Private water companies are in need of 'urgent reform' according to Liberal Democrat MP Richard Foord.

The comments come after the CEO of Thames Water quit her job amid mounting concerns over the firm's growing debt burden, which stands at £14 billion and counting.

Thames Water is the UK's biggest water company, and supplies 15 per cent of the population. But it has encountered difficulties over failures to curb sewage spills and its mounting debt obligations.

Speaking in parliament Mr Foord said: “The recent developments with Thames Water highlight just how poorly managed and regulated water companies have been over recent years. 

“The fact that this firm was allowed to rack up £14 billion of debt is concerning, especially as taxpayers may now have to pick up this eye-watering bill, should the company need to be taken over by the Government. 

“For too long we’ve seen bonuses and dividends put ahead of investment in infrastructure and maintaining sufficient water reserves. This has not only led to water shortages and hosepipe bans, but also the industrial scale dumping of sewage into our rivers and onto our beaches.

“Enough is enough and it’s time to properly reform the way these vital services are run. We need to transform them into Public Benefit Companies, with environmental standards and a quality service to billpayers at their core.  The corporation’s board should include representatives from local environmental groups” 

“This Conservative Government has repeatedly failed to take responsibility and properly get a grip of this issue. They need to clamp down on these companies with real action to make them clean up their act or, if they aren’t up to the task, they need to step aside and give regulators the powers needed to enact these essential changes.” 

The Liberal Democrats have called for water utility firms to become 'public benefit companies.' This would not mean renationalising but could involve imposing particular obligations on companies such as meeting environmental targets.

South West Water's parent company, The Pennon Group, recently announced a £112 million dividend payout to its shareholders. The move has courted criticism as the firm has imposed a hosepipe ban and is presently under investigation by the industry regulator.