Proposals have been unveiled to breathe new life into the water retail market after an in-depth review concluded it is still not delivering benefits for most business customers in England.
The Consumer Council for Water (CCW) has published a series of recommendations aimed at tackling the problems which continue to hamper the water market for business customers in England, as it approaches its sixth anniversary.
The proposals form part of a comprehensive five-year review of the market by CCW, combining in-depth analysis of performance data with the real-life experiences of business customers that have had the freedom to switch water retailer since April 2017.
The report concludes that small businesses, in particular, have seen little benefit from a market that continues to generate complaints from all business customers that remain three times higher than before it opened in 2017.
Overall satisfaction with water retail services is also lower than before the market opened. Just 66% of customers in England are satisfied compared to 85% in Wales, where the vast majority of businesses are not able to switch supplier. Switching rates have also remained low – hovering between 3% and 5%.
While some of the largest business customers in England have seen some benefits, our evidence shows that they are the most likely to complain. What is clear is that businesses of all sizes have not seen the improvements that were promised in 2017 – such as better customer service and data provision.
The consumer watchdog has called for action to strengthen the incentives around customer service delivery and improve the quality of market data to help reduce complaints and inaccurate billing, as well as strengthening protections for businesses if their water retailer suddenly exits the market.
CCW’s recommendations include measures to ensure businesses receive more frequent and accurate water consumption data through smart metering, along with clear commitments from water companies to work collaboratively with retailers to promote water efficiency.
CCW is calling for the vast majority of its proposed changes to be in place no later than 2024.
For low water users that are least engaged in the market, we expect to see tangible benefits from the market by 2025. Otherwise we will call on Defra and Ofwat to change the eligibility criteria so these customers are removed from the market.
Emma Clancy, Chief Executive of CCW, said:
“We envisaged a market that empowered businesses to save money and water, as well as providing tailored services, but it has failed to deliver for most customers.
“Tinkering at the edges is not enough. Our review sets out changes to enhance business customers’ experiences so they are more motivated to engage with the market and they get the improved services they deserve. If there are not significant improvements over the next two years, those seeing the least benefit should be taken out of the market.”
Other actions set out in the report include improvements to the market code change process so it works better for business customers. This would include prioritising changes that have the greatest potential benefits for customers.
The review also calls for business customers to have any accrued credit on their account automatically returned to them on an annual basis – a move CCW has been pressing for as part of its Credit Where It’s Due campaign.
CCW will be working with key decision makers across the market including retailers, water companies, regulators and government to implement its recommendations.
