Ofwat publishes new guidance to help households pay bills

These recommendations come off the back of research carried out by the regulator in 2022 that showed just over half of water bill payers believe they’ll struggle to pay a utility bill over the coming year - rising to seven in 10 if there are children in the household. 

Previous research found that water companies could do more to support customers with mental health issues, and make information about their services and bills more suited to customers’ needs. 

The regulator’s new guidelines are designed to cover several areas, which include firms being required to offer more flexible payment options for customers on irregular incomes and zero-hours contracts. 

It also outlines how businesses must talk sensitively with customers struggling to pay to understand their circumstances and resolve problems without needing to take debt recovery action. 

In addition to this, it’s informing businesses to use more complaints, research and other customer feedback to make real-time improvements to payment, help and debt services, and make full use of data to find those customers who are struggling and offer them support. 

As part of this, the regulator is calling on water companies to work with each other, as well as consumer and debt advice organisations, to reach customers that are struggling, share best practice, and improve services further. It’s also requiring companies to update their practices on debt to reflect the new guidelines. 

Commenting on the news, Ofwat’s senior director, Emma Kelso, said: “Many customers were struggling before the pandemic, and the current cost of living pressures are squeezing household incomes even further. 

“We were pleased to see water companies step up their support during the height of the pandemic, and now that many more households are likely to experience financial difficulty in the coming months, we want companies to continue to go above and beyond for customers.

“Our new guidelines are clear in what water companies can do to support customers. They can be making bills easier to understand and pay, helping those that need further support, and going further to help people repay their debt if they fall behind.”

Emma Clancy, chief executive of the Consumer Council for Water, said: “These changes have the potential to bolster support for customers in or on the cusp of debt with their water company and we’re really pleased they align with some of the key recommendations from our independent review of water affordability.

“The revised guidance will help to ensure debt support more closely reflects a customer’s individual circumstances, as well as encouraging greater consistency over the way people are assessed and treated. 

“Putting more onus on companies to reach out to customers to see if they need support is also a vital step towards overcoming the barriers to existing help, including low awareness and a lack of trust.”