DELVING INTO WATER. Performance of the water companies in England and Wales to

Transcription

1 DELVING INTO WATER Performance of the water companies in England and Wales to

2 Consumer Council for Water January 2015 Contents Section Page 1. Executive Summary 3 2. Introduction 9 3. Dealing with complaints Customer assistance schemes Sewer flooding Leaks Interruptions to the water supply Metering Daily water consumption Drinking water quality Appendices 34 Charts and tables Page Table one Summary of company performance to (industry 3 level) Table two Number of written complaints per 10,000 connections 11 Chart one Total Service Incentive Mechanism Score ( to ) 13 Chart two Number of customers per 10,000 household connections that are 15 registered on WaterSure or the equivalent Table three Number of customers that are registered for customer funded 16 social tariffs Chart three Number of customers per 10,000 household connections that are 17 paying through Water Direct Chart four Number of customers per 10,000 household connections that are 18 included on the special assistance register Chart five Number of properties flooded internally per 10,000 sewerage 19 connections Chart six Number of areas flooded externally per 10,000 sewerage 21 connections Chart seven Total daily leakage as a percentage of water put into the system 22 Table four Company leakage levels 23 Chart eight Number of hours lost due to water supply interruptions of three 25 hours or longer per property served Table five Companies performance against their supply interruptions targets 26 Table six Percentage of household metering 28 Table seven Percentage of non household metering 29 Table eight Average water use 30 Chart nine Overall drinking water quality 32 Page 2 of 39

3 1. Executive summary This report has been compiled using information that companies have voluntarily provided to the Consumer Council for Water to demonstrate their performance across a number of service areas that have an impact on consumers. Where appropriate, the information is shown in a comparable format, either by per 10,000 property connections, or using percentages. The key findings from the report are as follows: Table one: Summary of company performance to (industry level) Measure Contacts and Complaints Written Complaints 185, , , ,218 Unwanted contacts 4,703, ,694,150 3,135,539 2,698,240 Service Incentive Mechanism (score) - average Customer Assistance Schemes (total number of customers) WaterSure/Welsh Water Assist 63,381 78,835 93, ,404 Social Tariffs N/A N/A N/A 13,444 Water Direct 177, , , ,811 Special Assistance Registers 158, , , ,918 Operational Activities Total internal sewer flooding incidents 5,626 4,525 8,659 4,959 Total external sewer flooding incidents 39,504 39,426 52,308 43,307 Leakage (total megalitres per day) 3,382 3,093 3,094 3,113 Supply interruptions (arithmetical average number of hours per property) Household metering levels (arithmetical average) 41.6% 43.8% 46.7% 49.3% Non-household metering levels (arithmetical average) 88.8% 89.2% 89.5% 89.8% Per capita consumption (arithmetical average litres per person per day) Drinking water quality (average) N/A 99.96% 99.96% 99.97% Overall, the industry is making progress in most of the areas that matter to customers; the sections below provide further detail. Yet, there is still room for improvement across all service areas and significant improvement needed for some companies. This reinforces the importance of the customer focus of the recently completed price review (PR14) in December CCWater had argued that regulatory price setting needed to have much more customer input and influence than had occurred in the past. Ofwat and the industry listened and the price review of 2014 made major progress in reflecting customer priorities. Ofwat s announcement last month of price limits for contained a large range of investments to improve the services that customers had said, throughout the price review, they valued and wanted to see delivered. Many of these investments should help improve the performance measures covered in this report. In many cases these investments have been linked to outcome delivery incentives rewards for outperforming targets and penalties for failing to deliver them. We will monitor companies performance against these incentives, with particular attention on those that are customer-focused. And, where a company performs well and is due a reward, we will be looking at securing a share for customers. 1 The figure does not include data from Sutton & East Surrey as this information is not available. Page 3 of 39

