Concerns about how water sector reforms outlined by the government will be funded have been raised by consumer group CCW.
Following publication of the government’s Plan for Water, the head of consumer group CCW told Utility Week that there is no evidence that the cost of improvements has been considered or crucially who will pay for them.
Emma Clancy, chief executive of the water watchdog, told Utility Week there was a lot to welcome in the plan in terms of accelerating water resource programmes and a focus on forever chemicals. However she said a lack of detail on costing was a glaring omission and could lead to bill increases for customers.
“There needs to be so much more discussion about who’s going to pay,” Clancy said. “That is just absent, which obviously could jeopardise the implementation of the plan if it’s not considered appropriately.”
The Plan for Water published today (4 April) collates government’s ambitions to improve river water quality by addressing pollution at source from wastewater, agriculture, highways and other sectors. It adds regulatory tools and extends enforcement powers against polluters. It ties together government’s plan to minimise harm from combined sewer overflows, which carried a cost of £56 billion for the industry through work staggered over 25 years.
Clancy added that to cover the cost of the measures outlined in the plan, customer water bills could be impacted within the current price control period, at a time of high inflation and economic pressures on household finances.
“There’s some real risks,” she explained. “This kind of in period adjustment, which impacts the next bill rise period, it falls in the context of high inflation, in the context of investments required. It is quite difficult to see how that’s all going to land, and how customers are going to be able to pay for that.”
Clancy warned that billpayers would not be satisfied about costs rising on aspects of service and performance they understood to have been paid for in water bills already. “That’s another difficulty that needs a full and frank discussion,” she added.
The consumer body called for plans to be costed early on when it was clear there would be a significant need for investment to ensure decisions could be taken early on affordability.
“It seems inconceivable to have a plan where the cost is not clear, and who’s going to pay for it is unclear,” she added.
“Saying it will be dealt with in the price review surely puts the plan somewhat at risk? When the maths is done, if the cost is considered prohibitive that would be a disappointment for everyone involved and would risk putting up costs for future generations by kicking the can down the road on things that actually do need to happen.”