Describing the consultation as "informal", Defra said it would provide the water industry, and any organisation or individual with an interest, to comment on the proposed implementation of the scheme.
The scheme will provide the Secretary of State and Welsh Ministers with the power to recover costs of DWI regulatory activities via a charging scheme. The current annual cost of the regulatory functions undertaken by DWI on behalf of the water industry is estimated at around £1.9m per annum.
Defra said the water companies will be able to pass the charges onto their water customers, who are the main beneficiaries of the regulatory work . It is estimated that if water companies did pass the cost on to customers, the average annual water bill could increase by around 15 pence.
Defra said that by introducing a charging scheme, DWI will come into line with other related water regulators such as Ofwat, the Environment Agency and the Consumer Council for Water, all of which charge for their regulatory activities. The proposal also brings the arrangements for DWI in line with general policy on charging, which is that businesses which benefit from regulation, not the taxpayer, should bear the cost of regulation.
The Orders implementing the scheme will come into force on 1st January 2013. Deadline for responses to the consultation is 5th December 2011.
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