Consultation outcome

Summary of responses and government response

Updated 7 July 2026

The Department for Environment, Food and Rural Affairs (Defra) published a consultation on proposed strengthening of penalties for water company offences. This was open for responses from 22 October 2025 to 3 December 2025.

The consultation was conducted primarily through the Citizen Space online consultation tool. Respondents also submitted comments by email, an organisation-led survey coordinated by Organise and an E-actions campaign received in the form of emails from individuals who signed their names to the same statement. The Organise survey consisted of seven questions drawing on and combining questions from the consultation. The E-actions campaign statement can be found in Annex C.

This publication includes:

• a summary of responses received, with an analysis of themes of note arising from the responses
• a government response and planned next steps
• a full breakdown of responses by question in Annex A
• a summary of responses from Organise in Annex B
• a summary of responses from the E-actions campaign in Annex C

Background

Within England, the Environment Agency is broadly responsible for regulating water companies’ compliance with environmental requirements. The Environment Agency investigates where there appears to have been breaches of environmental regulations and can take enforcement action, in line with its enforcement and sanctions policy.

The Environment Agency brings criminal prosecutions for the most serious cases. For criminal proceedings the Environment Agency is required to prove that offences have been committed ‘beyond a reasonable doubt’, the criminal standard of proof. If a prosecution results in a conviction, a court will follow the Sentencing Council’s guideline for the sentencing of environmental offences, including for setting a suitable fine.

The Environment Agency also has the option to use civil sanctions, which are enforcement measures imposed by the regulator rather than the courts. These provide a more flexible, reactive, and proportionate alternative for less serious offences. Civil sanctions are underpinned by the Macrory principles, which set out how civil sanctions should drive improved compliance.

A range of civil sanctions have been applied across sectors via the Regulatory Enforcement and Sanctions (RES) Act 2008. The Environment Agency was granted powers to use these civil sanctions for the water sector through the Environmental Civil Sanctions (England) Order 2010 (the 2010 Order) (ECSO 2010) and the Environmental Permitting (England and Wales) Regulations 2016 (EPR 2016).

The changes consulted on are targeted at minor to moderate offences, which make up the majority of water company non-compliance with environmental requirements. The Environment Agency will be provided with the following:

• variable monetary penalties (VMPs) imposed to the civil standard of proof (civil standard VMPs).
• automatic penalties (APs), where the Environment Agency will be placed under a duty to impose fixed monetary penalties (FMPs) to the civil standard of proof (civil standard FMPs) in specific circumstances

The changes included in this consultation will apply to England only.

Summary of responses and methodology

12,159 responses were received in total. 172 were via Citizen Space (Defra’s online consultation tool), 8 were submitted via email, 6,559 were from a response led by Organise and 5,420 responses were from an E-actions campaign.

Of the Citizen Space respondents:

• 150 were a customer or individual
• 12 were a representative of a non-Governmental organisation (NGO) or other non-profit public interest group
• 4 were a representative of a water and sewerage company
• 3 were an elected representative
• 2 were a representative of a water-only company
• 1 was an academic or researcher

Questions were posed to respondents for their views on:

• offences and circumstances where new penalties can be imposed
• permit conditions that would be introduced to enable or support penalties
• the maximum penalty value of civil standard VMPs
• the value of an AP
• procedural requirements, including representations and appeals
• potential business impacts

In Citizen Space, for each of these questions, respondents could answer ‘yes’, ‘no’ or ‘don’t know’, or choose between listed options. There were also blank text boxes to allow for respondents to answer these questions with more information.

Methodology for analysing consultation feedback

To ensure a robust, transparent and proportionate analysis, the following approach was adopted.

The core analysis presented in the government response is based on the 172 Citizen Space responses, supplemented by the 8 email submissions where relevant. Citizen Space is the designated platform for the consultation and contains structured responses directly aligned to the consultation questions.

The 8 email submissions were reviewed qualitatively. However, because some of these free‑form emails did not map directly onto the consultation questions, they were not included in the quantitative summary statistics (for example, percentage breakdowns of closed‑question responses). Instead, their content was considered thematically to ensure that any substantive issues raised were reflected in the narrative analysis.

The Organise survey has been analysed separately because its 7-question structure does not align with the official consultation questions. In the Organise survey, questions 1 to 6 required respondents to select from pre‑populated drop‑down statements, with no option to provide additional comments. Only one question - the final open‑ended prompt, “Please share why you think it’s important for water companies to be held to account?”- allowed respondents to offer free‑text feedback.

This design means that the Organise dataset does not correspond to the consultation’s question‑by‑question structure and cannot be integrated into the quantitative analysis used for analysing consultation responses. Therefore, to avoid skewing the findings from the main consultation and to ensure all responses are interpreted in line with their respective questions, it is appropriate to analyse the Organise responses independently from the official consultation submissions.

However, the Organise submissions provide important insight into public sentiment. The responses have therefore been analysed independently and are presented separately (Annex B) to ensure transparency and to reflect their contribution to the wider evidence base.

The E‑action campaign responses have also been analysed separately. These submissions consisted of a standardised collective statement rather than answers to individual consultation questions. As with the Organise dataset, including them in the main statistical analysis would compromise the integrity of the consultation findings. The E‑action responses are therefore considered independently and presented separately (Annex C), ensuring they are appropriately reflected alongside the formal consultation results.

Analysis of responses

In this section, we give an analysis of the responses from the:

Online responses

Annex A contains a full breakdown of the Citizen Space responses.

Across the consultation, respondents generally showed strong support for the proposals to introduce civil standard VMPs, civil standard FMPs, and APs to be applied in specific circumstances. Most proposals received over 80% agreement, indicating broad support for strengthening environmental enforcement in the water sector.

Water company respondents supported some aspects of the proposals, including the introduction of civil standard FMPs, but raised concerns about other elements, including the introduction of civil standard VMPs and aspects of the AP regime. As key regulated entities, water companies provided detailed feedback on the practical and operational implications of the proposals, which is reflected in the qualitative analysis.

While views were broadly positive, respondents who expressed reservations or disagreement raised common themes, which are summarised in the sections below.

