Water companies must do more to address customer bad debt

28 Sep 2017 01:50 PM

Water companies are lagging behind other sectors where it comes to dealing with customers who are struggling to pay their bills, according to water industry economic regulator Ofwat.

It is estimated that bad debt currently adds approximately £21 annually to each customer’s bill. Tackling the issue of bad debt now, says Ofwat, will help reduce water companies’ costs, making bills more affordable for all customers.

Ofwat is calling on companies to do more for those who are struggling to pay their bill and to identify customers having difficulties before the debt becomes too big.

The water regulator also says that companies must also do more to deal with those who can afford to pay, but simply won’t pay their bills.

To address the issue of customer bad debt, Ofwat is asking water companies to take a number of steps which include:

Making affordability schemes more available and encouraging more customers to take them up;
Making better use of the customer data so they can anticipate where bad debt issues might occur and then deal with them early, before debts build;
Moving to more frequent billing to avoid the difficulty of having to pay one, large bill each year;
Improving customer communication and making customers aware of the help that is available if they need it;
Ensuring that customers are on the most appropriate tariff and payment method;
Looking to other sectors for new ideas on ways to deal with customer debt; and,
Ensuring there are real consequences for those customers who can afford pay, but choose not to do so.