CCW has published a manifesto setting out the priorities for what it wants to see from the 2024 Price Review (PR24) - and the organisation wants CCW to play a leading role in the coordination of collaborative, centralised research.
CCW has published a manifesto setting out the priorities for what it wants to see from the 2024 Price Review (PR24) - and the organisation wants CCW to play a leading role in the coordination of collaborative, centralised research.
According to CCW, carrying out research for each company using the same consistent approach will allow easier comparison of results. In CCW’s view, this will help identify where there are real differences between customer views in different company areas, rather than the differences being driven by the way companies have presented the questions.
The scope of the research also needs to be made clear early in the PR24 process so that companies can understand how it fits with their own, ongoing and business plan engagement.
CCW has set out the following priorities for what it wants to see from the 2024 Price Review (PR24), and what it intends to do to help:
Providing clarity through collaborative research
Instead of each water company conducting its own research, CCW will help to facilitate centralised research across the industry – aimed at improving the consistency and comparability of company research to deliver a better overall view of customer views.
Supporting and assuring local challenge
CCW plays an important role in challenging companies in the development of their business plans. At PR24, CCW will do this by sharing data and information, supporting local stakeholder groups, and facilitating the sharing of best practice. CCW has proposed the creation of a Central Oversight Group (COG) to help deliver this.
Delivering high-quality customer engagement
For customers’ voices to make a real difference to the price review process, it is important that all customer evidence used to inform decisions is of the highest quality. CCW has already published its Framework for Engagement at PR24 and will be building on this to help decision-makers strike a balance between the views of differing customer groups.
The right incentives for fast-tracked plans
Water companies can benefit from financial rewards and early certainty about their proposals if Ofwat gives them ‘fast-track’ status in the midst of the price review process. In CCW’s view, fast-track status should only be given where water companies have a track record of delivering on their promises to customers and sharing best practice.
CCW says companies should not be allowed a reward for proposing a good plan for the next five years when they have failed to deliver on their commitments from the previous five years.
Making clear how customers influence decisions
CCW is encouraging Ofwat to make it clear how the views of consumers can influence decisions across PR24; this transparency will add credibility to the process in the eyes of customers. CCW is calling for a Price Review that clearly and unambiguously responds to the needs and priorities of customers.
"Decision-making power in water sector still heavily weighted in favour of companies and regulators"
CCW Chief Executive Emma Clancy commented:
“Despite progress made in recent years in terms of the way Ofwat and water companies listen to customers, decision-making power in the water sector is still heavily weighted in favour of the companies and regulators. That’s why, as the voice representing water consumers, we at CCW think it’s critical to give consumers a powerful voice at every stage of the price review process.”
“Even though the outcome of this process won’t take effect until 2025, work has already started to shape the future of water and sewerage services. At CCW, we’re looking forward to playing an active role in delivering outcomes that are customer-focused, treat customers fairly and give them confidence in their water and wastewater services.”
Greater benchmarking of company proposals needed during PR24
CCW is also calling for greater benchmarking of company proposals during PR24, saying that customers of some companies should not have to wait five years (or longer) to benefit from the best ideas from the sector.
The organisation is pushing for Ofwat to incentivise the sharing of good practice at PR24 and believes that the benchmarking role of its COG model should be incorporated into the PR24 governance framework. CCW commented:
“ Sharing good practice at PR19 was difficult due to the competitive environment that Ofwat created. Companies should be incentivised to share their best ideas early in the process so the standard can be raised across the sector.”
CCW also points out that the customers of the future may have different priorities than those who need to pay the bills. Companies, and Ofwat, need to understand these priorities so they can be reflected in plans and decision-making – particularly when thinking about planning for the medium and longer term.
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