Civil standard VMPs (Q7, Q8)

The consultation set out the procedure that the Environment Agency must follow when imposing penalties and proposals for civil standard VMPs, including:

• offences where civil standard VMPs could be used:
• a preferred cap amount with the following options:
  • set the cap at £350,000
  • set the cap at £500,000
  • set the cap at another amount
  • do not know

Most respondents supported introducing civil standard VMPs for the offences proposed. These were the following:

EPR 2016 offences:

• Regulation 38(1)(a) and (b) – Operating without or other than in accordance with a permit
• Regulation 38(2) – Failure to comply with or contravening a permit condition
• Regulation 38(3) – Failure to comply with the requirements of a notice
• Regulation 38(4)(a) – Failure to comply with a notice (under regulation 61(1)) requiring the provision of information, without reasonable excuse
• Regulation 38(5)(a) – Failure to keep required records and make them available to the Environment Agency on request

WRA 1991 offences:

• Sections 24(4) and 25(2) – Unlicensed abstraction or impounding or failure to comply with condition of an abstraction or impounding licence
• Section 25C(1) – Failure to comply with an abstraction or impounding enforcement notice served under Section 25A
• Section 80 – Contravention of a drought order or permit
• Section 201(3) – Failure to comply with the requirements of a Section 201 notice

88% of respondents agreed with this, 11% disagreed and 1% did not know.

Some water company respondents raised concerns on whether applying the civil standard of proof across the proposed offences would provide sufficient safeguards, given these offences have historically been enforced under the criminal standard. There were concerns that without clear guidance, the proposals could lead to inconsistent or subjective enforcement across regions.

Overall, responses reflected both a desire for more effective enforcement and concerns about proportionality, legal certainty and consistent implementation.

In relation to the cap amount:

• 58% chose the cap amount of £500,000
• 7% chose the cap amount of £350,000
• 33% chose ‘set cap at another amount’
• 2% did not know

Of those respondents who chose ‘set cap at another amount’, the vast majority sought a much higher cap amount. Some respondents suggested penalties should be borne by individuals within the company or be in the form of limits on dividend payments. There was one respondent who suggested a lower cap amount of £100,000. There was strong feeling from many respondents that VMPs should be available up to a cap amount high enough to act as a deterrent and not just be seen by water companies as a ‘cost of doing business’.

Introducing Civil Standard FMPs (Q9,Q10)

This section of the consultation sought views on both:

• introducing civil standard FMP powers for permit and licence breaches (regulation 38(2) offence under EPR 2016 and section 24 offence under WRA 1991), for the purposes of enabling the Environment Agency to impose APs
• replacing existing criminal standard FMP powers for section 24 WRA 1991 offences, where civil standard FMP powers would be available instead

There was strong support for introducing civil standard FMP powers for permit and licence breaches:

• 94% of respondents agreed, 4% disagreed and 2% did not know

Of those respondents who selected ‘no’ to the introduction of FMPs for permit and licence breaches, all of them felt that FMPs were too low to act as a deterrent for water companies and suggested that penalties should be significantly higher or that more severe enforcement approaches should be deployed.

Responses also showed strong support for replacing existing criminal standard FMPs under section 24 WRA 1991 where civil standard FMPs would be available:

• 87% of respondents agreed, 7% disagreed and 6% did not know

Some respondents preferred retaining the criminal standard route for this offence, citing concerns about the seriousness of abstraction breaches or a preference for the use of the criminal standard in cases of environmental harm.

Pollution incident reporting requirements and APs (Q11 - Q13)

This section of the consultation made proposals to strengthen the reporting requirements for pollution incidents and to introduce APs for specified breaches. The consultation sought views on 3 linked areas:

• introducing a 4‑hour backstop for reporting significant pollution incidents
• applying an AP where companies fail to meet this 4‑hour requirement
• requiring all pollution incidents to be reported as soon as reasonably practicable following detection

There was strong support for the proposal to introduce a 4‑hour reporting backstop for significant pollution incidents:

• 78% of respondents agreed, while 19% disagreed and 3% did not know

The majority of respondents who replied ‘no’ to this question suggested that the 4-hour backstop should be considerably shorter, if not immediate - citing the serious impact of significant pollution incidents on the environment.

Some water company respondents noted that 4 hours may not always be possible due to the need to secure access over third-party property and that for significant pollution incidents, the priority is usually stopping the cause.

Support for applying an AP when a significant incident is not reported within 4 hours was similarly strong.

• 89% of respondents agreed, 9% disagreed 2% did not know

Respondents from water companies who did not agree questioned whether late reporting should attract an AP, noting that delayed reporting may not always lead to financial gain or cause additional environmental harm, and suggesting that an AP approach may not align with the Macrory Principles. They stated that reporting has on previous occasions taken longer than 4 hours, despite (in their view) best efforts and good practice.

Concerns were also raised that the 4‑hour timeframe may not always allow for a reliable assessment of incident severity due to conditions such as poor visibility, or where incidents occur in rural or difficult-to-reach locations.

Requiring all pollution incidents to be reported as soon as reasonably practicable following detection was also overwhelmingly supported:

• 89% of respondents agreed, 11% disagreed and 1% did not know

The overwhelming view from respondents who answered ‘no’ to this question was that ‘as soon as reasonably practicable’ was too vague and would not be enforceable.

EDM Requirements and APs (Q 14, 15 and 16)

This section of the consultation proposed to strengthen monitoring and reporting obligations relating to storm and emergency overflows. The consultation sought views on:

• applying an AP when an EDM device at a storm or emergency overflow fails to be operational for at least 90% of the year
• standardising EDM requirements in storm overflow permits, including the frequency of monitoring
• applying an AP if companies fail to report EDM data monthly to the Environment Agency

There was strong support for applying an AP where EDM devices fail to be operational for at least 90% of the calendar year. 

• 79% agreed with the proposal, 19% disagreed and 2% did not know

The vast majority of respondents who selected ‘no’ for this question felt that 90% uptime was too low and that EDM devices needed to be operational more than this. Water company respondents felt that clearer expectations and definitions were required to ensure fair enforcement and raised a concern that overlap with existing requirements in Environment Agency Environmental Performance Assessment (EPA) metrics and Ofwat storm overflow Performance Commitments had potential to cause double jeopardy.

Support for standardising EDM requirements in storm overflow permits, including setting a monitoring frequency of two minutes, was also high.