4 1.1 Dealing with customer complaints and contacts The number of written complaints to water companies has continued to fall, from 185,140 in to 123,218 in While the reduction is welcome there are still some companies whose performance is a cause for concern, and we are pressing them to improve so they come into line with the better performing companies. An unwanted contact is any phone contact about events/actions that have caused unnecessary aggravation (however mild) for the consumer, including the need to make repeat or chase calls. Over the four year period unwanted contacts have fallen by over 40% from around 4.7 million 2 to 2.7 million. Previously, we have worked with Ofwat and the industry to change the regulatory incentives and penalties system so every water company is focused on delivering services and behaving in a way that meets customers expectations. This resulted in Ofwat the industry s economic regulator - introducing the Service Incentive Mechanism (SIM) in This was a new measure of customer service which assessed companies performance in handling written complaints and included a survey of customers with resolved company contacts. Companies performance is scored out of 100. In the majority of companies saw an increase in their SIM score on previous years. In the average SIM score was but this has positively increased by 20% over the past four years to Customer assistance schemes The number of customers that are receiving help with payment of their bills has almost doubled over the past four years. However, there is still work to do, as one in five customers has told us that they can not afford their water bill 3. Other research 4 we commissioned has found that general awareness of the companies assistance schemes is often low, and some customers simply do not expect to be offered such help. We are using the findings of this research to identify areas for improvement in water companies practices, and to improve awareness of the assistance available with those agencies that deal with indebted customers. Since all water companies have increased the number of customers registered on WaterSure, which requires companies in England to offer eligible metered households financial assistance through a bill capped at their average level. Customers in Wales can seek assistance from Welsh Water Assist, which extends support to unmetered customers. In , almost 110,000 customers were registered on these two schemes, a 73% increase on the 63,381 customers registered in In addition to WaterSure/Welsh Water Assist, three companies - Bristol Water, South West Water and Wessex Water - introduced customer funded social tariffs in April 2013, offering lower bills to customers that would otherwise struggle to pay. Affinity Water, Sutton & East Surrey Water and Thames Water also launched schemes for their customers in 2014, with more expected to follow suit in There have been fluctuations in the number of customers who pay their bill through Water Direct (another Government run scheme that enables customers who are in debt and receive specific benefits to have payments taken directly from those benefits). In there were 2 The figure does not include data from Sutton & East Surrey as this information is not available Page 4 of 39

5 243,811 customers paying their bill via Water Direct, a 37% increase over the past four years. However, only five companies were responsible for this increase. Each company maintains a special assistance register which records the details of customers who have expressed a need for special assistance in the way that services are provided to them. Almost 250,000 customers are now registered on companies special assistance registers, a 58% increase from the 158,524 registered in Sewer flooding Sewer flooding is one of the worst service failures that customers can experience. Not only does it damage properties and belongings but it can seriously impact the quality of life for those affected. The number of properties that are flooded with sewage is heavily influenced by the intensity and duration of rainfall. As such there is often variability in sewer flooding across the years. For example, the years and were relatively dry (5,626 and 4,525 properties flooded respectively) but were followed by a relatively wet year of (8,659 properties flooded). In a total of 4,959 properties were flooded internally. Typically there are eight times more external than internal flooding incidents in any given year. Although, at 43,307, external flooding incidents last year were below the wet year of , they show a worrying upward trend when compared to earlier years. Customers, of course, do not accept the distinction between dry and wet years. What they want is action to prevent a recurrence of sewage entering their property or polluting the local environment. We expect companies to take action to resolve and mitigate sewer flooding. At each price review sewerage companies are provided with funds to resolve or mitigate existing problems and to prevent future flooding incidents. Ofwat s latest price determination has provided funds to reduce internal sewer flooding incidents by one-third, with companies collectively facing a 353m penalty if they do not deliver. We will be discussing with the companies where, when and how they will deliver these schemes, and whether there is scope for them to go beyond their commitments and reduce sewer flooding even further. 1.4 Leaks Customers have told us that their perceptions of their water company can be influenced by how they deal with leakage, and that this can also have an impact on customers own efforts to save water 5. While they do not expect leakage to be reduced to zero, they do expect companies to do more to fix leaks. They become particularly annoyed when, having reported a leak, the company does not repair it quickly or, if there is a delay, fail to keep customers informed about progress. We are pushing companies to prioritise leakage and address the more customer facing aspects by producing the information customers find useful, and demonstrating that they are tackling leakage. Some companies are rising to this challenge as they view active leakage control as part of both their wider water management activity and as a means to build a better relationship with their customers. Nevertheless, about 22% of the water put into the system is currently lost each day through leakage. While this is a slight reduction on the position four years ago, industry-wide leakage levels has been rising since The industry must, therefore, do a lot more to show customers that they are driving down leakage. They should be aiming to go below the targets set 5 Page 5 of 39

