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Consumer Council for Water welcomes more choice for water customers

CONSUMER COUNCIL FOR WATER News Release (CCWater11/09) issued by COI News Distribution Service on 22 April 2009

The Consumer Council for Water welcomes the recommendations put forward in Martin Cave's report on competition in the water industry today (22 April), and is echoing his call for a step by step approach which gets competition right for business customers first.

Dame Yve Buckland, Chair of the Consumer Council for Water, said: "Competition to date has not served business customers well. While competition for some business customers has existed since 2005, only about 2,000 businesses are eligible, and there is little financial advantage for them to change supplier. Business customers have told us that they are frustrated at this lack of progress.

"It is encouraging that the government and the independent review listened to our concerns on behalf of business customers and are calling to remove some of the existing barriers to competition for them."

The review concluded that moving toward domestic competition would not be appropriate at this time. Research by the Consumer Council for Water and Ofwat has shown that household customers have mixed feelings about whether or not they would like the opportunity to choose their water and sewerage provider.

According to the research, only a third of domestic customers surveyed supported competition, one third did not, and the rest were unsure when they understood that in practice some customers could be worse off in a competitive water market.

Dame Yve continued: "If competition for household customers is to happen it needs to live up to customers' expectations, deliver tangible benefits, and those benefits need to outweigh the costs.

"Those household customers who welcome competition believe it would lead to lower prices, with most saying that they would expect to save 20 per cent by switching supplier. This would mean between £60 and £70 off the average water bill, and it is hard to see how that saving would be possible.

"In order to encourage more involvement for household customers, the review is proposing to alter the way that water prices are set so that the Consumer Council for Water has a greater role in the process. While household customers would not be able to choose their supplier, they would have more of a say in the services they receive, and the price that they pay.

"We are pleased that Cave's review does not simply look at competition as a means to an end, but rather looks to see if a system of regulation which encourages more choice for customers also has the potential to bring benefits to both consumers and the environment. The views of consumers, business and domestic, must form the basis of any changes to the system."

The full report, 'Research into household customers' views on competition in the water and sewerage industry,' is available at http://www.ccwater.org.uk.

Ends

The Consumer Council for Water
1. The Consumer Council for Water was set up in October 2005 to represent consumers in England and Wales.

2. The Consumer Council for Water costs each water customer 25p per year.

3. The Consumer Council for Water has gained £130 million from water companies in reduced prices and extra investments.

4. The Consumer Council for Water has to date taken up over 42,000 consumer complaints about water and sewerage companies, and secured £4 million in compensation and rebates fur customers.

5. 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.

6. Our website is http://www.ccwater.org.uk.

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

The Consumer Council for Water
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