exaggeration).

World Mental Health Day – The people behind our water

Posted on by Molly Allen
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By James Wallace, CEO of River Action & Alex Papuca, Senior Communications Coordinator

Water should unite us all, not divide us

“Be kind, for everyone you meet is fighting a hard battle” – Plato

When rivers run foul or bills rise, frustration flows quickly. That anger is understandable, but too often it is directed at the wrong people through verbal and sometimes physical abuse. The engineers fixing broken pipes, the call handlers answering complaints, and the operations teams responding to pollution are not the ones making the big decisions in water companies. They are the ones trying to hold the system together.

Rather than venting our frustration at the staff trying to fix the problems, we should be focusing our concerns – peacefully – on the water company leaders, investors, regulators and the Government that are culpable. They are the ones responsible for bill increases, polluted waterways, private profiteering and failed regulation.

This World Mental Health Day, we are reminded that kindness and respect can make a world of difference. With help from Unison, the leading union in utilities, we spoke to workers within the water industry about the challenges they face, the abuse they endure, and the moments of humanity that keep them going. We found the conversations both enlightening and deeply sobering. To protect their anonymity, we have given each of the workers a pseudonym. Here is what they had to say:

Tony

Tony is an Operations Manager at Severn Trent, overseeing teams who work daily to maintain essential water and wastewater services across the Midlands. With more than two decades in the industry, Tony has seen the sector evolve through major changes in regulation, technology, and public scrutiny. He now represents staff at a time when pressures on the water industry are at an all-time high, and he’s passionate about ensuring that the voices and well-being of frontline workers are not forgotten in the debate.

Q: From your perspective in the industry, how have things changed over the years?

“In the early 2000s, there just wasn’t the same level of regulation. OFWAT wasn’t putting the right governance in place to stop problems before they happened. Back then, we had around 5,000 employees; now there are almost 12,000, and all of our wastewater operations are managed in-house. The sector has grown massively, but so have the pressures and expectations on staff.”

Q: What kind of impact has that had on employees?

“Staff are constantly getting heat from the public. There’s a lot of anger directed towards the industry, and that often falls unfairly on the people on the ground, especially the ones out there repairing infrastructure, responding to incidents, and trying to do the right thing. We’ve had members face some really frightening situations. There was an unprovoked machete attack on workers in Wolverhampton, and another case where a member of staff was stabbed with a screwdriver. Verbal abuse happens far too often.”

Q: How does it feel to be working under that level of scrutiny?

“There’s a lot of pressure right now, especially with increased regulation and public attention. People want to do the right thing, but it’s a stressful environment. We’re seeing a rise in stress-related cases among employees. The whole casework scenario has changed because of it. Many staff feel they have no voice to counter the negative narrative that’s out there.”

Q: How has this affected you personally?

“To be honest, I don’t wear a Severn Trent jacket in public anymore. I just don’t want to draw attention to myself. That says a lot about how people in the industry are feeling at the moment.”

Q: What message would you want the public to hear this World Mental Health Day?

“Please remember that the people out there fixing leaks, managing treatment works, and responding to incidents aren’t the ones making the big decisions. They’re doing their best under a lot of pressure. Kindness and understanding go a long way. The challenges the industry faces are real, but so are the people behind it.”

John

John is a Network Controller at Yorkshire Water, managing incidents and customer complaints from the front line. He’s often one of the first points of contact when something goes wrong, whether it’s a burst main, a pollution event, or a surge in bills. With public frustration growing, John shares what it’s like to work on the streets when tensions are high.

Q: What do you think the public often misunderstands about the people who work on the ground in the water industry?

“The public often misunderstands that those of us working in the field don’t make the big decisions. We’re just a small cog in a very big system. We work for the company, but we don’t own it, and we don’t have a say in how it’s run. There’s only so much we can do from our side, and we’re doing our best to fix problems as quickly as possible.”

Q: How does public anger or frustration around issues like pollution or water company performance affect you and your colleagues personally?

“It does get quite verbal. People are upset and I get that, but sometimes the anger gets directed at the wrong people. We’re the ones trying to sort out the problem, not the ones who caused it. People sometimes shout abuse during callouts, and it’s only a matter of time before someone really gets hurt. It affects people more than you might think. Colleagues take that stress home with them, and it can play on their minds.”

Q: Have you or your team ever experienced abuse or hostility from the public because of the industry’s reputation?

“Yes, and it’s increased a lot over the last year or so. What used to happen maybe once a month is now a day-to-day occurrence. Verbal abuse is the most common; sometimes it’s just frustration, but it can get very personal. We try to stay professional and move on, but it wears people down.”

Q: Are there any small acts of kindness or understanding from the public that really stay with you?

“Absolutely. When people take the time to thank us, offer a cup of tea, or just show appreciation, it means a lot. I’ve had customers bring out cake or send a kind email after we’ve sorted an issue. To be honest, I’m not here for praise; I just want to be able to do my job without suffering abuse.”

Q: If you could say one thing to members of the public who are frustrated about pollution or sewage issues, what would it be?

“I’d like people to know that we, the frontline staff, are working our hardest to fix these issues. None of us wants to see rivers polluted or communities affected. But these problems aren’t caused by the people on the ground; they’re the result of decisions made much higher up. Hold the industry accountable, but please treat those of us doing the work with respect.”

