Thread by @BDavisBriz

Looking forward to what should be a very interesting @APPGwater "In Conversation" event with @Ofwat's @OfwatChiefExec David Black #APPGWater

First @LizTwistMP opens by saying that this event is happening at a challenging moment for the #Water sector. @OfwatChiefExec agrees, then gives a potted overview of Ofwat & says Ofwat has a "positive role" to play in meeting these challenges #APPGWater

On Storm Overflows, Black notes that, while this is challenging, it is not unique to England - gives examples from Scotland & further afield including Canada #APPGWater

Black says that there isn't a "one-size-fits-all" approach to addressing the issues of Storm Connections. Says Ofwat will work with wastewater companies to ensure compliance & share best practise from UK & overseas #APPGWater

Black welcomes the progress that water companies have made on storm overflows, but argues that more progress needs to be made - particularly on monitoring & transparency of data #APPGWater

On PR24, Black confirms that Ofwat will call on companies to continue to reduce CSOs, advance nature-based solutions, and will tighten net biodiversity gains targets for water companies. Also notes that Exec Pay & dividends will be linked to environmental performance #APPGWater

Turning to water resilience, Black notes that #ClimateChange is making this a much more salient issue - particularly in the South East. Says this will need us to review our positions on reservoir construction & water recycling schemes #APPGWater

Alongside this, Black says more work will need to be done to ensure that water companies invest in reducing leakage, and that customers are encouraged to be more water efficient and consume less water #APPGWater

Black welcomes the fact that water companies have "risen to the challenge" of reducing leakages across their targets. He notes progress on water consumption has "been made more complicated due to #Coronavirus" as people worked from home, but efforts are now restarting #APPGWater

Turning to affordability, Black is sensitive to the fact that the #CostOfLivingCrisis will mean that there is little appetite to see rising water bills. He notes water companies will need to improve performance & be clearer on how they are investing money #APPGWater

Black also welcomes the fact that water companies are being more robust in promoting their #SocialTarrif schemes, but calls on them to be "even more innovative" on how they charge customers, to ensure that support is extended to all those who need it #APPGWater

Black concludes by repeating that the water sector faces significant challenges, but he is confident that water companies will be able to meet those challenges and that Ofwat has a "key and supportive" role to play #APPGWater

The meeting now moves on to a Q&A session #APPGWater

First Qs are on privatisation - whether it is right that companies are the ones who decide their own bonuses & whether privatisation is delivering on the investment promised. #APPGWater

Black says Ofwat would like to see boards "incentivised to make the right decisions" in terms of bonuses & dividend pay, says it is the role of Ofwat as regulator to help shape the incentives that will lead to behavioural change #APPGWater

Black also says that investors have a role to play in holding Executive Boards to account and welcomes the fact that, on the whole, investors are becoming more active in this sector #APPGWater

On privatisation, Black agrees that initially it was envisaged that Ofwat would "hold the fort until competition emerged", but this has not happened in the water sector, which is why Ofwat still has a vital role to play #APPGWater

Black notes that there is "limited scope" for competition in the sector, but cites the Thames Tideway model as an example of best practise in this area #APPGWater

On housebuilding & the #RightToConnect, Black welcomes the Govt agreeing to implement Schedule 3. However, also says that water companies have "other tools" they can use such as encouraging SuDS at household level & encouraging greater water efficiency #APPGWater

On bioresources, Black says that there is great potential to invest in ways in which sewage bioproducts can be reused, either as an energy source or industrial fertilizer #APPGWater

Next Q is on whether water companies should encourage customers to purchase shares as a way of engaging with local communities. Black says PR24 will explore this - noting South West Water's actions in this space, but it is up to other companies how they engage #APPGWater

Responding to a Q on climate resilience, Black says this is a space that Ofwat is taking "a more active role" in and stresses that Ofwat will expect water companies to invest more in this area #APPGWater

On company's financial resilience, Black stresses that companies are "performing at different levels", but welcomes progress is being made. Cites #ThamesWater shareholder's recent £2bn cash injection as a positive example #APPGWater

On #Devolution & the proposed water transfer schemes, Black says that any proposals "must have benefits for 🏴󠁧󠁢󠁷󠁬󠁳󠁿 as well as 🏴󠁧󠁢󠁥󠁮󠁧󠁿" says Ofwat is working with WaSCs, Westminster and the Senedd on the proposed schemes to find a solution that works for everyone #APPGWater

On skills, Black agrees that more needs to be done to promote the water sector as an attractive sector to work in & ensure training is available to meet needs of a changing skillset. Says this is an area Ofwat should play an active role in #APPGWater

Turning to #StormOverflows & how WaSCs should communicate with customers, Black says water companies need to be more transparent in the pros & cons of various approaches but also need to be better at demonstrating progress to customers #APPGWater

On whether Ofwat is still "fit for purpose" to meet the challenges the sector faces, Black says that, just as water companies need to change their focus to address the big challenges they face, so does the regulator to ensure there is a long-term view on investments #APPGWater

However, Black says that there is still opportunities within the current NPS to work differently with water companies to meet some of these challenges #APPGWater

On how to promote innovation & open data, Black recognises "this is challenging in a monopoly sector", but highlights the Ofwat Innovation Fund as examples on how they are seeking to promote it. Also says PR24 will aim to encourage greater collaboration #APPGWater

Final Q is on whether it is right to stay on 5-year funding cycles if we know challenges are long-term. Black says "short answer is no", but says that Ofwat looks at each 5 year cycle as "achieving 25-year objectives" #APPGWater

However, he also notes that timescales also needs to be flexible - says that the #Coronavirus pandemic & war in #Ukraine🇺🇦 shows how "the world can change overnight" and we need to be able to respond to those changes #APPGWater

Very interesting conversation on the role Ofwat can play in helping meet the current challenges faced by the #Water sector. Thanks to @OfwatChiefExec for your insights, to @LizTwistMP & @AnneCMcIntosh for chairing & @APPGwater for hosting! #APPGWater

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