South West Water is sharing its success with customers after performing better than expected in the first year of its 2015-20 business plan.
In 2015/16 South West Water outperformed its tough targets to earn £3.1million. This is being spent on further improving services to customers now, rather than at the end of its five-year business plan, as happened previously. The customer benefit stems from South West Water being able to borrow money for investment more cheaply than predicted when its business plan was submitted to economic regulator Ofwat in December 2013.
Under South West Water’s WaterShare scheme – the first of its kind in the water industry - the benefits of success are shared fairly between customers and investors in an open and timely way.
If South West Water underperforms, customers are protected. They are also protected by the company’s Price Promise to peg average household bills below inflation to the end of the decade
The £3.1million reinvestment is delivering a better and more responsive service to customers, on top of previously planned investment. The extra improvements include:
The WaterShare scheme is overseen by an independent panel, which scrutinises and challenges South West Water’s recommendations and decides how any benefit should be passed back to customers, either as a bill reduction or as reinvestment to improve customer services.
South West Water’s Regulatory Director Iain Vosper said: “We’re pleased to share our success with customers in this more open, transparent and timely way, but recognise that there is always room for improvement. As we deliver our business plan, the independent panel holds us to account, reviewing our performance and deciding how best to spend any financial gains we might earn to benefit customers.
“We have a strong record of being efficient and sharing our success with customers, but this was not as apparent as it might have been, up to now. We hope this is just the start of a new way of sharing benefits with customers and will be looking to build on this innovative, industry-leading approach as we develop our next business plan, from 2020 to 2025.”
Charles Howeson, independent Chair of the WaterShare panel, said: “South West Water set itself a challenging business plan, so it’s encouraging that it performed better than predicted in the first year against many of its targets. After much debate, challenge and review we decided to allocate the benefit towards investing in further improvements to customer service. I’m delighted that this is already paying off.”
South West Water’s highly-rated 2015-20 business plan, which was shaped by the company’s biggest ever consultation with customers, focuses on delivering against eight customer priorities:
Each priority is underpinned by a series of targets, some of which apply to the WaterShare scheme. Copies of South West Water’s current business plan can be viewed at: waterfuture.southwestwater.co.uk
Further information on WaterShare is at: www.southwestwater.co.uk/watershare