Sarah

 

Sarah works at United Utilities in West Cheshire, where she supports vulnerable customers and provides mental health support for staff. Her role often involves helping people in distress – whether they’re struggling to pay bills, facing water supply issues, or dealing with difficult personal circumstances. Sarah is driven by a simple motivation: “I do what I do because I want to help.”

Q: What’s your role at United Utilities, and what motivates you to do it?

“I work with vulnerable customers, helping them access support in any way we can, whether that’s through our own services or by connecting them with charities and resources like the Hub of Hope. I’ve also completed mental health first aider training, which helps me support people who are really struggling. I do what I do because I genuinely want to help people. That’s what keeps me going.”

Q: How does public anger or frustration around issues like pollution or water company performance affect you and your colleagues personally?

“There’s a lot of negative feedback at the moment. People are angry, and understandably so, but it’s tough when that anger is directed at staff. We’re trying to do our jobs and help people, but sometimes the abuse gets very personal.”

Q: Have you or your team ever experienced abuse or hostility from the public because of the industry’s reputation?

“Unfortunately, yes, and it’s getting worse. We’ve had staff receive death threats, and one colleague was told someone would kill her dog. Others have had people say horrific things like “I’m going to kill your parents.” It’s shocking, and it’s nothing like what we used to see in the past. The level of hostility has really escalated in the last few years.”

Q: If you could say one thing to someone frustrated about pollution or sewage issues, what would it be?

“We completely understand why people are upset. We see the same headlines and care about the environment too. But we’re just trying to do our jobs to the best of our ability. There’s nothing we can personally do about the big decisions, and we don’t deserve the abuse that sometimes comes our way. If you need to vent, that’s fine, just please remember there’s a person on the other end of the phone who’s trying to help you.”

Q: Are there any small acts of kindness or understanding from the public that really stay with you?
“Yes, there are always people who take the time to write in and say thank you. It doesn’t happen every day, but when it does, it makes a huge difference. It reminds you that most people out there do appreciate what we do and that the kindness far outweighs the hate.”

Please remember

Rivers are under threat, but so are the people working to protect them. On this World Mental Health Day, please remember:

  • Frontline water workers are doing their best in difficult circumstances.
  • Accountability lies with water company bosses, investors, and regulators.
  • Peaceful action is powerful. Target the system, not the staff.

Join River Action and campaigners across the nation by asking your local MP, your council, and your mayor to pressure the Government to:

  • Reform the regulators so they can hold profiteering and polluting water companies to account and invest in cleaning up our waterways.
  • End privatisation by restructuring and refinancing water companies for public benefit and environmental performance.

Please visit River Action’s River Rescue Kit for advice on how to be an effective campaigner. Together, we can make corporate and government leaders clean-up our rivers while respecting the mental well-being of frontline workers.

 

Myth Busting: Would it really cost £100 billion to bring water utilities into public ownership?

Posted on by Molly Allen
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By Dr Samir Seddougui

Whenever the conversation turns to the cost of nationalising the water industry or even just exploring public benefit and ownership models instead of continuing with deep privatisation, the government references the scarily high figure of £90-100 billion to dampen public support. 

On 16 September, Defra released a short policy paper outlining the rationale behind its estimation that nationalising the water industry would cost approximately £100 billion. A similar number was reached in a 2018 Social Market Foundation report paid for by four water companies (Anglian Water, Severn Trent, South West Water and United Utilities). The Social Market Foundation’s estimation takes the RCV from 2018 which was estimated at £64 billion and then added premiums for acquisition, so presumably their estimation would be even higher now.

Defra based this on three assumptions that: 

  1. the value of Water Companies should be tied to their Regulatory Capital Value (RCV); 
  2. the government would absorb equity and debt; and 
  3. no discounts or premiums should apply. 

 

Inflated Economics? 

Let’s be clear: this isn’t rigorous economic analysis. It is a simplistic and unrealistic theory being relied on by the government to justify not taking decisive action in public and environmental interests by putting failing companies like Thames Water into a special administration regime. What it protects are investors and an unsustainable cycle of debt servicing. 

Professor Ewan McGaughey, professor of Law at King College London and co-author of the People’s Commission argues that public ownership is an inexpensive solution, contending that the true cost is closer to zero as a more accurate market valuation would account for performance and financial failures.

As Economics Professor Sir Dieter Helm puts it, Defra’s estimate is “misleading, simplistic and wrong”. In his analysis published on 22 September, Helm sets out why each of Defra’s assumptions is wrong and goes on to explain why special administration for a failing water company such as Thames Water would make sure the business continues on a sustainable basis, giving it “breathing space” before, the special administrator would “almost certainly achieve a price which is at a significant discount to the RCV” with debt holders taking a “haircut”. 

When valuing a utility company such as Thames Water, RCV is only one factor a buyer would weigh. Helm argues that a company’s failure to maintain assets and its debt levels are central to any realistic valuation. The People’s Commission notes that RCV ignores another glaring reality: water companies have extracted £83 billion in dividends to shareholders. Karol Yearwood at the University of Greenwich has described the privatised water industry as a “cash machine for investors”. Today, the biggest beneficiaries are historic shareholders and debt holders keen to cash in on the roughly £17 billion debt Thames Water has been allowed to rack up. 

