Ofwat City briefing highlights the need for change

The present system of regulating the UK water industry has become too bureaucratic to work effectively, while companies will need to raise further equity in future, Ofwat told investors and analysts at its City briefing on 8th December.

Chief executive Regina Finn said Ofwat is “painfully aware” that over the past five years it has not picked up any failings on leakage targets or service standards from the ever more cumbersome annual regulatory returns.

One company’s accompanying commentary this year runs to more than 800 pages, and Finn said it is increasingly evident that much of the information is superfluous. Ofwat should focus its resources instead on where they are most needed. “We are firmly of the view that this is the time for change,” she concluded.

Finn also said that an upcoming Ofwat report on the future financeability of the industry would highlight the need for further equity issuance.