EA chair casts doubt on plan to levy £250m water pollution penalties

Proposals put forward by the former environment secretary Ranil Jayawardena to increase pollution penalties to £250 million are “crazy”, and DEFRA is currently looking at a more “sensible figure”, the Environment Agency's new chair has said.

Alan Lovell told an audience gathered at a private event in Andover, Hampshire, that he wants the regulator to pursue civil penalties over prosecutions as they are faster than a criminal court case, and rely on a lower standard of proof. However, he noted that the current limit on penalties is £250,000, which is the limit for variable monetary penalties (VMPs), a level which he described as “not enough to make a difference”.

The previous environment secretary, Ranil Jayawardena, had proposed increasing the cap to £250 million, a figure which Lovell derided as “massive and crazy”, and said DEFRA is currently looking at a more “sensible” number.

Yet, given that a VMP has never been given out to water company by the EA, despite being in legislation since 2010, campaigners have argued that this is a moot point. The initial announcement by Jayawardena was described by critics as “a pantomime”.

VMPs currently do not apply to the environmental permitting regime and therefore cannot be used against water companies for breaches of their permits and consequently cannot not be used to tackle sewage pollution by the sector.

Rivers' campaigner and former Undertones frontman Feargal Sharkey, who spoke to Lovell at the event, told ENDS he has concerns about whether Lovell had been properly briefed, since starting the role in September last year. He noted on Twitter, in response to a story by the Times which had suggested Lovell was dismissing tougher sentences through his comment on VMPs: “It's not that they never been used, they legally can't”.

The founder of campaign group Windrush Against Sewage Pollution, Ash Smith, who also attended the event, said that even if the upper limit for a VMP was £250 million, it does not mean that the full sum would “need to be used” but would send a message.

The EA has used VMPs for water company offences under the Salmon & Freshwater Fisheries Act 1975. In 2021, for example, Armathwaite Hall, a luxury hotel and spa in the Lake District, was given a £2,500 penalty under this act for discharging matter or effluent that will poison or injure fish, spawn, spawning areas or fish food, contrary to section 4(1).

He also questioned whether Lovell had been properly briefed, and said that some of his messaging was mixed.

For example, Smith said he was pleased to see Lovell agree with his predecessor Emma Howard Boyd’s call for water pollution bosses to face prison sentences if laws were broken and there had been no attempt to comply. But given his messaging on lowering penalties, Smith found Lovell’s stance on targeting water pollution came across as “weaker”.

Smith also welcomed Lovell’s call to tackle water pollution arising from agriculture, but expressed concerns that Lovell had been “taken in” by water company reassurances.

On water companies, Lovell told the audience: “They have made a lot of mistakes but actually they are trying pretty hard”

Head of practice at Fish Legal, Penny Gane, said: “It is reassuring to see that the new Environment Agency chair agrees with his predecessor that directors of water companies that are guilty of repeated, deliberate or reckless breaches of environmental law should be struck off and given custodial sentences.

“But talking about penalties does presuppose that pollution incidents are actually being investigated by the Environment Agency.  For years the agency appeared to be in denial that water companies were regularly spilling untreated sewage, despite there being evidence to the contrary.  

“Add to that its current ‘triage’ system for logging reports of pollution from the public, where only the most serious get an incident number with very little chance of an officer actually attending and you can see how easy it is for chronic pollution to go unchecked.”  

A DEFRA group spokesperson said: “We are clear that water and sewerage companies must be held to account for poor performance – with record fines of more than £102 million handed out in 2021 following successful prosecutions.

“Last year, proposals were put forward to raise the civil penalties that the Environment Agency can hand down for breaches of environmental laws and regulations. This will now be subject to consultation in the spring.”

The spokesperson confirmed that VMPs currently have had a limited use against water companies as they cannot currently be applied under the Environmental Permitting Regulations.