Water Watchdog Responds to Competition Commission

18 June 2010

In response to the Competition Commission’s provisional decision about Bristol Water’s prices until 2015 announced today (Friday 18 June), Charles Howeson, Chair of the Consumer Council for Water Western Committee, said:

“Although information about customers’ water bills in the Competition Commission document is not immediately clear, we believe at first sight that customers will be getting more investment for the Competition Commission’s estimated annual water bill increase of some £4 by 2014-15 over Ofwat’s previous decision. This is still significantly less than Bristol Water was seeking.

“The Competition Commission’s provisional findings also seem to suggest that it feels that Ofwat was too generous in some of its cost assumptions.

“This is a draft decision, and we now need time to go through the information in detail and will feed back our views on behalf of customers.”

Ends

Notes for editors

1. In November 2009, the economic regulator for the water industry, Ofwat, made its final decision on the work Bristol Water should carry out between 2010 and 2015, and the prices water customers would have to pay to fund that work. Bristol Water was told it could raise average prices by seven per cent above inflation by 2015. The decision was in contrast to the company’s proposals for price increases of 29 per cent above inflation by 2015. Bristol Water chose to challenge Ofwat’s decision, and referred the case to the Competition Commission. Today’s announcement outlines the Competition Commission’s provisional re-determination of the prices Bristol Water can charge its customers. The Competition Commission’s final decision on Bristol Water’s prices is due in August 2010.
2. Only 1 in 5 customers told the Consumer Council for Water that they found Bristol Water’s investment and price proposals set out in its final business plan acceptable.  This proposed an average annual water bill increase of £45 above inflation by 2015.

3. In contrast, about half of those customers said they could accept the water regulator, Ofwat’s, final determination on Bristol Water’s prices, which would have allowed the company to raise average bills by £11 above inflation over the same period. 
4. The Consumer Council for Water was set up in October 2005 to represent consumers in England and Wales.
5. The Consumer Council for Water costs each water customer 23p per year.
6. The Consumer Council for Water has gained £135 million from water companies in reduced prices, extra investments.
7. The Consumer Council for Water has to date taken up 75,000 consumer complaints about water and sewerage companies, and gained £9.6 million in compensation or rebates for customers.
8. The Consumer Council for Water is a non-departmental public body reporting to the Department of Environment, Food and Rural Affairs and the Welsh Assembly Government. It has a committee for Wales, and four committees in England.
9. Our website is www.ccwater.org.uk.

For public enquiries to the Consumer Council for Water, contact via our phone number, 0845 039 2837, email on enquiries@ccwater.org.uk, or minicom on 0121 345 1044.