29/06/09
Water UK is pleased that the Walker Review on water charging for domestic customers is now able to publish its interim report. Timing is of the essence if some of the recommendations of the report – we look particularly to those dealing with water debt – are to find their way into the forthcoming Floods and Water Management Bill.
The Walker Review was set up to take forward the discussion on the role of tariffs and water metering contained in the 2008 Government's strategy for water -'Future Water'. Water charging is critical to the implementation of a sustainable water policy.
Water UK’s main aim is to help develop a charging system that supports water sustainability throughout England and Wales. Water companies have supported the work of the Walker Review and, in particular, its policy of engagement with stakeholders through a number of workshops.
A policy for water charging and metering, like other elements of a national water strategy, needs to adhere to common principles of efficiency and fairness. It should recognize that each water company is different and needs policies suitably tailored to reflect variations in its customer base, population, climate, physical environment and, in particular, the availability of raw water. We are pleased that the Walker Review recognizes that the most sustainable strategies, policies and objectives regarding metering differ between water companies. Metering has costs as well as benefits. Water companies must be able to determine the rate at which they implement it in accordance with their circumstances.
We are also pleased that the Walker Review concludes that costs legitimately differ between companies and, therefore, so should prices. Prices must continue to be regionally-based and geographically averaged within one water company (in other words, common tariffs throughout a company’s area).
Increased water efficiency is in the Walker Review terms of reference and we believe it is an important objective of a water charging policy. We are pleased that the Walker Review has concluded that metering and water efficiency cannot, by themselves, provide a solution to the problem of affordability. The Review says that ‘solving affordability issues will require alternative approaches’ and affordability issues have to be resolved outside the main charging system.
We note that the Review, in effect, recommends that raw water, where it is scarce, should be valued at a higher price than now for decision-making purposes, which will increase the price that customers pay. We would like to see further analysis of how this price increase, associated with other increases, will affect customers and their willingness to pay.
We are pleased that the Walker Review report contains more specific recommendations concerning the actions Government can take to reduce the burden of water debt on the customers who pay. Water debt is increasing not just because of affordability issues but also because certain customers, who could pay, choose not to pay their water bills. We agree with the Review that “won’t pay” customers should not be able to avoid paying. We support the conclusion that Government should introduce legislation that improves the information companies have about the customers they supply and companies’ ability to ensure that bills are paid, including by short term tenants who are the largest group , relatively, of non-payers.
Also, Government – the DWP – could make it easier for customers on benefits to budget to pay their bills in manageable instalment. This requires co-operation between water companies, care agencies and DWP, which should be prepared to use its unique wealth of data on vulnerable customers to help alleviate water debt.
Water UK looks forward to providing comments on the Review and will press for inclusion of well-thought-out recommendations in the forthcoming Flood and Water Management Bill.
For more information please contact:
Water UK Communication
020 7344 1809 (out of hours 07833 450544)
