Utility Week

6 | 5TH - 11TH OCTOBER 2018 | UTILITY WEEK News Inside Story W ater companies are coming under increasing pressure to deliver great service to customers – the kind of service customers have come to expect from the likes of Amazon and John Lewis. No longer is it acceptable for water compa- nies to seek inspiration simply by looking at what their sector peers are doing. Generally, complaints about the vital product itself are few and far between, but companies' over- all customer service will be under scrutiny more than ever – especially with this being a key theme in Ofwat's framework for the next price review, PR19. The regulator has had plenty of reading material of late now all the water companies have submitted their full business plans for the next asset management plan period, cov- ering 2020-25. But as important as companies' proposals are for the coming years, their current performance is also something the regulator continues to monitor. Ofwat will have read with interest, then, the recent report from the Consumer Council for Water (CCWater) detailing household complaints to water companies in England and Wales between April 2017 and March 2018. The water watchdog has turned up the pressure on Southern Water, Bristol Water and SES Water for their relatively poor performance. All three will need to show what action they are taking to reduce complaints and have been asked to provide quarterly reports to CCWater. The 12th annual complaints report (published on 20 September) reveals households made more than 2.1 million calls about problems last year. It shows that nine out of 21 water companies in England and Wales reported an increase in calls from customers wanting to resolve problems – known as "unwanted" contacts. The companies in question are: Southern, Dwr Cymru Welsh Water, Wessex, Severn Trent, SES Water, Bristol, Cambridge, Portsmouth and South Staffs. Meanwhile four companies – Wes- sex, Bristol, South East, and Dee Valley – reported an increase in written complaints from their customers, although the num- ber for the whole industry fell by nearly 17 per cent. Alex Prentice, senior client partner at consultancy Huntswood, says: "How companies handle customer complaints will be a key consideration for Ofwat when reviewing the PR19 business plans submitted over the past few weeks. "It will be difficult for firms to justify price increases if effective measures are not put in place to improve customer service levels, particularly as inadequate progress appears to have been made over the past three years. Water companies are delivering a public service and therefore must focus on delivering better outcomes and services for customers that build trust in the industry." Under scrutiny Southern Water is under scrutiny aer it failed to improve on its position as the industry's worst performer against the two measures for a third successive year. CCWater says that was despite the water company reducing written complaints by one-fih. Overall the industry's three-year trend (2015/16 to 2017/18) for written complaints has shown a "strong improvement" but the industry's performance on unwanted contacts is "not so good". "There has been no progress over the past three years, with the number of calls above where it was in 2015/16," CCWater highlights in the report. One of the things it attributes the increase in unwanted contacts to is Southern Water's internal review of how it recorded these calls in 2016/17, which led to a "significant increase" in its number compared to the pre- vious year. The 12-month period to March 2018 was the first full year Southern Water's changes took effect, which brought about an additional 13 per cent increase from the previous period. Simon Oates, Southern Water's chief customer officer, pledges to "continue increasing responsiveness and focus on customers' needs". Southern Water says its written complaints for 2017/18 fell by more than 20 per cent, following a 48 per cent reduction in 2016/17. Taking out Southern Water, CCWater reveals it would have seen a 3.5 per cent decrease in unwanted contacts since 2015/16, instead of a 1.8 per cent increase. However, the watchdog points out that despite it putting pressure on poor performers and the possible financial penalties for poor service in Ofwat's Service Incentive Mechanism (SIM) "some companies are still letting down their customers and causing them to complain or have to call them because of an inconvenience". Southern Water remained the industry's worst performer for complaints and unwanted contacts, but two water-only companies (WOCs) are also in hot water. SES Water's 20.8 per cent increase in unwanted telephone contacts helped make it the worst performing WOC for this measure. Meanwhile, Bristol Water reported a significant increase in unwanted contacts (37 per cent) and written complaints (52 per cent), making it the worst performing WOC for written complaints. Because these three companies' unwanted contacts and written complaints are greater than 25 per cent above the industry average, CCWater has asked them to provide – or in Southern's case continue to provide – quarterly updates on what they are doing to bring their numbers "quickly back into line" with the rest of the industry. Despite seeing a reduction of 0.4 per cent in unwanted telephone contacts and a reduc- tion of 4.3 per cent in written complaints, Thames Water reported more than 25 per cent above the industry average for both types of complaints. Its performance this year will be "closely" monitored by CCWater. Giving credit where credit is due, CCWa- ter praised Anglian Water for its low num- ber of unwanted contacts (103,798 or 360 per 10,000 connected properties), which placed it in the best position across the industry. Bournemouth also performed well, especially as only two years ago it was required to provide quarterly updates Counting on complaints Complaints handling is a key metric for water companies, and CCWater's latest report shows overall numbers down, although three companies are in the dog house. Katey Pigden reports.

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