Executive Summary
Public spending on environmental protection was £19.2 billion in 2025-26. Most of it, £11.9 billion, was waste management, nearly all of it by councils. Pollution control received £2.2 billion, protection of nature and landscape £0.6 billion, and other environmental protection, including much of the Environment Agency's work, £4.0 billion.1 Sewage treatment appears as zero, because the water industry in England has been privately owned since 1989: its costs fall on water bills, not public spending.
Those bills are rising to pay for £104 billion of investment between 2025 and 2030.2 The Independent Water Commission, chaired by Sir Jon Cunliffe, found that the investment allowance is about 71% higher than in the previous five years, and that companies had been able to underspend their maintenance allowances and pay the difference out, including as dividends.3 Storm overflows discharged untreated sewage 291,492 times in 2025, a 35% fall on 2024 that the Environment Agency attributes mainly to dry weather.2 The government has said it will abolish Ofwat and create a single new water regulator.4
Around 6.3 million properties in England are in areas at risk of flooding, and that could rise to about 8 million, one in four, by mid-century as the climate changes.5 The government has committed £7.9 billion of capital over ten years for new defences, but that sum excludes routine maintenance.6 The National Audit Office found the previous programme would protect fewer properties than promised, largely because of inflation.7
England recycled 43.8% of household waste in 2024, against 58.6% in Wales on the same measure.8 Half of what English councils collect is now burned.9 And on nature, the independent Office for Environmental Protection judged in January 2026 that the government was largely off track on 21 of the 43 environmental targets and commitments it assessed, including both of its "30 by 30" commitments for nature.10
Key Proposals
Publish the condition of every water company's pipes and sewers before the next price review, and stop unspent maintenance money being paid out. The new water regulator publishes a full asset-health register for each company before the 2029 price review, and money allowed for maintenance that is not spent on maintenance is returned to customers rather than kept or distributed.
Match the ten-year flood capital budget with ten-year maintenance funding, and count protection lost as well as gained. Set a ten-year settlement for maintaining existing flood defences alongside the £7.9 billion for new ones, and report each year the number of properties whose protection has fallen because defences have deteriorated, not only those newly protected.
Give English councils statutory recycling targets, as Wales has. Set a statutory household recycling target for each council in England, rising over time, published annually council by council, with support for councils that fall short before any penalty.See how Budget 2026 relates to this
Fund up-to-date monitoring of every protected site, and publish an on-track verdict for every Environment Act target each year. Bring every Site of Special Scientific Interest's condition assessment up to date within five years, and require the government to state each year, target by target, whether it expects to meet its legally binding environmental targets.
1. Where the Money Goes, and Where It Doesn't
The Treasury counts £19.2 billion of public spending on environmental protection in 2025-26, up from £13.8 billion four years earlier. Waste management is the largest part at £11.9 billion, almost all of it councils collecting and disposing of household waste. Pollution abatement received £2.2 billion, research £0.5 billion, protection of biodiversity and landscape £0.6 billion, and other environmental protection £4.0 billion.1
What the public spending figures leave out matters as much as what they include. Waste water management, the treatment of sewage, appears as zero.1 In England and Wales the water and sewerage industry has been run by private regulated companies since privatisation in 1989, so the cost of sewage treatment is paid for through water bills and regulated by Ofwat, the Environment Agency and the Drinking Water Inspectorate. That is a different kind of public decision, set through price reviews rather than Budgets, but it is no less a public choice about who pays, and how much, to keep rivers and seas clean.
