Ofwat’s latest cost of living research has revealed that not only that many customers are still struggling financially but also that the percentage of customers aware that financial help is available from water companies has hovered around 30% over the last year.
This third wave of cost of living research reveals that the percentage of bill payers who had ‘never’ struggled to pay a household bill in the past year has fallen from 45% in 2021 to just 25%.
The research also shows that more than half (56%) of bill payers have struggled to pay household bills frequently over the last year. Women were much more likely than men to struggle with bills – 68% of women compared to 46% of men. Whilst almost eight in ten (78%) of those aged under 35 reported struggling with household bills.
Seven in ten (70%) bill payers who have a long-term illness, health problem or disability, or who live with someone who does, reported struggling to pay bill ‘sometimes’ of more often with only 7% of water bill payers reported having received financial support.
The research also shows that nearly one in four bill payers (23%) are currently struggling to pay their water bill. This is up from 20% in wave two (Oct 2022) and 15% in wave one (March 2022). Ofwat’s report also shows the impact that financial struggles can have on customers’ mental health: bill payers struggling with their household bills reported higher levels of stress, worry and depression to those not currently struggling. Only 15% of bill payers who reported struggling ‘all the time’ with household bills report having received help with their water bill.
It is the responsibility of water companies to ensure that bill payers who may be eligible for support are aware of and can access it. Crucially, this support must be clearly signposted and easily accessible to customers. 64% of those who reported struggling to pay their water bill agreed that they avoid or delay opening bills when they’re struggling with their mental health.
Ofwat is currently consulting on a new customer-focused licence condition that will require companies to provide excellent customer services for their customers. Where a company is not performing in line with the licence condition, Ofwat will have new powers to step in and take action.
Claire Forbes, Senior Director of Corporate Communications at Ofwat said “Ofwat’s message is clear: water companies must continue stepping up and supporting their customers who are struggling financially. No customer should be left behind, particularly those in challenging financial circumstances. Today’s research shows that support for customers struggling financially is still not reaching those who need it the most. There has been some good progress from water companies in this area, but now is not the time for complacency: when Ofwat sees poor performance from water companies in this area we will not hesitate to act.”
Andy White, Senior Leader for Social Policy at the Consumer Council for Water (CCW), said “It’s deeply concerning to see a growing number of people struggling to afford household bills and it reflects our own recent Water Matters study, where more than half of households felt their finances had got worse over the past year. Existing support is of little help to those struggling to pay their bills if they don’t even know it exists and that’s why water companies must strive to raise awareness of financial assistance.”
“We also need the sector to commit to a comprehensive baseline of financial support for households that cannot afford their water bill. The current support provided through the postcode lottery of existing social tariff schemes is unsustainable and risks seeing thousands more people slip into water poverty.”