MD3529 SuDS through Streetworks Market (SSM)

1.1.    Mayoral Decision (MD) 3382: 

•    approved the establishment of the Upgrading London’s Infrastructure (ULI) programme, and its associated delivery plan
•    appointed the Assistant Director of Connectivity, Air Quality, Transport and Infrastructure as the approved Senior Responsible Owner (SRO). 

1.2.    The ULI delivery plan aims to ensure that London has the energy, water, digital connectivity and data infrastructure in place to achieve the Mayor’s ambitious goals for net zero, climate resilience, housing delivery and economic growth. It has four project groups: 

•    enabling the new infrastructure needed for housing and productivity 
•    readying London’s infrastructure for the future 
•    reducing disruption caused by infrastructure delivery 
•    driving data innovation. 

1.3.    Projects set out in the ULI delivery plan fall into one of three categories:

•    projects already detailed in an existing MD or Director Decision (DD)
•    projects for which MD3382 seeks Mayoral delegation to the SRO to take expenditure decisions 
•    projects which will require separate MDs.

1.4.    The SuDS through Streetworks Market (SSM) project sits in project group three: reducing disruption caused by infrastructure delivery (as set out at paragraph 1.2) and falls into the last category (as set out at paragraph 1.3), requiring a separate MD as this is additional funding to expand projects in the ULI delivery plan, beyond the funding covered in MD3382. 

1.5.    Increasing the delivery of Sustainable Drainage Systems (SuDS), which are water management systems designed to mimic natural processes by sustainably managing rainfall, reducing flood risk, increasing biodiversity and improving water quality, is vital for London’s climate resilience. It addresses flood risk; water quality; extreme heat; and biodiversity loss. Expanding SuDS infrastructure was highlighted as a key recommendation of the London Flooding – Independent Review of the floods that occurred in July 2021. To scale up delivery, the Interim London Climate Resilience Review 2024 recommended that the Mayor work with public and private sectors to introduce a market-based system to fund SuDS through planned streetworks.

1.6.    This recommendation reflected work undertaken by the GLA’s Infrastructure Coordination Service (ICS) in Phase 1 of SSM conception. The SSM uses a market-based approach to match "buyers" who need SuDS (such as local authorities) with "suppliers" who are already planning streetworks (such as utility companies). Instead of reinstating standard asphalt, utility providers install green drainage features during planned digs, delivering SuDS at lower cost and with less disruption by leveraging existing streetworks. Funded in 2023 by the then Department for Science, Innovation and Technology’s Regulators’ Pioneer Fund (under DD2614), this initial scoping proved how this model can scale sustainable drainage across London. 

1.7.    Phase 2 took place from 2024 to 2026. During this period, the ICS (in partnership with Thames Water and funded by the Ofwat Innovation Fund Catalyst Stream, under DD2699) further developed the SSM concept. This phase of work focused on validating the concept; and ensuring it was ‘ready to implement’ for the next stage of development. 

1.8.    Analysis from Phase 2 indicated that the SSM could deliver approximately 27 per cent cost efficiencies; and unlock up to 68,000 new opportunities to deliver SuDS for local lead flood authorities. Furthermore, analysis indicated that on average, over 20 days of disruption to communities and the road network could be saved per SuDS project that is delivered.

1.9.    The SSM was endorsed by the Mayoral Delivery Board Transport, Infrastructure and Natural Environment Committee in December 2025. This built on support for the SSM from the Mayor’s London Infrastructure Group (LIG), on 24 November 2025, which unanimously endorsed the plan to seek Ofwat innovation funding to pilot the SSM in 2026-30.

1.10.    The ICS has successfully secured additional funding for the next stage of SSM development, through the Ofwat Innovation Fund Transform Stream. In partnership with Thames Water, the ICS applied for and was awarded grant funding totalling £6,869,054. Of this, £4,050,376 is allocated for GLA spend and activities, and the remainder of the award is allocated to Thames Water for their SSM programme and staffing costs. A financial contribution of £140,000, from the GLA Budget, will be made to the ICS’s project partner, Thames Water, in line with the funding requirements. The Ofwat funding requires each funding beneficiary to contribute towards the project deliverables. The GLA will receive this contribution back from Thames Water in accordance with a Collaboration Agreement, bringing the GLA’s total funding allocation to £4,190,376.

