Strategic Position Statement on Water

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					Strategic Position Statement on Water

Ministerial Foreword

One Wales: One Planet underlines the Welsh Assembly Government’s
commitment to playing its part in the need to take global action to tackle the
major challenges that climate and economic change pose to all of us.

Our commitment to managing water resources sustainably and maintaining
and enhancing water quality in Wales remains.

This Strategic Position Statement on Water puts the spotlight on how we will
do that in the wider economic, social and environmental context, in particular:

    Economic change will mean that the water industry will need to
     consider different ways of raising finance and develop more innovative
     ways to ensure good quality water services are delivered to homes and
     business while respecting the natural environment
    Social impact given that many parts of Wales are already feeling the
     consequences of an economic downturn
    Climate change will cause fluctuations in the availability of water during
     the year with more extreme dry spells and flooding events placing
     unprecedented demands on the system while society and businesses
     expect consistent availability of water services

Having, using and disposing of water is taken for granted, but it makes up a
significant component of our ecological footprint. The embedded water in the
food we eat, clothes we wear and goods we use should be considered in the
context that over-reliance on water-dependant goods from habitats which are
themselves short of water is not sustainable.

The Assembly Government wants to demonstrate that Wales is a responsible
global citizen and we want to build in consideration of the global impacts of
the water embedded in the goods and products we use alongside effective
management of resources.

Here in Wales, our core principles are ensuring access to safe drinking water,
maintaining water and sewerage services at an affordable price and
compliance with statutory obligations that drive all round water quality.

This Statement is particularly relevant to inform the work of regulators and
partners generally and specifically in the current review price limits for water
and sewerage companies for the 2010-2015 period. It also sets out the
position in Wales for taking forward the issues arising from the independent
reviews of competition and innovation in water markets and charging and
metering for water and sewerage services. In addition, it helps to establish
the context in Wales for input into the water aspects of the Flood and Water
Bill, which was announced as a draft Bill in the UK Government’s legislative
programme earlier in 2008.
I look forward to working with all the organisations involved in the delivery of
water services in Wales to progress this policy agenda.

Jane Davidson
Minister for Environment Sustainability and Housing
January 2009
Strategic Position Statement on Water

The Welsh Assembly Government provides the strategic direction for water
policy in Wales, framed within a complex set of regulatory and operational
responsibilities. One Wales: One Planet, the consultation on a new
Sustainable Development Scheme for Wales together with our Environment
Strategy for Wales and its action plan, provide the backdrop for the Assembly
Government’s water policy.

In this statement we set out our position on aspects of water policy that we
have revised or developed in response to the pressures and challenges we
face as we plan for the future.

This statement puts citizens at the heart of water services. It reflects the
unique nature of the water resource and the social dimension within Wales
and it emphasises the value of our water environment, its protection and

The management of water resources, the delivery of water and sewerage
services, customer representation and the protection of the water environment
involve a number of bodies with key roles and responsibilities that we will
seek to work with in taking forward our policies. These are summarised at
Annex 1.

Customers at the heart of delivery

Ensuring customers are at the heart of the delivery of water and sewage
services in Wales reflects the Assembly Government’s approach to citizen
centred delivery.

A customer focus requires a sound understanding of customer needs and a
strong voice for customer representation. We support a consultation on
options for customer representation in the provision of water and sewerage
services, including options on retaining the current water specific customer
representation and the potential role a broader national consumer body could
play. We will encourage the views of stakeholders and will consider these
and base our decisions on firm evidence and on the long term benefits for
customers in Wales.

        will jointly with the Department for Business, Enterprise and
         Regulatory Reform consult on the representation and redress for
         water and sewerage consumers

Wales Water Forum

In line with our commitments in the Environment Strategy for Wales to
manage water resources sustainably and to maintain and enhance water
quality in Wales, we will continue to work with the water industry and its
regulators in Wales to take a long term view to planning and to achieve a
system that recognises the value of water resources available in Wales. We
will seek to engage key stakeholders in this approach through the
development of a Wales Water Forum (that will follow on from the Wales
PR09 Forum).

     will develop a Wales Water Forum to engage key organisations in
      planning the strategic direction for water and sewerage
      management and services in Wales

Drinking water

Our top priority is for everyone in Wales to have access to clean, wholesome
drinking water. This includes public water supplies and individual or private

We want to see mechanisms in place to identify, locate and monitor these
private supplies to safeguard those consuming this water on a permanent or
temporary basis and intend to bring forward legislation to ensure that

A safe and reliable public water supply is vital. We want to see the current
high standard of our public drinking water quality maintained with appropriate
monitoring and response mechanisms to safeguard the quality of drinking
water sources.

     will consult on regulations for private water supplies


The Assembly Government is yet to be convinced that further competition in
the water sector would benefit domestic customers.

Further research and evidence is required to support any decision to extend
retail competition for business customers.

We believe that innovation is key to a long term sustainable water industry
that meets the needs of customers.

