Regulator demands answers on standards

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The Independent Online

Three of the big 10 water companies are now composing a reply to one of the most awkward letters they have ever received - a missive from industry regulator Ian Byatt suggesting, in polite and formal language, that they have been cheating their customers.

He believes he has compiled information which suggests that they have not delivered levels of service, tap water purity, leakage control and sewage clean-ups which they agreed to in return for being allowed to raise prices faster than the rate of inflation.

Mr Byatt, director-general of the Office of Water Services (Ofwat), has been scutinising a mass of facts provided this summer by all of the English and Welsh water companies, the National Rivers Authority (the Government's water pollution watchdog) and the Department of the Environment's Drinking Water Inspectorate.

He now has questions for North West Water, Yorkshire Water and South West Water which take the form of long annexes to his probing letters which have been leaked. They cover a broad range of alleged shortcomings in improving inland and coastal sewage works, raising purity standards for drinking water and tackling low pressure problems.

Anthony Goldstone, chairman of the Ofwat's North West customer service committee, said that the company's handling of the drought had been "haphazard" and left a lot to be desired.

"The letter is really saying have they complied with all quality standards? Have they had the service standards Ofwat demands of them? Have they supplied water over the last few months where there have been difficulties?" he said.

Yorkshire Water is told in its letter that it appears to have missed chances to improve its water supplies and storage in the years before this summer's drought. It has one of the highest leakage rates in the country, and has just announced that it plans to cut leakage from 26 to 24 per cent by 1998.

The letters follow the introduction this year of a new annual scrutiny by Ofwat. The regulator refused to comment on their contents, saying they were confidential at this stage. "We have to give them the chance to reply at length to what we're raising," a spokeswoman said.

Yorkshire Water said: "Mr Byatt has not yet reached any conclusions." It said it would cooperate fully, but was disputing "a large amount" of what the regulator was suggesting.