The Water Services Regulation Authority, or Ofwat, is the body responsible for economic regulation of the privatised

water Water (chemical formula ) is an Inorganic compound, inorganic, transparent, tasteless, odorless, and Color of water, nearly colorless chemical substance, which is the main constituent of Earth's hydrosphere and the fluids of all known living ...

and sewerage industry in

England England is a country that is part of the United Kingdom. It shares land borders with Wales to its west and Scotland to its north. The Irish Sea lies northwest and the Celtic Sea to the southwest. It is separated from continental Europe b ...

and

Wales Wales ( cy, Cymru ) is a country that is part of the United Kingdom. It is bordered by England to the east, the Irish Sea to the north and west, the Celtic Sea to the south west and the Bristol Channel to the south. It had a population in ...

. Ofwat's main statutory duties include protecting the interests of consumers, securing the long-term resilience of water supply and wastewater systems, and ensuring that companies carry out their functions and are able to finance them. Ofwat primarily sets limits on the prices charged for water and sewerage services, taking into account proposed capital investment schemes (such as building new wastewater treatment works) and expected operational efficiency gains. The most recent review was carried out in 2014; reviews are carried out every five years, with the next due to take place in December 2019. The Water Act 2014 extended retail competition to all non-household customers of English water companies from April 2017 and provided for possible future competition in

wholesale Wholesaling or distributing is the sale of goods or merchandise to retailers; to industrial, commercial, institutional or other professional business users; or to other wholesalers (wholesale businesses) and related subordinated services. In ...

markets. Ofwat's role includes regulating such water and wastewater markets and promoting effective competition wherever appropriate. Ofwat consists of a board, plus an office of staff which carries out work delegated to them by the board. The Environment Agency is responsible for environmental regulation, and the

Drinking Water Inspectorate The Drinking Water Inspectorate (DWI) is a section of Department for Environment, Food and Rural Affairs (DEFRA) set up to regulate the public water supply companies in England and Wales. Based in Whitehall, it produces an annual report showing th ...

for regulating drinking water quality. Water in Northern Ireland is regulated by the Northern Ireland Authority for Utility Regulation, and the supply and treatment is carried out by the government-owned

Northern Ireland Water Northern Ireland Water Limited ( ga, Uisce Thuaisceart Éireann; Ulster-Scots: ''Norlin Airlan Wattèr'') is a water company in Northern Ireland. Formerly an executive agency within Northern Ireland Executive, it became a government-owned co ...

. There is no separate charge for water for residents or companies in Northern Ireland. Instead, water is paid for by the rates system. The

water industry The water industry provides drinking water and wastewater services (including sewage treatment) to residential, commercial, and industrial sectors of the economy. Typically public utilities operate water supply networks. The water industry doe ...

regulator in

Scotland Scotland (, ) is a Countries of the United Kingdom, country that is part of the United Kingdom. Covering the northern third of the island of Great Britain, mainland Scotland has a Anglo-Scottish border, border with England to the southeast ...

is the

Water Industry Commission for Scotland The Water Industry Commission for Scotland (WICS) is the economic regulator of the water and sewerage industry in Scotland. Established in 2005, it is an executive non-departmental public body of the Scottish Government with statutory responsibi ...

History

Ofwat was set up in 1988, at the same time as 10 water authorities in England and Wales were privatised by flotation on the stock market. Its duties and powers are defined by the

Water Industry Act 1991 The Water Industry Act 1991 (c. 56) is an Act of the United Kingdom Parliament consolidating previous enactments relating to the water supply and the provision of wastewater services in England and Wales. It further implemented recommendations of ...

. The resulting companies are known as "water and sewerage companies"; this distinguishes them from around a dozen smaller companies which only provide water services, which were already in private hands in 1989 (having remained in private ownership since their creation in the 19th century). The water-only companies provide water to around 25% of the population in England and Wales. Before 1 April 2006, all regulatory powers rested with the Director General of Water Services. The staff who supported the role of the Director General were collectively known as the "Office of Water Services", which was abbreviated to "Ofwat". Ian Byatt was the Director General between 1989 and 2000;

Philip Fletcher Philip John Fletcher, (2 May 1946 – 10 February 2022) was a British public servant. Career From 1968 to 1995, he was a career civil servant, mainly working in the Department of the Environment and rising to the rank of deputy secretary. He se ...

was Director General until 2006 and chairman until 2012. On 1 April 2006, the Director General was replaced by the Water Services Regulation Authority. The name "Office of Water Services" is no longer used, as it had no legal basis.

Key people

The current chairman is Jonson Cox, who took up his position in November 2012. The current interim chief executive (effective April 2021) is David Black, replacing Rachel Fletcher who was chief executive from January 2018.

Iain Coucher Iain Michael Coucher (born 22 August 1961) is the serving Chief Executive of the Atomic Weapons Establishment. He has worked as a consultant in the railway industry and held a number of management posts, most notably serving as the Chief Execu ...

will succeed Cox as chairman in July 2022.

Price reviews

Every five years, Ofwat set limits on the prices which water companies in England and Wales can charge to their customers; this process is known as a price review or periodic review. Ofwat has carried out six price reviews so far – in 1994 (PR94), 1999 (PR99), 2004 (PR04), 2009 (PR09), 2014 (PR14) and 2019 (PR19). The most recent, PR19, set price limits for 2020–2025. Ofwat sets a so-called "K factor" in companies' licences which determine the average value of price rises above the rate of inflation ( RPI) for the next five year

asset management plan period An asset management plan (AMP) period is a five-year time period used in the English and Welsh water industry. It is used by the Water Services Regulation Authority to set allowable price increases for the privately owned water companies and for th ...

References

External links

* {{Authority control Water supply and sanitation in England and Wales Water in Wales Regulators of the United Kingdom 2006 establishments in the United Kingdom Organizations established in 2006

History

Key people

Price reviews

See also

References

External links