Rachel Reeves's Treasury eyeing water restoration fund (Image: Getty)
Campaigners have lashed out at the Treasury which reportedly wants to shred a pledge to reinvest water firm fines in river clean-up projects amid the flatlining economy.
Rachel Reeves’s department is said to want to keep millions of pounds levied on polluting water companies in fines that were meant to be earmarked for sewage cleanup.
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James Wallace, the chief executive of River Action, said: “The new government was elected on the promise to sort out the dreadful state of our rivers and the profiteering water industry. Any slackening of investment in restoration, especially a fund made up of polluter fines, sends completely the wrong message.
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“The obsession with growth at the cost of the environment that enables our economy is madness and a clear signal that Labour is gambling our future to pacify the rapacious demands of international finance markets. History will judge harshly those political leaders whose short-term policies broke our climate and nature. No water, soil and wildlife, no food, jobs and economy.”
The ￡11million water restoration fund was announced before the election last year, with projects bidding for the cash to improve waterways and repair damage done by sewage pollution in areas where fines have been imposed.
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But the Treasury is alleged to be in discussions about keeping the money for unrelated purposes at a time of huge pressure on the public finances and rising debt interest costs.
Environmental charities said the fund is set to rise substantially as regulator Ofwat begins to issue harsher penalties on water firms.
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A government spokesman said: “For too long, water companies have pumped record levels of sewage into our rivers, lakes and seas.
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“This government has wasted no time in placing water companies under special measures through the water bill, which includes new powers to ban the payment of bonuses for polluting water bosses and bring criminal charges against lawbreakers.
“We’re also carrying out a full review of the water sector to shape further legislation that will transform how our water system works and clean up our waterways for good.”