6 in the latest price limits, which are collectively above those being currently achieved 6. On behalf of customers, we will follow this up with each of the companies. 1.5 Interruptions to the water supply Interruptions to water supplies can cause inconvenience to customers, especially if they occur at a time when customers would normally be showering or using water appliances. If the interruption occurs without warning due to, for example, a burst main the inconvenience can be that much greater. Whilst customers accept that companies need to occasionally interrupt supplies to do planned maintenance they still expect them to be kept to a minimum and for communication about the interruption to be clear and accurate to minimise disruption. The amount of time that a customer is without a continuous supply of water is falling 7. In this was about 20 minutes per property, falling to about 14 minutes in Customers of Sembcorp Bournemouth Water, Essex & Suffolk Water and Portsmouth Water experience the least amount of time without water, while Dŵr Cymru Welsh Water customers suffered the longest supply interruptions of about 50 minutes. Given that customers want their water to keep flowing, we will work with those companies with recent high levels of supply interruptions to see whether they can adopt the practice of the better performing companies. 1.6 Metering Over the last four years household metering has increased from 42% to 49% in England and Wales. Whilst customers agree that metering is the fairest way to charge for water, many do not support compulsory metering. We have, and will continue to work with companies that introduce compulsory metering programmes to ensure that adequate transitional arrangements are in place for customers, particularly those that may struggle to pay for a metered water bill. Anglian Water and South West Water have comparatively high percentages of metered customers (above 70%) largely through promotion of the meter option scheme and other initiatives. Northumbrian Water (30%) and Portsmouth Water (23%) have the fewest metered customers. In parts of the South East of England compulsory metering programmes have significantly increased the level of metering, and will continue to do so over the next five years. Southern Water has reached 75% of households and South East Water 64% to date. The percentage of metered non-household properties has remained stable at around 90%. Although most business customers will be metered, non household customers that may not be metered include churches, scout huts, farm troughs and stand alone garages. 1.7 Daily water consumption Since there has been an overall reduction in water use. This reflects an increase in metering, particularly in the areas served by Southern Water and South East Water where there are compulsory metering programmes, and continuing calls for customers to use water wisely. This is partly offset by a slight increase in water use in some areas where water resources are not under the same sort of pressure. The difference in the average amount of water used by metered households (129 litres per person per day in ) and that of non metered households (155 litres per person per day) has widened since (136 and 158 litres per person per day respectively). 6 In companies reported leakage at 3,113Ml/day. Ofwat s Final Determination states that by 2020 companies will reduce leakage to 3,123Ml/day from 3,281 Ml/day (policy chapter A2 outcomes, section A2.2.3, page 20). 7 Ofwat s measure of performance is the average time across the customer base that supplies are off line. Page 6 of 39

7 Over the next five years, population growth, other demographic changes and restrictions on the amount of water that can be abstracted from rivers, lakes and ground waters mean that available water resources will come under greater strain. Although metering will increase to 61% of all households, it is likely that there will be renewed calls for everyone to use water wisely. 1.8 Drinking water quality The quality of drinking water is a priority for water consumers and regulated by the Drinking Water Inspectorate (DWI). The average figure for public water supply compliance with the EU Drinking Water Directive Standards in 2013 has increased to 99.97%. In 2011 and 2012 this was 99.96%. Over the next five years, companies are being challenged to increase compliance to 100%. 1.9 Conclusion The industry is making progress in most of the areas that matter to customers. Commitments that companies have made for the next five years to reflect their customers priorities should build on this. The high level trends over the past four years show that: Complaints are falling, but we will continue to press the companies who are underperforming to improve in line with the rest of the industry. More customers struggling to pay their bills are receiving help, but general awareness of the schemes remains low. We will therefore work with companies to improve promotion and take-up of the assistance available to those that would benefit. Less water is being lost through leakage than in , but this has been rising since the low. We are pushing companies to demonstrate to customers that they are addressing leakage. The amount of time that customers are without water is decreasing - and we are monitoring the progress of companies that are struggling to meet targets. Water consumption is falling which has been driven by increased metering and continuing campaigns to use water wisely by ourselves and companies. We will also continue to ensure that compulsory metering programmes have the right transitional arrangements and customer protection in place. However, sewer flooding does remain an area of concern. The consequences can be devastating, and the industry needs to work tirelessly to protect those at risk and provide solutions for those affected, especially as extreme weather events are becoming more commonplace. Customers expect and deserve high levels of service, and when things go wrong they want a sympathetic hearing and a quick resolution. Within each of the different service areas covered in this report, there are some companies that have much more to do to match the better performers: The three companies with the highest amount of complaints per 10,000 connections in were Southern Water, South West Water and South East Water. All three companies have had higher than average figures over the last four years (although not significantly so for South West Water in and ); Northumbrian Water s and United Utilities performance on sewer flooding has, of late, been comparatively poor. Northumbrian Water have attributed this to particularly wet weather, and for United Utilities the levels of sewer flooding has been impacted by the age of their network and higher rainfall than other regions; All companies should continue to encourage water efficiency by their customers, but need to demonstrate that they, too, are water wise by reducing leakage levels; Page 7 of 39

