Britain’s water system is in “complete ruin” and massive investment is required to deal with “catastrophic failure” and avoid rationing in a decade’s time, according to Environment Secretary Steve Reed. Warning of the danger of Britons being left without water, he said: “People would turn on their tap to get drinking water and nothing would come out because it would be rationed.”

Mr Reed admitted he would check the local water quality before going for a swim and he was appalled by accounts of illness and vomiting ahead of the Oxford and Cambridge boat race. Claiming his predecessors “left our water system in complete ruin” he said Britain has “the highest level of water pollution and sewage in our waterways ever recorded and people are furious about that because they remember when they were younger they used to be able to go and play in the river or the beach themselves”.

He added: “Now [when] they take their kids or grandchildren there, they worry they will get sick.”

It is not only people’s health that is at risk because of water pollution, he claims – the economy is also suffering because new homes cannot be built.

“We’ve got a high level of outages because we’ve got record amounts of leakage coming out of our pipes,” he said. “The lack of water and sewage infrastructure is holding back economic growth because the infrastructure isn’t there to support new housebuilding, new factories or data centres… There’s been no investment in it.”

A new law gives industry regulator Ofwat power to ban bonuses for water bosses who are “overseeing this catastrophic failure”. They could also face prosecution but Mr Reed said he did not want to see executives behind bars.

“I don’t want to see water bosses in jail because that would mean we failed to get them to clean up pollution,” he said.

In December, the regulator announced that water bills will rise by an average of £86 from April this year. Customers may well resent paying higher bills when research – refuted by Ofwat – suggests investors have withdrawn £85.2billion from 10 water and sewage firms in England and Wales in the years since privatisation.

Mr Reed said that if people object to effectively paying twice for investment in infrastructure “they make a good point” and admitted that bills are going up “higher than anyone wants to see”.

He claimed customers are “paying the price of Tory failure,” saying: “I cannot undo the physical damage they allowed to happen.”

He pledged: “I’ve ring-fenced bill-payers money so they can be assured it will not be wasted on undeserved bonuses and dividend payments in the way that happened under the Conservative Government.”

Boasting of a “£104billion of private sector investment over five years,” he said: “That will be the biggest single investment in our water sector in history and the second biggest private sector investment in any part of the economy over the lifetimes of this parliament. That’s not just good for cleaning up the water; that’s good for jobs all over the country.”

Warning that demand for clean drinking water has been on course to outstrip supply by the mid-2030s, he said: “It’s hard to believe that in this country that is even a possibility and that is what we were looking at before this Government came in and secured that additional investment in our water. It happens already in some Mediterranean countries; we don’t want it to happen here.”

Mr Reed acknowledged the issue of clean water stirs strong emotions.

“People in this country are very, very proud of our countryside and nature,” he said. “It’s our shared inheritance… And yet it’s been buried under a tide of sewage in too many cases.”

Describing a recent seaside visit, he said: “I was down at the beach in Bournemouth and they had a red flag flying – you couldn’t go in the sea because of the levels of pollution that were being pumped in there. There’s a little coffee cabin and I was speaking to the guy who runs it and he said they had a family that had come there on holiday and they were saying to him, ‘What’s the point of bringing my kids down to play in the sea if they can’t go in because it’s too contaminated with sewage?’

“What an awful thing to happen and yet it happens too often around our country. We’re going to turn back the tide of sewage and clean up our waterways so British people can enjoy them as we used to when we were younger.”

During Mr Reed’s time as Environment Secretary, the Government has been under fire for the Chancellor’s decision to make more farmers pay inheritance tax.

Mr Reed said the greatest threat to farming is not the tax but a lack of profits,and vowed to help revive the sector.

“The average age of a farmer is approaching the mid-60s. Young people are not going into farming because it’s not attractive to them when they look at how hard their parents and grandparents have to work to make no money so they go and do other things…

“If this Government can make farming profitable that makes it a better prospect for investment; that makes it much more likely more of those young family members will want to go into farming because it’s a successful business with a bright future for them and their future families.”