• 92% agreed, 4% disagreed, and 4% did not know

Similar to the feedback on the proposed 90% uptime requirement for EDM monitors, most water company respondents felt that similar requirements already exist in both the Environment Agency’s EPA metrics and Ofwat Performance Commitments and questioned the additional environmental benefit to this proposal. They highlighted potential increases in recorded spill counts resulting from more frequent monitoring, and raised concerns about timing, transitional arrangements and the potential for unfunded costs arising from upgrades to existing monitoring equipment. Several respondents therefore suggested that, if introduced, the requirement should allow for a reasonable implementation period and alignment with wider regulatory programmes.

The proposal to apply an AP where companies fail to submit EDM data to the Environment Agency monthly also received strong support:

• 94% of respondents agreed, 5% disagreed and 1% did not know

Some water company respondents viewed this proposal as an unnecessary additional and duplicating requirement – citing that they were already subject to regulatory sanctions on EDM reporting via, for example, the section 143DA Water Industry Act 1991 duty and EDM Annual Returns.

APs for more than 3 emergency discharges from an emergency overflow in a year (Q17)

There was strong support for applying an AP where there are more than 3 emergency discharges from an emergency overflow in a year.  

• 83% agreed, 15% disagreed and 2% did not know

Most of the respondents who answered ‘no’ to this question felt that 3 discharges before an AP is applied was too lenient. Some respondents highlighted environmental and public health risks associated with frequent emergency discharges and viewed APs as an appropriate and predictable consequence for avoidable failures.

Water company respondents who disagreed with the proposal generally questioned the evidence base for choosing 3 as the maximum times a year an emergency overflow can make an emergency discharge and whether all discharges above the threshold should automatically lead to penalties, noting that some exceptional circumstances may be beyond companies’ control.

AP for failing to return abstraction data to the Environment Agency within 28 days of being requested (Q18)

Support was strong for applying an AP where water companies fail to return abstraction data within 28 days of request.

• 92% of respondents agreed, 6% disagreed and 2% did not know

Water company respondents argued that monthly reporting would increase burden and cost, and noted that abstraction data requires extensive validation, raising concerns about whether post-submission corrections might be treated as late reporting. Companies also said clearer definitions and standardised requirements are needed before APs apply, including clarity on accuracy, reliability, and which records must be provided within 28 days of request.

Water company respondents also emphasised the perceived need for sufficient lead-in time to upgrade or modify meters. They cautioned that APs could unfairly penalise unavoidable delays, highlighting the need for allowances for exceptional circumstances. Companies also sought clarity on how new requirements would align with existing guidance and stressed the importance of phased implementation.

Abstraction: monitoring and reporting requirements (Q19, 20)

There was strong support from respondents for applying an AP where companies fail to have an accurate and reliable abstraction monitoring device in place.

• 95% of respondents agreed, 3% disagreed and 2% did not know

Water company respondents who disagreed with the proposal said that they would require additional funding and time to update assets to meet any new requirements. They also noted concern that the AP may not allow sufficient time for a faulty meter to be repaired or replaced. They called for clarity on whether this new requirement would supersede the existing guidance in the Abstraction Metering Good Practice Manual. A concern was raised about how the regime would apply where flow meters temporarily fail verification.

Support was high for applying an AP where companies fail to provide maintenance and accuracy records for monitoring devices within 28 days of request.

• 94% of respondents agreed, 5% disagreed and 1% did not know

Water company respondents raised a concern that the requirement for records on “accuracy”, if undefined, could be interpreted as mandatory calibration rather than verification, which would be costly and slow to implement at scale. Another concern was that there may be frequent and/or large requests for records and that the collation and provision of the required information would take a considerable amount of time.

Procedure, Discharge of Liability and Appeals (Q21, 22)

This section of the consultation asked for respondents’ views on procedural points for civil FMPs and APs including

• the procedure to issue penalties, including the ability to make a payment to discharge liability following the notice of intent
• the proposal to prevent companies from appealing the regulator’s decision on whether there are exceptional circumstances in place

There was broad support for the proposed procedure for civil standard FMPs – including for companies to be able to make a payment to discharge liability after receiving a notice of intent. 

• 74% agreed with this proposal, 20% disagreed, and 6% did not know

Most respondents who answered ‘no’ to this proposal felt that water companies should not be allowed to discharge liability. Water companies generally supported the proposed procedure, however raised concerns that the ‘payment to discharge liability’ option could act as a punitive disincentive to appeal and that they must be able to put forward genuine mitigating circumstances.

On whether companies should be prevented from appealing the Environment Agency’s determination of whether ‘exceptional circumstances’ apply.

• 83% of respondents agreed, 13% disagreed and 4% did not know

Water company respondents strongly opposed the proposal, highlighting the need to account for exceptional circumstances that mitigate the culpability of the company. Concerns were raised that not allowing appeals against the Environment Agency’s determination of exceptional circumstances would be disproportionate and would reduce accountability.

Civil FMP and AP design: Turnover Bandings and Penalty Values (Q23, 24 and 25)

This section of the consultation asked for respondents’ views on the proposals to vary civil standard FMPs and APs based on water company turnover. The consultation sought views on:

• whether penalties should vary according to company turnover
• the proposed turnover bandings for classifying water companies
• preferences for specific penalty values, with the option for respondents to suggest alternative amounts

There was strong support for the proposal to vary penalties based on company turnover:

• 85% agreed, 12% disagreed and 3% did not know

Respondents who selected ‘no’ argued that turnover alone may not capture all relevant considerations, or preferred a single penalty level for simplicity. Others raised concerns that companies could restructure corporate arrangements or use sub‑contracting chains to fall within lower turnover bands. Several water company respondents argued that larger undertakers already face greater operational exposure because of the scale and condition of their networks, and that applying higher penalties to larger companies would amount to a “double penalty”.

Support was similarly high for the proposed turnover bandings for classifying companies: 

• 85% of respondents agreed, 9% disagreed and 6% did not know

A number of respondents suggested that the thresholds differed from definitions used in other contexts and that the step between “large” and “very large” organisations should be wider. They noted that, under the Sentencing Guidelines, classification as a VLO depends on the circumstances of the case and is a determination made by the court, to ensure proportionality.

Respondents selected a range of preferred penalty values.

• Option 1 (a payment of £10,000 for very large organisations (VLOs) if liability is discharged after the initial notice, and £20,000 in other cases) - was the most chosen with 93 responses
• Option 4 (to set the penalty values at another amount) was the next most common, with 61 responses
• Option 5 (do not know) received 14 responses
• Option 2 (a payment of £7,500 for VLOs if liability is discharged after the initial notice, with a £15,000 penalty in other instances) received 3 responses
• Option 3 (a payment of £5,000 for VLOs if liability is discharged after the initial notice, with a £10,000 penalty in other instances) received 1 response

Many respondents provided free‑text suggestions advocating higher penalty levels than those proposed, or recommending graduated approaches based on the severity or environmental impact of the offence.

