As mentioned earlier, package holidays and the lack of investment, as attractions closed due to age and deterioration they were never replaced. The investment never came because they couldn't compete with what was on offer to travel abroad. At the same time the likes of the IOM fell in to decline along with many other seaside resorts, also Blackpool was just up the road and had more to offer for those who wanted to stay in this country. Once Freddie Laker and the likes started offering cheap flights to Spain, etc, the British working classes realised they could holiday abroad cheaper than they could here, British hotels and Boarding houses couldn't compete. Even during Harold Wilson's time and the pound was going through a difficult time and Harold put a £50 cap on the amount of money one could take out of the country, this never deterred anyone, it was more than enough to holiday for a fortnight abroad.
As for pollution of the Mersey, well its never been anything else, certainly never been blue, i think the decline of New Brighton came about long before people started to be concerned about the condition of the water.
Thinking about it, lying on a beach watching topless beauties walking past or a donkey ride at New Brighton, difficult decision.