The water regulator said talks with investors to raise the necessary funds were continuing.
A few days later, one of the UK's largest private pension funds, Universities Superannuation Scheme , became the first major investorBut Mr Black said there may not be an appetite from current investors to put further money into water companies.
"I think we should have stepped in at that point to stop companies gearing up," he said, implying that water firms were taking on too much debt relative to equity, or available funds."At the time, we really didn't have the power to stop that happening," Mr Black said, adding that now Ofwat was "very much of the view" that companies need to reduce their debt to reasonable levels.
Baroness McGregor-Smith asked Mr Black how much customers' water bills were likely to rise, given the £10bn investment water companies say they need to tackle sewage spills. When asked how much of the £10bn would be funded by increased customer bills, Mr Black said that was something that would be "examined as part of the price review".
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