8 This is especially relevant for Thames Water and United Utilities whose leakage levels have been the industry s highest for several years; and Dŵr Cymru Welsh Water needs to improve its performance on supply interruptions. In each case, we will continue to push these companies to improve their performance by adopting industry best practice, where appropriate, or by developing innovative solutions to issues and service problems that customers view as important. We will also monitor the performance of the better performing companies to ensure that their service levels to customers continue to improve. We will monitor companies in the context of their customers priorities and their PR14 commitments and, where necessary, adjust our monitoring to reflect this. Page 8 of 39

9 2. Introduction The Consumer Council for Water (CCWater) represents the interests of household and nonhousehold water and sewerage customers. We operate through four committees in England and a committee for Wales. We work directly with the UK and Welsh Governments, regulators, key stakeholders and water and sewerage companies, to influence and deliver for water consumers and to inform consumers about the issues they say are of interest to them. During 2013 we asked water companies across England and Wales to change the way in which they reported performance data to our committees. Over many years, the data requested of companies had expanded, become ever more variable and less comparable. Companies recognised the benefits of a reduced number of performance measures that were both customerfocussed and comparable. They agreed to provide us with quarterly reports setting out their performance against a core set of measures, commencing April We also asked companies to provide performance data for the full year, and the preceding three years. This report summarises and comments upon company performance for those four years. We will publish a company performance report each year. Our other reports This is one of three reports about the water industry that we publish. Since 2006 we have tracked customer satisfaction with the services they receive and the value for money of those services. The latest research report Water Matters 2013 is available on our website at We also produce an annual report on written customer complaints to the water companies. This is also available on our website, and the key findings are summarised in this report. For several years we have taken key data from our tracking survey and the complaints report and published it on our website under the banner how is my water company doing? We plan to add key data from this company performance report to that webpage to present a more rounded view of customer experience and perception of the water industry in England and Wales. Comparability of data Because water companies vary in size, the data in this report is shown as either per 10,000 property connections 8 or as a percentage. This ensures company performance can be directly compared. In some instances, data reported against Anglian Water includes its subsidiary, Hartlepool Water. Due to its small size, Cholderton Water 9 does not feature in this report. Future reporting As part of the 2014 price review, companies set themselves a number of performance targets based on measures that customers have told them are important. We recognise that there may be some cross over between the information companies gather in tracking progress against delivery of those measures and the information which CCWater will periodically collect. 8 Per 10,000 connections is calculated from the year end total connections data 9 Cholderton Water serves approximately 2,000 consumers on the Wiltshire/Hampshire border. Page 9 of 39

10 We will be working with the industry and Ofwat to determine how company performance measures will be monitored in future, to: Uncover cross overs; Ensure information is provided at the right time and the right level of detail; Avoid duplication of reporting or an unnecessary burden; and Report for customers and others interested in the performance of the water industry and the individual companies. Page 10 of 39

11 3. Dealing with customer complaints and contacts 3.1 Number of written complaints to water companies CCWater was formed at a time when complaints to water companies were rising rapidly. In written complaints to water companies peaked at 273,000. Since then we have used information about complaints to press all companies to adopt a right first time approach to complaints management. We name and shame the poor performers, and praise the better ones in our annual written customer complaints report 10. We also undertake an on-site assessment of the processes and procedures used by companies with the aim of helping poor performers improve by adopting best practice from industry leaders. This, together with the introduction of SIM, has helped to drive written complaints to water companies down by 55% to 123,000 from their peak in Table two: Number of written complaints per 10,000 connections Trend Average Water and sewerage companies Anglian Dwr Cymru Northumbrian Severn Trent South West Southern Thames United Utilities Wessex Yorkshire Water only companies Affinity Bristol Cambridge Dee Valley Essex and Suffolk Hartlepool Portsmouth Sembcorp Bournemouth South East South Staffs Sutton and East Surrey Over the past four years there has been a 34% fall in complaints from 185,140 to 123,218. While welcoming the continuing improvement, we will continue to press the poorer performing water companies to do more work in some areas as they have not improved enough to bring them in line with better performers, or even within 25% of the industry average. Despite seeing a decrease in the number of complaints received, South East Water and Southern Water are still the poorest performers. They have both made new commitments to CCWater to put a greater focus on addressing the concerns of their customers. We will monitor them closely to ensure they do Page 11 of 39

