Question to the Department for Environment, Food and Rural Affairs:

To ask the Secretary of State for Environment, Food and Rural Affairs, what steps she is taking to incentivise water companies to invest in drought mitigation.

Defra recently published its Plan for Water setting out the importance of ensuring a clean and plentiful water supply. The National Framework for water resources sets out in detail how the Government, regulators and regional groups, including water companies, will work together to improve water resources management. This includes reducing demand, halving leakage, developing new water supplies and moving water to where it is needed.

Earlier this year, regional water resources groups and water companies including Yorkshire Water consulted on their draft water resources plans. These statutory plans set out how each company will secure water supplies sustainably for at least the next 25 years and develop drought plans, which outline the actions taken to maintain secure supplies during drought events. In their plans, water companies consider all options, including demand management and water resources infrastructure. The draft water resources management plans contain proposals for multiple new schemes by 2050, including nine new desalination schemes, nine new reservoirs, 11 new water recycling schemes, and several new internal and inter-company transfers to share resources, as well as the expansion of some existing reservoirs.

Water companies are also using the £469 million made available by Ofwat in the period 2020-2025, to develop strategic water resources options required to improve the resilience water supplies. In April 2023, Ofwat announced that water companies are bringing forward £2.2 billion for new water infrastructure, starting in the next two years, with £350 million worth of investment in water resilience schemes.

The Government also supports the agricultural sector with its Water Management Grant, under the Farming Transformation Fund, for the construction of new on-farm reservoirs and the adoption of best practice irrigation application equipment to help ensure farmers have access to water when they need it most. We aim to launch a third round of the grant next year in 2024.