Ofwat is calling on the water companies to ensure more consistency in self lay requirements between their own staff, contractors and self-lay providers (SLPs).

Michael Deakin, Principal, Performance and Outcomes at Ofwat, has written to the water companies about the Code for Adoption Agreements and the current accreditation requirements for staff competence and training.

The water sector regulator considers that there should be greater consistency in how companies assure the competency of their own contractors/staff and SLPs. Ofwat is looking for the companies to take the lead and to confirm back to Ofwat by 30 November 2021 setting out the details of how they will achieve this.

According to Ofwat the existing accreditation requirements for SLPs is an area where companies and SLPs were not in complete alignment. While SLPs must have accreditation from the Water Industry Registration Scheme (WIRS), not all water companies require this from their own contractors/staff.

The regulator said that SLPs do not consider this fair and have raised concerns that the current accreditation arrangements could potentially enable anti-competitive behaviour by water companies in two respects:

• Preventing SLPs that are unable to spend the time and money on WIRS accreditation from participating in the market
• Preventing SLPs from employing staff who have previously delivered works on behalf of water companies without experiencing costs or delays (i.e. creating barriers in a potential labour market) Conversely, SLPs perceive that companies can take on new starters almost immediately.

SLPs consider that the issues lead to “significant barriers” to SLPs entering the market.

An information-gathering exercise by Ofwat in July last year revealed that:

• water companies use a mix of contractors and their own staff to deliver new connections work
• some companies currently require contractors to be WIRS accredited to carry out new connections work
• some companies do not use WIRS accredited contractors (or sub-contractors)

Michael Deakin, told the water companies:

“ We maintain our view …. that there are good reasons why SLPs must be accredited to demonstrate the skills and competence of their staff. Companies need to ensure the quality and longevity of adopted assets so they can fulfil their long-term obligations in terms of the safety, resilience and reliability of public water supplies. When SLPs provide infrastructure, they are only responsible for a short period, whereas companies are responsible for an asset for its lifetime.”

However, it was “not entirely clear why some companies are comfortable requiring formal accreditation of their contractors (i.e. through WIRS), while others are not.”

“ We consider there are likely to be some difficulties with staff moving from those companies who do not require formal accreditation of their contractors to SLPs, and we think greater consistency is desirable to facilitate movement within the market.”

Looking ahead, Ofwat considers there is “room for improvement” and there should be “greater consistency in how companies assure either their own contractors/staff or SLPs competency.”

Ofwat now wants the companies to take the lead in how to achieve this. The regulator has expressed disappointment that “having previously committed to exploring this issue, companies did not take any sector wide actions” and is looking for companies to commit to “achieving a better outcome this time.”

Michael Deakin has asked the companies to write setting out their plans, milestones and the progress they are making on the issue by 30 November 2021.