12 Our complaints report shows that four water companies (Dŵr Cymru Welsh Water, Severn Trent Water, South West Water and Affinity Water) bucked the industry trend and reported an increase in complaints during the year. CCWater has challenged each company to explain why this has happened and what they propose to do to improve performance. 3.2 Unwanted contacts An unwanted contact is any phone contact about events/actions that have caused unnecessary aggravation (however mild) for the consumer, including the need to make repeat or chase calls to their company. Over the four year period unwanted calls have fallen by over 40% from around 4.7 million 11 to 2.7 million. This broadly reflects the fall in written complaints, and demonstrates that companies are increasingly adopting a right first time approach to dealing with their customers. If you would like to read more about complaints within the water industry and what we are doing to drive improvements, please see our annual written customer complaints report The Service Incentive Mechanism Previously, we worked with Ofwat and the industry to change the regulatory incentives and penalties system so incentives drive customer-focused company behaviour and outcomes that satisfy customers. This resulted in Ofwat introducing the Service Incentive Mechanism (SIM) in This new measure of customer service assessed companies performance in complaint handling, from unwanted customer telephone calls to CCWater investigations. It also included a survey of customers with resolved company contacts. Companies performance is scored out of 100. The SIM s financial rewards and penalties have added weight to the right first time ethos that CCWater has encouraged companies to adopt within their complaint handling processes, with the average score for the industry improving year on year. In the average SIM score was 68.76; it now stands at The industry leaders for the SIM in were Anglian Water (87), Wessex Water, (87) and Sembcorp Bournemouth Water (86.76). Wessex Water has shown the highest SIM score for each of the four reporting years. In , Portsmouth Water (+15) and Southern Water (+13) saw the largest increases. Three companies saw a decrease in their SIM score: Affinity Water (-1.58), Bristol Water (-0.2) and Cambridge Water (-1), albeit from a high base level. Affinity Water s 1.58 points reduction in their SIM score was attributed to problems arising from merging the computer systems of the three formerly separate company areas. They have told us that they are currently analysing the root causes of those complaints and implementing improvements to address them. We will monitor progress. Bristol Water attributes its slight decrease to a rise in the number of unwanted, abandoned and engaged calls, primarily due to increased call volumes following unplanned interruptions, caused by burst mains and pump failures. Cambridge Water has informed us that high staff turnover in its call centres has had an impact on its SIM score. The company says it has put processes in place to address this which should hopefully have a positive result for We will be working with these companies to ensure the plans they have put into place to address these issues result in improvements and a more positive customer experience. 11 The figure does not include data from Sutton and East Surrey as this information is not available Page 12 of 39

13 Chart one: Total Service Incentive Mechanism Score ( to ) Water and sewerage companies Service Incentive Mechanism Water only companies * The value for Anglian Water also includes that for Hartlepool was a transitional year and did not count towards the Ofwat Price Review 2014 SIM assessment of companies performance. The data for this year was affected by reporting issues, as many companies could not count all of the measures and so direct comparisons between companies for this year cannot easily be made. Page 13 of 39

