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How could a greater choice of water suppliers benefit you?

water from tap

Ofwat, the regulator of the water and wastewater sector in England and Wales, has published its review of the options for developing greater competition in the household water market. How does the Ofwat report lead to a benefit for you?

So what does this mean? Could we end up with five different taps in our sinks, or even one that provides sparkling water? Well, no, this is strictly about retail competition, ie, which company you pay your household water bill to and what extra services it could provide.

Ofwat and the government recognise there is largely a natural monopoly in water networks (the pipes that get water to you), so you needn’t worry that your streets are about to be dug up to lay different water suppliers’ pipes either.

Our response to the Ofwat report

Ofwat’s findings were mixed and, in some cases, unfairly ridiculed, in my opinion.

The first question most of us want to know is: ‘How much can I save on my water bill?’ Well, Ofwat’s analysis points towards a top-end saving of £8.

While this is rather modest, Ofwat has suggested that opening up the water market to greater competition would drive innovation and new ideas. And in my view, that’s where you’d see the most benefit.

What if one company could provide you with water, gas and electricity, so you’d only have to make one phone call to sort all your bills? How about an app to help you manage your account? Currently, only two of the monopoly water companies offer their customers an app, as Ofwat’s CEO Cathryn Ross pointed out on BBC Radio 4’s Today programme.

And as the latest figures from the Consumer Council for Water, which were published on Wednesday, show that complaints to water companies are on the increase, could a competitive market lead water companies to focus more on their customer service?

While water competition on its own doesn’t sound like an attractive deal for consumers, when you start to think about the new innovations, I wonder if it becomes more so?

Role of government

Ofwat has presented its report to the government, which must now look at it and make a decision as to whether it is worth developing greater competition in household water and wastewater services. This would put it in line with non-household customers who are due to get the choice of water suppliers from April 2017.

When the government makes its decision, it should weigh up the overall costs to customers and assess the overall outcomes for customers against those.

What do you think – would competition in the water sector make a splash, or sink like a stone?

Comments
C. A. Ridley says:
2 October 2016

The supply of water and waste treatment, the Health Service, the railway system and the supply and generation of electricity should all be nationalised.

Ron Bergin says:
5 October 2016

My water bill with Thames Water went up by a third this year and I have no idea why. We are on a meter and use water conservatively. We are a household of two and now pay annually as much for water as we do for heating oil. Seems wrong to me.

Ron – was it an estimated reading and was it for the same number of days and time of year as the bill you are comparing it with? There is a possibility of a leak in your system; for example I have found that modern toilet cisterns with a press button on top for flushing do not always shut off and water keeps running. If you can, shut off all taps and outlets and open the water meter trap to see whether any flow is still being recorded. If so, there could be an underground leak. Thames Water might help you to locate it and advise you on how to fix it. They should also test the meter to prove it is accurate. If none of these things solves the problem then you will probably have to accept that your consumption has increased.

From what I gather today (spokeman for the Consumer Council for Water) as the provider of water supply and disposal will not alter, the only change will be in the “retail” aspect – meter reading, billing and customer service for example. This could have an effect on bills of up to £8 a year. Seems a waste of time then to insert another layer of profit makers into the system, in my opinion.

Am I the last one to have found out that part of our water bills since around 2001 includes a “surface water charge”? This charge is shown on the back of my bill in small print, around £20 or so a year. What is it? It includes rainwater disposal from your roof, but if that does not go into the main drain but into your own soakaway(s) then you should not pay this charge. I found a claim form online with my water company and had a rebate of all these charges back to 2011. Around £145. I am trying to get them backdated to the beginning – 2001.

My gripe is that I recall no publicity for this change, the avoidable charge is shown in small print and not properly explained and the charge is not shown as part of the main bill. Seems to have been a very low key change, perhaps to avoid too many people claiming a bill reduction and possible refund.

So was I the only one to miss out on this?,

It is publicised on water company websites malcolm , but its the legal aspect that interests me. It seems to me that the water companies dont look on it as an “Act of God ” when the rain falls out of the sky onto your property and not onto council owned land like a public road . This could be because under English Law you OWN the air above your property , therefore their thinking could be that you therefore own the rain that lands on it (unlike the US ) so getting rid of YOUR water is chargeable . This puts a fundamental intrinsic basic legal point , that being the case the water you collect falling on your air space can be collected and used without fear of future US type legislation.

In the case of my supplier I would have to go to “Your account” – “Billing and Payment” – “Our charges” – e.g. “unmetered charges” – “Surface water drainage” – “claim a rebate”. Hardly obvious or well publicised.

I receive a paper bill which tells me how much to pay so the only time I visit the website is to make an online payment. No visible publicity urging me to look at whether I might qualify for a reduced bill if I dispose of my own rainwater! A case of concealment?