Since privatisation 32 years ago, Thames Water has handed £7.2 billion pounds to shareholders, while neglecting essential upgrades leaving the public with failing pipes, sewage discharges, and degraded waterways.

Defra also glosses over Thames Water’s massive debt pile and fines including a record-breaking £123 million penalty this year for serious pollution that continues to devastate our rivers. Polluters should foot the bill, not taxpayers. Under a special administration regime, customer payments would flow to court-appointed administrators to fund the operation of essential water services, instead of being paid out to as returns to shareholders who would go to the back of the queue, making the process far less of a financial burden than Defra claims. In fact, as Helm points out, it would exceed the cost of running the business.

 

The cost of and case for special administration 

The Government says that special administration of Thames Water would cost the government £4 billion. This is also overblown: on Helm’s analysis, the Government should recover its costs from the sale of Thames Water which, when offered for sale, would receive bids way in excess of £4 billion. The net cost to the Treasury should be zero. 

Helm also explains why special administration is not nationalisation, as it is often misleadingly labelled or conflated as a tactic to avoid having to use it. Special administration is a regime designed specifically to deal with water company failure and it offers the most effective way out of the mess Thames Water is in.  It should not be feared but favoured.

Dieter Helm cuts through the noise: “What is needed now is for Defra to put Thames into special administration, instead of putting out simplistic and ill-thought-through “assumptions” to support an implausible, very big round number.” 

We are also pursuing a Judicial Review against DEFRA for failing to set out clear thresholds for when a company should be put into SAR. In our view, this failure breaches core public law duties and leaves rivers and communities at the mercy of failing operators. With 16 million customers, some ministers may believe Thames is too big to fail. River Action says it’s too big to be allowed to keep failing. It’s time to put customers and the environment before private profits – by putting Thames Water out of its misery and into a special administration regime. 

 

References

  • Becky Malby, Kate Bayliss, Frances Cleaver, Ewan McGaughey, “A fair price to the public for water nationalisation.” The Guardian. 3 August 2025. Accessed here.
  • Defra, “Nationalising the water sector: how we assessed the cost.” Policy Paper, 16 September 2025, accessed here.
  • The Social Market Foundation, “The cost of nationalising the water industry in England.” February 2018. Accessed here.
  • Dieter Helm, “The next episode in the Thames Water saga: Defra’s misleading £100 billion cost of nationalisation and flawed board vetting proposals”. 22 September 2025, accessed here.
  • Ewan McGaughey, “How to Clean Up Our Water: Why Public Ownership in Law Costs Zero”. Common Wealth, 5 June 2025, accessed here.
  • Kate Bayliss, Frances Cleaver, Becky Malby, “Defra and the £100bn”. The People’s Commission, 18 September 2025, accessed here.
  • Karol Yearwood, “The Privatised Water Industry in the UK. An ATM for investors.” University of Greenwich, September 2018, accessed here.
  • Tainted Water, “Where Your Money Goes”, Goldsmiths, University of London, 2024, accessed here.
  • Sandra Laville, Anna Leach, & Carmen Aguilar García, “In charts: how privatisation drained Thames Water’s coffers”, The Guardian, 30 June 2023, accessed here.
  • Sandra Laville, “Thames Water fails to complete 108 upgrades to ageing sewage works”, The Guardian, 10 July 2024, accessed here.
  • Environment, Food and Rural Affairs Committee, “Reforming the Water Sector”, House of Commons, 9 September 2025, accessed here.
  • Eleanor Shearer & Ewan McGaughey, “Deep Trouble: Fixing Our Broken Water System”, Common Wealth, 11 July 2024, accessed here.
  • Sarah Olney MP, “Thames Water: Contingency Plans”, House of Commons, 15 March 2024, accessed here.
  • Alex Lawson, “The fate of Thames Water hangs in the balance. So what are its options?”. The Guardian, 22 March, 2024, accessed here.
  • River Action, “River Action launches legal challenge against the Government over Thames Water failures”, 30 July 2025, accessed here.

MISSING: Policy for special administration (or is it?)

Posted on by Molly Allen
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River Action’s legal challenge

In July, River Action launched its legal challenge over the Government’s failure to explain when it will trigger special administration for Thames Water and other failing water companies because of breaches of their performance duties.

That same month, the Independent Water Commission also recommended that a clearer policy for special administration be adopted.

Our legal challenge is simple: we say that the Environment Secretary has acted unlawfully by failing to publish a policy on when they will ask the High Court to put a water company in a special administration regime – a mechanism under existing legislation designed to enable the government to take action to deal with failing water companies.

What is special administration for water companies?

Special administration is a legal process for companies supplying essential services like water that are failing in terms of performance, finances or duties. It allows the government via an administrator to step in and take temporary control, ensuring operations keep running while offering a clean break from unsustainable debt and chronic underperformance.

Importantly, a special administration regime prioritises public interest – customer service, environmental protection and infrastructure investment – instead of existing shareholders and debt holders. By redirecting funds away from private profits and towards urgent improvements, it offers a route to restructure and refinance a water company for public benefit and long term sustainability.

