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Water regulator Ofwat has called for the government to make a swift decision on whether it will proceed with plans to introduce competition into the domestic retail market.
At a media briefing in London, chief executive Cathryn Ross told Utility Week the regulator hopes a decision is made “soon” as clarity is “really important for everybody in the market”.
The Treasury first announced in November 2015 that it proposed to open the domestic water market as early as 2020. It commissioned Ofwat to carry out a cost-benefit review. The regulator published this in September 2016, stating that the financial benefits could be as much as £3 billion.
However, since its original announcement the government has gone quiet on the issue, with no mention of it being made in the chancellor’s most recent autumn statement. Rumours are now circulating in the water sector the it may be backing away from domestic reform. Ross said she did not know whether this would happen.
The Department for the Environment, Food and Rural Affairs declined to comment on when it will make a decision. A spokesperson said: “Introducing competition to the household water market is clearly a complex issue and something that needs careful consideration.”
Labour has strongly opposed measures to make the domestic market competitive, saying water and sanitation is “too important” to turn into a market.
Lord Rupert Redesdale – chair and acting chief executive of new entrant The Water Retail Company – told Utility Week he believes the government should put its plans on hold because of problems that could arise for vulnerable customers.
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