Further supplementary memorandum from
Water UK
FEEDBACK FROM THE WATER COMPANIES ON THE
PERFORMANCE OF THE DRINKING WATER INSPECTORATE IN 1998
Report of a Survey undertaken for DWI
EXECUTIVE SUMMARY
A survey was conducted to obtain feedback from
water companies in England and Wales on DWI performance in 1998.
All companies (except Cholderton and District Water Co) were approached
and their views sought either by telephone or in face to face
meeting.
Feedback was structured to reflect the organisation
of DWI and allow the performance of individual sections to be
identified. The manner in which the activities were carried out,
the companies' views on the appropriateness of the conclusions
or decisions reached and the level of professional knowledge and
expertise shown were evaluated. DWI's performance against its
own targets published in the Code for Enforcement was also assessed.
The blend of positive and negative feedback which the survey produced
provides a pointer to the Inspectorate of where the water industry
sees DWI's strengths and weaknesses.
1998 was a particularly demanding year for DWI
with the introduction of a new organisational structure, AMP3
and all that brings, heightened activity in the area of incidents
and prosecutions and the drafting of new regulations. These factors
were reflected to some degree in water company responses.
Water companies expressed respect for DWI and
a recognition of the important role it has played in the development
of the water industry in England and Wales. They had a high degree
of respect too for the knowledge shown by DWI inspectors and for
their professionalism in their dealings with the companies. However
they voiced their frustration in a number of areas where they
were waiting for DWI responses or where they felt there were more
important issues than those which were exercising the Inspectorate
in its dealings with the company or with the industry as a whole.
Nevertheless water companies did recognise that resources at DWI
were very heavily stretched during the year particularly in some
sections and that this contributed to significant failures on
the part of DWI to met its own targets for responding to companies.
In general the companies felt that DWI had dealt
with individual companies in a fair and reasonable fashion although
the initiative taken by DETR/DWI with respect to Cryptosporidium
was not seen in the same light. Consistency of treatment by DWI
remains an issue for some companies.
A scoring system was introduced in the survey
to provide a better structure to the subjective information being
sought from the companies. The respondents were asked to score
on a scale of one (poor) to five (excellent) how well they believed
the Inspectors had carried out their functions and the professional
knowledge they had shown. A large majority of the scores fell
within the range of three to five.
All companies interviewed expressed a wish for
a professional partnership with DWI rather than a confrontational
relationship. But many also were concerned that in the last 18
months the relationship had moved away from this ideal rather
than towards it. This change was seen by the companies to be a
consequence of initiatives taken by DWI.
INTRODUCTION
1. This report describes a survey of water
companies in England and Wales carried out in January and February
1999. The objective of the survey was to obtain from relevant
company employees their views on the performance of the Drinking
Water Inspectorate in 1998. The brief for the task was set down
in a specification entitled "Consultancy: Feedback from Water
Companies on DWI Performance (Annex I) which accompanied a letter
from the Duty Chief Inspector dated 18 November 1998. The areas
upon which feedback was to be sought and the questions to be asked
were agreed with the Deputy Chief Inspector before the survey
was undertaken. Companies were informed of the survey by Information
Letter 2/99 dated 14 February 1999 (Annex 2). It was agreed that
views would be sought from all companies except Cholderton and
District Water Company.
2. The Inspectorate's formal statement of
how it intends to carry out its duties is set down in its Code
for Enforcement. During 1998 the second edition of the Code published
in July 1995 was current but it has subsequently been superseded
by the third edition.
3. In carrying out the survey, feedback
was sought from water company representatives on DWI performance
against specific targets set in the Code for Enforcement but it
also ranged widely over the principal regulatory activities of
the Inspectorate. In providing factual statements company representatives
in many instances consulted their records but some of the less
critical factual information came from the memories of those participating
in the survey. No attempt was made in the survey to cross-check
the statements made with DWI.
HOW THE
SURVEY WAS
CARRIED OUT
4. Water company views on DWI's performance
during 1998 were gathered by telephone or face to face interviews.
The specification for the contract provided the basis for producing
a checklist of questions (Annex 3) which was developed and agreed
with the Deputy Chief Inspector prior to the survey.
5. Responses were sought from water companies
on the principal activities of the Inspectorate, ie:
— incidents and complaints;
— liaison via the Liaison Inspectors.
6. The interviews were concluded with general
questions on whether companies believed that the Inspectorate
had been fair and objective in carrying out its functions and
that it had shown reasonableness in its decision-making. Companies
were also given the opportunity to make any other points which
they felt were relevant to the feedback survey.
7. Where important subjective judgements
were being sought a simple scoring system (from one = very poor
to five = excellent) was used to provide some structure and comparability
to the views expressed.
8. Letters (Annex 4) were sent to the board
level contacts in all 26 participating companies inviting them
to nominate a representative or representatives and providing
them with a copy of the checklist. A list of water company contacts
who provided feedback is given in Annex 5.
9. In carrying out the interviews a discussion
style was adopted as far as possible rather than an interrogatory
format as it was considered that this approach would elicit franker
and more useful feedback.
10. Where face to face meetings took place
some companies arranged for a number of staff to attend for a
round table discussion. This approach was particularly useful
and it gave the opportunity to judge better the range of views
that existed within a company.
11. For telephone discussions the normal
procedure was that the company representative used the checklist
to obtain views from colleagues beforehand and then received a
call at a pre-arranged time. Telephone feedback sessions were
variable in length but normally lasted about one hour. (In total
some 95 telephone calls were made in the course of the survey).