2. Water: Who Pays for Clean Rivers
Sewage pollution is the environmental problem most visible to the public. Every storm overflow in England is now fitted with a monitor, and in 2025 they recorded 291,492 spills of untreated sewage, 35% fewer than in 2024, with an average of 20.5 spills per overflow. The Environment Agency is clear that "much of this improvement reflects unusually dry conditions in 2025 following a particularly wet 2024", rather than investment.2
Investment is now rising sharply. Ofwat's 2024 price review allows £104 billion of spending between 2025 and 2030.2 The Independent Water Commission found this allowance about 71% higher than in the previous price review, with spending on improvements, as opposed to running costs, up by about 400%.3 Customers pay for it through bills. The Commission also found that the higher return Ofwat allowed investors, its weighted average cost of capital, rising from 2.96% to 4.03%, added around £43 to the average bill in 2025-26 alone, about a third of that year's rise.3
The Commission's diagnosis of how the industry reached this point was blunt. Regulators did not know enough about the condition of companies' assets, and companies could underspend the allowance given for maintenance, count it as an "efficiency saving", and spend it on other things "or distribute the unused allowance as dividends". It recommended that the regulator make sure maintenance funding is spent on maintenance, supported by full registers of asset health.3 In January 2026 the government published a water white paper committing to abolish Ofwat and to bring the water functions of Ofwat, the Drinking Water Inspectorate, the Environment Agency and Natural England into one new regulator, with legislation in this Parliament.4
3. Flooding: Building New Defences While Old Ones Wear Out
The Environment Agency's national flood risk assessment, updated in December 2024, found around 6.3 million properties in England in areas at risk of flooding from rivers, the sea or surface water. With climate change, that could rise to about 8 million by mid-century: one property in four. The number of properties at high risk of surface water flooding was put at about 1.1 million, three times the previous estimate.5
The last flood programme ran from 2021 to 2027 with a record £5.2 billion of capital. The National Audit Office found in 2023 that it was forecast to protect fewer properties than promised at launch; the government acknowledged that inflation accounted for "between half and two-thirds of the reduction".7 In June 2025 the government committed £7.9 billion over ten years from 2026. That figure is "solely capital spending": it pays for new defences, not for maintaining the ones that exist. A separate £4.2 billion covers both building and maintenance for the first three years.6
4. Waste: Stuck at 44%
English councils collected 25.2 million tonnes of waste in 2024-25. The household recycling rate was 43.7%, and it has hovered around 44% every year since 2020. Only 5.5% of council-collected waste now goes to landfill, but 50.3% is incinerated, most of it to generate energy.9
Wales shows that more is possible. On the same UK-wide measure, Wales recycled 58.6% of household waste in 2024, against 43.8% in England, 50.1% in Northern Ireland and 42.7% in Scotland.8 Wales sets each council a statutory recycling target, most recently 70% on its own wider measure for 2024-25. Twelve of its twenty-two councils met it, and the Welsh rate on that measure reached 68.4%.11
5. Nature: Targets Without Measurement
The Environment Act 2021 set legally binding targets, including to halt the decline in species abundance by 2030 and to reverse it by 2042, and the government is committed to protecting 30% of land and sea for nature by 2030. In January 2026 the Office for Environmental Protection, the independent watchdog created by the same Act, assessed 43 environmental targets and commitments. It found the government largely on track for five, partially on track for sixteen, and largely off track for twenty-one, including both "30 by 30" commitments. One could not be assessed for lack of evidence.10
The government's own progress report shows how much of the problem is measurement. The measure meant to show whether species abundance is still falling is an "official statistic in development" and, the report says, "cannot currently be used to assess whether we are on track". For Sites of Special Scientific Interest, the most protected wildlife sites in England, the interim target is for half of their features to have actions on track to recover by December 2030. By March 2026 the figure was just under 26%, and only about 35% of features had an up-to-date assessment of their condition.13
The Office for Environmental Protection found the government largely off track on 21 of 43 environmental targets and commitments, and could not assess one for lack of evidence.10 The government's own report says its species abundance measure cannot yet show whether it is on track, and that only about 35% of protected-site features have an up-to-date condition assessment.13
This connecting argument is this project's own. A government cannot manage what it does not measure, and targets whose progress cannot be assessed carry little political cost when they are missed. Where two-thirds of protected-site features have no current assessment, neither the government nor the public can tell whether money spent on nature is working, which makes it easier to cut and harder to defend.
One option is to keep the current approach, improving monitoring gradually as resources allow. A second is to add new targets or spending without first fixing measurement. A third, which this pillar proposes, is to fund complete, current monitoring of protected sites and require an annual on-track verdict for each statutory target, so that slippage is visible while there is still time to act.
Spending on monitoring rather than on direct habitat work is a choice. This pillar judges that, without measurement, it is impossible to tell which habitat work is succeeding. A reader who would rather every pound went straight into restoration is making a reasonable choice under a tight budget; the disagreement is about priorities, not evidence.
Bring every protected site's condition assessment up to date within five years, and publish an annual on-track verdict for every Environment Act target. The test below sets out what would show this is not working.
6. The Steel Man: The Case Against This Pillar's Approach
The strongest case against this pillar is that its four proposals are the dull, administrative end of environmental policy, and that the real problems need bigger answers. Sewage pollution will not be fixed by asset registers; it needs tens of billions of pounds of new storage and treatment, which is exactly what the £104 billion is for, and the risk of adding more regulatory demands is that investors demand even higher returns, pushing bills up further. Some argue the industry should be brought back into public ownership instead, so that money currently paid to investors goes into the network.
