Viewpoint

Part of our role as a Customer Challenge Group is to provide an independent view on South East Water’s performance, ensuring it listens to and delivers on its promises to consumers and communities. Below we outline the CCG’s view on the company’s progress on its responsible business commitments. We also provide commentary where relevant on the company’s progress against Ofwat’s public value supporting principles.

Context

South East Water has committed to be a ‘leading responsible business’ not just in the water sector, but more widely. In our CCG report to Ofwat on the company’s 2020-25 business plan, we praised South East Water’s ‘fledgling’ and pioneering responsible business strategy which included ten high-level commitments to make a positive impact on society.

Since then, public, regulator and investor expectations of companies have increased significantly. The Covid-19 pandemic, extreme weather events, and the ‘cost of living crisis’ have all shown, it is no longer enough for water companies to just ‘do the right thing’ by their customers and staff or to deliver their minimum statutory obligations. They must now actively be part of the solutions to the challenges society faces. This is reflected in Ofwat’s Public Value Principles “For water companies to provide greater social and environmental value, delivering more for customers, society, and the environment" published in March 2022.

South East Water is currently reviewing and updating its responsible business commitments. This assessment is based on progress to end May 2022.

So how is South East Water progressing against its aim to be a leading responsible business and its promises in this area?

Overview: South East Water’s progress against its responsible business commitments

The company’s ten responsible business commitments and CCG views on progress against them are outlined below.

• Green means the target as set by the company has been met or justifiable reprioritisation has occured.
• Red means it has not been met.
• Amber means it is in progress or partially met.

Grey means we don’t yet feel able to rate progress at this stage based on the information reviewed.

It should be noted that while these high-level commitments reflect stakeholder priority areas in 2018, the company did not engage external stakeholders on the development of the performance metrics that underpin these commitments i.e. ‘what success looks like’, nor the ambition levels for these commitments or how they are measured.South East Water proposes to address this as part of its current review.

Commentary

The company has made progress on many of its responsible business commitments set out in its 2020 business plan. It is in the process of updating these promises in line with changing expectations or environmental and social need. We take each commitment in turn.

1. Trusted corporate governance

There appears to be a genuine leadership commitment to being a responsible/purposeful business and the company has strengthened its corporate governance to reflect that.

• In line with Ofwat’s Board Leadership, Transparency and Governance principles the company has articulated its Purpose, which is to “To provide today’s public water service and create tomorrow's water supply solutions, fairly and responsibly, working with others to help society and the environment to thrive.”
• Its Purpose is constitutionally embedded in its Articles of Association and the Chief Executive uses his platform to highlight how the company creates social and environmental value.
• Clear governance structures and lines of responsibility have been set up including:a responsible business board level committee comprising the CEO and three NEDs which meets at least twice a year; and an operational level Responsible Business Steering group, which meets bi-monthly and report into the Responsible Business Committee.Each commitment under the Public Interest Commitment is also led by an allocated member of the Responsible Business Committee.The board monitors and assesses values and culture to satisfy itself that behaviour throughout the business is aligned with the company’s purpose.
• The company has also demonstrated a consistent willingness to lead and collaborate in the public interest.In 2021 for example, it commissioned joint research on the impact of Covid-19 on consumer vulnerability and future scenarios in the South East with UK Power Networks and encouraged other water and energy utility companies in the region to participate.
  

In addition, the company actively seeks out best practice and benchmarking, and has been open to scrutiny and feedback:

• It has performed well under the Global ESG Benchmark for Real Assets (GRESB) achieving a five-star score for the third year running and increasing its overall score by 2 points to 92/100. This places South East Water 5th out of 15 network water and sewerage companies for overall GRESB and 2nd out of 15 for its management score of 39/40.
• The company’s approach to sustainability/responsible business was also reviewed by an independent expert from Creative Sensemaking and the findings and areas for improvement shared with the CCG. The CCG also assessed South East Water’s approach against both Sustainability First’s Fair for the Future framework and Oxford University’s Sustainable Corporations approach. These have informed this Viewpoint.
• The company has been receptive to feedback, including from the CCG, but due to resource challenges and the need to build in-house skills and expertise, relatively slow to enact improvements.

