UK water companies performing at higher level, Ofwat says

All achieved C or above in Ofwat's assessment compared with less than half of companies five years ago. Water only companies, Portsmouth Water, South Staffordshire Water and Bournemouth and West Hampshire Water, achieved an A for both operating and capital maintenance efficiency. And for the first time, one water and sewerage company, Yorkshire Water, achieved an A for all four aspects of its relative efficiency performance...

LONDON, Jan. 27, 2005 (GNN) -- More water and sewerage companies are achieving the top efficiency band than ever before, according to a new report by Ofwat.

All companies have achieved band C or above in Ofwat's five-band assessment compared with less than half of companies five years ago.

Three water only companies, Portsmouth Water, South Staffordshire Water and Bournemouth and West Hampshire Water have achieved the top-ranking 'A' band for both operating and capital maintenance efficiency.

And for the first time, one water and sewerage company, Yorkshire Water, has achieved the 'A' band for all four aspects of its relative efficiency performance.

Ofwat's 'Unit costs and efficiency report 2003-04' compares all 22 water and sewerage companies on the basis of how efficiently they run their businesses day-to-day and how efficiently they spend money on the maintenance of pipes, sewers and treatment works. The information in the report is particularly important as it formed part of the calculations for Ofwat's recent review of water prices.

These companies, and others, are now eligible for the new enhanced incentive reward at the next price review. This is designed to encourage top performing companies to keep on improving and to raise the bar for all other companies.

Bill Emery, Ofwat's chief engineer and director of costs and performance, said: "I am very pleased to see more companies converging at the top of the scale.

"This is another sign that our incentive-based regime is working. Companies have strong incentives to reach the top and our enhanced rewards will encourage them to strive for more improvement.

"This doesn't mean that any company can now sit back and rest on its laurels. We think that all companies can continue to move forward and have assumed they will do so in our recent price review."

The Office of Water Services (www.ofwat.gov.uk) is based in Birmingham, England.

Notes to Editors:
1. The Director General of Water Services is the economic regulator of the water and sewerage companies in England and Wales. He exercises his powers in a way that he judges will allow them to carry out their functions properly, and finance them.
2. The 'Unit costs and efficiency report 2003/04' is available from the Ofwat website www.ofwat.gov.uk and from the Ofwat library on 0121 625 1373.
3. Companies' efficiency performance is banded from A to E (A being the most efficient).
4. We assess relative operating and capital maintenance efficiency separately for water and sewerage services.

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