Reckon: cross subsidies, price structures and competition in the England and Wales water industry
Reckon LLP report (136 pages, PDF), commissioned by the Cave Review and the Walker Review. The report:
- considers how theoretical new forms of competition may affect current price structures in the water industry;
- identifies what might then be done to preserve features of current price structures, if desired; and
- examines how the establishment of new forms of competition may affect the opportunity to introduce certain new types of tariffs which may enable water and sewerage charges to achieve policy purposes better.
The report identifies relevant features of current charging arrangements for water and sewerage services, and considers how these relate to public policy objectives. The report draws particular attention to the following:
- charges based on the rateable values of customers’ properties;
- water companies setting the same charges across the whole region they supply, regardless of any cost differences between locations;
- the WaterSure scheme, which provides capped water bills for qualifying households who have water meters; and
- the costs of late payment and bad debt being spread across all customers.
The report was published alongside the Cave review final report (144 pages, PDF). The final report to the Walker review is due later this year.
For further information or advice please contact Nicholas Francis.
Filed under Reckon LLP, Water.
