Good quality, abundant water must be at the heart of economic growth

Click here to find the full report: The Business Case for a National Water Framework

The public and businesses are increasingly frustrated by the state of England’s water supply. Costs of supply are rising, beaches and rivers are heavily polluted, and development is being constrained by shortages.

Businesses want to be part of the solution, but are being held back by misaligned incentives, poorly enforced regulation and a lack of clarity about where water will be needed and where responsibilities lie. The government has commenced some welcome reforms, however, as they stand, these will not address these concerns.

The Aldersgate Group, working with businesses from across the economy and in discussion with sector experts, has examined these systemic water issues. The project’s goal was to understand how good quality, widely available water can be at the heart of economic growth, public health and a flourishing environment, rather than being seen as a risk and a barrier.

At the heart of the Group’s proposals is the empowerment of places and regions through greater clarity of strategy and regulation. The report recommends:

1. Introducing a framework and strategy in law. A National Water Strategy and a National Water System Operator established to oversee national delivery.
2. Regional planning, local delivery. Statutory Regional Water Authorities, with input from regional mayors, translating national goals into place-based action.
3. Regulatory consistency. Aligning rules across sectors so environmental duties are not subordinated to commercial ones, empowering the new water regulator.
4. Greater investment. Unlocking the estimated £300 billion needed in the water sector over 25 years by giving business and investors clear, structured routes in.

Aldersgate Group Board Member, Guy Thompson, said: “If we want more resilient water infrastructure, we need to pay at some point in the lifetime of the assets. There is a way through this: by moving to outcome-based regulation that incentivises the most cost-effective solutions at system scale. This Aldersgate Group report provides an important pan-economy perspective on how the water system could evolve to unlock long-term resilience for the benefit of all water users as well as the natural environment.”

Water Resources East Managing Director, Daniel Johns FCIWEM, said, “Sir Jon Cunliffe’s number one recommendation last summer was for ministers to develop a new National Water Strategy, but this was conspicuous in its absence when they responded with A New Vision for Water in January. This new report from the Aldersgate Group reinforces the importance of such a statement of long-term targets and policies to drive the whole water system for the years ahead. Without it, the system risks being rudderless, when businesses and civil society need direction and confidence to invest.”

— ENDS —

— NOTES TO EDITORS —

• In January 2026, the government published a Water White Paper – A new vision for water, which introduced a Transition Plan. This was expected for publication in June, but timelines are now unclear.
• The Clean Water Bill, announced in May 2026, is expected to enter parliament from November 2026,
• The fourth Water Framework Directive cycle will begin in December 2027.
• Meanwhile, Price Review 29 preparations have already begun in the water sector.