Wholesalers reject liquidity support for retailers beyond July

Wholesaler representative, Water UK, has urged Ofwat not to extend the liquidity support wholesalers have provided to retailers during the Covid crisis beyond the end of the month.

Responding to Ofwat’s consultation on next steps for the business retail market, Water UK firmly argued liquidity should not be extended after July, given limited take-up of the scheme (eight retailers have opted in); that retailers have had time to find alternative means of support; that the lockdown has been eased; and that the risk of systemic retailer failure has now passed.

Water UK supported Ofwat’s plans to put a backstop profile in place for the repayment of liquidity support, and for all temporary vacancy flags to be withdrawn by the end of September. It said the end of October rather than the end of September would be preferable for the reintroduction of all market performance charges.