Areas for improvement and next steps

1. Cayman Islands debt – In response to stakeholder concerns and in line with its commitment, the company has not issued any new debt from the Cayman Islands. South East Water says the cost of swapping out Cayman Islands debt is more expensive than the reputational risk, especially as it understands it’s the last company to still hold this kind of debt. To improve transparency the CCG would welcome some kind of easy to find ‘Our taxes explained’ document and a route map to remove debt that is held there as soon as practicable.

• Ofwat’s Principle 5 states that ‘Companies’ public value activities should not displace other organisations who are better placed to act.’ Principle 6 states that Companies should take account of their capability, performance and circumstances in considering the scope for delivering greater social and environmental value.For the company’s Purpose to be meaningful and strategic we encourage South East Water to clearly define its boundaries of responsibility, in collaboration with its stakeholders and to update its Purpose and responsible business strategy/priorities as appropriate.
  
  This includes:
• Asking both bill payers and citizens what role they think the company should play in the environment, economy and society
• Where it should set its ambition levels and why, considering its core role as a water services provider
• What it should and shouldn’t do and at what pace
• What customers and shareholders should fairly pay for respectively.

The CCG think this is urgent and foundational engagement for PR24 business plan development.

• Risk management - By way of next steps we are also keen to better understand the company’s governance focus on the Task Force on Climate-related Financial Disclosures (TCFD) implementation.This defines short-term (2025-35), medium term (2036-2050) and long-term (2051-2080) horizons with scenarios for optimistic, orderly and disorderly. In particular the insight from its workshops to review climate related risks and their impact on the business and strategy and as noted how it will consider indirect risks.
• Embedding Purpose - The company needs to continue to embed its purpose-led approach, providing training and tools to support new ways of thinking including whole-systems and longer-term approaches. South East Water’s managers are generally dedicated and passionate about what they do, but there’s a question as to whether they need more support, tools and bandwidth to better understand sustainability and whole-systems thinking. Public Union, in its report to Ofwat concluded of the water sector ‘we felt that although companies were comfortable reporting on inputs and outputs concerning societal value initiatives, not enough were able to report on impact at a system-wide level. Culture change is always challenging – the company still has some way to go until employees can confidently express their own Purpose and how that relates to the company’s Purpose, and its impact in wider society. Purpose is starting to drive strategy, including the review of the responsible business strategy, but we’ve not yet seen it reflected in objective setting; nor public value creation integrated into core business processes, such as decision-making at all levels, investment prioritisation and policies.This links back to the company clearly defining and understanding the boundaries of its responsibility.
  

2. Natural Capital Accounting

Natural capital accounting is a way to ensure that when making a decision or reporting activity South East Water considers the impact on natural assets, such as water, air and woodland or other natural habitats. This helps to ensure that the company’s decisions support the long-term sustainability of our region.

While the CCG has been disappointed with the slow progress to deliver this commitment progress has been made. The company says it is collaborating to produce a common industry-wide approach. It has worked with AECOM to produce a route-map to integrate natural capital accounting including a training plan for employees. It undertook two pilots in 2021 and is using natural capital accounting in the production of its water resources management plan. We look forward to seeing evidence of its effective application in the best value water resources management plan and PR24 business plan.

Areas for improvement and next steps

Ofwat’s Public value Principle 1 - outlines that “Companies should seek to create further social and environmental value in the course of delivering their core services, beyond the minimum required to meet statutory obligations. Social and environmental value may be created both in direct service provision and through the supply chain”.

Principle 2 highlights that “Social and environmental benefits should be measurable, lasting and important to customers and communities”.

To meet this aim and stakeholder expectations to be a sustainable corporation, the CCG is pushing South East Water to:

• Deliver on and accelerate its existing commitment to embed not just natural capital but also social capital into decision making so it can better measure and report on impact. We would like to see the impact on social and natural capital in particular reflected in investment decisions on the upcoming water resources management plan and PR24 business plan.
• Better understand its direct and indirect impact on stakeholders beyond its investors and the business. The company doesn’t yet measure, monitor, report its impact on stakeholders. It therefore doesn’t truly know if it is sustainable.Without this kind of understanding there is a risk the company will miss opportunities to create and demonstrate value.
• The company also needs to better understand its dependencies.For example, the recent UKPN electricity interruption in the South East of England caused severe water customer supply interruptions and wider problems for its operation than anticipated. Better engagement with the companies which it relies on including those in its supply chain could help the company to become more resilient. In this instance, failure to strategically and effectively engage with UKPN (while not solely South East Water’s fault), had significant financial, reputational impacts for South East Water, and caused detriment to customers.
• Understand and communicate the wider social and environmental impact of its decisions/different options, to enable consumers to make informed willingness to pay decisions in line with Principle 4 ‘that Delivery of social and environmental value outcomes should not come at greater cost to customers without customer support’. It is important however should there be customer willingness to pay that this is recognised by Ofwat.