Customers in Wales served by Dŵr Cymru receive benefits including a
customer dividend driven by the efficiency of the Glas Cymru business model
under which the water company operates.

The Glas Cymru business model is unique within the water industry across
England and Wales. Considering the success to date, we believe it should be
given time to prove it is able to provide ongoing benefits to customers in the
long term and be seriously considered as part of the wider review of
competition in the water industry alongside other approaches in delivering
better value for customers.

        support measures to encourage innovation and a longer term
         shift towards a system that recognises the value of the water
         resource available to Wales
        remain to be convinced that increased retail competition will
         deliver any measurable benefits in Wales
        want to ensure that the unique not-for-profit model for water
         service provision currently operating in Wales is given full
         consideration alongside other approaches to securing better
         value for customers

Charging and metering

Keeping water bills at affordable levels is a priority for the Assembly
Government. We want customers to have a choice of charging options that
will drive up efficiencies, reduce debt issues and deliver benefits for all
customers while protecting vulnerable groups. The current system of charging
for water on a rateable basis does not drive water efficiency, reduce bad debt
or protect vulnerable groups.

The cost of debt and collecting debt is borne by all customers. We want to
see, and will support, innovative schemes in place to help customers pay their
bills and reduce their debt burdens and in doing so reduce the cost of this
debt to all water customers.

We encourage the development of cost benefit analysis and innovative tariffs
not directly linked to a metered supply. Whereas a metered supply can have
benefits for increasing efficiency and enable low water users to decrease their
bills, some vulnerable groups such as large families on low incomes would
see an increase in charges. Protecting such groups is paramount, and we
believe this can be specifically addressed by the development of appropriate
tariffs and targeted charging schemes.

Our commitment to protecting vulnerable groups combined with the current
and forecast water resource situation in Wales means that the need to move
toward compulsory metering or encouraging accelerated uptake of metering is
not generally appropriate in terms of managing water resources. In some
instances increased metering will have a part to play in driving water
efficiency particularly in terms of targeting larger ‘luxury’ uses such as private
swimming pools and spas and so on in first instance.

        want charging for water services in Wales to be updated to
         include a range of tariffs and options that will drive up efficiencies
         while protecting vulnerable groups
      will look for win-win tariff options, targeted at supporting
       vulnerable customers, but which deliver benefits for the customer
       base as a whole by helping to manage debt
      consider that increased use of metering will have a part to play in
       the longer term, but are concerned about the potential negative
       impact on some vulnerable groups. Metering should be targeted
       on ‘luxury use’ such as swimming pools and spas and so on in
       the first instance.

Private sewers

In February 2007 Welsh Ministers announced a decision to adopt private
sewers into the mains network. A large number of households in Wales are
responsible for the maintenance and repair of their sewers and often do not
realise this until problems arise. As a result this can come as a shock as often
the repair includes a financial burden which some households are unable to
meet. The Assembly Government is committed to addressing the inequity of
this situation and to relieve the burden from individuals. However, in
achieving this we recognise the some of the private sewer network maybe in a
poor condition and the potential costs of repairing and maintaining this
acquired asset that would be transferred to the generality of water bill payers.

In the first instance we will want to stop any further proliferation of
development of sub standard sewers which are ultimately unadoptable by the
water and sewerage companies. We will work with the UK Government, local
authorities, water and sewerage companies and others to ensure all future
household sewer pipes are built to a standard acceptable for the adoption by
the water and sewerage companies.

Secondly, with the interests of priority customers in mind, we aim to introduce
a two phased approach to the transfer of private sewers to the water and
sewerage companies in Wales. We will pursue the development of
regulations that will facilitate the transfer (alongside the approach being taken
in England) and also propose speeding up the adoption process for those
customers who suffer significant problems with their private sewers by
supporting a proactive assessment scheme to identify issues and offer early
remedial action.

Under this scheme Dŵr Cymru Welsh Water will identify priority areas,
through close liaison with local authorities, the Environment Agency and the
Welsh Assembly Government. Where feasible private sewers in the worst
affected areas will be targeted for early investment in advance of any transfer
by regulation. We want this scheme to be developed by spring 2010 to allow
remedial works to begin on the highest priority cases later that year.

This preparatory work will help to put us in the right place to pursue legislation
to enable the regulatory transfer of all private sewers in the future. We will
use the information gathered on priority areas to prioritise investment
following transfer, using the fundamental principles of keeping household bills
as low as possible, while not leaving the bill payer disadvantaged.

        do not want further proliferation of private sewers that are not of
         an adoptable standard
        will continue to explore ways to enable us to take action to
         prevent this
        will develop a scheme with Dŵr Cymru Welsh Water to identify
         where action on private sewers is most needed
        pursue the development of regulation to facilitate the transfer of
         private sewers

Secure supplies and building up Resilience

A safe and secure supply of water requires investment and maintenance of
the infrastructure network, building in resilience from natural hazards and the
impacts of climate change and ensuring adequate protection and security
measures are in place. Wales has benefited from high levels of investment in
system improvement over the past decade and we want to ensure the system
remains robust and able to support high quality services in the future.

