Ofwat consults on raising business back bill limit to 24 months in disputed cases

Ofwat is consulting until 5 December on extending the maximum period a non household customer can be back billed by a retailer for water and sewerage services from 16 months to 24 months.

The suggestion follows the emergence of an inconsistency within the Wholesale Retail Code last year which needed to be rectified and which had a knock-on effect on the Customer Protection Code of Practice (CPCoP) which set the 16 month limit before the water market opened.

Ofwat has proposed that wholesalers be able to bill retailers for positive sums where a settlement report is issued after a dispute, for a maximum of eight months (a maximum of 24 months from the end of the invoice period).

Consistent with that change, it is proposing retailers can bill customers for a maximum of 24 months, where there is a dispute. In other circumstances, the back billing restriction remains at 16 months. The amendment does not apply to negative sums – meaning rebates and refunds can be sought for beyond the 24 month period.

Ofwat is also consulting on the following additional amendments to the CPCoP:

• to require retailers to pass on payments to customers where there has been a recalculation of primary or non-primary charges and a payment is made by the wholesaler to the retailer;

• to amend the definition of ‘back-bill’ and ‘reasonable repayment plan for a back-bill’ to account for the changes proposed to the restriction on billing; and

• to extend the requirement to issue a final bill within the specified timeframe to all non-household customers, so that it no longer applies to micro-businesses only.