Canterbury council leader demands South East Water be placed into special administration

Canterbury City Council’s leader has written to government calling for the water company to be moved into effective public ownership following repeated supply failures affecting local residents.

Canterbury City Council’s leader has escalated his battle with South East Water by formally demanding the government place the company into special administration – a move that would effectively bring it back into public ownership.

Cllr Alan Baldock has written directly to the UK government calling for South East Water to be moved into special administration under section 24 of the Water Industry Act 1991 on performance grounds, according to a statement published by Canterbury City Council.

The letter argues there is a “growing body of evidence” that South East Water has contravened its statutory and licence obligations, with Cllr Baldock contending that the company’s “continued failings” now meet the legal test for special administration.

Prolonged Supply Disruptions Hit Canterbury

The council leader’s intervention follows prolonged water supply disruptions that have affected households and businesses across Canterbury and wider parts of Kent and Sussex. Residents have been left without water or experiencing low pressure, forcing them to rely on bottled water stations during outages.

South East Water supplies drinking water to roughly 2.3 million customers across Kent, Sussex, Surrey, Hampshire and Berkshire, serving as the statutory water undertaker for the Canterbury area. The company operates roughly 9,000 kilometres of water mains infrastructure.

Canterbury City Council has previously demanded explanations from South East Water for recent outages, seeking details of compensation arrangements for affected residents. The council has also requested reimbursement for its additional costs in organising extra recycling collections to handle the surge in empty plastic water bottles distributed during supply failures.

But the company has published an investment programme for Canterbury and surrounding areas, stating it plans water network upgrades over the next five years to improve resilience and meet demand. These include mains replacement and infrastructure improvements around Canterbury.

How Special Administration Works

The UK special administration regime for water companies is a statutory process designed to protect customers’ essential services if a company fails financially or seriously fails in its duties. Under section 24 performance grounds, government can act – on Ofwat’s advice and with court approval – if a water company is deemed unable or unlikely to carry out its functions properly.

This includes persistent failure to meet statutory and licence obligations on service and performance. Special administrators would replace existing management while services continue, though the process is complex and rarely used.

Supporters of intervention argue that public ownership would prioritise service delivery over shareholder returns, potentially redirecting profits into infrastructure investment. Some residents frustrated with recurring outages may welcome stronger government action to secure accountability.

However, critics warn that special administration can be costly and disruptive, with uncertainty over who bears the financial burden. Industry voices suggest climate-related extremes and legacy under-investment can be addressed through enhanced regulation rather than ownership changes.

Compensation and Costs Mount

The disruption has generated significant household costs and inconvenience for Canterbury residents. Families have needed to travel to bottled water collection points, store emergency supplies, and manage limited water for washing, cooking and sanitation.

Vulnerable groups – including older residents, disabled people, those with health conditions, and families with young children – face disproportionate impacts due to additional needs for hydration, hygiene and medical uses of water.

Under Ofwat’s Guaranteed Standards Scheme, residents may be eligible for statutory compensation or goodwill payments where supply is cut off for 12 hours or more without planned notice. Canterbury businesses, particularly in hospitality and retail, may have suffered lost trade and additional costs during closures.

The large volumes of bottled water distributed have created a surge in plastic waste, prompting Canterbury City Council to organise additional recycling collections and seek reimbursement from South East Water.

What Happens Next

Any decision to place South East Water into special administration would rest with central government and Ofwat, not Canterbury City Council. The process requires stringent legal tests to be met and court approval.

South East Water has faced a series of high-profile supply incidents across Kent and Sussex The company has cited factors including extreme weather, infrastructure failures and high demand in its public apologies and updates.

Ofwat and the Environment Agency have highlighted performance concerns across the water sector, including South East Water’s record on supply interruptions, leakage and customer service in recent regulatory assessments.

Even if special administration proceeded, day-to-day water services would continue under the regime, though governance and management of the company serving Canterbury could change significantly.

Key Takeaways

• Canterbury’s council leader has formally requested government place South East Water into special administration over repeated supply failures
• The move would effectively bring the water company serving 2.3 million customers back into public ownership
• Special administration is a rare, complex process requiring government approval and stringent legal tests

What This Means for Canterbury Residents

Residents should continue to follow South East Water’s communications for updates on supply issues and compensation arrangements, as any special administration decision will take time to process through government and regulatory channels. Those affected by recent outages can check eligibility for compensation under Ofwat’s Guaranteed Standards Scheme, which typically covers interruptions lasting 12 hours or more. In the meantime, Canterbury residents can expect the council to continue pressing for explanations, compensation clarity, and reimbursement of additional costs while planned network upgrades proceed over the coming years.