26 June 2007
The Consumer Council for Water has called for the government and Ofwat to ensure money generated from fines on water companies is pumped back into benefits for consumers.
Last week Ofwat ordered sewerage company United Utilities to pay a 8.5 million fine for breaching regulations regarding trading arrangements with associate companies.
Under current legislation this money will be paid to the Treasury, however, the north-west region's water watchdog called for it to be used to fund initiatives to help many customers who struggle to pay their water and sewerage charges in the area.
This is something Dame Yve Buckland, Chair of the National Consumer Council for Water, thinks should start happening all over the country.
"In monopoly businesses, it's likely that results of breaches of regulations benefit shareholders and disadvantage consumers. Therefore consumers need to benefit from Ofwat's action," she said.
"We want to put a marker down to say that, in most instances, where a water company is fined, the money should go back to consumers in the most appropriate way for the circumstances and the region - and not go to the Treasury," Dame Yve said.
Speaking last week, Andrea Cook, Chairman of the Consumer Council for Water North West, said: "We believe that there are more innovative ways in which this money could be used to address debt problems for the poorest water customers in the north west.
"The money will be of little use to Treasury, but by supporting our proposal the government could show that it is committed to doing something about water poverty."
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