14 4. Customer assistance schemes Affordability is now a major concern for customers with household budgets under increasing pressure. Although customers inform us they are generally satisfied with the service their water and sewerage companies provide, one in five customers thinks their water bill is unaffordable 14. We will continue to encourage companies to have in place a range of strategies to support those who need extra help. Water companies have been set targets by Ofwat to ensure that over the next five years ( ), 445,000 more households will receive assistance through schemes to help them pay their bills 15. The paragraphs below explain some of the different ways in which companies are working to help their customers who are struggling to pay their water and sewerage bills. 4.1 WaterSure and Welsh Water Assist WaterSure is a Government mandated scheme which requires companies in England to offer some metered households a bill capped at the average metered bill for the company. Customers are eligible for the scheme if they are on a water meter, in receipt of certain benefits and have either three or more children living at home or someone with a medical condition requiring significant water use. You can find out more about WaterSure on our website here. The scheme only applies in England, although Dŵr Cymru Welsh Water and Dee Valley Water who operate in Wales have introduced similar schemes on a voluntary basis. The Welsh Water Assist scheme also extends help to customers without a meter and charges are capped at a level lower than the average bill. Chart two shows how many customers per 10,000 connections 16 are registered for WaterSure or the equivalent scheme in Wales. Please note that these figures are for information only and should not be used to compare companies as the number of households with meters, the level of charges, and the extent of household poverty in the company s supply area will have a significant effect on uptake. Over the last seven years, CCWater s project to rebrand the scheme and introduce a standard simplified application form has helped improve take-up of the WaterSure scheme (excluding the unmeasured element of Welsh Water Assist) by 426%. For the four year period covered by this report the number of customers registered on WaterSure and Welsh Water Assist has increased from 63,381 to 109,404. It is not surprising to see that South West Water has the highest number of customers per 10,000 connections registered for WaterSure as they have both a high percentage of metered customers (see section eight) and historically high charges 17. They have also worked to promote the scheme alongside other affordability measures which has contributed to the high take up. The number of customers per 10,000 connections registered with Dŵr Cymru Welsh Water is also high, as its scheme has been extended to unmetered customers Based on household connections (water, water and sewerage, and sewerage only) for An annual 50 Government Contribution for South West Water s household customers was introduced in April 2013, aimed at addressing the unfairness of water charges in the South West caused by three per cent of the population funding the clean up of 30% of the nation s bathing waters since It is a flat rate reduction that will run until Page 14 of 39

15 Chart two: The number of customers per 10,000 household connections that are registered on WaterSure or the equivalent 18 Number of customers per 10,000 connections that are registered on WaterSure Water and sewerage companies Water only companies Despite seeing increases in WaterSure uptake, our annual tracking survey Water Matters 19 showed that general awareness amongst customers of the scheme remains fairly low (9% in 2014 and 12% in 2013). Not surprisingly, the highest awareness was in regions where there were more metered respondents in the survey. Our recent Living with Water Poverty research also found that although more help is now provided by water companies than ever before, general awareness of the assistance available is often low. Some customers simply don t expect their water company to be able to offer such help. We are using the findings of the research to identify areas for improvement in water companies practices, and to improve awareness of the assistance available with those agencies that deal with indebted customers. 4.2 Social tariffs In addition to WaterSure and Welsh Water Assist, some water companies have introduced, or are planning to introduce, customer funded social tariffs. Further information about these schemes is available from the water companies. As table three shows, in 2013 three companies introduced a social tariff. By the end of the year almost 13,500 customers were signed up The figures for Bristol Water and Wessex Water refer to the WaterSure Plus scheme which has the same eligibility criteria as WaterSure, but offers greater financial assistance. The Welsh Water Assist scheme extends help to customers without a meter and charges are capped at a level lower than the average bill These figures do not include customers registered for Bristol Water and Wessex Water s WaterSure Plus scheme. Page 15 of 39

16 Table three: The number of customers that are registered for customer funded social tariffs Company Number of Per 10,000 connections 22 customers Bristol Water 4, South West Water 1, Wessex Water 7, Please note that for Bristol Water and Wessex Water, these figures include customers that were already receiving help through a pre-existing assistance scheme, in addition to those that have taken up the social tariff since April Affinity Water, Sutton and East Surrey Water and Thames Water also launched social tariffs for their customers in 2014 and most other companies plan to follow suit over the next few years. CCWater has worked closely with all companies that have introduced social tariffs, and is currently working with others to ensure implementation of their schemes goes smoothly. A number of other water companies also have schemes to offer support to customers, who are struggling to pay and you can find out more about these from the companies or on their websites. 4.3 Water Direct Water Direct is part of another Government administered scheme that enables customers who are in debt and receive specific benefits to have payments taken directly from those benefits. You can find out more about Water Direct on our website here. Although chart three shows the number of customers within each company that are paying their water bill via Water Direct, comparisons of the success or otherwise of companies promotion of the scheme cannot be drawn. There are several local factors that will affect registration on the scheme, including the number of benefit recipients and the level of customer debt. Over the four year period, there have been fluctuations in the number of customers that are paying through Water Direct. In there were almost 250,000, an increase of 37% on However, only five companies saw an increase in numbers of people paying through the scheme these were Affinity Water, Essex and Suffolk Water, South Staffs Water, United Utilities and Thames Water. The stable numbers in other areas may be a reflection of the economic climate improving, or that the scheme has successfully helped customers out of debt in previous years. Additionally, customers may be struggling to meet bills from other utilities which have a greater priority than water in the Water Direct hierarchy, so the maximum deductions are already being made leaving nothing for water. 22 Based on all household connections (water, water and sewerage, and sewerage only) for Page 16 of 39

