Another fine for Severn Trent Water

Midlands-based Severn Trent Water will have to pay a further fine for its failures to meet customer service standards, Ofwat announced on Wednesday.

The new penalty, the exact sum of which is yet to be decided, is the latest development in Ofwat's ongoing investigation into the water company's operations. The fine follows one announced in March for bad debt, income and leakage (see related story).

The total amounts of all fines imposed on the company will emerge from an ongoing independent enquiry by corporate lawyers Ernst and Young, who Ofwat and Severn Trent jointly asked to look into the "irregularities".

Ofwat formally announced on Tuesday that it plans to impose a financial penalty on Severn Trent, as it is legally required to do a year in advance of actually fining the company.

Ofwat chairman Philip Fletcher said: "It is extremely disappointing that we have had to launch this investigation into an area of Severn Trent Water's customer service activities, following our earlier investigation into other aspects of its business.

"From the evidence we have seen it is clear that Severn Trent Water has failed to meet the GSS performance standards. The failures were within the company's control and customers' interests have been damaged.

"Customers' interests must be protected. A financial penalty will send a clear message to Severn Trent Water that it must meet its legal obligations to its customers."

The water company responded to Ofwat's announcement with assurance that it will try to make up any inconvenience caused to customers: "As set out in our Announcement of 7 April we have been and will continue to work in full and open cooperation with Ofwat, and if customers have been disadvantaged then Severn Trent Water shall reimburse them," the company said in a statement.

Goska Romanowicz



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