Evidence on Costs, Breaches, Investment Impacts and Familiarisation (Q26, 27, 28, 29 and 30)

The consultation invited comments on the modelling presented, including 

• potential cost of penalties
• likely number of breaches and costs
• impacts on investor returns
• any other information helpful in considering penalty impacts on private sector investment
• familiarisation costs

Feedback across the five questions in this section was not required. Most respondents did not provide additional evidence or commentary.

On the modelled potential cost of penalties:

• 37% of respondents provided comments, while 59% did not and 4% did not know

Respondents who did provide their feedback said they would welcome further clarity and transparency in the modelling approach, including additional information on the assumptions, datasets and inputs used, and clearer explanation of how different offence types were reflected. A smaller number questioned whether the modelling sufficiently captured future planned changes, or the interaction between penalties and other parts of the regulatory framework.

Regarding further evidence on likely number of breaches and penalty costs:

• 7% of recipients provided evidence, while 92% did not, and 1% did not know

Respondents commented on the number and frequency of likely breaches, expressing strong concern that non-compliance by water companies to date has been widespread, long-standing and, in some areas, persistent. Respondents cited local experience, publicly available spill data and previous enforcement cases as examples where it was felt that existing regulatory approaches have not delivered sufficient change, and argued that penalties to date have been too low to deter repeat offending.

Others highlighted the impact of repeated discharges on local communities, sensitive environments and economic activity, and emphasised the need for effective enforcement to restore public confidence.

For the modelled potential impacts on investor returns:

• 36% of recipients provided comments, with 62% offering none

Responses generally rejected the idea that impacts on investor returns should be a relevant consideration. Many respondents argued that water is an essential public service and that environmental protection, public health and infrastructure investment should take precedence over shareholder returns.

Water company respondents referred to the findings of the Independent Water Commission, highlighting concerns that financial burden of penalties on shareholders could exacerbate existing challenges for the sector, including low returns, elevated risk and the need to attract new equity. They argued that increased regulatory and financial uncertainty could reduce investor appetite or increase the cost of capital, with potential implications for the sector’s ability to finance long‑term investment in infrastructure and environmental improvements.

On private sector investment more broadly:

• 12% of recipients provided evidence, while 85% did not

Several respondents emphasised that penalties alone would be insufficient unless accompanied by firmer regulatory action to require infrastructure upgrades, better data transparency and coordinated decision making across government, including planning and housing policy. Respondents frequently stressed that enforcement should focus on preventing environmental harm and protecting customers, rather than on mitigating impacts to company finances.

Regarding familiarisation costs:

• 7% of recipients provided evidence, and 88% did not, and 5% did not know

A number of respondents considered that familiarisation with the proposed changes should be relatively quick and straightforward, and questioned whether such costs should be treated as material at all. Some argued that these costs are only relevant because of historic failures in compliance and investment and should not be used to dilute or delay the effectiveness of the proposals.

Many water companies emphasised that a fuller understanding of the final requirements, including any updates to the Enforcement and Sanctions Policy, would help them provide more robust cost estimates. Respondents noted that where new obligations are introduced, implementation would involve updates to staff training, internal processes and systems, including operational responses to pollution incidents and financial processes associated with penalty payments.

Email responses

Defra received 8 responses by email. Of these responses, 6 were from water company respondents or sector bodies, the remaining 2 email responses were from an eNGO coalition and a modern Livery Company. These responses were provided as free-form letters rather than the structured response used in the Citizen Space questionnaire.

As explained in the methodology section, the 8 email responses were not included in the quantitative analysis (the % breakdown of responses to each proposal) because their format did not map directly onto the consultation questions. However, the emails were reviewed in full, and their content was combined with the qualitive themes identified from the Citizen Space responses. This ensured that any issues raised uniquely in email submissions have been reflected in the overall analysis and addressed in the Government response.

Organise responses

The Organise campaign generated 6,559 responses across seven questions, providing a strong indication of public sentiment on water sector enforcement.

Nearly all respondents (over 99%) believed water companies should face stronger and more immediate consequences for pollution breaches. There was a widespread sentiment that penalties are too small to deter misconduct. Respondents also highlighted perceived concerns about the frequency of pollution incidents, the cost burden on customers, and environmental harm.

Most respondents preferred higher penalties, suggesting a public expectation that penalties must act as a serious deterrent and reflect the scale of environmental harm caused. Respondents also emphasised the importance of accounting for factors such as repeat offending, the scale of damage and company responsiveness when setting penalties.

Overall, support for APs was extremely high, with around 90% stating that APs were appropriate for clear-cut obligations. Most respondents supported the specific AP triggers that were consulted on.  

On the open question posed by Organise about why accountability is important, 2,014 responses were received.  Analysis of the responses indicates that the most frequently cited reasons for holding water companies to account related to:

• the environmental and public health impacts of pollution (20%)
• concerns that water companies prioritise profit over service provision (20%)
• the view that water is an essential resource that should be protected accordingly (12%)

A further 10% of responses explicitly called for personal accountability for directors and chief executives, and 10% called for nationalisation.

In addition, 9% of respondents highlighted rising customer bills despite ongoing pollution incidents and continued company profits. Smaller proportions pointed to failures in the regulatory framework, with 2% citing weak regulation and enforcement, while 17% of responses referred to other reasons.

Government response

Overarching policy position and rationale

Following consideration of the consultation responses, and the consistently high levels of support for the proposals, Defra has decided to proceed with the proposals consulted on.

Cross‑cutting feedback themes and overarching government response

Across the consultation, respondents raised several themes that cut across multiple questions. These themes related both to the operation of the proposed penalties themselves and to wider expectations around enforcement, regulatory consistency and environmental protection. Defra has carefully considered these issues in forming its final position.

Several respondents raised concerns that penalties could be passed onto customers. Under the existing regulatory framework, water companies are expected to ensure that the costs of non-compliance are borne by shareholders and not customers. Ofwat has powers to take enforcement action where this does not occur. Accountability for non‑compliance will continue to rest with companies.

