Bilaterals costs and benefits outstrip business case expectations

The Bilaterals Transactions Programme is delivering financial savings of £2.4m a year (at 2020/21 prices) – double the ‘mid-case’ estimate of £1.2m savings anticipated in the business case – according to MOSL’s final cost benefit assessment of the Ofwat-mandated work.

MOSL reported the savings include £340,000 of benefits identified during the delivery of the programme, and that there have been a range of benefits for customers on top – "from faster, more reliable processing of requests and better handling of enquiries to a reduction in the number of manual input errors due to an increase in the number of fields that are automatically completed”.

The final assessment put the total cost of the mandatory programme at £4.1m, 39% per cent higher than anticipated. MOSL said: “This was principally due to trading parties’ request to accelerate the rollout and include additional functionality. Higher costs were more than offset by benefits, however.”

Work is now underway to standardise the remaining bilateral processes and add them to the central hub. This will take two years and is anticipated to deliver a further £1.1m in efficiency savings per year.

Programme director, John Gilbert, said: “We look forward to working with trading parties over the next two years to implement the remaining processes so that they, and customers, can enjoy the same benefits across all bilateral processes and wholesalers can finally de-commission their existing legacy systems.”

The bilaterals programme sought to bring consistency and standardisation to the operational interactions of wholesalers and retailers in the non-household water market.