A union representing water workers has called for an inquiry into the closure of more than 20 reservoirs in recent years in parts of the country most affected by the drought.
The GMB said 25 water storage facilities had closed in the South East, mostly since the industry was privatised in the late 1980s.
Rainfall is left to run into the sea rather than be collected while the region is hit by drought orders, said the union.
The GMB called on the Environment, Food and Rural Affairs Select Committee to launch an inquiry into water companies, the Environment Agency and the regulator Ofwat to establish why parts of the country were "needlessly" running short of water, the Press Association reported.
National officer Gary Smith said: "The mission of a water undertaking is to deliver the water needed for human purposes and for industry. That requires proper direction and management. Both have been sadly missing in Britain for the past 20 years.
"Storage and transfer are two of the main elements of water resource management, one to move water from times of plenty like last weekend to times of shortage, the other to convey water from places where it is plentiful to areas where it is in short supply. The third basic element is treatment to regulate water quality.
"It cannot be repeated often enough that there is no shortage of water in Britain. We divert only a small fraction of the throughput of our water cycle for human purposes. We use less than 1% of total UK rainfall and less than 10% in the South East.
"Closing 25 water storage facilities in the South East before diverting water into the region from the Severn has left the region short of water twice in the space of six years.
"Since 1990 Thames Water has paid out £5 billion in dividends to shareholders, raised from households, that should have been used to divert water into the South East and Eastern England."
The Angling Trust called for a "completely fresh" approach to water supply and storage in order to end the "chronic" waste of water in times of flood.
The Trust highlighted the situation in the Thames region where despite a 7% increase in population in London and the South East since 2001 no new reservoirs have been built for more than 40 years. At the same time, the Trust said demand for water has reached a record level of 1,000 litres per person per week, putting huge strain on the network at the expense of the environment.
National Campaigns Co-ordinator Martin Salter said: "As any angler knows, billions of gallons of floodwater rush out to sea at times of high rainfall yet a few weeks later water companies may be applying for drought orders to suck dry our already depleted chalkstreams and other vulnerable rivers.
"It is utter madness that governments of both persuasions have failed to plan for the needs of expanding populations and the challenges of climate change which mean more extreme weather conditions including both drought and floods. In the Thames region in particular it beggars belief that no new reservoir has been given planning permission for the last 40 years and that proposals for a much needed Abingdon reservoir were rejected in 2010. It is just plain commonsense to store in times of plenty to get through periods of scarcity."
Chief Executive Mark Lloyd added: "Politicians must realise that water is a precious resource which must be used more carefully and stored more wisely. There is an urgent need to invest in greater storage to avoid the widespread depletion of groundwater levels and river flows."
A spokesman from Thames Water said that "several" options for transferring water from the Severn to the Thames were being considered but none of the proposed schemes could be completed during the current drought.
The spokesman added that many of the sites which were closed were not reservoirs.
He said: "They stored small amounts of treated water, in between a treatment works and people's homes, rather like holding tanks in household lofts, to ensure our network could cope with fluctuating demands for water at different times of day.
"They did not store raw water and were shut when improvements to our water supply network made them redundant.
"Other sites listed by the GMB were only ever treatment works for water stored elsewhere, or were part of the distribution system, and at least one was actually part of the waste water network and nothing to do with drinking water.
"All of these sites were shut down when they became surplus to operational requirements following upgrades to our network."