How does the Welsh Government reconcile the provisions of the Water Industry Act 1991, which encourages competition in the water sector, with its Strategic Priorities and Objectives Statement to Ofwat, which discourages competition in the sector?
The Water Industry Act 1991 requires Ofwat and the Welsh Government to “protect the interests of consumers, wherever appropriate by promoting effective competition”. Our SPS sets out where we believe promotion of competition is not appropriate:
“The Welsh Government does not support the introduction of competition where the activity of new entrants would reduce companies’ overall accountability for the delivery of excellent services to customers and the environment; nor where it would threaten the integrity and efficiency of the management of the water system; nor where it cannot clearly be evidenced that it would be beneficial to customers. The Welsh Government does not support the fragmentation of the water industry in Wales and further promotion of competition is undesirable.”