BusinessCompany NewsSouthern Water given £20.3m ‘misreporting’ fine

Southern Water given £20.3m 'misreporting' fine

Ofwat issues severe punishment to water giant after it 'manipulated information to conceal the company's true performance' in price reviews

Southern
Water
has been hit with a £20.3m fine by Ofwat for misreporting customer
service data, leading to a price hike for customers.

The economic regulator said that because of the two misrepresentations during
price reviews in 1999 and 2004 which improved Southern Water’s response times to
customer calls, the company was able to increase its prices by more than it
should have done.

Ofwat chief executive Regina Finn said: ‘Southern Water deliberately
misreported its customer service performance to Ofwat and systematically
manipulated information to conceal the company’s true performance over an
extended period of time.’

The situation was uncovered by Southern Water itself in October 2005 after
the new management team was in the process of installing a new billing system –
ironically to improve customer service. The management discovered the
irregularities and launched an investigation.

Because of the performance misrepresentations, customers also missed out on
guaranteed standards payments to which they were entitled because of the service
failures.

In a statement chief executive Les Dawson said: ‘I understand Ofwat’s
intention to fine us for what happened in the past. Today, I would like to
reassure customers that those historically entitled to guaranteed standards
payments have now been paid and that we are well on course to meeting a service
improvement plan agreed with the regulator.’

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