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Ofwat and CCW have joined forces to tell water companies to go further in the financial support they offer householders during the cost of living crisis.
They asked companies to “carefully consider” how to manage and mitigate any “significant inflationary” increases in customers’ bills for 2023/24.
The chief executives of the two organisations wrote to heads of water companies to ensure they are ready to act.
David Black, head of Ofwat, said the sector’s support during Covid-19 showed “that where there’s a will, there’s a way”. He asked companies to “find the will to go above and beyond once again”.
Black said: “It is now for companies to demonstrate that they can find ways to help customers through this affordability crisis while not compromising on their performance. I look forward to engaging with them further on their plans.”
The letter said: “More customers are struggling to pay their bills, beyond those that may be eligible for social tariffs, and this is particularly the case in the context of rising inflation. We are therefore asking you to anticipate and act in advance.”
Ofwat said companies must not wait until PR24 to act on affordability.
“We expect all companies to do more to support a greater number of customers through the cost of living crisis,” the letter said, while also acknowledging the efforts already made to extend social tariff schemes and boost awareness of bill support.
The methodology for next price review “proposes to incentivise companies to be ambitious in supporting and enhancing customer affordability, recognising the importance of company actions now, as well as from 2025 onwards.”
Chief executive of the water watchdog CCW, Emma Clancy, added: “Struggling households need immediate relief and the long-term security of knowing they can afford something as essential as water. Companies need to take action now, while continuing to support our calls for a new water affordability scheme that protects customers that cannot afford the growing investment pressures on the sector. We should not have to choose between water poverty and progress.”
Companies will be required to write to CCW and Ofwat by 8 December to set out how billpayers will be supported amid cost of living pressures.
How utilities balance mounting affordability concerns with urgent investment will be core to the agenda at Utility Week Forum this November. Find out more about the event on 8-9 November here.
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