Water industry regulator Ofwat has issued a call for evidence to inform a review looking to update and uplift the compensation provided to customers when they are without access to water.

Residential customers are currently entitled to £20 if they are without water for a day and an extra £10 for each 24 hours on top of that.

Following its investigation into water companies’ performance during the ‘Beast from the East’, Ofwat concluded that the compensation arrangements in place do not reflect the impact on customers who are without access to water and is now reviewing them.

During the period of cold weather in late February and early March 2018, over 200,000 customers across England and Wales were left without supply for more than 4 hours, over 60,000 for 12 hours and nearly 40,000 for over 24 hours.

Ofwat’s investigation found many incidences of poor advance planning, inadequate communication with customers and a lack of basic support such as bottled water. As a result of the disruption, the sector paid over £7 million in compensation to customers.

There was also a wide variety in the amounts of compensation paid by each company in response to the freeze thaw incidents when supply was not restored. Some companies made payments at the minimum statutory compensation scheme – the guaranteed standards scheme (GSS) – which is an initial payment of £20 and £10 for every additional 24 hours a residential customer is without supply (payments are £50 and 25 respectively for business customers); while others chose to exceed this minimum.

Ofwat is also calling for evidence on the pros and cons of expanding compensation arrangements to cover supply restrictions – such as hosepipe bans – as well as supply interruptions.

Commenting on the review, Ofwat Chief Executive, Rachel Fletcher, said:

“We know that customers rely on water like no other service and customers have told us of the profound impact it has on them, their families and their work when they do not have access to water.

“The current compensation arrangements do not reflect the impact on customers of not having water and so we are seeking evidence to help find the right level of compensation. Equally important as setting the right level is making sure that when customers are due some compensation, access to it is fair, fast and free from hassle.”

Once Ofwat has reviewed the evidence, the regulator will then develop plans and submit recommendations to the UK and Welsh Governments by the end of the year.

Deadline to submit responses to the call for evidence consultation is Tuesday 11 September 2018. Click here to download the Call for Evidence paper