 The Government’s response

The Environment Secretary has now formally responded. Remarkably, it has been claimed again that a policy setting out the circumstances in which or the criteria by reference to which the Court would be asked to put a water company into special administration does not exist. The response simply states “There is nothing for the Defendant to publish”.

Evidence that a policy exists?

The Environment Secretary has maintained this position despite clear indications that a policy exists in some form. Most strikingly, in a recent Environment, Food and Rural Affairs committee hearing, the Minister for Water and Flooding was asked about the circumstances in which a water company would meet the threshold for special administration. She read out a “whole list” of thresholds that are apparently being used to determine whether special administration should be pursued by the government. This sounds remarkably like a policy; the very thing the government insists does not exist.

The Water Minister also said that “Thames Water has not met the threshold for special administration for going into special administration” on the “formal advice” she had been given.

Why transparency matters

Why is the government so reluctant to publish a policy on when it will use the regime specifically created to deal with water company failure? How much worse does it need to get at Thames Water before the government will trigger the process? The public has a right to know what policies and plans exist to protect bill payers, our rivers and the provision of essential water services.

This goes beyond Thames Water. It matters for the whole water sector. Having a clear policy on when special administration will be triggered means it will be seen as a credible tool that strengthens regulatory discipline, incentivises better water company performance and avoids political delays. This is crucial to restore public trust and provide certainty to investors. Everyone should know the rules and then they must be followed.

What next?

Now the High Court will decide whether to grant permission for our claim to proceed to a full hearing. In the meantime, River Action will continue to push for transparency around the government’s policy and plans for special administration when water companies fail – and for leadership when it comes to Thames Water.

The Wildlife Trusts Report: More Proof Our Rivers Need Urgent Action

Posted on by Molly Allen
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A Call for River-Friendly Farming: Why We Can’t Ignore Factory Farm Pollution

Today, The Wildlife Trusts released a powerful new report exposing the devastating environmental toll of the UK’s intensive pig and poultry industry. For those of us fighting to protect our rivers, its findings come as no surprise – but they provide yet more hard evidence of the scale of damage being caused by factory farming.

At River Action, we welcome this report wholeheartedly. Communities along the Wye, Severn and Kennet have long been raising the alarm about nutrient pollution from intensive farming. This report adds weight to their voices, strengthening the case for urgent change.

Why enforcement matters

The “Farming Rules for Water” already exist to stop pollution – but they remain largely unenforced. Without real accountability, factory farm pollution continues unchecked, leaving rivers overloaded with nutrients and communities paying the price. If the government is serious about protecting nature and rebuilding trust, it must enforce the law while helping farmers make the shift towards more sustainable practices.

River Action’s fight against factory farm pollution – Timeline

We have has taken major legal steps to hold polluters and the authorities enabling them to account:

Taken together, these legal battles underscore a simple truth: without urgent action to rein in the industrial farming model, our rivers and the wildlife that depend on them will continue to pay the price.

What’s next?

The evidence is overwhelming. The law is clear. And communities are demanding change. Now the government must act – ensuring regulations are enforced and farmers are supported in transitioning to sustainable, river-friendly farming practices.

Because nothing less than meaningful reform will do.

The Water Commission’s Final Report: Why It Falls Short – And What Must Come Next

Posted on by Molly Allen
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By Amy Fairman, Head of Campaigns

At the end of July, the Independent Water Commission released it’s final report on the state of our water industry with recommendations on how the industry could be fixed. River Action, alongside Surfers Against Sewage, has analysed the recommendations against our five core principles for real reform.

Our conclusion? While the Commission makes some useful noises about reform, it ultimately ducks the bold changes needed to end sewage pollution and protect people and nature.

Here’s how the Commission performed when measured against our principles – and why government must now go much further with its upcoming White Paper.

1. Operating for Public Benefit

The Commission’s approach accepts the profit-driven privatised model of water companies as a given. Instead of rethinking this broken system, it focuses primarily on tighter regulation.

This is not enough. Decades of evidence show that shareholder-first models drain money out of the system while rivers fill with sewage. The Commission ignored credible international evidence that public benefit ownership models – like those in much of Europe – deliver lower bills, more investment, and cleaner rivers.

Without a fundamental redesign of ownership, governance, and financing, alongside regulatory reform the crisis will continue.

2. Democratic Decision-Making

The Commission’s proposal for Regional Water Authorities is a step forward, hinting at more democratic oversight. But as drafted, these bodies risk being toothless talking shops.

Real reform requires municipal-level oversight, with local authorities, communities, and environmental groups holding real power over how water companies invest, operate, and deliver. Without this, decisions will remain in the hands of profit-driven boards.

3. Protecting Public and Environmental Health

The Commission acknowledges sewage pollution is a major public health crisis – but stops short of the urgent action needed.

Taskforces and reviews won’t protect the thousands of people falling ill after using polluted rivers and seas. We need immediate legal duties for all water companies, regulators, and government to protect public and environmental health, backed by stronger permits and updated Bathing Water Regulations that safeguard everyone, year-round, from emerging pollutants like ‘forever chemicals’ and microplastics.

4. Tough, Independent Regulators 

The Commission rightly diagnoses regulatory failure. But renaming regulators without changing their powers, duties, and resources will not fix the problem.