Many respondents also expressed the view that the existing penalty framework fails to act as a deterrence, particularly for larger water companies. The proposals consulted on are designed to provide penalties that are both proportionate and capable of acting as a meaningful deterrent, including using turnover‑based penalty values for civil standard FMPs and APs. For serious or high‑harm incidents, existing enforcement options, including prosecution and unlimited criminal standard VMPs, will continue to be available.

Water company respondents raised points about fairness, context and proportionality, including concerns that some breaches may arise from factors outside a company’s control. Defra recognises these concerns but is clear that the strengthened regime remains proportionate. Secondary legislation will set out the procedure the Environment Agency must follow to impose each of the civil sanctions consulted on, including a company’s right to make representations and bring appeals.

A further recurring theme was the perceived potential duplication of enforcement. Water company respondents sought assurance that the AP framework would not operate alongside other regulatory routes for the same breach. Under the statutory framework, the Environment Agency’s duty to issue an AP does not apply where criminal prosecution or a VMP is being considered or is in progress for the same breach. In such cases, the Environment Agency will determine the appropriate enforcement route in line with its published policies, and the Environment Agency will not apply a VMP if an AP has been issued in relation to the same offence. Defra also recognises concerns about potential duplication of regulatory requirements. The strengthened requirements do not replicate existing requirements except where greater consistency or standardisation is needed. This approach ensures that new obligations complement, rather than duplicate, the wider regulatory framework.

Water company respondents also raised concerns about a lack of clarity on when civil standard FMPs would apply, including how decisions would be made between issuing VMPs or FMPs; how minor, moderate and more serious breaches would be distinguished; and how liability would be assessed where third-party factors contributed to an incident.  Secondary legislation will set out the circumstances under which the Environment Agency will be required to apply APs. Decisions on whether to use FMPs or VMPs, and the categorisation of breaches by seriousness, will continue to be guided by the Environment Agency’s Enforcement and Sanctions policy, which requires a proportionate assessment of the nature of the breach, harm, culpability and circumstances of the event, including the role of any third‑party factors.

Several respondents raised issues relating to investment and investor confidence, including concerns that stronger penalties could deter investment in infrastructure or adversely affect company valuations. Others argued that predictable, and proportionate enforcement would improve public confidence and support a stable long‑term investment environment. Defra considers that a transparent, stable and proportionate enforcement framework supports both environmental outcomes and financial resilience. The strengthened penalty regime is targeted at specific, well‑defined obligations and is not expected to inhibit responsible investment.

Some water companies also raised concerns about the potential for unfunded obligations during the current regulatory period. The proposals being taken forward do not alter existing regulatory arrangements for how costs are treated and are limited to clear operational expectations already central to companies’ responsibilities. Wider issues relating to funding, cost recovery and regulatory allowances fall outside the scope of this consultation and are addressed through established regulatory processes.

Water company respondents requested further information and clarity on several of the proposals in the consultation, including on definitions and procedural guidance. Defra’s response is that secondary legislation and the updated Environment Agency Enforcement and Sanctions Policy will provide additional detail and clarification in due course.

Wide-reaching proposals for structural reform of the sector, changes to director-level accountability, alterations to dividend or bonus practices, or broader strategies for water resource management were raised throughout the consultation responses. However, this consultation focuses specifically on the design and operation of the new civil standard penalty regime.

A small number of respondents expressed a broader concern that water companies might seek ways to circumvent any strengthened requirements. For example, in relation to the proposed EDM uptime requirement, respondents suggested that monitors could be turned off intentionally during periods of poor performance, exploiting the 10% downtime allowance to do so (which is intended for unavoidable downtime). The proposed civil penalty framework sits within a wider regulatory framework including permitting requirements and regulatory oversight that operates to discourage and address such behaviour.

Taken together, these cross‑cutting themes reflect a strong desire for a penalty regime that is clear, proportionate, predictable and effective. Defra considers that the measures set out in this response provide the right balance between robust enforcement and maintaining regulatory stability for future investment.

Civil Standard VMPs (Q7, 8)

Defra will implement VMPs to the civil standard of proof for the offences proposed and has decided to set the cap at £500,000.

In reaching this decision, Defra considered the full range of views expressed in response to questions 7 and 8, including calls for higher penalty caps, concerns about deterrence, and differing views on the appropriate balance between civil standard and criminal standard enforcement. These issues were raised across multiple questions and are addressed in the cross-cutting government response section above.

Civil standard FMPs (Q9 to Q10)

Reflecting strong support for a more timely and proportionate approach, Defra will introduce civil standard FMP powers for permit and licence breaches. Defra has also decided to replace the existing criminal standard FMP powers for section 24 WRA 1991 offences where civil standard FMPs are available.

In reaching these decisions, Defra considered the views expressed from a small number of respondents that there was a preference for retaining criminal standard enforcement for serious abstraction breaches. For serious or high‑harm incidents, existing enforcement options, including prosecution and unlimited criminal standard VMPs, will continue to be available.

Pollution Incident Reporting (Q11 to Q13)

Reflecting strong support for clearer and more consistent reporting requirements, Defra will introduce a 4-hour reporting backstop for significant pollution incidents.

Defra considers timely reporting essential for effective regulation, as delays can influence incident classification and slow the provision of regulatory advice or intervention, which could increase the potential for environmental harm. Defra notes that the 4-hour requirement itself is not new, with companies already working to a 4-hour expectation through their monthly EPA self-reporting. Defra also notes that the requirement applies only from the point of detection and that companies will be able to make representations before any penalty is confirmed.

Regarding feedback that further clarity is required to understand what the point of detection is defined as, the Environment Agency’s Guidance for reporting and assessing water industry regulation incidents (WIRI) provides guidance here.

Defra has also decided that an AP will be triggered for failing to report a significant pollution incident within 4 hours.

In relation to water company concerns about practical and safety-related constraints, Defra recognises that some conditions may affect how companies investigate incidents, but underlines that these constraints should not prevent reporting within the required timeframe.  

In relation to requests for clarity on how the 4-hour requirement interacts with incident classification and validation processes, Defra confirms that reporting and final classification are separate stages and that confirmation is not always necessary at the point of reporting. Water companies can and should submit further information as their investigations progress.

Defra will also implement the requirement to report all pollution incidents as soon as reasonably practicable.

Whilst some respondents were concerned that this was ‘too vague’ to be enforceable, the proposal is informed by existing guidance on incident detection and reporting, and by established regulatory practice. Enforcement decisions will take account of the circumstances of each case, including when an incident was detected and what steps were reasonably possible at that time.

