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Water companies could face unlimited fines and penalties under new government plans to tackle pollution.

Environment Secretary Therese Coffey is expected next week to announce plans that ministers believe will “make polluters pay”, with tougher fines imposed on water companies put into a “water restoration fund “.

It comes as the latest figures from the Environment Agency showed there were a total of 301,091 sewage spills in 2022, an average of 824 per day.

Discharges fell 19% in 2022, but this was due to dry weather and not to any action taken by water companies, the agency said.

As part of the plan, Ms Coffey will publish a six-week consultation on strengthening the Environment Agency’s ability to impose sanctions on water companies without going through the courts.

It is believed that the government will support lifting the upper limit on civil penalties for water companies, allowing unlimited fines.

Defra said the sanctions would be quicker and easier to enforce, with the most serious cases still subject to criminal proceedings.

The government has come under heavy pressure from activists to tackle the pollution in recent months, and the new measures are expected to form part of plans to toughen enforcement against companies.

Opposition parties have also condemned the government, with Labor leader Sir Keir Starmer telling The Guardian that ministers were “turning Britain’s waterways into an open sewer.”

The Lib Dems have called on Ms Coffey to resign over the issue.

Ms Coffey said: “I know how important our beautiful rivers, lakes, streams and coastlines are to people and nature, and I couldn’t agree more that more needs to be done to protect them.

“I want to make sure that regulators have the powers and tools to crack down on companies that are breaking the rules, and to do it faster.

“Through the Water Restoration Fund, I will ensure that the money from the fines and higher fines, taken from the profits of the water company, not from the customers, is funneled directly into the rivers, lakes and streams where needed.

“We know that about 310 miles of rivers have been improved each year through community-led projects; we must build on that success.”

Currently, the penalties and fines imposed by Ofwat are returned to the Treasury. But new government plans will see the money returned to the Department for Environment, Food and Rural Affairs.

Activists have accused water companies of discharging sewage far more often than they should, even when it hasn’t rained, and have repeatedly called on water companies to use their profits to invest in more infrastructure.

Defra said the new fund will be aimed at helping local groups identify the biggest issues and direct investment where it’s needed most, with the money going to support a range of projects including wetland restoration, creating of new habitats and the addition of natural river bends to improve water quality.