Performance at Northern Ireland Water (NIW) is certainly improving but they have a long way to go to be as efficient as the UK mainland water companies.
When NIW was formed the gap on costs was 49% now this has reduced to 39% but this still means that NIW customers are paying about £1.6 for every £1 paid in England a significant additional cost burden. The service NIW provides is also a long way behind with a notional OPA score of 131 compared to the UK mainland average of 254
NIW is unique in being the only water company in Europe that does not charge its customers. There has long been talk of introducing charging as a means of both increasing investment and encouraging customers to reduce their water demand. But it is very clear that this is politically totally unacceptable.
The consequence is that NIW are in the very difficult position of both being a Government Company and also a Non Departmental Government Body. This means that NIW are subject to annual budgets and reductions in expenditure as public finances tighten despite the Price Control agreement implemented by the Utility Regulatory. Price Control 2010 (PC10) does allow expenditure of £190m a year, but in PC13 (2013 -2015) this is dropping to £170m a year
The forecast for 2015 onwards shows a massive drop to £100m a year.
For NIW to meet the challenges it faces it is essential the Governance issues are solved and that will require strong political leadership.