1.11.    The Ofwat Innovation Fund activities will be managed by the ICS. This will include initial project scoping, procurement, delivery, and monitoring and evaluation. These activities must all be completed before/by April 2031. The GLA Environment and Energy unit will partner with the ICS to ensure alignment between related work areas.

1.12.    The initial phase will focus on the Lee Valley and Central catchment areas, selected because they are Flood Ready London’s priority catchment areas where funding opportunities can be aligned with the SSM. Work in these areas will focus on targeted stakeholder engagement, to build market awareness and readiness for participation alongside setting up the necessary governance, data platforms, and contractual partnerships across both areas. 

1.13.    The ICS will run two end-to-end market pilot rounds (bidding and matching) in the priority surface water catchment to refine the market mechanism, build organisational maturity, and prepare for a full transition to an operational model by 2031.

1.14.    To resource the delivery of activities, a team will be established within the ICS to carry out the SSM work programme. This resource will be funded by the grant award until April 2031. 

1.15.    Consultancy support will be procured and managed over the course of activities, according to specialist skills required to deliver different workstream activities. The GLA’s role will be to project-manage the delivery of the outputs, as well as wider coordination and facilitation. The GLA will not undertake physical infrastructure works. 

1.16.    A governance structure will be established at project set-up. A steering group (comprising key senior and officer-level members from both the GLA and Thames Water) will provide strategic oversight and approve key decisions at defined stages (i.e. quarterly steering group meetings).

1.17.    The SSM represents one of the key delivery mechanisms of the London Surface Water Strategy (LSWS), published by Flood Ready London (FRL) in 2025. FRL is a partnership of six organisations, including the Mayor of London, with a strategic interest in reducing surface-water flood risk. 

1.18.    The SSM directly supports the objectives of the London Green Infrastructure Framework, by accelerating the delivery of SuDS in priority locations for green infrastructure investment. By embedding SuDS within planned streetworks, the SSM enables a more cost-effective and coordinated approach to delivering multi-functional green infrastructure. In this way it contributes to improved flood resilience, water quality, urban cooling and biodiversity, while maximising the benefits of public infrastructure investment.

1.19.    The SSM is aligned with key priorities outlined in the London Infrastructure Framework published in March 2026. Across the prioritised list of LIF investments, SuDS are highlighted as a core component of London’s long-term water, wastewater and flood-risk management.

1.20.    The SSM is also a key action in the Mayor’s forthcoming Clean and Healthy Waterways Plan (due in summer 2026). It is strongly aligned with the Thames Regional Flood and Coastal Committee’s (RFCC) revised 25‑year strategy, which emphasises collaborative, catchment-wide approaches. 

1.21.    The SSM aligns closely with national-level reform to water-sector regulation, funding and governance. In particular, it stands to further the ambitions to enable scaled public and private capital investment in SuDS and nature-based solutions, as set out by: 

•    the Independent Water Commission
•    DEFRA’s reforms to Flood Risk Management funding
•    the National Infrastructure and Service Transformation Authority, and UK Infrastructure 10 Year Strategy.

1.22.    The current solvency position of Thames Water has been well publicised and some of the envisaged risks due to this have been noted in table 4.
 

Objectives

2.1.    This funding will allow the ICS to:

•    run market rounds in the Central and Lee Valley catchments – from identifying opportunities, matching, contracting, and oversight of the market process, through to monitoring and verification
•    develop a live public-facing dashboard for initial market rounds – providing real-time visibility of opportunities, delivery status, costs and outcomes
•    develop a communications and engagement strategy covering stakeholder and public engagement and partnership-building
•    finalise legal frameworks and contractual arrangements for a functioning environmental services market
•    publish a SuDS market implementation strategy for London, including a detailed blueprint for long-term rollout covering governance; funding; sequencing; market operation; and capacity requirements
•    develop the business case for scaling up the SSM across London and its network of SuDS investors (including water companies and lead local flood authorities) – demonstrating a robust economic, financial and social rationale for expanding the SSM beyond the initial catchments.