Taken together, the combination of a clear 4‑hour backstop for significant incidents and an overarching requirement to report all incidents promptly provide both certainty and flexibility, ensuring that reporting expectations are enforceable, while accommodating the wide range of operational scenarios in which incidents may arise.

EDM requirements and APs (Q 14, 15 and 16)

Reflecting the clear support for strengthening EDM monitoring and reporting, Defra will introduce an AP if an EDM device at a storm or emergency overflow fails to be operational for at least 90% of a calendar year. Reliable EDM data is central to improving transparency, supporting public confidence and enabling a more responsive enforcement system.

Some water company respondents highlighted that EDM uptime may be affected by external factors such as device connectivity issues or issues accessing the site. However, some respondents felt that 90% was too lenient. Defra confirms that this threshold is intended to establish a clear and enforceable minimum standard, rather than to represent an operational target or level of good performance. It provides regulatory certainty on when an AP will apply, while allowing for unavoidable downtime associated with maintenance, repairs or access constraints.

Defra will standardise permit condition requirements for all storm overflows to require EDMs to be installed, maintained, repaired and replaced as needed, and set the monitoring frequency to two minutes.

In addition, Defra has decided to extend the requirement to maintain, repair and replace EDMs and have a monitoring frequency of two minutes to emergency overflow permits. Existing EDM permit conditions at emergency overflows are not uniform and, in some cases, do not clearly set out requirements for ongoing maintenance or consistent monitoring frequency. This variability risks undermining both regulatory certainty and fairness between operators. Standardising these requirements is therefore needed to ensure that the data underpinning the AP regime is reliable, comparable and enforceable.

These requirements do not mandate the installation of new EDMs on emergency overflows or alter the Environment Agency’s long‑term Monitoring Certification Scheme rollout programme, which will continue to be delivered through permit variations. Rather, they focus on ensuring that existing monitoring equipment is operated effectively during the transition period, avoiding the need for extensive individual permit variations and supporting the effective implementation of the strengthened penalties framework.

Defra acknowledges the concern that moving to a standardised two‑minute monitoring interval may result in increased detection of short duration discharges. This does not reflect an increase in pollution events, but improved accuracy and consistency in monitoring. Reliable and comparable data is essential to effective regulation and underpins fair and proportionate enforcement, particularly in the context of APs.

Defra considers that the introduction of a two-minute monitoring frequency does not represent a significant additional burden to water companies. Many companies have already set out programmes for monitor replacement or upgrade in their EDM Annual Return assurance documents, and there has been a wider shift across the sector towards shorter monitoring intervals to support timely operational oversight and reporting. Standardising the monitoring frequency therefore reflects capabilities that are, in part, already being implemented across water company networks.

Defra does not consider monthly EDM reporting to duplicate existing requirements.

Other requirements highlighted, including near-real time reporting and annual EDM returns serve different regulatory purposes. Monthly reporting provides a routine, structured mechanism for regulatory oversight, enabling consistent monitoring of compliance and early identification of data gaps or systemic issues.

APs for more than 3 emergency discharges from an emergency overflow (Q17)

Defra will introduce an AP for more than 3 emergency discharges from an emergency overflow in a year. Defra considers that repeated emergency discharges from an emergency overflow are not consistent with responsible system management, and that this AP creates a clear and enforceable standard.

Defra recognises concerns from some respondents that a numerical trigger on when an AP applies is an arbitrary threshold. Defra considers that setting a clear numerical trigger provides regulatory clarity, supports consistent enforcement, and enables earlier intervention where repeated emergency discharges occur.

APs for failing to return abstraction data to the Environment Agency within 28 days of being requested (Q18)

Defra will introduce an AP for failing to return abstraction data within 28 days.

Defra recognises concerns raised by some water company respondents regarding the practicalities of returning abstraction data within 28 days of a request, including the need for data validation and recent changes to routine abstraction reporting arrangements.

The 28‑day requirement is intended to ensure timely regulatory oversight. It does not replace routine abstraction reporting cycles. The AP applies where companies fail to return requested abstraction records within the specified timeframe and does not require the installation or upgrade of monitoring equipment.

Abstraction: monitoring and reporting requirements (Q19, 20)

Defra will require water companies to have accurate and reliable monitoring devices in place to measure the quantity of water abstracted, with an AP applying where this requirement is not met.

Defra recognises the concern of a small number of water company respondents about how an AP would operate in practice where abstraction monitoring devices temporarily fail, or require repair or re-validation.

The AP is intended to address any absence of accurate and reliable abstraction monitoring, or failure to maintain such monitoring, rather than short‑term interruptions that arise during normal operation and are remedied through established maintenance, repair or verification processes.

Expectations regarding meter operation, verification and maintenance continue to be informed by existing abstraction metering guidance, including the Abstraction Metering Good Practice Manual.

Defra will introduce an AP for failing to provide maintenance and accuracy records within 28 days of a request.

Some respondents raised concerns that the obligation to provide records on “accuracy” could be taken to imply mandatory calibration rather than verification, and about the potential burden associated with responding to record requests within 28 days.

Defra confirms that this AP relates to the provision of records that demonstrate the operation, verification and maintenance of equipment in line with established expectations. The 28-day obligation is to supply records that will already be held, not to generate new evidence or undertake additional testing in response to a request.

Procedure, Discharge of Liability and Appeals (Q21, 22)

Defra will implement the procedures for issuing penalties, including the ability to discharge liability following a notice of intent.

The ability to discharge liability through payment is a standard feature of the civil sanctions framework and is intended to provide a timely and proportionate means of resolving clear cases of non-compliance. It does not prevent the Environment Agency from publishing details of enforcement action.

Some water company respondents argued that, while they supported the ability to discharge liability, this could be perceived as a disincentive to appeal and emphasised the importance of being able to put forward genuine mitigating circumstances. Defra confirms that the option to discharge liability through payment is voluntary - it does not remove the right to make representations or to challenge the imposition of a penalty through appeal where appropriate.

Defra has decided to implement the proposal to prevent companies from appealing the Environment Agency’s determination on whether exceptional circumstances apply.

The grounds of appeal to the First-tier Tribunal set out in the RES Act 2008 in respect of the imposition of FMPs will be maintained. These are that the decision of the regulator was based on an error of fact, was wrong in law or was unreasonable. These appeal grounds will not be removed. Defra considers it proportionate to prevent appeals on determinations of exceptional circumstances in order to avoid this appeal route being used as a means to avoid or delay the payment of an AP.