17 Chart three: The number of customers per 10,000 household connections 23 that are paying through Water Direct Number of customers per 10,000 household connections that are paying through Water Direct Water and sewerage companies Water only companies The special assistance register Each water company maintains a special assistance register which is open to anybody who needs one of the services they offer, regardless of their age, health, disability, or indeed their lack of disability. For example, anyone who is concerned about personal security in the home should be able to register for a password scheme, which helps ensure only genuine water company staff have access to their property. Other services include meter reading, help during water supply interruptions, and large print, Braille or talking bills. You can find further information about the types of assistance that are available here. Although the number of customers that are on water companies special assistance registers has risen by 58% over the past four years to almost 250,000, there are annual fluctuations in the numbers reported by individual companies. This may be due to companies updating their data as customers leave the area, go into sheltered accommodation/nursing homes, or pass away. 23 Based on all household connections (water, water and sewerage, and sewerage only) for Historic figures not available for Wessex Water and Bristol Water and the figure relates to both companies a split is not available Page 17 of 39

18 Chart four: The number of customers per 10,000 household connections 25 special assistance registers included on Number of customers per 10,000 household connections that are included in the special assistance register Water and sewerage companies Water only companies Our annual tracking survey Water Matters 26 found that customer awareness of services for the elderly and disabled such as the special assistance register has been rising strongly, although uptake remains static at 1-2%. We are continuing to monitor the level of registration for these services; raise awareness of them through the media; maintain companies focus on raising awareness of the scheme and particularly encourage companies to work with other utilities to ensure customers are aware of these cross utility services. 25 Based on all household connections (water, water and sewerage, and sewerage only) for Page 18 of 39

19 5. Sewer flooding Number of properties that have flooded internally Sewer flooding is one of the worst service failures that customers can experience. Not only does it damage properties and belongings but it can seriously impact the quality of life for those affected. Until remedial action is taken every time there is heavy rain those customers who have been through this horrendous ordeal can become anxious about a repeat event. The number of properties that are flooded with sewage is heavily influenced by the intensity and duration of rainfall. As such, there is often variability in the number of reported sewer flooding incidents across the years. For example, and were relatively dry years, and internal sewer flooding incidents reduced over this two year period from 5,626 to 4,525. However, in November 2012 there was in excess of 150% of the average monthly rainfall, and this occurred predominately in one week. This brought widespread disruption across many parts of England and Wales 28. During this wet year, 8,659 properties were internally flooded. The winter of was reported to be the wettest in England and Wales since at least Although the number of properties affected was not as numerous (4,959), because rainfall fell throughout the winter months rather than in concentrated periods, properties tended to be affected by flooding for longer periods. Chart five: The number of properties flooded internally per 10,000 sewerage connections The number of properties flooded internally per 10,000 sewerage connections For customers of Northumbrian Water, was a particularly difficult year with 2,112 properties internally flooded. This was due to three exceptional storms (including Newcastle upon Tyne s Thunder Thursday on the 28 June 2012) which led to a quadrupling of flooding problems. Sewer flooding numbers returned to the long term average last year. Northumbrian 27 Sewer flooding information relates to public sewers and does not include those which have transferred to companies from private ownership as these were not included in the targets set for companies at the last price review period (2009) Page 19 of 39

20 Water is investing heavily in maintaining and upgrading the sewer network to reduce the risk of flooding and has delivered a significant programme of individual property protection to reduce the risk of flooding to people s homes and businesses. United Utilities also report a higher number of internal flooding incidents per 10,000 connections when compared to other companies across most years. They have one of the largest and oldest sewer networks in the UK, and also typically have more rainfall than any other region. These factors mean the company has started from a very low base in trying to tackle flooding problems. It has made significant investment in improving the sewerage system; this has resulted in improvements in operational performance shown by a 52% reduction in internal flooding over the last four years. Through offering a comprehensive mitigation programme alongside targeted customer campaigns they have been able to improve the performance level for customers. However, further improvement will be constrained by costs and customers willingness to pay for more rapid improvement. Wessex Water and Dŵr Cymru Welsh Water reported the lowest incidents of internal sewer flooding in The increase in flooding incidents in and media interest in this issue could explain why there has been a reduction in the number of customers who are satisfied with how their sewerage company minimises sewer flooding 30. In 2011 this was 83% but it fell to 76% in 2012, falling further to 68% in However, Ofwat s Final Determinations require water companies to reduce the number of properties that are flooded by sewage by 33% by Number of areas that have flooded externally While not as traumatic as internal sewer flooding, the presence of sewage material in gardens, roads, paths and open spaces is very unpleasant and could have implications for public health. The flooding of external areas is typically eight times greater than internal flooding, largely because the sewerage system is designed to overflow from manhole covers and other areas before it impacts on homes. Chart six below shows the number of external flooding incidents per 10,000 sewerage connections 7 in each of the four reporting years Page 20 of 39

