River Action Launches Legal Challenge Against Ofwat Over Water Bill Hikes

River Action has filed a landmark legal challenge against Ofwat, accusing the regulator of unlawfully allowing water companies to pass the cost of their own failures onto customers. The case comes as water bills rise by an average of £123 a year, forcing households to pay for decades of underinvestment by the water industry.

The challenge, filed with the support of Leigh Day law firm, targets Ofwat’s Price Review 2024 (PR24), which granted enhanced funding to water companies like United Utilities without sufficient safeguards to ensure the money is spent on new water and sewage projects. Instead, River Action warns that customers will be left footing the bill for past infrastructure neglect, paying twice for the same failing systems.

Paying Twice for Polluted Water?

The legal action stems from investigations by environmental campaigners Matt Staniek and Windrush Against Sewage Pollution (WASP), which exposed severe regulatory failings.

In August 2024, United Utilities requested extra funding to upgrade treatment works and pumping stations in the Windermere area, following 6,000 hours of raw sewage discharges into the lake that year alone. Ofwat approved the request under PR24, but River Action argues that the regulator:

• Relied on hydraulic simulation modelling rather than real-world pollution data, which failed to reflect the true environmental damage.
• Ignored key evidence of widespread sewage discharges when assessing funding needs.
• Lacked a clear mechanism to regain funds if companies misused the additional investment.

As a result, customers could be forced to pay twice: first through water bills that should have covered infrastructure maintenance, and again through new hikes aimed at fixing the same problems.

A Call for Reform

River Action is demanding urgent regulatory reform to stop water companies from passing the cost of their mismanagement onto the public. The financial burden of repairing the UK’s crumbling water infrastructure must fall on the companies and their investors, not customers.

Emma Dearnalely, Head of Legal at River Action, said:

Holding Ofwat Accountable

River Action’s legal challenge also raises broader concerns about Ofwat’s oversight and accountability, questioning whether the regulator has the necessary powers or will to prevent water companies from profiting at the public’s expense.

Ricardo Gama, solicitor at Leigh Day, commented:

Fighting for Clean Water

River Action’s legal challenge is part of its broader mission to hold water companies and regulators accountable. The group continues to campaign for stronger enforcement, greater transparency, and a financial and governance model that prioritises people and the environment over profits.