Civil FMP and AP Design: Turnover Bandings and Penalty Values (Q23, 24 and 25)

Defra will proceed with the proposal to vary penalties based on water company turnover.

Defra has considered concerns about restructuring or sub‑contracting to fall within lower bands. The turnover‑linked framework will be applied consistently, within a wider system of statutory duties and regulatory oversight designed to ensure that obligations are not circumvented.

Regarding concerns that larger water companies already face greater operational exposure because of the scale and nature of their networks, Defra confirms that the use of turnover bandings is not intended to penalise larger companies simply for operating larger or more complex networks. The purpose of the banding approach is to avoid a single flat penalty having a disproportionate impact on smaller operators or insufficient deterrent effect on larger ones.

Defra will implement the proposed turnover bandings for classifying water companies as:

• very large organisation (VLO): a turnover of £250 million or more
• large organisation: a turnover of £50 million or more and up to £250 million
• medium organisation: a turnover of £10 million or more and up to £50 million
• small organisation: a turnover of £2 million or more and up to £10 million
• micro organisation: a turnover of less than £2 million

Water company respondents raised concerns that current classification as a VLO is done by the courts and depends on the circumstances of each case. Defra notes that this approach reflects the discretionary nature of criminal sentencing. Introducing a VLO category defined by turnover provides a clear, objective and administrable way of distinguishing the largest undertakers in the sector, ensuring that fixed penalties deliver a meaningful deterrent without relying on case‑by‑case financial assessment.

Defra has concluded that aligning the turnover definition with that used across other environmental penalties and with the Sentencing Council Guidelines ensures a clear, objective and administrable approach to assessing company size. Under this approach, turnover is taken from a company’s most recently filed statutory accounts, rather than being limited to revenue from specific regulated functions, providing a transparent and standardised measure based on audited financial information.

On penalty values, Defra has decided to adopt option 1 from the consultation. Lower penalty values risk being absorbed as a routine cost of doing business, particularly for the largest undertakers, and would not deliver the behaviour‑changing effect required to support the objectives of the Water (Special Measures) Act 2025.

Evidence on Costs, Breach Volumes, Investor Impacts and Familiarisation (Q26 to Q30)

In relation to feedback suggesting the modelling was not sufficient to respond effectively, Defra notes that the figures presented are indicative and were intended to support consultation.

On the concerns raised on the likely number of breaches and penalty costs, Defra recognises the strong feeling expressed by respondents on the scale and impact of non-compliance by water companies. Defra agrees that stronger, clearer and more consistent enforcement is required to drive better performance and restore public confidence. The proposals being taken forward are intended to strengthen regulatory oversight, ensure penalties are provide meaningful deterrence, and support earlier and more effective intervention where non-compliance persists.

On investor impacts, Defra recognises that water companies highlighted wider sector challenges, including those identified by the Independent Water Commission. Defra does not consider that the proposed penalties are likely to undermine responsible investment. Instead, clearer expectations, improved data quality and more predictable enforcement processes are expected to support a more stable investment environment over time.

In relation to familiarisation costs, Defra notes that companies will need time to embed strengthened requirements and that the scale of familiarisation activities may vary across undertakers. Defra expects these costs to be proportionate and outweighed by the benefits of greater regulatory clarity, improved environmental performance and reduced ambiguity in enforcement. Further engagement will take place through the updated Environment Agency Enforcement and Sanctions Policy, allowing companies to understand operational requirements before implementation.

Next steps

Following the publication of this response document and when Parliamentary time allows, Defra will bring forward secondary legislation to implement these changes in law, subject to the legislation securing Parliamentary approval. Throughout this process, Defra will continue to engage with the Environment Agency.

Annex A: Summary of Citizen Space responses, by question

Question 7: Do you support the offences proposed to be enforceable by civil standard VMPs?

• Yes – 152 respondents, 88%
• No (please explain) – 19 respondents, 11%
• Do not know – 1 respondent, 1%

Total responses: 172

Question 8: What is your preferred cap amount?

• £350,000 – 12 respondents, 7%
• £500,000 – 100 respondents, 58%
• Set the cap at another amount – 56 respondents, 33%
• Do not know – 4 respondents, 2%

Total responses: 172

Question 9: Do you agree with the proposal to introduce civil standard FMP powers for permit and licence breaches?

• Yes – 163 respondents, 95%
• No (please explain) – 6 respondents, 3%
• Do not know – 3 respondents, 2%

Total responses: 172

Question 10: For the section 24 WRA 1991 offence, do you agree with the proposal to replace the existing criminal standard FMP powers, where civil standard FMP powers would apply?

• Yes – 150 respondents, 87%
• No (please explain) – 12 respondents, 7%
• Do not know – 10 respondents, 6%

Total responses: 172

Question 11: Do you agree that 4-hours is an appropriate backstop for the reporting of significant pollution incidents?

• Yes – 134 respondents, 78%
• No (please explain) – 33 respondents, 19%
• Do not know – 5 respondents, 3%

Total responses: 172

Question 12: Do you support the proposal for an AP to be triggered for failing to report a significant pollution incident within 4-hours?

• Yes – 153 respondents, 89%
• No (please explain) – 16 respondents, 9%
• Do not know – 3 respondents, 2%

Total responses: 172

Question 13: Do you support the proposal to require all pollution incidents to be reported as soon as reasonably practicable?

• Yes – 153 respondents, 89%
• No (please explain) - 18 respondents, 10%
• Do not know – 1 respondent, 1%

Total responses: 172

Question 14: Do you support the proposal for an AP to be triggered if an EDM device at a storm or emergency overflow fails to be operational for at least 90% of a calendar year?

• Yes – 136 respondents, 79%
• No (please explain) – 33 respondents, 19%
• Do not know – 3 respondents, 2%

Total responses: 172

Question 15: Do you agree with standardising EDM requirements in storm overflow permits, including setting the frequency of monitoring as two-minutes?

• Yes – 158 respondents, 92%
• No (please explain) – 7 respondents, 4%
• Do not know – 7 respondents, 4%

Total responses: 172

Question 16: Do you support the proposal for an AP to be triggered if companies fail to report EDM data to the EA monthly?