On flooding, funding maintenance for ten years would lock up money that might be better spent on new defences for the growing number of properties at risk, and the Environment Agency already prioritises its highest-consequence assets. On waste, statutory targets would add costs to councils that are already in financial crisis, as the Local Government pillar describes, and Wales's success owes as much to early investment and a different set of councils as to targets. And on nature, monitoring does not restore a single hectare of habitat; with limited money, the priority should be doing the work on the ground.
This case is right that none of these proposals is sufficient on its own, and the pillar does not claim they are. On public ownership of water, the evidence this pillar has reviewed concerns how the regulated system allowed maintenance money to be diverted, which a publicly owned company could also do without transparent asset records; ownership is a separate decision that would cost the public purse a great deal to buy out, and this pillar does not take a position on it. Where the steel man falls short is in treating maintenance and measurement as optional. The water industry, the flood programme and the nature targets have each been let down less by a lack of ambition than by not knowing, or not funding, the condition of what already exists.
7. Counter-Arguments
'The water companies should just be nationalised'
That is a decision about ownership, and it would not by itself tell anyone what condition the pipes and sewers are in or make sure maintenance money is spent on maintenance. Those problems, which the Independent Water Commission identified, would need solving under any ownership model.3 This pillar's proposals apply whoever owns the companies.
'Sewage spills are already falling, so the problem is being solved'
The Environment Agency itself attributes most of the 35% fall in 2025 to dry weather after a very wet 2024.2 A wetter year would show more spills again. Progress will be real when spills fall in wet years too, which depends on the investment now being paid for through bills actually being delivered.
'Recycling targets punish councils that are already broke'
Wales's targets come with support as well as penalties, and its councils face financial pressures too. The proposal here puts support before any penalty. Councils also now receive payments from packaging producers for collecting packaging waste, which shifts part of the cost of recycling away from council tax.12
'Flood maintenance money is better spent on new defences'
A new defence protects homes that were not protected before. A neglected one stops protecting homes that were. Both matter, and the only way to compare them is to count both, which the current reporting does not do.
Cross-Pillar Dependencies
| Pillar | Connection |
|---|---|
| Energy | Climate change and the energy transition have their own pillar. Rising flood risk is one of the clearest costs of climate change already being paid. |
| Local Government | Councils spend most of the £11.9 billion on waste and are under severe financial pressure. Any recycling target has to be funded, not simply imposed. |
| Agriculture | Most protected land and most of the nature targets depend on how farmland is managed. Agricultural payments are the main lever for restoring habitats outside protected sites. |
| Transport | Flood defences and local roads face the same problem: long-term capital commitments for new building while maintenance is funded short term. |
| Cost of Living | Water bills are rising to pay for the £104 billion investment programme. How much households pay, and how the cost of past underinvestment is shared between customers and investors, is a cost-of-living question as well as an environmental one. |
| Devolved Governments | Environmental policy is devolved. Wales's recycling record, set out here, is an example of one nation of the UK trying an approach the others can learn from. |
9. Proposals for Change
These are the evidence-based proposals of this pillar, put forward for public discussion and challenge.
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P1 Require the new water regulator to publish a full asset-health register for every water company before the 2029 price review, and return to customers any money allowed for maintenance that companies do not spend on maintenance.
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P2 Set a ten-year settlement for maintaining existing flood defences alongside the £7.9 billion capital programme, and report each year the net change in properties protected, counting those whose protection has fallen as well as those newly protected.
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P3 Introduce statutory household recycling targets for English councils, rising over time and published council by council each year, with support for councils that fall short before any financial penalty.
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P4 Fund up-to-date condition assessments for every feature of every Site of Special Scientific Interest within five years, and require the government to publish an annual, target-by-target statement of whether it expects to meet each Environment Act target.
None of the failures described here came from a lack of announcements. Each came from neglecting what already existed: the condition of the sewers, the upkeep of flood defences, the measurement of the wildlife the law says must recover. The Generational Reset does not claim these are the most exciting environmental policies. It argues they are the ones on which every other ambition depends.
The Generational Reset is a non-partisan, public-interest project. It is not affiliated with any political party, does not accept corporate funding, and publishes all its work under open licence for public discussion and adaptation.
For public discussion. Not affiliated with any political party. | generationalreset.org
The Generational Reset | S1_13: Environment | For public discussion. Not affiliated with any political party. | generationalreset.org