Water companies holding back housebuilding – new report

Water companies are slowing down the rate of housebuilding with sluggish connections to supply and sewerage infrastructure, according to a new report from the Housing & Finance Institute (HFI).

The report says government should force the water companies to clean up their act with quicker connections to support more housebuilding. The HFI is calling for a merger of Ofgem and Ofwat to drive better performance and delivery standards. According to HFI’s research, every water company in England failed its sewerage connection targets for houses in 2015.

Chief Executive of HFI, Natalie Elphicke, said a lack of local infrastructure on new housing sites is slowing down the rate of new homes coming onto the market. 

“To get homes built faster we need better performance from utilities companies who are currently failing to deliver on the homes the country needs. There is mounting evidence that a continuing failure of performance of water companies is delaying housing growth," Elphicke said.

The HFI says the company that performed the worst was Affinity Water, which services housing in the South East, Essex and around London. Over the first three quarters of 2015, Affinity failed to hit its performance target by 40%, the report says. 

Slow connections are also reported for Thames Water, Southern Water and South Staffordshire. The HFI says regulatory reform is needed to bring better performance and support for housebuilding.

“There is a strong case for providing the same legal framework for water as there already exists for electricity,” Elphicke said

“Given that there are so few utilities providers for water and electricity, there is a powerful case for a single utility regulator to drive more collaborative and planned local utilities provision and higher standards across all regulated entities.”

The HFI report also calls for new power for councils to force the release of disused public land for house building. “Some sites have sat vacant for 10, 15 or 20 years. Across the board we need to see more homes built faster. Consideration should be given to beefing up the planning conditions imposed by councils to set agreements about the rate of building on sites. The Secretary of State for Communities and Local Government should have new powers to step in where strategic sites are not building out to the required rate.”