The scale of debt facing many water customers was brought into sharp focus last week when Ofwat revealed the industry has failed to collect £2.2 billion in unpaid water bills. Our own research reinforces the size of the problem with one in eight households currently saying they cannot afford their water bills. But these headline-grabbing figures only tell part of the story.
Debt is a very obvious and visible sign of water poverty but it doesn’t take into account the metered customers who will cut back on their water use – and other essential items like food and heating – in a desperate bid to avoid slipping into unmanageable debt. This is the hidden side of water poverty which we cannot afford to ignore.
That’s why so much of CCWater’s work in recent years has focused on tackling affordability and pressing water companies to show a greater willingness to help customers struggling to pay. Our efforts and those of water companies have brought notable successes with a big surge in eligible customers signing up to WaterSure and the launch of new support schemes like social tariffs to help low-income households. Collectively this means there is now more assistance available to water customers than ever before – so why does affordability remain a significant problem?
Lack of awareness remains one of the biggest obstacles, along with the perception among some customers that their water company will not, or cannot, help them with their bills. We know from our own research that when customers get into difficulty many will actually avoid contact with their water company due to feelings of hopelessness or embarrassment, or because they fear any negotiations will only exacerbate their financial problems.
Changing these negative perceptions will help to ensure more customers get access to the assistance they are entitled to. Of course this is an enormous challenge and one which will not happen overnight. But we’ve been encouraged by the commitment shown by some water companies in pursuing our recommendations to improve their direct communication with customers struggling to pay. In some cases that has meant having to make short term concessions in order to establish a long-term relationship with customers. Adopting a more positive tone with customers in debt is also vitally important, through shifting the focus on what support is available rather than the money that is owed.
As well as direct communication with customers, water companies need to use every channel at their disposal to promote customer assistance. This includes everything from social media campaigns with trusted advice agencies, to closer partnerships with frontline community groups such as food banks.
Through these and other positive changes we hope water companies will ultimately begin to re-frame their relationships with customers, so they are viewed as supportive allies in the battle to stay out of debt.
Tony Smith, Chief Executive of the Consumer Council for Water, was writing for Utility Week