3. Develop a future generations schools programme

Educating young people in water efficiency, the value of water and raising awareness of the relationship between personal behaviours and the impact on the environment is increasingly important. Customers and wider stakeholders expect South East Water to carry out this activity and this commitment supports the delivery of the company’s core water service.

As outlined below the company failed to meet its schools programme targets. This was in part due to schools continuing to be cautious about having external visitors due to covid transmission. We’d welcome understanding to what extent other organisations have been able to deliver their schools programmes online.

While this area is scored red, it’s worth noting that South East Water has done some good preparatory work including developing new school resources and its new educational engagement platform called ‘Aquasmart’ which others could use and benefit from.

KPI Measure: How many children engaged with each year? (spending more than 30 minutes on a water education activity)

Areas for development and next steps

We support the company carrying out a strategic review of its schools’ programme. We’d like to see:

• The schools’ activity positioned more strategically within its wider behaviour change programmes.
• The company working with other organisations to identify and share good practice and to co-deliver education programmes for different age groups and in different settings to improve efficiency and effectiveness.
• More outcomes focussed targets developed with stakeholders e.g. testing and reporting on knowledge and understanding after sessions or follow-up in terms of behaviour change in the home.

4. Create more partnership community projects on water use and vulnerability

Effective partnership working is critical to maximise public value to South East Water’s stakeholders and to deliver the company’s performance commitments more efficiently e.g. on social tariff take-up and demand reduction. Indeed, Ofwat’s Public Value Principle 5 says that “Companies should consider where and how they can collaborate with others to optimise solutions and maximise benefits, seeking to align stakeholder interests where possible, and leveraging a fair share of third-party contributions where needed.”

Part of the target on this commitment was to appoint a new vulnerability manager and to fill engagement support team vacancies. These goals were met. However, the company has subsequently lost two key members of staff, including the new vulnerability manager and is now recruiting again.

In its business plan 2020-25 South East Water committed to:

• Increase the number of community projects per year working with universities
• Increase the number of community projects per year working with local charities
• Develop a partnership project to look at water footprint, beginning from 2020.

The company has exceeded its partnership commitments 1 and 2 – working not only with universities (seven projects and one under development) and charities (11 projects), but by building new partnerships including innovative data sharing agreements with local authorities (four projects in train). Worthy of particular praise are South East Water’s auto-enrolment data sharing partnerships with two Kent local authorities which have resulted in the provision of a further £1.6m discounts to customers in financial difficulty.We look forward to seeing that extended.

South East Water deprioritised its water footprint project in favour of expanding its affordability and vulnerability partnerships given the Covid-19 pandemic and the cost of living crisis. Overall despite not delivering on the water footprint project, given the work carried out with local councils, we have consequently scored this area green.

Areas for improvement and next steps

To maximise public value and meet minimum standards for high quality engagement the CCG is encouraging South East Water to:

• Systematically map its interested and impacted stakeholders across all policy and operational areas (this is an open Challenge). That is to identify strategic partners and better understand how it can engage with those ‘on its pipes’ to maximise public value and improve delivery of its performance commitments.
• Focus on building partnerships to promote water efficiency. This is especially important in the current cost of living crisis given the link between energy and water costs and the recent drought.
• Be transparent about how the effectiveness of partnerships is evaluated. The stakeholder satisfaction metric seems a useful KPI in this context but it’s important that all relevant stakeholders are surveyed for this to be meaningful.
• Clarify where the company will lead partnership working and where it will collaborate to maximise public value including across sectors to tackle whole-system problems.
• We’d encourage South East Water to continue its positive work with others to address the interlinking factors that underpin affordability and resilience challenges.
  

