Water Companies: Accountability
The question
To ask the Secretary of State for Environment, Food and Rural Affairs, what steps his Department is taking to hold water companies accountable for financial mismanagement.
Answered by Emma Hardy
Ofwat monitors the financial position of all water companies, taking action when needed to strengthen company’s long-term financial resilience and producing an annual ‘Monitoring Financial Resilience Report’ to provide a publicly available assessment of the financial resilience of each water company.
Ofwat has also strengthened its powers to improve financial resilience, including stopping water companies paying dividends where financial resilience is compromised and preventing customers funding executive bonuses where companies do not meet performance expectations.
Furthermore, the Water (Special Measures) Bill will drive meaningful improvements in the performance and culture of the water industry as a first important step in enabling wider, transformative change across the water sector.
And finally, on 23 October, the Secretary of State, in conjunction with the Welsh Government, launched an Independent Commission on the water sector regulatory system. The commission aims to build consensus for a resilient and innovative water sector and a robust wider regulatory framework that will deliver long-term benefits and ultimately serve both customers and the environment.
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