Bosses of water companies found to have breached pollution rules face up to two years in jail under new measures proposed by the government.
Under the new rules, water company executives can be locked up if they do not cooperate with or obstruct regulatory investigations.
The Water (Special Measures) Bill will also enable Ofwat and the Environment Agency to issue severe and automatic fines without having to direct resources to lengthy investigations, the Government said.
Bonuses for water bosses will also be affected if targets ranging from environmental protection, water supplies and even finances aren’t met and to enable prosecutions more easily, the burden of proof requirements in civil cases is also being lowered.
Sewage pumping by utilities has soared in recent years, sparking fury among the public about the deteriorating quality of Britain’s coastlines and inland waterways.
Environment Secretary Steve Reed said: “The public are furious that in 21st century Britain, record levels of sewage are being pumped into our rivers, lakes and seas."
Under the new rules, Reed added every sewage outlet will be independently monitored and spillages reported within an hour.
Monitoring already occurs for 14,000 storm overflows across England but a further 7,000 emergency overflows, used in cases where a pump fails, for example, will also be checked with real-time data for all emergency overflows published.
Water companies will be responsible for the cost of enforcement action taken in response to their failings.
Other measures include directors and chief executives passing “fitness and propriety” tests and for firms to publish annual pollution incident reduction plans.
Alan Lovell, chair of the Environment Agency, said: “The Bill will give us, as regulator, more power to protect our precious water quality and resources, hold water companies to account and ensure the polluter pays."
David Black, chief executive of Ofwat, said: “This Bill strengthens our powers and will help us drive transformative change in the water industry so that it delivers better outcomes for customers and the environment.”
A spokesman for industry lobby group WaterUK said: “We agree with the Government that the water system is broken. Fixing it requires the Government to deliver the two things which it has promised: fundamental regulatory reform and speeding up investment.
“Ofwat needs to back our £105 billion investment plan in full to secure our water supplies, enable economic growth and end sewage spilling into our rivers and seas.”
Shares in Severn Trent PLC (LSE:SVT) rose by 2% to 2,657p and United Utilities Group PLC (LSE:UU.) by 1.8% to 1,047p.