Water companies must be held to account on sewage provision if the Government’s target of 1.5m new homes by 2029 is to be realised.
Up to 30,000 new homes have been delayed due to concerns over inadequate wastewater infrastructure, according to the Drain on the Nation report by the Home Builders Federation, HBF.
HBF executive director David O’Leary said: “With each passing month, the government’s ambitious housing supply targets are slipping further out of reach as public bodies and utility companies impose new barriers to delivery.”
About half of the 30,000 delayed homes are served by Anglian Water where just two out of 54 local planning authorities have reported sufficient water recycling capacity for new homes. A further 7,000 new homes are being stalled in areas covered by Thames Water.
“Water companies are legally responsible for ensuring network capacity and have received £2.3 billion from developers over the past five years to do so,” said Mr O’Leary.
He said £1.72bn of the £2.3bn figure had gone to funding assets such as sewers and pumping stations. Thames Water and Anglian Water received £440m and £330m, respectively, in combined assets over the last five years, despite offering insufficient water recycling centres for new homes.
Drain on the Nation shows a 52 per cent increase in average wastewater charges over the last seven years, exacerbated by Of wat’s price review in March 2024.
The study has reported a growing number of councils refusing to grant permissions or discharge planning conditions due to uncertainty over sewerage provision.
This is despite the national planning policy frame work, which requires collaboration to ensure wastewater infrastructure can support development. Local planning authorities are expected to work with water companies and other bodies on drainage and wastewater management plans.
Government intervention needed to ensure homes get built
Mr O’Leary said: “The government must reassert the statutory role of water companies, clarify how national policy should be applied, and ensure infrastructure investment reflects housing supply.”
Brokers Hank Zarihs Associates said development finance lenders wanted local planning authorities to consider wastewater capacity when drafting their local plan. This would enable them to resolve any doubts about capacity before the local plan is adopted.
The HBF study cited Oxford as an example where 18,000 new homes were allowed following government intervention. This led to the Environment Agency withdrawing demands for planning conditions to be tied to wastewater capacity.
The National Federation of Builders, NFB, policy and market insight head Rico Wojtulewicz said: “We need the Government to enact emergency planning reforms which deliver wastewater capacity upgrades, new reservoirs and upgraded treatment plants. These are the only real solutions to the quagmire that decades of underinvestment have caused.”
A ministry of housing spokesperson said the government had invested a record £104bn in England and Wales water and sewage infrastructure from 2025 to 2030.
“We are clear that development should not be blocked if the right water infrastructure is in place, which is why we expect councils and water companies to work together on this issue so we can turn the tide on the housing crisis we have inherited,” he said.
LinkedIn Question: Should the government insist that water companies make provision for the 1.5m new homes targets in their water management and sewage plans, and ask local planning authorities to flag up any problems before adopting their local plans?