• Yes – 161 respondents, 94%
• No (please explain) – 9 respondents, 5%
• Do not know – 2 respondents, 1%

Total responses: 172

Question 17: Do you support the proposal for an AP to be triggered if an emergency overflow discharges more than 3 times a year?

• Yes – 143 respondents, 83%
• No (please explain) – 25 respondents, 15%
• Do not know – 4 respondents, 2%

Total responses: 172

Question 18: Do you support the proposal for an AP to be triggered for failing to return abstraction data to the EA within 28 days of being requested?

• Yes – 158 respondents, 92%
• No (please explain) – 10 respondents, 6%
• Do not know – 4 respondents, 2%

Total responses: 172

Question 19: Do you support the proposal for an AP to be triggered for failure to have an accurate and reliable monitoring device in place to measure the quantity of water abstracted?

• Yes – 164 respondents, 95%
• No (please explain) – 5 respondents, 3%
• Do not know – 3 respondents, 2%

Total responses: 172

Question 20: Do you support the proposal for an AP to be triggered for failing to provide records related to maintenance and accuracy of monitoring devices to the EA within 28 days of being requested?

• Yes – 161 respondents, 94%
• No (please explain) – 9 respondents, 5%
• Do not know – 2 respondents, 1%

Total responses: 172

Question 21: Do you support the procedure proposed above, including the ability to make a payment to discharge liability following the notice of intent?

• Yes – 128 respondents, 74%
• No (please explain) – 34 respondents, 20%
• Do not know – 10 respondents, 6%

Total responses: 172

Question 22: Do you support the proposal to prevent companies from appealing the regulator’s decision on whether there are exceptional circumstances in place?

• Yes – 143 respondents, 83%
• No (please explain) – 23 respondents, 13%
• Do not know – 6 respondents, 3%

Total responses: 172

Question 23: Do you support the proposal for penalties to vary based on water company turnover?

• Yes – 146 respondents, 85%
• No (please explain) – 21 respondents, 12%
• Do not know – 5 respondents, 3%

Total responses: 172

Question 24: Do you support the turnover bandings proposed for classifying water companies?

• Yes – 146 respondents, 85%
• No (please explain) – 16 respondents, 9%
• Do not know – 10 respondents, 6%

Total responses: 172

Questions 25 to 30

Respondents were not asked to select from specified options or provide quantitative responses. Instead, these questions invited free-text submissions and descriptive evidence. As a result, percentage breakdowns are not presented here. The qualitative themes raised through these free-format questions are summarised in the main government response.

Annex B: Summary of responses from Organise

A total of 6,559 responses were received from the organisation Organise, covering seven questions relating to the proposals. Below are the questions and the corresponding responses.

Question 1. Should water companies face tougher, faster penalties for breaking pollution rules?

• Yes – 6,162 respondents, 99.5% of responses
• Not sure – 21 respondents, 0.3% of responses
• No – 13 respondents, 0.2% of responses

Total responses: 6,196

Question 2. What concerns you most about the regulation of water companies right now?

Respondents could select multiple options.

Answer	Number of respondents	Percentage of responses
There are too many incidents	5,764	94.3%
Water companies get away with breaking the rules	5,765	94.3%
Water companies increasing out bills to pay for their mistakes	5,777	94.5%
The Government or EA are too slow to act	5,476	89.5%
Fines are too small to make a difference	5,226	85.5%

Total responses: 6,111

Question 3. What should be the maximum fine for companies who breach pollution rules?

Answer	Number of respondents	Percentage of responses
More than £500,000	4,497	75.3%
Not sure	675	11.3%
£500,000	716	12.0%
£350,000	70	1.2%
Less than £350,000	15	0.3%

Total responses: 5,973

Question 4. What’s most important when setting a pollution fine?

Respondents could select multiple options.

Answer	Number of respondents	Percentage of responses
How much damage the pollution caused	5,707	94.2%
Whether the water company is a repeat offender	5,625	92.8%
How the company responded	4,717	77.8%
The size or profits of the company	2,503	74.3%
Not sure	66	1.1%

Total responses: 6,060

Question 5. Do you support the idea of automatic fines when companies repeatedly break the rules?

Answer	Number of respondents	Percentage of responses
Yes – repeat offences should always trigger fines	5,448	90.7%
No – each case should be reviewed separately	256	4.3%
Yes – but only if the breach is serious	203	3.4%
Not sure	99	1.6%

Total responses: 6,006

Question 6. Which of the following should trigger an automatic fine?

Answer	Number of respondents	Percentage of responses
Failing to report a major pollution incident within 4- hours	5,413	90.3%
Failing to monitor or share sewage data properly	5,463	91.1%
Sewage spills more than 3 time a year	5,331	88.9%
Breaking permit or licence rules	5,298	88.4%
None of the above	37	0.6%

Total responses: 5,995

Question 7. Finally: Please share why you think it’s important for water companies to be held to account.

Theme	Percentage of responses
Environmental and public health impacts caused by pollution	20.2%
Water companies prioritising profit over service and investment	19.6%
Water is an essential resource	12.2%
Calls for personal accountability for directors and CEOs	10.3%
Calls for public ownership/Nationalisation	10%
Rising customer bills despite pollution incidents and company profits	8.9%
Regulatory failure and weak enforcement	2.3%
Other	16.7%

Total responses: 2,014

Annex C: Response from E-actions

E- actions submitted a campaign response to the consultation. A total of 5,420 responses were received. The responses were standardised emails given by members of the public, coordinated by E-actions.

The campaign responses argued that existing regulation has failed to protect the environment, citing persistent sewage pollution, repeated breaches by water companies and limited behavioural change resulting from financial penalties. Respondents emphasised that fines are too small to influence company behaviour and highlighted examples where large penalties had not prevented further pollution incidents. Many argued that companies are able to “game the system” due to the disparity in resources between regulators and the industry.

A significant theme within the campaign was the assertion that public ownership of water companies would provide stronger accountability and environmental protection than a strengthened regulatory regime.

Campaigners also expressed concerns about company influence over regulatory processes, including examples where undertakers or their creditors sought to shape compliance frameworks. They argued that the absence of special administration in high‑profile cases undermines incentives for responsible corporate behaviour. Across submissions, respondents questioned whether strengthened penalties alone would be sufficient to drive the improvements needed to protect the environment and restore public confidence.

Although all responses followed a standard template, the high volume demonstrates strong public engagement with these issues. The themes raised have been considered in forming the government’s understanding of public concern relating to the regulation of the water industry.