Ofwat to redefine vulnerability

The water regulator has proposed redefining vulnerability as part of work that feeds into the new customer focused licence condition for water companies.

It is consulting on how companies can best support domestic and non-domestic customers who need additional help accessing water and wastewater services.

This includes examining how vulnerability is defined to make sure no customers are inadvertently alienated or excluded.

The last time this was explored was 2016, at which point Ofwat defined a customer experiencing vulnerability as someone who due to personal characteristics, their overall life situation or due to broader market and economic factors, is not having reasonable opportunity to access and receive an inclusive service which may have a detrimental impact on their health, wellbeing or finances.

While Ofwat said this definition was still “relevant and useful” it asked for stakeholder feedback on whether this was applicable.

It said the work would feed into the new customer-focused licence condition and establish a direction of travel for the future of vulnerability support in the water sector.

Separately, Ofwat reviewed how water companies are helping customers pay their water bills, get help and repay debts.

Efforts by Welsh Water, Hafren Dyfrdwy, Severn Trent Water, United Utilities and Yorkshire Water were described as “exemplary” and Ofwat called on others in the industry to look at and learn from these examples.

Across the sector, the 17 water companies told Ofwat about 200 separate activities designed to go beyond compliance and minimum expectations set out in Ofwat’s paying fair guidelines.

Areas Ofwat urged companies to improve include bills and charging, which it said were “by far the biggest cause of complaints” for almost all companies. One third of complaints made to CCW related to disputes around liability for charges. Other complaints included “overly aggressive” debt recovery action and customers being chased for payments they had not received bills or reminders for before action was escalated.

Furthermore, it said debt recovery activities and communications should be “targeted and proportionate” underpinned by robust systems and processes to ensure billpayers’ mental health is not impacted.

Ofwat’s review said: “Given reports of harm that some debt recovery businesses have caused in other sectors, it is important that water companies ensure their own agents receive high levels of scrutiny.”

In October, companies will set out their plans for supporting customers who struggle to pay their bills during 2025-30 within PR24 submissions.