New year – same old problems?

As the UK gets more and more exasperated over Brexit, Mark Abrams looks at how this will affect utilities and their customers.

Brexit is continuing to give us a headache. ­No-one really knows at this stage what will happen, even as the March deadline for leaving the EU looms. But one thing is sure: there will be economic ­uncertainty, if only because of the wide range of possible outcomes from post-Brexit negotiations.

What is a fact, however, is that in times of economic uncertainty, more and more people caught in the poverty trap will be looking for someone to throw them a lifeline. It is believed more than eight million people in the UK are having to live with day-to-day debt problems – some as a consequence of the increase in bills.

Ofwat will be completing its next price review – covering a five-year period – in 2019. So in that respect consumers will know what to expect in the coming years. It is encouraging that the water sector’s economic regulator wants to see affordable bills that not only offer value for money but which are as low as they can be while ensuring there is the right amount of investment for the future.

In addition to expecting affordable bills, consumers demand efficient and reliable services from utilities. In order to provide such facilities, companies are forced to maintain high levels of investment; for example, water firms have invested £150 billion over 30 years. This means bills must rise but Ofwat, in its 2019 price review, will be incentivising and encouraging water companies to find new and better ways of delivering their services.

The regulator’s efforts to date are to be applauded. Following an initiative introduced by Ofwat and Ofgem, working through the UK Regulators Network (UKRN), a pilot data-sharing scheme has been introduced in the northwest of England to identify vulnerable customers.

But Ofwat has made it clear that it wants water firms to go even further. For example, they are expected to expand their support beyond social tariffs, ensuring they reduce debt and help customers out of water poverty.

Not-for-profit organisation Auriga Services has been working since 2004 as a subsidiary of Severn Trent Trust Fund to help vulnerable customers of Severn Trent Water. Since then, we have been working with utility companies and local authorities to assess and distribute grants to those in need, helping more than 1.8 million people and each year distributing £15 million.

Sadly, with debt continuing to rise – utility bills account for almost a third of overdraft debt – we have seen unprecedented demand for our services and support in the past 12 months. Our vision is to have helped two million people by 2020 and to proactively develop partnerships and support, which is greatly required.