Ofwat, meters, big pay Key takeaways from the landmark review

The water industry in England and Wales is "broken" and requires fundamental reform, the biggest review of the sector since its privatisation in 1989 has found.

- Mark Sweney

Sir John Cunliffe, the former Bank of England deputy governor who led the review, yesterday published its report, which aims to address an industry beset by underinvestment, rising pollution incidents, soaring customer bills and meaty shareholder payouts.

The 465-page report of the independent water commission (IWC) makes 88 recommendations, with significant ramifications for the industry and consumers. Here are some of the key takeaways.

'Powerful' new water regulator The report said a fundamental "reset" of the water sector was needed. It proposed replacing the existing regulators with one body for England and one body for Wales.

In England, this would lead to Ofwat and the Drinking Water Inspectorate being scrapped, and the removal of the environmental regulation functions of the Environment Agency and Natural England.

Under the proposal, an integrated regulator that would be "less desk-based" would be set up.

In Wales, Ofwat's economic responsibilities would be integrated into Natural Resources Wales.

The government said yesterday it would adopt the plan.

Compulsory smart meters The IWC recommended meters be made compulsory for a "wide range of circumstances" in a drive to force consumers to reduce household water consumption. That includes installing them for households in areas where there is no "water stress".

It suggested the water industry look to the energy sector, where suppliers must install a smart meter when replacing or installing one for the first time unless there is a good reason not to.