The ten water and sewerage companies in England and Wales took something of a leap into the dark in October 2011 when they took control of private sewers. The estimated 200,000km of drains that were transferred – any that connect more than one property to the public sewer, or which sit outside the boundary of the property – were, and to an extent remain, un-mapped and in a largely unknown condition.
That said, private sewer transfer was in planning for years and extensive research was carried out to try to determine the level of work that would be required to maintain the sizeable drainage asset. Estimates were made and companies used these to tool up ahead of the transfer. In response to the predicted volumes, call centres were expanded and supplier frameworks established.
With over a full year of ownership now under its belt, how has the reality compared with the predictions? The overwhelming answer you get from speaking to water companies is that the volume of calls on private sewer issues has been nowhere near as high as predicted. One firm in the south of England anticipated it would get 70,000 call-outs a year. In practice, it got less than 20,000.
The pre-transfer research was robust and detailed, so why the mismatch? It seems safe to assume the estimates were approximately accurate, so one possible explanation is that householders’ behaviour has been slow to adapt and they are still carrying out much of the work privately, despite it now being the water company’s responsibility.
This is backed up by research carried out earlier this year by the Consumer Council for Water. In its survey, only 46 per cent of domestic customers and 27 per cent of businesses said, unprompted, that they had received and read the notice from the water company informing them of the change. On being questioned about the notice, this number increased to 55 per cent of domestic customers and 39 per cent of businesses.
According to the report, the most commonly remembered aspect of the notice was that it was about a change of sewer ownership, but less than half of those who read it said they remembered reading about who owns the different pipes or how different types of property were affected. Clearly, there is still work to be done to raise awareness and ensure work is carried out by the organisations now responsible – the water and sewerage firms.
The work aside, the biggest challenge for the industry is that it has taken over responsibility for private sewers but has not yet been given any additional funding for the purpose. Plus it faces an unpredictable spend profile with its new asset.
The cost of maintaining any drainage system can fluctuate widely, and in a way that is hard to forecast. The unknown condition of the transferred drainage only serves to exacerbate this. The weather is a major factor. Heavy downpours typically cause a significant short-term spike in unblocking work but, interestingly, they can also often be followed by a lull in the number of call-outs because the system has been flushed through and many potential build-ups dislodged.
There is a sense that some companies are attempting to keep spending at a minimum (see box) until it can be reviewed ahead of the next Asset Management Plan cycle – AMP6 – which begins in 2015. The problem – aside from the customer relations risk – is that it could be difficult to make a case for increased spending at that point when it has been considered dispensable now.
Water companies are not in an easy position. The complete absence of any negative publicity following the transfer seems to suggest that the customer service they have provided through their recently expanded supply chain has been excellent. However, in some cases there is a clear argument for an increase in the level of self-funding assigned to the transferred asset if the new network is to be brought under effective management.
Moreover, companies should be keenly aware that year two may be a completely different ball game as more homeowners wake up to the fact that they are no longer responsible for what were private sewers but are now water company property.
Greg Beech is chief executive of UKDN Waterflow
Sewer strategies
There has been significant variation in the approaches taken by each of the water companies, ranging from:
Minimum spenders: some have worked on a purely reactive basis, doing a good job of attending and removing any blockages, but avoiding any further investigative work or preventative maintenance. While clearly this will lower cost in the short term, there are risks attached.
For one thing, without reparative maintenance the condition of the drains will steadily deteriorate, with new issues adding to existing problems. Over time, this will cause basic management costs to increase – so the outlay is merely being held off for the future.
Second, there is a danger of attracting negative feedback from customers. Blockages on the transferred assets are mostly located under private property, so attendance requires contact with customers. However well-handled and non-disruptive this customer contact is, failure to tackle the cause of issues and stop them happening time and again will lead to customer dissatisfaction. Avoidance of repeat attendance is also a key aspect of the service incentive mechanism.
Longer term planners: not all firms are taking this minimum spending approach; some are employing more promising strategies. One, for example, has put in place a “find and fix” agreement with its drainage network contractor under which, every time the contractor attends an unblock job, it also investigates the cause of the issue and assesses how much it would cost to fully repair it. If this is below a set threshold, it has authority to liaise with the customer and carry out the work. This avoids repeat call-outs and while costing more in the short term will pay dividends in the medium to long term.
This article first appeared in Utility Week’s print edition of 14th December 2012.
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