A joint report from NEA and Waterwise

A new paper published on National Stress Awareness Day is warning UK debts owed to government and utility providers are set to soar due to the impacts of Covid.

Following on from the June 2020 NEA policy paper “The Gathering Storm: Utility Debt and Covid-19”, this paper provides an evidence synthesis of personal debt, both prior and post the Covid-19 outbreak, with a focus on the shift from consumer debt, such as loans and credit cards, to household debts, such as arrears with utility providers, offering a comparison of known debt levels in energy, water and local government.

NEA recognises that many low-income households experience affordability issues with their essential household bills, rarely struggling with one bill in isolation, and as a result is delivering a programme of work which seeks to support ‘People Living in Water Poverty and Fuel Poverty’.

NEA is proud to be working with Northumbrian Water Group (NWG) on an innovative programme which aims to eradicate water poverty by 2030.

In the first few months of 2020, the world watched a global pandemic unfold. Countries around the world were imposing strict nationwide lock-downs, with economies basically shutting down to control the spread of the virus. The turning point for the UK came on 23rd March when Prime Minister Boris Johnson addressed the nation.

In a modern world, water is recognised as a human right.  It is understood to be essential to life and yet some are so concerned about the cost of it that they actively decide not to use the water they vitally need and find themselves falling into debt or self-rationing their water use. These families may also be making impossible choices between heating and eating, at the same time as restricting bathing to once a week, all sharing the same bath water, because the cost of their water, and the cost of heating it, is just too high.

In our January 2020 response to Ofwat’s forward work plan, we acknowledged that driving innovation across the water sector was vital to address the strategic challenges the industry faces. We believe the innovation competition allows an additional opportunity for companies to address these key challenges.

Driving consumer and societal outcomes through company performance should remain a key ambition of Ofwat so that it can continue to demonstrate the legitimacy of a privatised water sector even with the reduced risk of re-nationalisation following the recent general election. Developing a richer understanding of company performance is valuable, providing the commitment to do so leads to consistent and comparable metrics made visible to a wider audience, including customers.