Water regulator Ofwat will create a £100 million fund paid by customers to get the public to use less water.
This is in a bid to bring down the level of water use across the country, Ofwat’s chief executive David Black said.
He added: “We’re establishing a fund of £100 million for the next price review period which will be funded from customers to help the sector get to a much better place on water demand. We haven’t seen progress by the sector in the current period nor in the previous periods. The Government set challenging targets. We think the sector needs to rise to the challenge of delivering on them.”
The Government wants water companies to encourage the public to reduce their daily use of water from 142 litres a day per person to 110 litres.
Mr Black appeared before the Commons’ Public Accounts Committee alongside the regulator’s chair Iain Coucher.
He said “strong efforts need to be made” to help save water.
The Ofwat CEO admitted too many water companies “have fallen short too often” in meeting their targets.
Most companies failed to meet key targets on reducing pollution, leakages and supply interruptions, Ofwat confirmed earlier this month.
Mr Black said there was an “unsatisfactory picture” for some firms lagging behind.
There were just under 400,000 discharges of raw sewage into UK waterways in 2022 alone.
The Daily Express has highlighted the state of nation’s waterways and pipes through the Green Britain Needs You campaign.
England and Wales leaked 51 litres of water per person per day in 2020-21 because of creaky Victorian infrastructure.
It was reported that water companies are drawing up plans to increase household bills by up to 40 per cent to pay for the cost of tackling the sewage crisis and the consequences of climate change.
Liberal Democrat MP Sarah Olney quizzed the regulator chiefs about the level of dividends awarded to bosses who underperform towards customers and the environment.
Mr Black said: “We’ve changed the rules to give us the ability to step in if companies don’t align their dividends towards customers and the environment.”
