Committee of Public Accounts


Press Notice No. 30 of Session 2003-04, dated 15 July 2004


THIRTIETH REPORT: OUT OF SIGHT-NOT OUT OF MIND: OFWAT AND THE PUBLIC SEWER NETWORK IN ENGLAND AND WALES (HC 463)

Edward Leigh MP, Chairman of the Committee of Public Accounts, said today that compensation is wholly inadequate for the victims of sewer flooding, and called on DEFRA to extend statutory compensation, whilst urging Ofwat to encourage water companies to increase their voluntary payments.

Mr Leigh was speaking as the Committee published its 30th Report of this Session, which examined responsibilities for preventing sewer flooding, compensation for sewer flooding incidents and information on the performance of sewer networks. Sewers provide an essential service to households and businesses throughout the country but they are usually taken for granted. When they fail the consequences can be very damaging, especially when homes are flooded internally with sewage. There were 6,000 such incidents in 2002-03. Although this represents a small proportion of properties connected to the sewer network, these incidents cause great distress and inconvenience for those affected.

The Director General of Water Services is the economic regulator of water and sewerage services in England and Wales and head of Ofwat. Ofwat's statutory duties are to ensure that the functions of water and sewerage companies are properly carried out and financed, facilitate effective competition and protect customers' interests as regards price and quality of service.

The Committee found that there is insufficient co-ordination between the bodies responsible for managing connections to the sewer network. Public sewers are owned by 10 water and sewerage companies, but local authorities, housing developers and property owners are responsible for ensuring that connections to sewers do not overload the existing system. At present, water companies are not required by statute to be consultees in the planning process by which new properties are connected to existing sewers.

Water companies should educate consumers and businesses to help reduce sewer blockages. Nearly half of all sewer flooding incidents are caused by blocked sewers, often a result of households and businesses disposing of inappropriate items (for example, nappies or cooking fat) down their drains. Ofwat should work with water companies to investigate the costs and benefits of a national campaign of education, or a series of local campaigns run by each company.

Compensation arrangements are currently inadequate. All consumers pay for an effective sewer system through their water and sewerage bills. About 5,000-7,000 each year suffer from sewer flooding. At present, the victims are guaranteed only a refund of their sewerage charges for the year, and are left to bear the cost of cleaning, repair and redecoration themselves. Consumers can cover these costs under household insurance, but some have been unable to obtain insurance through poverty or because of repeated flooding.

The Department for Environment, Food and Rural Affairs should extend statutory compensation arrangements so that all consumers who benefit from effective drainage contribute, through their sewerage charges, to the costs of those who endure sewer flooding. In the meantime, Ofwat should encourage companies to increase voluntary compensation payments.

Ofwat should secure greater consistency in recording the number of properties at-risk of sewer flooding. Ofwat requires sewerage companies to record properties that are at-risk of future sewer flooding incidents. Companies adopt a range of approaches to identify these properties. This inconsistency means that Ofwat cannot compare the performance of companies in a meaningful way and homebuyers cannot be confident about the risks facing the property they wish to purchase.

Ofwat should require companies to include the same sewers in its regular five-year asset inventory assessments. At present it is rare for the same sewer to be surveyed from one five-year assessment to the next and companies have been unable to assess the deterioration of individual sewers over time. Ofwat should also develop measures which provide an indication of the future condition and performance of sewer networks. The current indicators are inherently backward-looking, and may give neither sufficient warning of imminent problems nor an adequate guide to investment needs.

Ofwat should require water companies to prepare long-term sewerage resource plans. At present, Ofwat requires water companies to prepare water resource plans which consider the balance of supply and demand over a 25 year period. There is no parallel requirement for sewer systems. In view of the potential pressures on sewer systems arising from new housing developments in the South East, and climate change, Ofwat should require sewer resource plans.

Mr Leigh said today:

"Around 5,000 to 7,000 customers a year suffer from sewer flooding. This might only concern a small proportion of the properties connected to the network but that's no consolation if you suffer the distress and inconvenience of your home being flooded with raw sewage. Compensation is wholly inadequate, with victims having to pay to clear, repair and redecorate their homes. DEFRA should extend statutory compensation to cover these costs, even if it means a very small rise on everyone else's water bill, and Ofwat should encourage water companies to increase their voluntary payments to those who are flooded."


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