The current rules about payments for infrastructure for new developments have been widely criticised. They are seen to be both complex and uncertain in their operation, leading to unnecessary disputes about the correct level of payment to be made for particular works.
Under the Water Act 2014, Defra has the opportunity to provide guidance to Ofwat on a new set of charging rules for these activities. Over the past few months, Defra has been discussing with a wide range of interested parties both the failings of the current regime and what might replace it.
This is the background to a workshop being organised by Water UK on 8 February 2016 for government, regulators, developers and water companies to consider what system could be put in place to replace the current rules.
One interesting possibility is that because the new regime allows Ofwat to draft the charging rules, it could do so in stages, with some obvious improvements being made for implementation in the next financial year. The more difficult issues, such as paying for off-site reinforcement, might then be delayed to allow further time for discussion between the various parties involved in this work.