SWW 'should share profits with customers'

CONSUMERS have called on South West Water to ""share"" its success with customers as the group's parent company announced profits of £259 million in the last financial year.

Exeter-based Pennon has reported profits up 7 per cent on the previous year, including an increase of 3.6 per cent for South West Water (SWW), which made £191.6 million.
Pennon's waste wing, Taunton-based Viridor, has seen its profits rise by 12.7 per cent, making £65.5 million.

Responding to SWW's profit announcement, Charles Howeson, chairman of the Consumer Council for Water (Western) said yesterday he understood water companies needed to make profits to attract investment but added: ""Our view is that they should share their profits with consumers, not just shareholders"".

Since it was set up in 2005, he said the council had pushed for water companies to give some of their profits back to consumers. ""I am delighted that SWW was one of the companies who chose to share its profits with consumers by investing £5 million of its profits in customer service improvements and helping customers who are struggling to afford their bills.

""However, SWW customers are on average continuing to pay more for their water and sewerage services than people in other parts of England and Wales – our job now is to ensure consumers get a fair deal when prices for 2010 to 2015 are decided later this year.""

Water regulator Ofwat is currently considering SWW's business plan for 2010 to 2015. It contains proposals to raise average water bills by 6 per cent above inflation, meaning the average annual Westcountry water and sewerage bill could rise from £454 to £481, before inflation, by 2015.

Bill Jordan, chairman of the Devon Senior Council, said the council was concerned that older people and those on a low income were struggling to maintain a decent standard of life and ""larger bills aren't going to help"".

He said he realised SWW had to satisfy its shareholders but he thought it should ""have regard for its customers as well"", particularly in the light of large profits.
""These companies say they're very concerned about serving customers – they could demonstrate this by making some returns to customers,"" he said.

SWW chief executive Chris Loughlin said the company was aware customers were in the middle of a ""deep recession"" and was doing its best to support them. He highlighted its WaterCare scheme, which helped customers struggling to pay their bills to manage their water consumption and cut costs.
He said take-up of the scheme had increased in the past year. SWW had also strived in the past year or two to ensure it was operating as effectively as possible so the impact on prices for customers was as low as possible, he added.

He acknowledged that the proposed increase to bills was ""not welcome"" but stressed it was ""not a large increase"".

Yesterday's profit announcement also brought renewed calls from MPs in the region for a shake-up of a system which sees the cost of keeping Westcountry beaches clean laid at the door of the region's water bill-payers.

Matthew Taylor, Liberal Democrat MP for Truro and St Austell, said: ""A new system to spread the cost of the clean-up of the coastline more fairly across the country, and sharply cut SWW bills, is massively overdue.""
Hugo Swire, Tory MP for East Devon, said that rather than demand SWW share its profits with consumers, it would be better to address the ""underlying unfairness"" which meant SWW customers paying ""disproportionately larger bills than the rest of the country in order to keep beaches clean for visitors"".

Mr Swire has called on the Government to introduce new measures that would treat Westcountry beaches as a ""national