Outcomes

2.2.    At the close of the project, the ICS will have:

•    tested and refined the SSM for delivering SuDS at an unprecedented scale in London – reducing surface-water and sewer-flood risk, and combined sewer overflows
•    helped to identify and deliver up to 100 SuDS projects, accredited by the newly established market operator, using the new methodology, with verified performance
•    developed market confidence and capability across market participants (buyers and suppliers), and the supply chain
•    addressed key barriers to delivering SuDS at scale – including uncertainty around funding, maintenance, technical capabilities and linking benefits to projects
•    developed the governance, systems and processes for an independent market operator that incentivises innovation and competition to deliver SuDS at significantly reduced cost
•    developed the supply chain required to deliver SuDS at scale, strengthening contractor capability and expanding the pool of competent installers across London
•    delivered wider environmental benefits, including: 

o    improved water quality, amenity and biodiversity, and reduced the urban heat island effect and air pollution, through green infrastructure benefits
o    reduced congestion, with associated health, environmental and economic benefits.
 

3.1.    Under section 149 of the Equality Act 2010 (“Act”), the Mayor and the GLA are subject to the Public Sector Equality Duty (“PSED”) and must have due regard to the need to:

•    eliminate unlawful discrimination, harassment and victimisation and any other conduct that is prohibited by or under the Act
•    advance equality of opportunity between people who share a relevant protected characteristic and those who do not
•    foster good relations between people who share a relevant protected characteristic and those who do not.

3.2.    The consideration of the PSED is not a one-off task. The duty must be fulfilled before taking a decision, at the time of taking a decision, and after the decision has been taken in order to ensure that the equality impacts are kept under ongoing review.

3.3.    The protected characteristics are age, disability, gender reassignment, pregnancy and maternity, marriage and civil partnership (but only in respect of the requirements to have due regard to the need to eliminate discrimination), race (ethnic or national origins, colour or nationality), religion or belief (including a lack of belief), sex and sexual orientation.

3.4.    Both in the delivery of direct activity, and when procuring consultants under this MD, project officers at the GLA will undertake the following:

•    ensure project briefs and specifications consider diversity and inclusion
•    engage stakeholders through co-design and anonymous feedback channels
•    ensure recruitment processes are inclusive and recruitment panels are diverse
•    measure impact by setting and tracking EDI objectives throughout delivery, including: 

o    100 per cent of outputs meeting accessibility standards
o    at least two co-design sessions with diverse stakeholder groups
o    publication of an EDI impact summary at relevant workstreams and project completion.

3.5.    Streetworks conducted in affiliation with this project will comply with British Standard 8300 – ensuring safe and accessible routes, signage and facilities. Temporary works will maintain step-free access wherever possible; provide tactile wayfinding; and ensure stable, slip-resistant surfaces. Diversions will accommodate wheelchair users, and those with mobility aids, via dropped kerbs and tactile paving. There will also be appropriate lighting and audible signals to support people with sensory impairments.

3.6.    Supporting increased delivery of SuDS measures can contribute to reducing inequalities across London. SuDS’ flood-mitigation benefits help build long-term resilience for marginalised communities and groups with protected characteristics, who are often most vulnerable to flooding events. Additionally, the greening provided by SuDS enhances local neighbourhoods by offering fairer access to green space, cooling urban heat, and improving water quality.
 

4.1.    The risks and mitigations are outlined in the table below:

4.2.    Links to relevant Mayoral strategies and priority programmes are detailed in the table below:

Conflicts of interest

4.3.    No one involved in the drafting or clearance of this document has any conflicts of interest to declare.

5.1.    Approval is being sought for the receipt and expenditure of up to £4,190,376 of grant funding from the Ofwat Innovation Fund, paid via the GLA’s project partner Thames Water. This is to deliver enhanced infrastructure planning and delivery in London through the SSM. This grant is not part of the Integrated Settlement and was not part of the GLA: Mayor budget for 2026-27, as confirmation of this grant has only just been received. It will be included in future budget rounds. 

 
5.2.    This funding is ringfenced. Any funds not spent on this project must be returned to Thames Water. 

5.3.    Expenditure will span financial years 2026-27 to 2030-31. The anticipated profile for the spend is set out in the table below:

5.4.    Income from the Ofwat Innovation fund via Thames Water will be disbursed as shown in the table below: 

5.5.    Note that the ICS will pay Thames Water £140,000 towards the project. As part of the Ofwat Innovation Fund bid, Ofwat requires a financial contribution from the project partners. This will come from the ULI programme budget, under project 3.1: Reduce disruption by expanding the Lane Rental Scheme, deploying the ‘dig once’ approach and developing the SuDS through SSM. The GLA will receive this contribution back from Thames Water in accordance with a Collaboration Agreement for expenditure on the SSM.