A robust system will help to ensure a safe supply, but there are always risks
and emergencies. Altering weather patterns with increased storminess as
predicted with climate change and the consequent risks of flooding means it is
essential to identify the possible impacts on the water and sewerage
infrastructure. To adapt to these changing conditions we will support further
research and development of sustainable urban drainage systems to alleviate
the pressure on the sewerage network and help reduce flood risk.

Water companies are category 2 responders under the Civil Contingencies
Act and are required to cooperate and share information in the event of an
emergency. We will work with the companies to develop plans that identify
strategic assets, consider the loss of supply and provision of alternative
supplies. We will issue Security and Emergency Measures Directions as
appropriate and actively ensure compliance against these.

The Assembly Government is developing a new risk based approach to
managing flood risks. As part of that programme we will continue to work
alongside water companies and the Environment Agency to identify and keep
under review critical infrastructure at risk of flooding and prepare the
measures required to mitigate the impacts.

        will promote the deployment of sustainable urban drainage
         systems to help ease the surface water burden on the sewerage
         system and alleviate flood risk
        will issue Security and Emergency Measures Directions
        consult on a new risk based approach to managing flood risk
Our global water responsibility

The Assembly Government has set ambitious targets for greenhouse gas
reductions and we believe that behavioural change will have a central role to
play in tackling climate change in Wales. The water industry can make a
considerable contribution to achieving this through its own operations,
providing water efficiency advice to customers and though the development of
onsite renewable energy.

We need to value water more, understand the spatial variations of water
resources across Wales and use it wisely to minimise our water footprint. The
efficient use of water contributes to longer term sustainable management of
water resources. As part of our communications on climate change we will
encourage water efficiency through key messages to help individuals take
personal responsibility for reducing, reusing and recycling resources. Water
efficiency advice will be available from water companies, the Environment
Agency and as part of the Energy Saving Trust’s expanding range of services.

We also want the embedded water in our goods and food services to be
highlighted. Working in partnership to promote more sustainable behaviours
and providing appropriate incentives will be key to achieving these changes. A
continued increase in the dependency on goods requiring high water use from
countries or zones of the global economy, where water shortage is endemic,
is not a sustainable pattern of trade.

        consider behavioural change to be fundamental to tackling the
         causes and consequences of climate change and want messages
         on water efficiency in Wales to be consistent with our climate
         change communications campaign in the context of living more

Protecting our Environment

We want to minimise the impact of water abstraction and wastewater
discharges on our environment, while being able to ensure the amount of
water abstracted meets the needs of water users. The management of water
resources is principally based on the Abstraction Licensing System
administered by the Environment Agency.

We need to manage water resources in a way that takes account of the likely
impacts of climate change and will enable us to achieve water quality
objectives. We want to ensure that all abstractions are monitored and brought
under review. We are committed to implementing the changes provided for in
the Water Act 2003 to update the Environment Agency’s licensing regime and
will consult on the need to time limit all licenses.
We expect competent authorities to complete their review of consents in
respect of the Habitats Regulations, and for any resulting consent adjustment
to be firmly based on clear and robust evidence. Water companies must also
play their part in ensuring that the discharges from sewerage systems
continue to meet the prescribed requirements and protect our water
environment. We also see the benefit of addressing pollution at source and
will look for ways to prevent pollution in the first place rather than rely on clean
up measures.

Many factors can impact on water quality, from changes in water flow to the
proliferation of alien species. Due to the numerous pressures, we consider it
important to take an ecosystem approach and look at the whole catchment,
including land management practices when considering solutions. The work
we are undertaking as part of the Water Framework Directive (WFD) is an
important instrument for achieving an integrated approach.

Achieving a good quality water environment is a vital part of supporting water
based recreation and our commitment to improving access to the environment
for all. We want people in Wales to enjoy the recreational opportunities
offered by the waterways in Wales.

        will consult on the time limiting of all abstraction licenses
        will consult on the removal of phosphates at source
        encourage an integrated, whole catchment approach to water
        will promote recreational use of water in a safe and sustainable
Annex 1
Key Partners:-

The water industry in Wales –
    Dwr Cymru Welsh Water (DCWW) provides water and sewerage
      services for most of Wales
    Dee Valley Water provide water services in North East Wales
    Severn Trent serves some customers in Mid Wales.
    Albion Water provides water services to one large commercial
      customer in Wales.

Ofwat - the economic regulator for the water industry

Environment Agency - the main environmental regulator in relation to water

Countryside Council for Wales - advise on issues relating to conservation.

Drinking Water Inspectorate - the regulator for drinking water safety and

Consumer Council for Water - represent water consumers’ interests

Local authorities - regulation of private water supplies, which are significant in
rural areas