We need a strong, independent regulator with a clear duty to protect public and environmental health – not water company profits. And where companies fail, government must use the Special Administration Regime to reset them around public benefit principles, starting with Thames Water.

5. Transparency

The Commission calls for more monitoring – which we welcome – but still clings to the discredited model of operator self-monitoring, where water companies mark their own homework.

That system has failed. Independent monitoring, citizen science, and full real-time transparency are the only way forward. People deserve to know what’s happening in their rivers and seas.

The Bottom Line

The Water Commission’s report was a once-in-a-generation opportunity to reset a failing system. Instead, it tinkers at the edges, leaving the profit-driven model intact and communities exposed to sewage, debt, and declining water quality.

Government must now go further. The upcoming White Paper must:

  • Restructure water companies to deliver public benefit, not private profit.
  • Embed democratic oversight at local and regional levels.
  • Put public and environmental health at the heart of water law and regulation.
  • Create a tough, well-funded regulator with the power to act.
  • End operator self-monitoring and deliver full transparency.

Anything less will leave us trapped in the cycle of pollution, public anger, and political failure.

You can read our full indepth analysis HERE.

Plans for 32,000-bird “Megafarm” on the River Kennet Rejected

Posted on by Molly Allen
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Berkshire factory farm plans rejected in win for river campaigners

 

A major win for river campaigners has been secured in Berkshire. Plans for a 32,000-bird egg production unit near Marsh Benham, close to the River Kennet, have been rejected following strong objections from local residents, environmental groups, and anglers led by Action for the River Kennet.

A major win for river campaigners has been secured in Berkshire. Plans for a 32,000-bird egg production unit near Marsh Benham, close to the River Kennet, have been rejected following strong objections from local residents, environmental groups, and anglers led by Action for the River Kennet.

The proposed development would have been sited on the banks of one of the world’s rare chalk streams – the River Kennet, a designated Site of Special Scientific Interest.

Why was the application turned down?

The application was turned down based on the harmful effects from groundwater pollution and surface water runoff that could result from the development, particularly through increased phosphorus and nitrogen deposition. These risks had not been adequately avoided, mitigated, or compensated, with insufficient information provided to justify otherwise.

Community-led resistance

 

The objection was spearheaded by Action for the River Kennet (ARK) and the Angling Trust, with support from River Action. Together, they argued that the risks to the river had not been properly addressed or mitigated.

Local resident Kate Jones, who objected to the application said:

“We are a small community who have come together to fight this, and we want to encourage others that it can be done. We are incredibly pleased and relieved it has been refused. The River Kennet is safe from such developments for now, though West Berkshire Council have left the door open for SRSL to resubmit. We would also like to thank everybody who has lent their support to our campaign, including River Action.”

A turning tide against factory farming

 

This decision follows our successful legal case against Shropshire Council, where the High Court overturned approval for a 200,000-bird intensive poultry unit near Shrewsbury in the River Severn catchment. That ruling was described as a “national precedent” and “a pivotal moment in the movement against factory farming in the UK.”

Our CEO and local resident James Wallace added:

“I learned to swim and fish in the River Kennet. This decision sends a strong message: communities will not allow our rivers to continue to be the dumping ground for industrial-scale agriculture. The rejection of this damaging proposal is a victory for rivers, wildlife, and the united voices of concerned local residents, and further evidence that the days of factory farms wrecking our waterways may be numbered.”

The Angling Trust also objected to the application. Martin Salter, lifelong Kennet angler and Head of Policy at the Angling Trust said:

“We told the Sutton’s Estate back in March that the game is up and they should withdraw their irresponsible application to locate a polluting poultry unit on the edge of the Kennet floodplain and just a few hundred metres from a highly protected SSSI, but they didn’t listen. It’s been a long hard campaign but I’m so pleased that common sense has finally prevailed and those of us who love and cherish Berkshire’s most famous chalkstream can breathe a sigh of relief.”

Why is this important for our rivers?

 

We have consistently warned of the devastating impacts of intensive livestock units on the health of Britain’s rivers. Phosphorus and nitrogen pollution from such sites is a leading cause of algal blooms, oxygen depletion, and widespread ecological damage. Stopping megafarms proposals like the one on the Kennet is integral to protecting the health of our rivers.

Our CEO adds:

“This is an important step forward, we must now accelerate the transition to farming practices that support farmers to work with nature, not against it. Communities are speaking out, decision-makers are listening, and the era of industrial river-wrecking factory farms is drawing to a close.”

Fightback against factory farms: New toolkit to empower communities

 

As the fightback against industrial-scale factory farms that wreck our rivers gathers pace, we have launched a new Planning Toolkit. This resource is designed to empower individuals and community groups to object to developments that may threaten their local waterways. Be sure to check it out!

From Green to Clean – The Spanish community that saved their lake and what the UK can learn

Posted on by Molly Allen
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By Drew Richardson, Communities Coordinator, River Action

The Dirty Man of Europe

The UK is unaffectionately known as the ‘Dirty Man of Europe’ when it comes to the state of our rivers. Three-quarters of rivers now pose a risk to human health, with many of our great lakes and rivers turning green with algal blooms from upstream pollution. Industrial meat production is one of the biggest culprits, driving 62% of river stretches to fail ecological health standards. But a community in Spain faced a similar crisis – and fought back. Their victory offers a blueprint for how we could save our own rivers.

