When doing so I noticed an electrical wire attached to the lead pipe,
and assume this has something to do with the earth for the electrics
meter cupboard.

If you have copper pipework in the house, move the earth connection to the
where this takes over from the MDPE. Note that this isn't (at least
shouldn't!) be your main earth. It is just ensuring that the pipework has
the same earth potential as the rest of your house. The main earth is either
supplied by the electricity suppler via the cable sheath (TN-S) or via the
neutral (TN-C-S), or you will have an earth rod (TT) and every circuit will
be RCD protected.

If you have a older house, it is possible that you have an old system that
did rely on the water pipe to provide earthing and that now your house is
very dangerous. As you don't seem to know enough about electrical
installations to determine the type of earthing in use, I'd advise you post
a picture of your meter cupboard and consumer unit so you could get further
advice, as it should be obvious what type of earthing you have from the
supplier's installation. If this determines a TT system, you'll need to find
out if you have a good earth rod. Alternatively, just call out an
electrician who will test that the earthing is safe.

Do I need to provide anothe connection to earth. Should I extend the
(now severed) wire back to the water board's supply, which is still in
lead?

Unfortunately, it is a requirement that the cable is unbroken and unjointed.
If it not long enough to reach the copper part of your house plumbing, you
are up sh*t creek and will need to lay a fresh cable from the earthing
terminal, which might be not a nice job.

Christian.