Ofwat urges clarification from NIC on its regulatory or market changes option

Ofwat has pressed the National Infrastructure Commission (NIC) for urgent clarification of its intentions relating to the water sector following the commission's reference in a recent consultation to options for change in regulation and the market to improve UK infrastructure.

Ofwat, in its response to the NIC's consultation on The National Infrastructure Assessment - Process and Methodology, has urged the commission to confirm or qualify its support for planned projects for the water sector including Water 2020 and preparations for the next periodic review. Ofwat was particularly concerned about NIC's reference to "changes to regulatory or market structure" among its options for cost-effective infrastructure.

Ofwat warned: "Given the timescales for our Water 2020 programme, market development and the planning to inform the next Periodic Review for water and wastewater services we would ask that the commission clarifies its support for these process early to avoid uncertainty.'

Ofwat points also to concerns over the absence of reference in the NIC consultation to devolved water policies in Wales. It says: "We regulate England and Wales and water policy is largely devolved. It will be important that the distinction between the approaches in both countries is recognised in the work of the commission that addresses the water sector. This will be particularly important if options to transfer water resources across the political boundary were to be considered."