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<p>Ofwat, the independent economic regulator, is legally required to act in accordance
with the strategic policy statement (SPS). A draft SPS was laid in parliament 2nd
February and is due to come into force following a period of 40 sitting days.</p><p>Government
expects Ofwat to explain how it intends to achieve against the priorities set out
in the SPS when making key decisions. For example, in its forthcoming price control
review methodology.</p><p>Protecting and enhancing our nation's water environment
is a priority for this government. It is government's expectation that Ofwat and the
water industry will prioritise appropriate action to enhance water quality and deliver
a resilient and sustainable water supply. In particular, the Government wants to see
water and sewerage companies making progressive reductions in the adverse impacts
of discharges from storm overflows.</p><p>DWMPs will become statutory through the
Environment Act 2021 when the first cycle ends and will help sewerage companies to
fully assess wastewater network capacity and develop collaborative solutions.</p><p>In
delivering against the priorities set out in the Strategic Policy Statement, water
companies should significantly increase their use of nature and catchment-based solutions.
We expect companies and regulators to work towards delivering these solutions as a
matter of preference.</p>
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