Progress since privatisation
High levels of investment in water
Effects upon customer bills
Maintaining standards
The UK water companies were privatised in 1989 and took over responsibility for a public water and wastewater industry that had suffered decades of under investment and struggled to deliver good service and meet quality standards – for drinking water, for our rivers and beaches and for the pipes and plants themselves.
In just 15 years, with more than £50 billion of investment, huge efficiency savings and extensive modernisation, the companies engineered a transformation of water services. They have delivered exceptional results and achieved standards that are measured in terms of today’s rigorous quality controls and customer-focused service delivery.
High levels of investment in water
In the past few years the industry has invested, on average, half of its sales revenue in new assets, bringing the vital infrastructure up to date and improving services. Investment will total around £68 billion between 1990 and 2010 – the end of the current pricing period.
Since privatisation, water and sewerage bills have risen at a rate above inflation due to the need to invest in environmental improvements, to improve drinking water quality and to maintain the infrastructure.
Ofwat reports on the trends in water prices since privatisation, showing how this increased investment is reflected in customer bills.
The trends also reveal the value in real terms of improved company performance. By 2000 this has produced savings equivalent to around £100 a year for the average customer. Without these efficiency gains, the required investment would have led to much steeper bill increases.
The industry is continuously monitored across all its activities and subject to rigorous testing and regulatory enforcement. Annual reporting in key areas by the three main regulators for England and Wales – Ofwat, the Drinking Water Inspectorate and the Environment Agency – against UK and EU standards present an overall picture of continuous improvement in drinking water quality and environmental standards.
The water and wastewater companies continue to ensure high levels of reliability and service delivered to the vast majority of customers1, near-perfect compliance (99.96%) with drinking water standards in England and Wales2 (Scotland 99.96%3, Northern Ireland 99.78%4) and a significant contribution to the high quality of our bathing waters (98% compliant with standards5) of which we are all rightly proud.
Sources:
1 Ofwat report Levels of Service for the Water Industry 2006-07
2 DWI June 2007
3 DWQR August 2007
4 Environment & Heritage Service December 2006
5 Defra
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Longer-term planningWater company strategic direction statementsPublished December 2007
Water company resource management plansPublished April 2008
Prices & investmentWater UK briefings
Water industry finance and investment: overview
Water UK briefing pdf
Priorities and prices
Water UK briefing pdf
Why water services need so much investment
Water UK briefing pdf
Customers and shareholders investing in improvement
Water UK briefing pdf
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