Cyclical Debt Assessments Overview 2014-15

A significant area of our work involves ensuring water companies strike the right balance between collecting revenue effectively to minimise customer debt but remain sensitive enough for those customers experiencing financial difficulties.

Customer debt to water companies has increased over the last six years. The cost associated with unpaid bills is around £21 (£32 in Wales) a year for every household – up from £17 in 2009/10 (2014-2015 prices). Water customer bills do not solely cover this amount. The price limits set by Ofwat ensure a proportion of the cost risk lies with the companies themselves.

We have worked with the industry and other stakeholders to address the issue of customers struggling to pay their water bills. Our customer research in 2010 found nearly all customers supported helping those experiencing financial difficulties in paying their bills. We worked with the UK and Welsh Governments on developing their guidance to companies on introducing social tariffs. As a result, fifteen companies have implemented social tariffs with a further four expecting to implement them in 2016/17.