5. The tap water refill campaign to reduce plastic bottled water

Stakeholders continue to have concerns about plastic pollution. The aim of this commitment was for more people to use tap water rather than single-use bottled water by installing more water refill points. In its 2020-25 business plan the company also committed to run an annual hydration campaign in conjunction with Refill.
The company installed three refill points at the start of the financial year thanks to collaborative working with Seaford Town Council. Discussions are underway with Eastbourne to support further refill points. Progress was hampered in 2020/21 by the inability to carry out outreach work in the community during Covid-19.
In practice we are unclear if the aim of this project has been met or if the target number of refill sites has been met. We are also mindful that due to the number of water supply interruptions South East Water has increased its plastic bottled water deliveries. Beyond the company’s usual messaging on hydration during hot weather we’ve not seen evidence of the promised annual campaign.

Areas for improvement and next steps

• The CCG continues to support the refill initiative but encourages better monitoring, evaluation and transparency of how this initiative contributes to the company’s progress to “end the use of avoidable single-use plastics in our businesses”.
• The company may benefit from a more flexible approach as to how it will help deliver the industry-wide Water UK Public Interest Commitment to “Prevent the equivalent of 4 billion plastic bottles ending up as waste by 2030.” A more outcomes focused target would facilitate this.
• South East Water as per other water companies provides plastic bottles of water during supply interruptions. We encourage the company to explore innovative plastic-free ways of providing necessary emergency water supplies.
• Given the increasing frequency of hot weather events, we’d welcome South East Water developing its hydration messaging as part of wider programme of activity to support customers to become more resilient to hot weather. There are innovation opportunities here and some good practice from overseas.

6. Renewable energy measures

South East Water has made positive progress on its commitment to bring online renewable energy sources. This commitment is welcomely funded by shareholders. Given the challenges of rising energy prices and energy insecurity this is increasingly important. The company is focusing on 12 sites across its supply area for its own renewable generation to support its operations and help reduce demand from the grid.

It has withdrawn from the open Renewable Energy Guarantees Origin (REGO) market, which guarantees all electricity is carbon zero, due to price increases. This has heightened the need to secure direct green Power Purchase Agreements (PPAs) to support its long-term net zero goals.
Progress has been made here e.g. approval has been granted to progress a PPA for EDF Renewables (solar) project at East Stour in Kent though this site is not expected to be online until 2025.The PPAs are important as they will mean energy will come from new renewable assets – so genuinely contributing to reducing UK carbon and will enable the company to identify the source of the energy e.g. which solar or windfarm their energy comes from.

We have rated this commitment amber on balance as the company missed its aim set out in its net zero route-map to deliver the PPAs by autumn 2021. Following its decision to withdraw from the REGO market it is also now forecasting to miss its separate reputational greenhouse gas emissions target.

Areas for improvement and next steps

For CCG views on the company’s net zero route-map see here.  South East Water’s net zero strategy will be the focus of our September CCG 2022 meeting.

7. Play an active role regionally in relation to the impact of housing growth

We strongly welcome South East Water’s focus on this area. Stakeholders and consumers continue to call for the company to play a more proactive and active role in relation to influencing local and national planning and decisions on housing given population growth, the impact on water resources, economic development and the wider environment. This activity also supports the company’s core business delivery.

The company reports it has met its target to respond to ‘all relevant consultations and contacts’. This includes in the last year (2021-22) - 9 local plans, 2 housing allocation sites, 1 infrastructure development plan, 5 neighbourhood plans and 1 customer inquiry. In practice, the CCG is unclear how ‘relevant’ consultations are identified and how the company can have confidence that opportunities are not missed. We have therefore not scored this area. South East Water has a target to attend all housing related local community events when requested. There were zero requests last year raising the question as to levels of awareness of this ‘service’.

Areas for improvement and next steps

We are encouraging South East Water:

• To engage with stakeholders on how it can best deliver on this priority and more effectively monitor impact of its activity. We query if the target to respond to 100% of national, regional and local consultations is realistic, effective and efficient in terms of making a real impact.
• The company is proposing to go live with a new tracker on housing plans in its area and to develop a charter and KPIs with local planning authorities. This may be welcome but South East Water needs to go beyond this, map its interested and impacted stakeholders and engage more widely to understand what role people think the company should play beyond responding to consultations and speaking at community forums. It also needs to improve the promotion and transparency of its work in this area.
• We’d encourage South East Water to be clearer where it will seek to set or influence policy agendas. For example, it already advocates directly and indirectly via Water UK for government water efficiency labelling which is key to it delivering on its obligations.

