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How to cleanse public opinion on investing in water

Water companies have been keen to reassure the public over hosepipe ban fears caused by this year’s exceptionally dry spring (News last week). But it is widely agreed that water scarcity is a growing problem, and a great deal of engineering work may be needed to tackle it in the future.

Water customers will likely bear the costs of that work through increases to their water bills. Whether the necessary rises will be well received is something of a worry.

63% of voters and 57% of businesses were “willing to pay a little more each month to upgrade our water system”.

But US research on consumer attitudes to water infrastructure investment offers some hope that the public may be persuaded to pay a little extra for infrastructure improvements that they may never see, or even think about.

Engineering and manufacturing company ITT surveyed registered voters and businesses across the USA − a country whose water infrastructure funding gap could grow to as much as $224bn (£137bn) by 2022, according to the Environmental Protection Agency.

The 2010 survey found that 63% of voters and 57% of businesses were “willing to pay a little more each month to upgrade our water system”, with voters willing to pay on average £3.80 more per month − an average increase of 11%. Businesses were willing to pay 7% more on average.

Telling the facts

Moreover, the survey found that the number of respondents who supported “a complete overhaul or major reform” of water infrastructure increased by 62% among voters and 46% among businesses after they were told the facts of the issue.

The latter point is significant, suggesting that if infrastructure improvements are properly communicated, customers are likely to be more willing to pay for that work. The same idea underpins a consultation by industry regulator Ofwat, which finished on Tuesday.

Customers are more likely to pay their bills − and therefore fund future investment − if they believe they are receiving value for money, Ofwat says.

Ofwat is proposing to improve customer engagement in the water price setting process, with the aim of ensuring that the price rises it approves every five years “represent a price and service package that customers and society want and are willing to pay for”.

Customers are more likely to pay their bills − and therefore fund future investment − if they believe they are receiving value for money, Ofwat says.

A large proportion of the UK does not currently hold that belief. In 2009, Ofwat found that 30% of customers felt that the impact on their bills from their water company’s business plan for the 2010-2015 regulatory period was “unacceptable” because the bill was too expensive already, they could not afford it and the improvements were not worth the money.

Ascribing value

The idea that attitudes towards paying for water need to change is far from new. It’s no secret that there are real difficulties in ascribing a monetary value to water − and, as the Northern Irish water crisis this winter illustrated, many people strongly resist the idea that water can be commodified (NCE 19 January).

The Consumer Council for Northern Ireland has identified “strong feelings of ownership” towards water, which people perceive as a natural resource that everyone has a right to access, and that should not be sold for profit. The same feelings do not occur towards other utilities.

The difficulty in making people see water as a valuable substance is exacerbated by the perception of heavy rain and flooding.

And a 2009 report by Black & Veatch Water president and chief executive officer Dan McCarthy entitled Communicating the Value of Water − The UK Water Industry’s Challenge found further problems.

The public’s perception of water is skewed in comparison to other utilities, he reported, with many people willing to pay large sums for a broadband connection, yet recoiling from small increases in their water bill.

The difficulty in making people see water as a valuable substance is exacerbated by the perception of the UK as a place beset by heavy rain and flooding, which is expected to increase with climate change.

“The general perception is that the UK is a wet environment, and yet the south east of England has less water available per person than Sudan and Syria,” McCarthy says.

The regional differences in rainfall mean that messages about water value must be delivered differently to different people, complicating the task.

In addition, he says, the approach of trying to link water bills to the value of water itself as a substance is unhelpful because it obscures the fact that a huge proportion of water bills actually pays for wastewater services.

With that in mind, it looks as though Ofwat and ITT are on to something.

Perhaps what’s needed is not to persuade the public of the monetary value of water itself, but to persuade them of the value − and the real financial cost − of infrastructure.

Readers' comments (1)

  • RFP

    Persuading the public of what goes into providing their water is true to an extent but gas and oil need similar utilities. Water though is the staff of life without which we wouldnt survive. Water companies tend not operate as efficiently or value their product as oil or gas, starving funds from the front line installations that provide the customer with their water and being to extravagant in other areas of the business.

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