I had a look at the ofwat website , it took 4 clicks to get to info on surface water but if you think English surface water regs are complicated you should see the ones in Scotland .There sewerage charges are collected by the community tax but try and get any facts about domestic surface water and getting a rebate for not using the public sewage system and its -OMG !!!! Scottish Water wont tell you I had to go to gov.Scotland.co.uk and look up a obscure legal document and you should see the conditions –wow ! you need to conform to a set legal distance from your home all shown in algebraic terms , you need to show via plans from an architect all the drainage from your property , you must prove beyond a shadow of a doubt that the water does not drain into a river/stream that is connected to public ownership or that it drains into your neighbours property , that the drainage does not endanger the foundations of your house or that the water falls directly on the ground causing ice to form , you will need a building surveyor , plans drawn up , a lawyer , original builders plans , it just goes on and on and Scottish Water has a say as well and did I miss out the environment ? well gov.Scotland doesnt thats brought in as well as Global Warming , its all set up like a legal document . The positive ? you are positively encouraged to collect rainwater and use it —if you make sure its safe to drink as this “saves the environment ” the environment is big in the FM eyes . So while there might not be domestic water meters there sure are a lot of “water tight ” legislation favouring Scottish Water.

duncan, interesting about Scotland. I fail to understand in a “United” Kingdom why it is that the different countries have different laws. Simply to assert their “independence”?

Your 4 clicks on Ofwat. How many people would, first. think “I winder where my roof rain water etc goes” and “can I pay less”? Then second, go to Ofwat to find out? Very few I would guess. I suggest most rely on their water companies bill through the post. they are good at publicising water meters and Homeserve – style insurance for example, but I never recall seeing a leaflet suggesting I look at my surface water dosposal with a view to a rebate for past excess charges.

@ldeitz (sorry Laura, couldn’t see Simon’s link!): This, I imagine, could affect a lot of people. A good idea perhaps if Which? brought it to peoples attention, told them where to get information, how to claim and what backdated rebates they might expect to receive. Maybe they have and I’ve missed it?

John Morris says:
29 October 2016

I am aged 69 and have 7 incurable diseases which i manage alone i live in a one bedroom flat that is so small that the cat left because i couldn’t swing her around. I have been in conflict with Thames water because i am paying water rates that are just £42 less than the 3 bedroom house next door, Our house split into 2 flats but identical in size to all the other houses in the street. I paid £308 this years so does the flat upstairs that is £616 for the same building the same size house next door they paid £350. TW say that it is due to the rateable value decided years ago between 1973 and 1993 . when i asked to see how my value was made up i was told that i can’t because there are no records of that anymore I have asked WATRS to help me but i am left with paying a rate that is not based on the size of my flat or how many people live here so just me using water and i can’t check the validity of the rate, and i can’t change to another supplier as i could with gas or electric. Regardless of my disability and income they will stick to the rateable value. The inland revenue tell me the rate is based on square footage if that is so then a one bedroom flat should be less than a 3 bedroom house. I have trust that WATRS will be able to sort something for me so that i can live in my own house until i don’t need it anymore.

Are you able to have a water meter? They are free and you should then only pay for the water you use.

Thames Water dont seem too helpful malcolm I had a look through their conditions and they are either adverse or not willing to fit them in flats due to cost . I went to the country this idea came from, the USA , and guess what ? you can employ a plumber who comes and fits one , no big deal , as long as there is an individual water pipe going in your flat separate from all the others . I could easily do it , its coupled connections , the WM is small and compact , it even shows you nice clear coloured photos of actual water meters in a multiple dwelling in the US, easy peasy ! I think we are down to protocol and regulations in this country.

Thanks duncan. Ofwat say:
What happens if I would like a meter but my company cannot fit one for me?
This may be because:
• there is more than one supply of water to the property;
• your property is on a shared supply;
• the pipework inside your property is inaccessible, obstructed or in poor condition;
• the company is not able to find a suitable place to fit the meter internally or externally; or
• you live in a flat and have access to communal facilities or a shared hot water supply.
If your company says that it cannot fit a meter at your property, it should explain why it is impractical or too expensive to do so. If you disagree with your company’s decision not to install a meter, you can ask us to investigate this on your behalf and make a decision. Our contact details are on page 25.
Your company should also offer you the option to switch to an ‘assessed charge’. This is an estimate of what your metered bill might have been had a meter been installed.
You will need to compare the assessed charge with your current bill to decide if you will save money. Your company will be able to give you more information.

It will be with asking Thames Water to look at fitting a meter or making an assessed charge.

Ann Banks says:
31 October 2016

Thames Water charges on my bill of £35.69 for last six months are £45.37 extortionate. Pushing it up to £81.06 I’m a pensioner, live alone, very frugal with water to the point of only flushing loo 3 times a day, washing up water waters plants in summer and I’m quick in the shower and I do have a water meter. My yearly consumption is around 35m (cubic metres) in comparison with Thames Water’s 44m for a single person household. Seems however much I try to cut my bill down Thames Water pushing it up!