CEO, Susan Davy said: “We are pleased that Ofwat has completed its review into wastewater at South West Water as part of its sector wide investigation. For South West Water this related to historical issues. I have always said that when things go wrong, it is how we respond and put things right and that is exactly what we are doing. In response to Ofwat’s findings, we have proposed a ringfenced investment programme of £24m to spend more to further reduce spills, tackle sewer misuse and establish a Nature Recovery Fund, benefiting environmental groups in Devon and Cornwall and the wider community.  This is in addition to the £760m we are already investing over the next 5 years to reduce the use of storm overflows across the region."

 

 Background

  • We have 655 WWTW – one of the highest amounts across the industry with permit requirements.
  • As noted by Ofwat, we have stepped up to put things right.
  • The £24m is funded by the company and shareholders and not our customers.
  • Susan was appointed chief executive in 2020. She has overseen all the investment and improvement works that have been made since the investigation started in 2021. She took responsibility by acting decisively, making the resolution of this issue a main priority of her leadership. Ofwat’s report states on page 137: “It is clear that South West Water's reporting to its Executive and Board on the performance and compliance position at its WWTW and storm overflows has significantly evolved since 2020.”
  • Susan also launched our WaterFit scheme, our three-year plan to improve the health of rivers and seas in the region. We are also pleased Ofwat recognised that, under Susan’s leadership, we ‘made significant changes’ to improve our internal governance and systems, took a ‘series of steps to significantly improve’ monitoring at our treatment sites and, since 2023, South West Water has ‘taken further steps to improve the processes it has in place to enable its Executive and Board to monitor and address compliance risks relating to this case’.
  • We knew this investigation would take time, which is why we have already taken serious action to transform our operations, ensuring significant improvements to provide a better service to our customers and enhanced environmental protections, some of these include (and have been noted by Ofwat within the report):
  • Investing more than £16m to remedy the 21 WWTW that have failed to meet FFT requirements.
  • In the process of delivering a £100m storm overflow reduction plan, supported with a £45m shareholder investment intended to reduce spills from storm overflows.
  • Secured funding under the Green Recovery programme to progress a further 100 investigations into high spilling storm overflows – by April 2022, this had expanded to 260 investigations.
  • Strengthened internal processes and controls regarding collection and analysis of flow and spill data Introduced new governance arrangements to ensure greater oversight of its compliance with its legal and regulatory obligations, including to improve the way it manages risks and reports on performance to its Executive and Board.
  • Significant changes to its internal systems and governance process to improve its ability to accurately report to its Group Executive and Board the compliance position across its WWTW and network storm overflows.
  • Routine reporting of FFT performance to senior management.
  • Taking steps, or in the process of taking steps, to remedy those WWTW identified as potentially not complying with their FFT permit requirements.
  • Taking steps, or in the process of taking steps, to address four WWTW it had identified as failing to achieve DWF permit requirements. Strengthened its approach to monitoring and maintaining compliance with DWF permit conditions over past 12 to 18 months.
  • Since 2023 SWW has taken further steps to improve processes in place to enable Executive and Board to monitor and address compliance risks relating to this case, such as establishing KPIs to measure WWTW performance against FFT and DWF requirements and assess how well risks are being addressed for the purpose of reporting to Board.
  • Our largest ever investment of £3.2bn investment will see further improvements across our customers priorities – securing safe, clean drinking water, reducing the use of storm overflows across the regions’ bathing waters and protecting the environment, with investments in renewables. We are serious about tackling pollution, and we have allocated £760m to reduce storm overflows across the South West Water region over the next five years. 
  • As Ofwat noted, this work has included more than £16m investment in 21 wastewater treatment works and the ongoing implementation of a £100m storm overflow reduction plan.
  • We installed monitors across 100% of our entire network a year ahead of the government’s target, vastly improving our ability to identify and rectify any issues as quickly as possible through enhanced reporting systems.