Water companies should “dip into deep pockets” to extend social tariffs

Water sector are only helping one in five needy households with current welfare offers, warns CC Water boss

Water companies should dip into “their own deep pockets” in order to fund the extension of social tariffs for those in financial hardship, the chief executive of CC Water has said.

Writing for Utility Week, Tony Smith said that while it is positive that water companies have committed to helping 1 million customers in financial hardship by 2020, their commitment does not go far enough.

He pointed to new research from CC Water which found around 3 million customers across England and Wales find their water bill to be “unaffordable”.

“That means financial support may only be available to about one in five households who actually need it – a drop in the ocean,” said Smith.

With PR19 “looming large”, Smith insisted water companies have a “golden opportunity to put affordable bills at the top of the agenda”.

He added: “One of the ways water companies could do this is by dipping into their own deep pockets to extend the funding of social tariff schemes.”

Currently, social tariffs provided by water companies are largely funded by customer, who pick up cost of supporting those less able to pay.

“These customer-funded schemes have helped to reduce the bills of more than 260,000 low income households. But can you imagine what impact they could have if they didn’t rely almost entirely on other customers’ willingness to fund them?” wrote Smith.

He also said that CC Water’s research suggests customer would be willing to contribute more to social tariffs “if they could see their water company was also playing its part”.

Affordability is one of four key themes identified by Ofwat in its draft framework for PR19 which it has promised will be a “challenging” review for water companies.