8. Transparency of reporting

South East Water has addressed a number of the CCG concerns around lack of transparency and met its public commitments in this area.In line with Ofwat’s Public Value Principle 3: the company has become more open with information and insights on operations and performance. For example:

The company has honoured its promise to the CCG to report on category 1 and 2 pollution incidents though we continue to push that this should also include category 3 where the majority of incidents currently. The CCG was previously concerned that South East Water was dropping its pollution outcome delivery incentives in its 2020-25 business plan at a time when it had poor performance in this area and high stakeholder interest.

We welcome the launch of the company’s new Performance, People and Planet microsite that brings together the company’s performance on key areas such as the environment, customer service, staff wellbeing in a more balanced, accessible and interrogable way.

Despite it no longer being a requirement, the company still publishes its Company Monitoring Framework which outlines its strengths, risks, and weaknesses and final assurance plan.

We support the publishing of the CEO pay ratio information which was last year a median of 17:1.

We welcome South East Water’s early commitment to publish its insights from research and engagement so that third parties may benefit in line with expectations. We look forward to seeing this delivered in practice.

Areas for improvement and next steps

By way of next steps, we are encouraging South East Water to:

• Publish progress in an easily accessible way on its promises in relation to its Water UK Public Interest Commitment for net zero, social mobility, and plastics; and its consumer vulnerability strategy.
• Provide, where possible, further benchmarking information in its reporting to enable cross-company comparisons.
• Consult relevant stakeholders and consumers on what information they are interested in, and how performance can be more proactively and effectively communicated to stakeholders.
• Be even more transparent in its approach to leadership remuneration including how it takes account of short and longer-term company performance and delivery for customers and society, and also to publish social mobility, ethnic and disability diversity performance.

9. Improving Health and Safety and wellbeing of our people and communities

South East Water has demonstrated a strong commitment to improving the wellbeing of its people including responding to the challenging circumstances of Covid-19.

• The company’s Monthly Pulse Surveys 2021 found 82% of employees recommend the South East Water as a good place to work in line with the Company’s vision to be ‘the water company people want to work for’. During the pandemic 92% staff said they trusted South East Water to treat their health and safety as a high priority. This is also reflected in qualitative feedback to CCG members.
• The company launched a new wellbeing strategy at the beginning of 2022, with four key pillars – physical health, social health, financial health and mental health and now has 32 wellbeing champions. This includes regular activities in areas of focus. In particular, we praise the company’s strong focus on mental health. South East Water now has 42 Mental Health First Aiders, who continue to be a much-used resource with 797 contacts in 2021 about largely non work-related issues.
  

We’ve scored this area partially amber as the company missed its safety target with five reportable incidents 2021-22:

• One was a case of covid contracted in the workplace (future cases are not reportable due to easing of restrictions)
• Two involved members of the public experiencing injuries that required hospital treatment at their works and two were slip or trip injuries.

Areas for improvement and next steps

We understand that there has been an increase in safety incidents across the energy and water sectors following the pandemic. Alongside its review of incidents and any associated training improvements we particularly welcome the company’s commitment to work collaboratively with other utilities to share learning and best practice in this area. We encourage companies as part of this work to explore potential future safety risks that result from whole system challenges and changes in working and climate impacts.

The company made little progress on its volunteering program and there is in its words significant scope to introduce a ‘volunteer army’. It is important that if this commitment is developed it delivers meaningful value to society with employees’ skills appropriately used to benefit the community.

10. Ensure fair pay, reward and recognition for all our employee

South East Water’s customers and stakeholders expect fair pay, reward and recognition, and diversity and inclusion as baseline performance from a responsible business.

• The company says it is on track to achieve Gold Investors in People Award by 2025, and currently has Silver Investors in People.
• South East Water aims to have a workforce that reflects the diversity of the customers and communities it serves. While it still has a significant way to go (see table below), the number of women in leadership positions has increased and the gender pay gap reduced by 5.2% over the last two years to 19.8% per cent (mean wage of £14.50 v £18.08). This though remains above the national average of 7.9% for full-time employees. We have no utility or water sector comparators for this still male dominated sector.

