Analysis: John Halsall’s apology in Whitstable was overdue and Ofwat’s findings against his company are damning. But the number of people South East Water has to supply is set by government population projections and government housing targets, and both moved after the company’s plan was written.
Disclosure: the editor of Kent Local News is the founder of GB Freedom, a registered political party which holds positions on immigration and housing. This article relies only on published ONS, Kent County Council, Ofwat and South East Water figures and on statements made on the public record.
Six weeks into the job, South East Water’s new chief executive John Halsall stood in front of almost 100 residents at the Horsebridge Arts Centre on Wednesday evening and said what his predecessor never quite managed to say.
“Our job as a water company is to provide all of our 2.3 million customers with water 24 hours a day, seven days a week, 365 days a year. And so we absolutely accept that we have failed, full stop. No question about that. And I am very sorry.”
The meeting, organised by SOS Whitstable and reported by the Local Democracy Reporting Service, heard that the company loses about 100 million litres a day through leaks, roughly a sixth of what it supplies. It heard that a Whitstable pub told the meeting it had lost £6,000 in the May outage and was offered £200 in compensation. Residents told the meeting they felt they had been “gaslighted”. Mr Halsall promised better performance next summer and declined to promise an outage-free one.
None of that should be softened. In March, Ofwat found the company had “failed to plan to ensure it had sufficient headroom during high demand periods”, had not maintained reservoirs, boreholes and major pipes, and “lacked ownership for fixing the root cause of supply interruptions”. In July it confirmed a £30.5 million redress package, paid by shareholders, and put an independent monitor into the company. The May outage in Whitstable and Herne Bay happened because, in the company’s own words, local storage tanks reached a critical level under heatwave demand of 670 million litres a day, almost 100 million above the seasonal average. On the basis of Ofwat’s published findings, that is an operating failure and it belongs to the company.
But something else was said at the Horsebridge that got less attention. Mr Halsall told the room the company may now oppose new housing where the network cannot cope, and that councils could use Grampian conditions, which stop a development being occupied until named infrastructure exists, to hold building back until the water is there.
That is a water company saying in public that it is being asked to supply more people than its network was planned for. The question that follows is who decided how many people that would be. The answer is not South East Water.
How the demand number is built
Every water company in England must produce a Water Resources Management Plan every five years, looking 50 years ahead. South East Water’s current plan says its demand forecasts “are based on latest local authority plans, local housing need calculations and data from the Office for National Statistics”, and that “population growth will be a key driver for future demand”. On those inputs it expects the population of its supply area to rise from 2.26 million in 2019-20 to 2.81 million by 2050, an increase of 25 per cent.
The company is funded to plan for that. Ofwat’s 2025 to 2030 settlement gives it £1.8 billion, £651 million more than the previous five years, and the regulator’s summary says the increase reflects “investment to facilitate population growth and new housing”. So the company cannot say it was never asked to plan for growth. What it can say, and what its operations director told Canterbury councillors in March, is that the growth it was told to plan for has since been raised.
Where the extra people come from
The ONS 2022-based projection, the one government housing targets are built on, has the UK population rising by 4.9 million between mid-2022 and mid-2032, with births and deaths roughly equal. By the ONS’s own arithmetic the entire increase comes from net migration. Kent follows the pattern: Kent County Council’s analysts reported that the county’s population, excluding Medway, grew by 21,400 in the year to mid-2024, with natural change at minus 400. All of the growth was migration, 9,300 from elsewhere in the UK, mainly London, and 12,700 from overseas.
Nor is this new. The fertility rate in England and Wales fell below the replacement level of 2.1 in 1973 and has never recovered; in 2024 it was 1.41, the lowest on record. The population kept growing because people lived longer, migrants arrived and migrants had children here. That cushion has gone: the ONS expects deaths to outnumber births every year from 2026, and its zero-migration variant shows every UK nation shrinking. Without net migration the population would already be falling.
The scale is larger than the net figure suggests. Gross immigration ran at about 1.4 million a year in 2022 and 2023 under the Conservative government’s points-based system, and was still 813,000 in 2025 under Labour after both parties tightened the rules. The projections that set Kent’s housing targets were struck at the height of that surge and still assume 340,000 a year of net migration from 2028. Whether that is the right level is a political choice made in Westminster. It is not one South East Water gets to make.
Then the housing targets moved
Under the government’s revised Standard Method, Kent’s 13 councils are now expected to plan for 13,572 homes a year, up from 12,133. Tunbridge Wells’ target rose by two-thirds; Tonbridge and Malling’s from 820 to 1,057. Those targets landed after South East Water’s plan was written. In March, the company’s head of water resources Nick Price told a Westminster Hall debate that the plan “did not reflect the Government’s latest housing requirements” and that “we are not a statutory consultee in planning applications”. The same month its operations director Douglas Whitfield told Canterbury’s scrutiny committee that the Local Plan adds about 1,600 properties by 2034 above what the company forecast for the district, which includes Whitstable and Herne Bay. In Tonbridge and Malling, on figures South East Water gave the borough council and which were cited in the Westminster Hall debate, the council must deliver 19,746 homes by 2042 and the company says it can supply 6,318 of them.
Put the levers together. Government sets the population assumption. Government sets the housing target that flows from it. Councils allocate the sites, in some cases above what the water company planned for. The company must supply whoever moves in, has no statutory voice on the application, and is fined when the tanks run dry. Mr Halsall’s Grampian remark is the company, for the first time, reaching for the only lever it can touch.
What this does not excuse
It would be convenient for South East Water if the analysis ended there. It does not. A company that loses 100 million litres a day has a problem that predates any housing target. Ofwat’s findings are about maintenance, headroom and ownership, not population. The May outage happened with the population the company already has. Residents are right to hold Mr Halsall to his promise for next summer.
Both things are true. The company failed at the job it was given, and the size of that job was set, then enlarged, by people who will never sit in a hall in Whitstable and apologise for it. Two further parts of this publication’s Kent Water Investigation follow: the first on the demand that nobody in Whitstable voted for, the second on why fixing the leaks cannot close the gap, what the company plans to build, the data centres nobody has planned for, and the sewage in the sea.
South East Water has failed. But who decided how many people it must supply? Quiz
8 questions
Sources
- Local Democracy Reporting Service report of the SOS Whitstable public meeting, Horsebridge Arts Centre, 2 September 2026.
- Ofwat, proposed penalty notice, 5 March 2026; confirmed £30.5m redress package and Independent Monitor, 14 July 2026; Overview of South East Water’s PR24 final determination, December 2024.
- South East Water, Draft Water Resources Management Plan 2025–2075, Technical Overview; service update 25 May 2026.
- ONS, National population projections: 2022-based; Long-term international migration, provisional: year ending December 2025; Births in England and Wales: 2024.
- Kent County Council, Kent Analytics, Migration indicators bulletin, September 2025.
- Westminster Hall debate, 24 March 2026 (Hansard); Canterbury City Council scrutiny committee, 4 March 2026.
- Kent Local News, Water Investigation Parts 2 and 3 (May 2026).