Three key changes to water resources policy and what they mean for land managers

Three important changes to water resources policy are currently under proposal or in development in England:

• Reserving water abstraction rights
• Moving abstraction into environmental permitting
• Changing reservoir safety regulations

As it stands, the plans mean no immediate changes for CLA members, but these early‑stage proposals could shape the future framework for farm water use.

In this blog, we set out the CLA’s advocacy priorities, explaining how we’re working with the government and the regulators to ensure that farm abstractors are supported and protected as these policies evolve.

Separately, farm abstractors should be aware of the existing programme of catchment reviews that are reducing licence volumes, as well as the new powers to protect the environment (that the Secretary of State will be able to exercise from 1 January 2028 to revoke or vary abstraction licences without paying compensation). More detail is available in guidance note 32-22, available for CLA members to read here. Your local Water Abstractor Group is also a good source of further information and support.

Large, strategic infrastructure projects, like new reservoirs for the public water supply, need guaranteed supplies of water to attract investment. However, the current system cannot licence future water. The Environment Agency (EA) recently concluded a consultation on early-stage proposals which would allow strategic projects to reserve future water. These projects could, in theory, come from any sector, but would most likely benefit water and energy companies.

In the CLA’s response, we accepted the need to design a reservation mechanism, but we did not support its widespread use and argued the EA’s proposal was insufficiently thought through. We would like to see the current proposal withdrawn and a new mechanism codesigned with all abstractors.

A key concern was the proposal that water companies could reserve water for projects in the adaptive pathway of their Water Resource Management Plan (WRMP), which include schemes that may never be built. Allowing water companies to reserve water for such schemes would make it harder for farmers and growers to obtain abstraction licences to fill farm reservoirs, or to expand irrigated crop production on affected aquifers and rivers.

If the main source of water in the catchment is relicensed, agricultural abstractors would have low confidence in securing a return on investment from the farm reservoirs or other farm infrastructure before the reserved water could be potentially reclaimed. This would leave the farm infrastructure stranded, and risk making it unfinanceable for growers. Widespread reservation of water is likely to reduce investment in horticulture, erode food security and compromise rural growth.

On behalf of CLA members and rural land managers, we have argued that any reservation mechanism must:

• Not compromise existing abstraction rights, now or in the future
• Be conditional on reserved water being re-licenced in the interim
• Only be available for schemes with a very high confidence of being delivered
• Not unduly limit or prejudice the number of long-term winter storage licences that are granted for farm reservoirs

To support decisions over competing demands for water, the EA also proposed a hierarchy of water users, placing the public water supply in the top priority tier, and agriculture in the third (or possibly second) tier. We strongly rejected the need for a hierarchy: it oversteps the agency’s remit and is unnecessary given existing provisions to secure water for public consumption. Any need to reconcile water needs between sectors could be much better dealt with via a government direction to the regulator.

Defra’s recent water white paper confirms its intention to move abstraction and impoundment regulation into the environmental permitting regulations, replacing the current licencing system. The previous government consulted on this in 2021 but did not publish a response. We do not know the scope of the current proposals, but remain concerned about their implications.

Our response in 2021 highlighted that permits could be reviewed and changed more easily than licences, which would reduce water security and make it harder for members to have confidence to build farm reservoirs and other farm investment. With permitted volumes only assured in some cases for six years, reservoirs could easily become stranded assets with no way to pay back debts. Permits might also make it easier for the EA to suspend abstraction during low-flows compared to current licences. We raised separate concerns about the proposal for the permit holder to need to meet conditions of an operator, which could create liability issues in relation to tenants and contractors.

The CLA will continue to monitor closely how the government proposes to implement this move, and work to shape it to protect members’ long-term water security.

Following the near-failure of the Toddbrook Reservoir in Derbyshire in 2019, an independent review recommended changes to reservoir safety legislation. The EA, Defra, Welsh Government and Natural Resources Wales have been progressing these proposals, with a consultation expected this year.

The EA has indicated it intends to replace the current ‘high-risk’ designation mechanism with a more risk-based, proportionate approach. Importantly for CLA members in England, this is likely to bring some reservoirs with a capacity between 10,000 and 25,000 m3 into scope of an enhanced inspection regime (in Wales, reservoirs above 10,000 m3 are already in scope). Inspections are costly, partly due to a shortfall in qualified engineers. The EA would also bring reservoir safety regulation under environmental permitting, as for abstraction.

The CLA will robustly defend members from unnecessary regulatory overreach for low-risk reservoirs, particularly non-impounding farm reservoirs in sparsely populated flat landscapes. We will carefully examine the consultation when published.

To support our response, please get in touch with any data on how much compliance is currently costing you if operate a reservoir designated as high risk.