• The company is now a Disability Confident Employer and has signed up to the Social Mobility Pledge. The former initiative is designed to help companies recruit and retain disabled people and people with health conditions for their skills and talent. It includes, for example, where a disabled person meets the minimum criteria for a role, they should automatically have an interview.The company is also rolling out inclusion training for all employees and comprehensive immersive training for all senior managers.
• In line with stakeholder views and following CCG challenge the company has increased its apprenticeship ambition. It envisages between 80-90 apprenticeships being delivered each year.This reportedly equates to 8-10% of employee headcount which the company believes is market leading.
• Living wage and affordability - South East Water was the first water company to receive real Living Wage accreditation in 2014 and has continued this commitment. This ensures that everyone working for the company, regardless of whether they are permanent employees or third-party contractors and suppliers, receives a minimum hourly real Living Wage as opposed to the national minimum wage.As the cost of living crisis worsens and inflation soars South East Water is aware of the importance of checking in in with its lower paid staff to ensure its remuneration package continues to provide a living wage in practice. Also, to identify if there are additional services it can provide to support its employee who may be at risk of financial difficulties. The new Living Wage rates will be announced on 22nd September 2022. South East Water should implement the rise as soon as possible.

Areas for improvement and next steps

• Diversity - The CCG continues to push South East Water to further improve workforce diversityand to publish data including in relation to ethnic and disability pay gaps. Intensifying efforts to champion equality, including capturing ethnicity and gender data is especially important during financial crisis where certain groups are disproportionately negatively impacted .
• While improvements are being made, it appears from available data that people from ethnic minorities and with disabilities are under-represented. BAME employees for example, are poorly reflected at leadership levels. The company also has a much smaller population who identify as having a disability relative to benchmarks - 1.3%, compared to 12% of employees in the water industry identifying as having a disability and 15% for all sectors (though the company thinks this data may be underreporting).South East Water understands the need for further action. It is currently trialling three internships with Change 100 which provides internships of 100 days for graduates with a disability who have no work experience to support their career ambitions. The CEO actively promotes the benefits of diversity of thinking that comes from offering a truly inclusive workplace. We look forward to seeing the Diversity and Inclusion Strategy.
• Social mobility - we will review South East Water’s social mobility action plan and encourage the company be more ambitious in promoting STEM subjects including programmes aimed at younger age groups.
• Cost of living crisis response – We encourage the company to set out how it will/has supported its employees and communities during the cost of living crisis beyond regulatory requirements.
• Support your supply chain - we’d encourage the company to become ‘Good Business Pays’ accredited. This recognises that slow and unfair payment practices threaten the future of hundreds of thousands small and medium sized businesses. United Utilities and Severn Trent were among those identified as fast payers in 2021 with over 95% of invoices paid on time.

So what’s the final word?

There is much to be done if South East Water is to meet its goal to be a leading responsible business. Some areas have progressed well; others rightly pivoted but changes not communicated externally; some stalled or it’s unclear if they are delivering the intended impact as targets and monitoring are not clear.

The company has historically undersold its work in this area. Its commitment to be a purpose-led organisation appears genuine though this vision is not yet appropriately supported by necessary resourcing, tools, understanding and skills.

Ultimately it will be hard for South East Water to get full credit for its responsible business activities and build confidence in its approach if it isn’t seen to be delivering its core water business commitments efficiently.Underperformance in supply interruptions in particular, risks undermining trust in the company.

Despite the company’s excellent GRESB assessment outlined above, with a rapidly rising bar on responsible business and changing stakeholder expectations, South East Water risks falling behind its water sector peers if it doesn’t move up a gear.In particular, we encourage South East Water to clearly set out, and proactively communicate, how it is and will be supporting its employees, customers and communities during the current cost of living crisis, going beyond regulatory expectations. There are opportunities for leadership here.

We welcome South East Water updating its responsible business strategy, in particular reviewing it commitments and the metrics and targets that underpin them.

Looking towards PR24, further clarity is needed on how social value will be assessed and weighted in decision making.

We also encourage South East Water to engage stakeholders on the role they think the company should play in society, the environment and economy and to accelerate embedding its’ new Purpose into the company culture. This must be genuine open engagement – not simply testing its own assumptions.

We’d like to see meaningful engagement that allows stakeholders to thoughtfully discuss the role of South East Water as a water supply company within the context of wider economic, social, environmental and technological change and future challenges. Importantly that customers are able to give informed views about how much they are willing to pay, if anything for services that go beyond the company’s core water supply requirements. We think this is foundational engagement for the PR24 business plan.

Longer-term the CCG will continue to monitor company progress, including against stakeholder feedback from its engagement activity and third-party research.

As always we would really welcome your comments and questions including in particular any benchmarking information in this area.