Ofwat urges water firms to do more to break cycle of poor mental health and bill arrears

Ofwat has urged water firms to “go further” in their efforts to break a cycle of customers’ bill arrears and mental health problems.

The regulator warned that customers who struggle to pay their bills are often locked into a “vicious circle” where their struggle with bills causes deteriorating mental health which leads to deeper debt.

“Those who struggle with their mental health find it much harder to ask for help with bills - creating a vicious circle for people in need of support.” Ofwat cited findings from research it commissioned which found that 51% of bill payers believed that poor mental health made it harder to ask for help with bills. For those already facing challenges with their bills, the study found that 65% had difficulty in requesting help owing to their mental health issues. It concluded that “people experiencing mental health challenges find it harder to ask for help, sometimes through nervousness or embarrassment of their situation and sometimes because they are not aware that support is available.”

The research also found that there was a link between poor mental health, inability to pay and low awareness of support

And it found that this cycle has been exacerbated by the pandemic with 48% of bill payers reporting that their mental health had declined during the past year.

To address the issue, Ofwat said water companies should be “identifying the most appropriate way to communicate with their customers - using more traditional means of communication such as phone calls, in addition to alternative channels such as web chats and email where that is preferred. Water companies need to take an empathetic, tailored and gentle approach to support customers.”

Interim chief executive at Ofwat, David Black, said: “We know that companies can go even further to promote the services they have available to instil trust in bill payers so that issues can be identified at an earlier stage.