The sad state of the River Wye

A Familar Problem

You may have read my blog post earlier this year, where I visited a community in Spain battling an industrial dairy factory that was threatening to become bigger than their township. I visited this community alongside representatives from across Europe. Organised by Friends of the Earth Europe, we had come together to share knowledge on how communities across the continent are fighting back against industrial pollution.

There I met campaigners from Amigos de la Tierra (Friends of the Earth Spain) and Federación de Consumidores y Usuarios – CECU (the Federation of Consumers and Users). They told me how the community of As Conchas, on the shore of a 25‑mile‑long reservoir, had already begun taking action after years of suffering from pollution caused by industrial meat factories upstream.

For years, local people had endured nauseating smells, keeping their windows shut in the Spanish heat. Further to this, they could no longer access local drinking water, as they saw their wells become contaminated by the waste seeping into the aquifer. Local communities raised their concerns with local government officials, but were told, that the water was safe to bathe in, that their wells were safe to drink from, and no action was needed. And yet, studies warned that cancer rates in the district exceed the rates found in other Galician districts.

Here I am outside the industrial dairy factory in Spain

From Citizen Science to the Courtroom

So local communities decided to take action.

They began with citizen science and found that the Lima River that empties into the reservoir contained at least 97 million dangerous cyanobacteria per litre of water and nitrate pollution levels 1000 times higher than the permitted limits.

The source? Labs attributed this pollution to manure produced by industrial meat factories that litter the river’s catchment. Still the regional government did nothing. So members of the community took their regional government to court, supported by Amigos de la Tierra, Federación de Consumidores y Usuarios – CECU, and Client Earth, for allowing the uncontrolled expansion of industrial meat factories, and inaction regarding the environmental and health impacts they were causing which breached their human rights under the Spanish Constitution and EU human rights law.

After supplying such clear evidence, the judge ruled in their favour and the regional government was ordered by the court to immediately adopt measures to end the pollution impacting the As Conchas reservoir and its community.

What This Means for the UK

This was a tremendous win, which sets a precedent across the EU. Already Portuguese politicians are taking their Environment Agency equivalent to task about downstream pollution. But how does this help us rid the blight from good old Blighty?

Well it wasn’t too long ago that we were part of the EU, so a lot of our environmental law is still in line with our European cousins’. Of course, our laws no longer have to be kept in line with EU directives, so could be liable to change, but so far so good.

Our human rights law however is still the same; we still subscribe to the European Convention on Human Rights (ECHR). These are the laws that ensure we have a right to a fair trial, a right to live, etc. Article 8 is particularly interesting; it’s the right to respect of our privacy and family life. Our private life isn’t just about a place free from surveillance, its our right to participate in society, the economy, culture, and leisure activities. It also means we have rights for the state, individuals, or businesses to not invade our home, affect our private life, or force us from our home.

A Blueprint for Action

When the people of As Conchas could no longer drink the water from their wells, participate in the culture and leisure activities that were intrinsically tied to the reservoir As Conchas was built around, when the smell invaded their home, and when the pollution invaded their bodies and was affecting their health, it became a human rights problem.

We have these same rights in the UK, and now a clear legal precedent that can help hold polluters to account in court. Imagine if we could use these to rescue our rivers. Imagine communities in the Wye, Severn, Thames, or Windermere taking their evidence of pollution to court and forcing action to happen where regulators had failed.

Swimmers, rowers, anglers, and local people, could use their citizen science to demand change, not only through protest, but with the weight of human rights laws behind them. The people of As Conchas have shown us that when local voices come together, even the dirtiest of waters can become clean. And when no one else will listen, not even the authorities, the law can be used to protect people and planet.

Campaign Win! New DEFRA guidance a win for our rivers

Posted on by Molly Allen
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DEFRA has issued stronger guidance on Farming Rules for Water. The change means that manure can now only be spread when crops actually need it – not at times it can just run off and pollute our river. After years of campaigning and legal pressure, we welcome this significant step forward that provides stronger protection for England’s rivers from agricultural pollution.

The stream of events:

June 2022 – Manure and fertiliser overuse is killing our rivers

In 2022 WWF and ClientEarth launched a legal complaint to the UK’s environmental watchdog the Office for Environmental Protection (OEP). The complaint was related to DEFRA’s guidance with regard to the overuse of manure and fertiliser which floods our rivers with nitrates and phosphates, fuelling algal blooms that choke ecosystems and suffocate wildlife.

May 2024 – Farming practice must change

As a result of our legal challenge against the Environment Agency (EA), the High Court ruled that farming practices must change to comply with the Farming Rules for Water – a response to the EA’s failure to prevent pollution in the River Wye and other threatened waterways. As a result of this legal action, Defra committed to reviewing its guidance.

June 2025 – New Farming Rules for Water

In June 2025, DEFRA released revised statutory guidance ‘Enforcing the Farming Rules for Water’. While this was a welcome step, it fell short in two key areas:

1) Autumn manure spreading: It didn’t go far enough to clarify the rules around autumn manure spreading – a practice often linked to river pollution.

2) A lack of clarity around enforcement thresholds: I.e. How are the rules actually going to be enforced.