5.6.    As Ofwat funding runs to 2031, the staff posts being established will run for several years and are therefore being treated as permanent roles. Budget will need to be identified to cover the posts in future years. In the event of any redundancies, grant funding will be used to cover these costs. Redundancy costs for all seven posts at the end of the five-year programme are estimated to come to £65,700, based on all staff being with the GLA for five years. 

5.7.    All appropriate budget adjustments will be made. Future years’ budgets will still be subject to the annual budget-setting process. Any contracts that cover future years will need to have break clauses. Any changes in the anticipated profile of spend across the years will be reflected as updates during the budget-setting process. 

6.1.    The GLA has wide powers under section 30 of the Greater London Authority Act 1999 (GLAA) to promote economic development and wealth creation; social development; and the improvement of the environment, all in Greater London. Section 34 provides for the GLA to be able to do anything that is incidental to the exercise of its functions, including its general power under section 30. These powers are sufficiently broad to cover the proposed use of funds in this decision. 

6.2.    The GLA is restricted from incurring expenditure on doing anything that may be done by functional bodies, such as TfL, under section 31 of the GLAA. However, this restriction does not apply to the activities for which this approval provides, that are limited to the GLA cooperating with such bodies, or coordinating or facilitating the activities of such bodies, on a London-wide or wider-than-local basis. Similarly, the restriction does not apply to the GLA providing a related specialist service that would be of benefit to London as a whole, where it has the agreement of such authorities or bodies. 

6.3.    In taking this decision, the Mayor must comply with the public sector equality duty under section 149 of the Equality Act 2010. This is addressed at section 3, above. 

6.4.    The award will be paid to Thames Water, via a Winner’s Agreement. Thames Water and the GLA intend to enter into a Collaboration Agreement regarding payment of the award, as the GLA is not party to the Winner’s Agreement. Legal have advised on the draft Collaboration Agreement, currently being negotiated between the GLA and Thames Water. This includes highlighting the key risks if Thames Water was placed into an insolvent regime, which are detailed at paragraph 4.1, above. 

6.5.    If the Mayor makes the decisions sought, officers must also ensure that:

•    no reliance is placed on, nor commitments made in reliance of:

o    third-party funding, until legally binding commitments are secured for it; and officers are satisfied that their proposed use of the same aligns with any conditions of award
o    future budgets remaining subject to the outcome of the budget-setting process for future financial years, until those budget setting exercises are completed

•    “returned funding” – can be used as proposed and, where applicable, liaising with third-party funders and varying current GLA funding agreements to reflect the reallocation of funding
•    where applicable, the requirements of the Subsidy Control Act 2022 are met
•    where expenditure concerns: 

o    the purchase of services: they are procured in accordance with the GLA’s Contracts and Funding Code (the Code) and, where applicable, the Procurement Act 2023 (the Act); officers must: 

    liaise with TfL’s procurement and supply chain team, which will determine the detail of the procurement strategy to be adopted in accordance with the Code and the Act
    put in place appropriate contractual documentation 
    ensure it is executed by the chosen service provider and GLA before the commencement of those services 

o    the award of grant funding: such awards are made fairly, transparently, and in accordance with the GLA’s equalities requirements and the requirements of the Code; and funding agreements are put in place between and executed by the GLA and recipients before any commitment to fund is made.

6.6.    If the Mayor makes the decisions sought, the SRO must comply with the obligations set out in the Openness of Local Government Bodies Regulations 2014, when taking decisions in accordance with the delegations set out in this decision form, or any other delegations in existing MDs. In particular. regulation 7 provides that where a decision has been delegated to an officer, either (a) under a specific express authorisation or (b) under a general authorisation, and the effect of the decision is to award a contract or incur expenditure which, in either case, materially affects the GLA’s financial position, the officer to whom the delegation has been made must produce a written record of the decision (regulation 7(1) and (2)). Regulation 7(3) provides that the written record must be produced as soon as reasonably practicable after the decision has been taken; and must contain: 

•    the date the decision was taken
•    a record of the decision taken with reasons, details of options considered and rejected, if any
•    where a decision is delegated under a specific express authorisation, any conflicts of interest. 

Regulation 8 requires that the written record, together with any background papers, must – as soon as reasonably practicable after the record is made – be made available for inspection by members of the public including, on the GLA’s website.
 

7.1.    The table below captures the project’s expected activities and timeline: