CCW’s long-delayed annual reports published after adjudication mishap investigated

(by Karma Loveday)

Defra and the Consumer Council for Water (CCW) last week published the latter’s long-delayed annual report and accounts for 2023/24 and 2024/25.

The delay was a result of an inquiry by the National Audit Office (NAO) into CCW’s internal control and financial regularity. This tracked back to a single issue about the organisation’s operation of Alternative Dispute Resolution (ADR) services through its subsidiary, CCW Trading Company. These mediation and adjudication services were operated on a non-profit basis, with all costs incurred recharged to water companies who subscribed to ADR on a voluntary basis.

In the 2024/5 accounts, Gareth Davies, comptroller and auditor general at the NAO, gave CCW a clean bill of financial health, with the exception of a “qualified opinion” on regularity. He explained that CCW’s provision of ADR services was “not in line with its legal powers” and hence that the consumer watchdog had no legal basis to charge water companies for these services. Nor did it seek Treasury clearance: “The CCW did not seek prior consent from HM Treasury to commence the delivery of the ADR scheme or to incorporate CCW Trading Company.”

In May, Water UK appointed a different ADR provider, Dispute Resolution Ombudsman, after Defra instructed it in April to stop using the CCW provision.

There remains little clarity about government plans for the consumer landscape under a reset water sector. January’s White Paper committed to stronger customer advocacy, and access for customers to legally binding resolutions to complaints via a “new, independent, impartial, strong, and accredited Water Ombudsman”. It said there would be a bespoke model for water, “applying best practices from other sectors.” There was no clarity on exactly who would perform these functions.

The Independent Water Commission had recommended Defra consider converting CCW into a new mandatory water ombudsman, and transfer CCW’s advocacy functions to Citizens Advice.

Water UK said water companies will provide the Dispute Resolution Ombudsman service for customers until such time as Government establishes a statutory ombudsman to take on this responsibility.