In particular, some farming commentators wrongly interpreted the guidance to mean that autumn spreading could still go ahead as usual. However, The High Court ruling in River Action’s legal case demonstrated that it is unlikely to be compliant with the Farming Rules for Water unless it’s in exceptional and specific circumstances. The new guidance failed to set this out.

July 2025 – Closing the loophole

To address these issues, we wrote to DEFRA to seek urgent clarification. We’re pleased to say DEFRA listened. On 16 July, DEFRA issued additional new guidance to farmers called ‘How to comply with the Farming Rules for Water’. This new guidance made it explicit that manure must only be applied when it meets crop or soil need at the time of application – a critical clarification that closes a dangerous loophole and brings guidance in line with the law.

If accompanied by robust enforcement and clear advice for farmers, this should lead to much stronger compliance and significantly reduce agricultural pollution across England’s rivers. We’re grateful to DEFRA for taking these vital steps forward to rescue our rivers. We’ll continue pushing for the protections our rivers so urgently need.

River Action launches legal challenge against the Government over Thames Water failures

Posted on by Molly Allen
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River Action launches legal challenge over Government’s failure to explain when it will trigger special administration for Thames Water


We have filed a legal claim over Environment Secretary Steve Reed’s failure to explain when he will trigger special administration for Thames Water and other failing water companies – despite having the legal mechanism to take action, serious breaches by Thames Water, rising harm to customers and rivers, and calls from the Independent Water Commission for a clearer policy.

Our legal challenge is simple: we say that the Environment Secretary has acted unlawfully by failing to have or publish a policy on when he will use his power to ask the High Court to put a water company in the Special Administration Regime (SAR) – a mechanism under existing legislation specifically designed to enable the government to take action to deal with failing water companies.

This comes amid the deepening crisis at Thames Water, which has repeatedly breached environmental law, mismanaged its finances, failed to invest adequately in infrastructure, and shattered investor confidence and customer trust. Thames Water is on the brink of collapse with £20 billion in debt and widely regarded as no longer investable, with customers and the environment paying the price.

Steve Reed as Environment Secretary or Ofwat as water regulator (with his approval) have the power under section 24 of the Water Industry Act 1991 to ask the High Court to place a water company in special administration on either financial or performance grounds.

Special administration is a temporary insolvency and restructuring process for companies that provide essential public services like water, energy or transport. It is designed to ensure continuity of service while the company is stabilised and restructured. There is a bespoke special administration regime for the water industry, created in 1991 and designed to prioritise customers and services, putting financial interests second. Where water companies are failing, special administration can provide better, fairer and more sustainable outcomes – with the major benefit that it gives the water company the ability to recover and refinance with the opportunity for funds to be redirected away from investor profits towards the urgent infrastructure improvements needed to solve the ongoing sewage crisis, all without exposing its customers and at little cost to the public purse. Yet special administration has never been used for the water industry.

Thames Water has breached its duties and violated its licence conditions, seriously and repeatedly. It is the clearest possible case for special administration.

River Action’s legal challenge

The judicial review is concerned with the legal requirement for the Environment Secretary to have a policy for when he will trigger special administration for water companies. The claim challenges two key failings by the Government:

  1. Failure to publish a policy, breaching core public law duties.
  2. Failure to develop a policy at all, breaching obligations under the Habitats Regulations and other planning and environmental law.

Special administration is not limited to insolvency. It can also be used to protect customers and the environment when a water company is failing to meet performance standards. Our claim focuses on the Government’s approach to triggering a performance-based special administration process.

Under section 24 of the Water Industry Act 1991, special administration can be triggered by a water company’s failure to meet performance standards and a breach of its statutory or licence duties in ways that are “serious enough to make it inappropriate for the company to continue to hold its licence”. We believe that Thames Water clearly meets this threshold and has done so for years.

Independent Water Commission on Special Administration 

Last week, the Independent Water Commission, chaired by former Bank of England Deputy Governor Sir Jon Cunliffe said that “the policy around SAR assessment should be set out more clearly”.  The Commission also said that “SAR should be a practical option for the regulator and government” and stressed the importance of water companies preparing a plan for SAR now.

A route to public benefit models

We believe that special administration represents the most effective and immediate means of addressing the failures within the water industry. We see special administration as the first step toward meaningful and necessary systemic reform including providing the opportunity for a shift to a public benefit model of water ownership, governance and financing, of the type seen successfully implemented across Europe.

We are calling for the urgent use of special administration procedures for Thames Water as a tool to stabilise and reset using public benefit principles, with other failing water companies to follow as necessary.

Frequently Asked Questions

 

What is the Water Industry Special Administration Regime (SAR)?

The Water Industry Special Administration Regime (SAR) was introduced in England and Wales under the Water Industry Act 1991, with detailed procedures governed by the Water Industry (Special Administration) Rules 2009 and a comprehensive modernisation of the regime in early 2024. The legislative intent behind this regime is to protect consumers, public health and the environment in the event that a regulated water or sewerage company becomes insolvent (an insolvency SAR) or fails to carry out its statutory functions or licensed activities to such an extent that it is inappropriate for it to continue to hold its appointment or licence (a performance SAR).