21 Chart six: The number of areas flooded externally per 10,000 sewerage connections Number of external sewer flooding incidents per 10,000 connections Although the number of external flooding incidents in was below the levels reported in , they show a worrying upward trend (from earlier years). This is despite the heavy investment that companies have made, and are making, in resolving or minimising sewer flooding. This may be due to the wet winter in , but we will discuss this further with the companies to better understand the underlying reasons for the increase, and to identify the actions the companies are taking to reverse the trend. Customers, of course, do not accept the distinction between dry and wet years. What they want is action to prevent a recurrence of sewage entering their property or polluting the local environment. At each price review sewerage companies are provided with funds to resolve or mitigate existing problems and to prevent future flooding incidents. Ofwat s latest price determination has provided funds to reduce internal sewer flooding incidents by one-third, with companies collectively facing a 353m penalty if they do not deliver. We will be discussing with the companies where, when and how they will deliver these schemes, and whether there is scope for them to go beyond their commitments to further reduce sewer flooding. Page 21 of 39

22 6. Leaks Leakage is a key concern for customers and can have a big impact on their perceptions of water companies and their own water saving activities 31. With more than 17 billion litres of water travelling through hundreds of valves and pumps, thousands of kilometres of pipes, and millions of joints each and every day, water can be lost via small pinholes in pipes through to major bursts that flood roads, gardens and sometimes properties. It will never be possible to reduce leakage to zero as it would be enormously expensive and impact significantly on customer bills. Although customers have told us that companies should prioritise leakage, they accept that leakage will happen. But they expect companies to do more to fix leaks. Customers become particularly annoyed when, having reported a leak, the company does not repair it quickly or, if there is a delay, fail to keep them informed about progress. We are pushing companies to address the more customer facing aspects of leakage by producing information customers find useful, and demonstrating that they are tackling leakage. Some companies are rising to this challenge as they view active leakage control as part of both their wider water management activity and as a means to build a better relationship with their customers. The graph below shows the level of leakage as a percentage of the total volume of water put into the system each day by each company (the distribution input). Chart seven: Total daily leakage as a percentage of water put into the system 32 Total daily leakage as a percentage of water put into the system Water and sewerage companies Water only companies The figures for Anglian also include Hartlepool Water. Page 22 of 39

23 In , about 22% of the water put into the system was lost each day through leakage. While this represents a slight reduction on the position four years ago, industry-wide leakage levels have been rising since Both United Utilities and Thames Water have leakage levels around 25%, but are meeting the targets set for them by Ofwat. For United Utilities this is because the region is relatively water rich and reducing leakage further is only cost effective in locations where providing extra resources is either expensive or environmentally damaging. For Thames Water this is predominantly due to the age of the network which is prone to leaks. However, due to the pressures on water resources in London and the South East of England, Thames Water has committed to reduce its leakage levels. Its progressive (compulsory) metering programme will help to locate leaks on customers supply pipes (for which it will provide free repairs) and identify the areas of its network where leakage reduction activity will have the biggest impact. Table four: Company leakage levels (mega litres per day) Trend Water and sewerage companies Anglian* Dwr Cymru Northumbrian Severn Trent South West Southern Thames United Utilities Wessex Yorkshire Water only companies Affinity Bristol Cambridge Dee Valley Essex and Suffolk Hartlepool Portsmouth Sembcorp Bournemouth South East South Staffs Sutton and East Surrey Whilst companies are meeting their leakage targets (with the exception of Portsmouth Water in ), there has been a slight rise in the levels of leakage reported since In only six companies - Affinity Water, Hartlepool Water (marginally), Northumbrian Water, Portsmouth Water, Thames Water and United Utilities - reduced the level of water that they lose each day through leakage. South East Water, Severn Trent Water and South West Water all remained static, with the remaining companies all reporting increased leakage levels. There are a number of factors that can influence annual leakage performance and these are largely weather related. Additionally, some water companies may have chosen to simply meet 33 The figures for Anglian also include Hartlepool Water Page 23 of 39