The Environment Agency is failing to regularly audit water companies to check they are telling the truth about pollution and illegal sewage dumping in England, the Guardian can reveal.
The audits contribute to the star rating companies are given for environmental performance by the watchdog. Some companies are being given top ratings, even though the FoI data suggests the EA has not audited them for several years.
“The agency has failed to do its job,” said Ashley Smith of the campaign group Windrush Against Sewage Pollution (WASP), which unearthed the FoI data seen by the Guardian. “Serious failure has been allowed to continue in the water industry and the regulator for many years.”
Ever since 2010 when the law changed to allow the privatised water industry to self-report on its operations – known as “operator self-monitoring” – the EA is supposed to audit companies each year to make sure they are accurately recording how their treatment works operate.
The checks are to ensure that water companies are abiding by the permits that control how they operate, that they are not illegally dumping raw sewage and that they are honestly recording how much effluent they treat and the quality of the treatment.
According to the FoI data, 36% of audits over the past 13 years were not carried out or are inexplicably missing from records.
The data shows 42 audits are missing out of the 117 that should have been produced from annual inspections of the nine water and sewerage companies since 2010. The revelations come as the environmental watchdog said ministers and the regulators may have broken the law by failing to stem the flow of raw sewage discharges into rivers and seas by water companies.
Audits on Southern Water, which was fined a record £90m in 2021 for dumping billions of litres of raw sewage into the sea from its treatment works, do not appear to have taken place since 2013, according to the data.
Audits for South West Water, which has one of the worst records for pollution, are missing for eight of the past 13 years, according to the data. The last audit produced was in 2015. However, South West Water disputes the data, saying its most recent audits took place in 2019 and 2021.
The data contrasts with evidence given to MPs by James Bevan, then chief executive of the EA, in March. Accused of allowing the companies to “mark their own homework” with operator self-monitoring, Bevan indicated the checks by the EA were robust. “On marking their own homework, we do not let water companies do that. What we do have is a system called operator self-monitoring …
“We require water companies to monitor and report on a whole bunch of things, including effluent quality and the storm overflow data that you have rightly raised, and to tell us whenever they cause a pollution incident.
“We require them to self-report if they do other things out of kilter with their permit … we check this data, so we do not just take it literally. We audit the data … with those appropriate checks and balances, operator self-monitoring is a good thing.”
The EA audits contribute to the star rating they are given for environmental performance by the watchdog and inform the industry regulator Ofwat on issues of price review, penalties and rewards.
United Utilities is held up as an above-average, industry-leading water firm and consistently given the top three- and four-star ratings for environmental performance. But the FoI data indicates that the last audit of its operator self-monitoring by the EA was in 2017.
Smith said: “Allowing water companies that have powerful financial incentives to exaggerate performance to monitor themselves was a massive risk that needed effective measures to ensure integrity both within the companies and the Environment Agency, which is clearly highly vulnerable to corruption in many ways.”
The EA budget was more than halved by the Conservative Government over a decade and staff have complained they cannot do their jobs properly as a result.
The annual audits of operator self monitoring are supposed to identify where companies are in breach of their permits to operate, and rate any breaches as major non-conformity or minor non-conformity. For example, a lack of independence between the company’s monitoring teams and those who manage the assets is considered a major non-conformity, according to internal EA guidance. It states there must be no delay in taking enforcement action.
But the EA audit in 2016 of United Utilities’ self-monitoring identified a lack of independence between the monitoring and asset management teams as a minor non-conformity.
The audits of UU that have been produced provide what the EA teams said were concerning gaps in flow data provided by the company, which could indicate discharges of raw sewage during dry weather – which is illegal.
But the last audit produced by the EA into the company’s self monitoring in 2017 – according to the FoI – marks each audit area as “not assessed”. The summary notes explain this is because the agency takes a “light touch” approach. No audits have been produced by the EA since then into UU, according to the FoI results.
Audits of Yorkshire Water have not been provided for seven of the 13 years since operator self-monitoring came in, according to the FoI results. But the company has received six three-star ratings and two four-star ratings for environmental performance in that time.
An EA spokesperson said: “We use a wide range of tools – alongside operator monitoring audits – to make sure companies are held accountable. That includes detailed data analysis, event duration monitoring, new data tools, inspections of monitors, chemical analysis and on-site inspections and assessments. We take action against companies that do not follow the rules, including £150 million in fines since 2015.
“Operator self-monitoring for water companies is in line with other industries that are monitored in this way, such as waste and chemical sectors. Only the water companies can do this level of monitoring and they should also be the ones paying for it.”
The water companies did not provide a comment.