An application for special administration of a water company may only be made by the Secretary of State or Ofwat with the Secretary of State’s consent. This contrasts starkly with normal administration under the Insolvency Act 1986 which can be applied for by creditors, the company or a director.

Special administration allows the Government to:

  • Appoint independent special administrators;
  • Restructure failing companies and their debt (the focus of an insolvency SAR);
  • Restore and maintain performance standards (the focus of a performance SAR);
  • Ensure water and wastewater services continue without interruption.

Importantly, the special administration regime is designed to keep services running using the company’s own revenues – from ongoing customer bills – not taxpayer funding. It is intended as a mechanism for accountability and  reform, not a bailout.

What are the details of the judicial review claim?

On 7 March 2025, we wrote to the Secretary of State for Environment, Food and Rural Affairs (“SSEFRA”) to ask whether the SSEFRA or the SSEFRA’s ministers had given consideration to whether it would be appropriate to exercise their discretionary power to apply to the High Court to have Thames Water placed into special administration in light of the contraventions of its “principal duties” in accordance with section 24 of the Water Industry Act 1991.

In response, the SSEFRA has refused to provide details of any such policy and has simply contended that there was no requirement to have a “written document or policy”.

Accordingly, we have three grounds of review:

  • Ground 1: Failure to publish a policy. The SSEFRA has a policy on the circumstances in which he will exercise his discretion pursuant to section 24 WIA and has acted unlawfully in failing to publish that policy.
  • Ground 2: Failure to have a policy. If, contrary to Ground 1, the SSEFRA does not have such a policy, that is in breach of Regulation 9(3) of the Conservation of Offshore Marine Habitats and Species Regulations 2017 (the Habitats Regulations).
  • Ground 3: Failure to have a policy. If, contrary to Ground 1, the SSEFRA does not have such a policy, that is in breach of section 85(A1) of the Countryside and Rights of Way Act 2000, as amended by section 245 of the Levelling-Up and Regeneration Act 2023.

We are seeking a mandatory order that SSEFRA either provides details of any policy or, if there is no policy, requires a policy to be developed and published.

Why does Thames Water need to be brought into Special Administration?

  • Persistent failures: Thames Water has a long record of breaching environmental, financial, and regulatory obligations.
  • Record fine: In May 2025, Thames Water was fined nearly £123 million by water regulator Ofwat for breaches of rules relating to its wastewater operations (£104.5 million) and breaches of rules relating to dividend payments (£18.2 million). This is the largest penalty Ofwat has ever issued.
  • Investor confidence collapsing: KKR, Thames Water’s preferred buyer, pulled out of negotiations leaving its various existing lenders as the only option.  Thames Water’s creditors have reportedly demanded that the company and its management be granted immunity from prosecution for serious environmental crimes as a condition of their restructuring proposals, without which Thames Water has said it would not be “investable”.
  • Inflated cost claims: The Treasury has claimed placing Thames Water into special administration could cost up to £4 billion – with reports it told DEFRA that it would have to meet these costs from DEFRA’s annual budget totalling £4.6 billion. Independent experts such as Professor Ewan McGaughey and Professor Dieter Helm believe the £4 billion figure is overstated and politically driven, with the likely costs being much lower and likely to be recouped by the Government on exit from administration.

 

What is the Independent Water Commission’s view on Special Administration?

On 21 July 2025, Sir Jon Cunliffe’s Independent Water Commission published its 88 final recommendations to the UK and Welsh governments for the reform of the water sector.

Two recommendations were made in relation to the special administration regime:

  • Recommendation 46: The regulator in England and Wales should continue to adopt an evidence-based process to consider, on a case-by-case basis, whether it would be appropriate for a water company to transition to an alternative ownership model where they request to do so or following a Special Administration Regime.
  • Recommendation 59: The regulator in England and Wales should develop and consult on a framework for ensuring companies are prepared for SAR.

In relation to Recommendation 59, the Commission said:

“793. The Commission believes the SAR should be a practical option for the regulator and government but that it should be very much a last resort. However well prepared, a SAR would be a major exercise which carries some risk of disruption to the company’s operation. The Commission notes that lowering the threshold for SAR would increase costs to customers through higher financing given the increased risk on investors. The Commission is also mindful of the risks in creating automatic triggers – experience in insolvency and similar regimes in other sectors, including financial services, is that conditions and circumstances of individual cases vary widely and cannot be anticipated. There is a need for broad, judgement based tests within a clear policy, that has been set out in advance, of how the regulator will assess failing companies against these tests, the factors it will take into account and the indicators it will consider. In the Commission’s view the two current tests for entry into SAR effectively balance objective and subjective factors and include an appropriate level of judgement.  It believes, however, that the policy around making the SAR assessment should be set out more clearly.

794. The Commission believes that further practical steps can be taken to ensure the SAR is a credible, but low probability, threat. In particular, as part of the SAR policy set out above, the regulator should develop and consult on a framework for ensuring companies prepare a plan for SAR. This should consider what the practical barriers to SAR might be, and how these can be mitigated in advance.”

Although the Commission’s recommendations focus on the regulator, its comments around the need for a clearer policy for special administration logically apply to both Ofwat as regulator and SSEFRA, as the two authorities with the power to petition the High Court for a special administration order.

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