Utility Week

Policy & Regulation UTILITY WEEK | 6TH - 12TH JULY 2018 | 13 "Challenges lie ahead for water companies on service delivery, environmental improvement and transparency." Chief executive's view Michael Roberts T rust is an essential ingredient in any sector – espe- cially for water companies, given the vital public service they provide and on which we all depend. So it is good to see the findings of the latest inde- pendent polling by ComRes, which reveals that 86 per cent of people trust their water company overall. What could be driving this? Perhaps it is the track record of service and envi- ronmental improvements, underpinned by £150 billion worth of investment over nearly 30 years – and reflected in high overall customer satisfaction scores. Or the fact that customers receive this high-quality service while paying on average just over a pound a day, with bills roughly where they were 20 years ago in real terms, and due to fall over the next few years. Or the recognition of individual companies as respon- sible businesses by respected external organisations such as Business in the Community, FTSE4Good and the Ethisphere Institute. But significant challenges lie ahead for English water companies on service delivery, environmental improve- ment and transparency, as highlighted by environment secretary Michael Gove among others. The sector is diverse and the issues affect companies differently, but all are determined to demonstrate their long-standing commitment to working in the public interest. We are seeing this in the 2020-25 business plans that companies are preparing – covering many aspects of delivery such as leakage, water efficiency and water poverty – and the further commitments for which regulators will press by the time the plans are finalised. And we have seen it in the action from individual companies on company financing arrangements, the widespread support for the direction of travel of Ofwat's agenda to promote change in this area, and the subsequent engagement on the detailed proposals. Notable, too, are the conversations taking place between companies, regulators, policymakers and stakeholders about what more has to be done to support the ambitions of the sector in the next few years and in the longer term. With growing customer and societal expectations on price and service, the need to do better on the environ- ment and the challenges to resilience posed by popula- tion growth and climate change, two things are striking about the way ahead. The first is how much water companies need to work with others – be that with other companies, to encour- age further transfers of water from areas of surplus to areas of deficit, or with customers, to unlock the positive impact they can have through changes in the way they use water. Conceptually, none of this is new. For example, the value of catchment management – where water compa- nies work with farmers and others to deliver better water and environmental outcomes – is well known. What is different is the scaling up needed in future. The second is the need to strengthen the current tools available to water companies to step up to the next level, and there is a lot we can already do in this space. For example, work to improve the frameworks with which companies plan improvements in drainage management is at an advanced stage. And the discus- sion among key players on improving national and regional arrangements for water supply planning has been re-energised by the recent report from the National Infrastructure Commission. But we also need to harness the role of public policy. Whether it is achieving the water aims of the govern- ment's 25-year environment plan through SuDS, better building regulations and water efficiency labelling of household appliances; or the scope for future post-CAP public funding for farmers to boost catchment manage- ment, this is a rich area of opportunity. Notwithstanding the many calls on government time, this is an opportunity that we at Water UK believe we need to seize, with the support of policymakers and stakeholders. Michael Roberts, chief executive, Water UK "The issues affect companies differently, but all are determined to demonstrate their long-standing commitment to working in the public interest"

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