In some instances companies asked that telephone feedback be obtained
from more than one company representative and this was done where
requested.
12. Those companies where face to face meetings
were held at the company offices were as follows:
— Essex and Suffolk Water;
All other companies were surveyed by telephone.
13. A further component in the survey was
to seek views face to face from the Water UK team who participate
in regular liaison meetings with the senior inspectors at DWI.
This discussion sought inter alia to test DWI performance
against statements made in the Code for Enforcement about consultation
with the industry association.
GENERAL FINDINGS
14. There is widespread respect for and
recognition of the role of DWI amongst the water companies. On
the majority of topics discussed with the companies a positive
attitude was adopted towards the Inspectorate. This respect and
goodwill had been built over a period of some years.
15. It is recognised by many that DWI has
made an important contribution to a major raising of standards
in the UK water industry. DWI Inspectors are seen as generally
having high levels of knowledge and expertise particularly in
the areas of laboratory work and regulatory legislation. Knowledge
of the operational aspects of treatment and distribution is normally
adequate although not so well developed.
16. All companies interviewed expressed
a wish for a professional working partnership with DWI rather
than a confrontational relationship. Differences no doubt exist
about the concept of what a professional working relationship
should be. It is recognised however that DWI must retain a clear
and separate identity from those it regulates.
17. There is widespread concern amongst
the companies that in the last 18 months there have been significant
changes in the relationship as a result of DWI initiatives. This
is leading some companies to question their stance and attitude
towards the Inspectorate particularly with respect to openness
of approach and the volunteering of information.
18. Performance over the years against DWI's
own targets for speed of response set in the Code for Enforcement
has not been good. This was recognised in the Chief Inspector's
report for 1997 and addressed in the reorganisation of January
1998. As a consequence companies believe that there has been a
modest improvement (with some notable exceptions) in the times
taken to deal with and report upon incidents. This is despite
1998 being an exceptional year with the introduction of a new
structure for the Inspectorate and all the work which AMP3 has
brought. A question for the Inspectorate however must be—would
they have accepted similar delays in the return of data and reports
from the companies? Or would enforcement action have been taken?
19. A perceived inconsistency of treatment
by DWI remains an issue for some companies—particularly
where direct comparisons can be made between companies and between
inspectors. The potential for arguments has already been reduced
by allocating one inspector to all companies in common ownership.
And presumably internal written guidance is available to Inspectors
to achieve greater consistency. On the other hand a comment made
by other companies is that the Inspector was not sufficiently
pragmatic and would not depart from the "party line".
It is a difficult balancing act for the Inspectorate but remains
a sensitive matter for companies and it is raised again in the
section on the detailed findings.
20. Company representatives were asked a
general question about whether they felt that DWI had been fair
and objective in its dealings with their company and to provide
a score on the one to five scale. Scores ranged from two to five
with a mean of 3.8. A further question was put on the reasonableness
of DWI's decisions. A mean score of 3.6 was recorded with the
same range of individual responses as was given to the previous
question. These responses suggest that in the water companies'
view fairness, objectivity and reasonableness prevail but in the
experiences of small number of companies they do not. The Inspectorate
will wish to remain vigilant to ensure that these important principles
are maintained and are seen as such by those whom they regulate.
DETAILED FINDINGS
Inspection Activities
21. Water companies felt that the arrangements
for the 1998 inspections were generally good and they were carried
out in a professional manner. The average score was 3.9 with 19
out of 26 companies giving a score of four or higher.
22. The principal reasons given for the
lower scores offered by seven companies were:
— inconsistency with previous inspections;
— major differences between conclusions
at the wash-up meetings and the subsequent written report;
— inefficient handling of audit trail
queries;
— poor organisation and inadequate
time.
Two Inspectors were responsible for carrying
out inspections at six of these seven companies.
23. Conclusions and recommendations were
considered broadly appropriate by 14 companies. Of the remainder,
three were still waiting for the draft report at the time of the
survey. The most widespread cause of disagreement arose not so
much from the findings and conclusions themselves as from the
way in which they were dealt with, ie whether suggestions, recommendations
or enforcement resulted. An issue raised by several companies
was that an inspector new to the company had carried out the inspection
and had made recommendations or even initiated enforcement action
for practices which had been in existence for some years and were
known to and apparently acceptable to Inspectors carrying out
inspections in earlier years.
24. A related issue was that of the significance
attributed to infringements and deficiencies. In the context of
the quality and reliability of water supplies and the protection
of public health there were wide differences in their significance.
But several companies felt this was not recognised adequately
in the Inspector's conclusions.
25. The professional knowledge and expertise
of the Inspectors carrying out inspections were considered to
be high with 17 companies scoring four or higher. The lowest score
was three and the average was 3.8. When pressed on the areas where
the Inspectors were weakest companies cited knowledge of some
operational aspects of modern water treatment works and of distribution
systems. However, no company identified serious shortcomings in
the professional knowledge of the Inspectors.
26. When asked about their experiences with
consultants many companies commented that in the past the quality
of consultants had been very variable. It had improved recently
but in a few instances consultants had been used in 1998 who in
the view of the companies concerned lacked adequate professional
knowledge and expertise.
27. Companies generally preferred Inspectors
to carry out inspections as their knowledge was usually better
(and so an initial steep learning curve was avoided), better continuity
could be maintained and a more decisive approach adopted. However,
some consultants are very highly regarded by companies particularly
with respect to their practical operational knowledge. In practice
consultants appeared to have been very little used in the general
inspections in 1998 but extensively used in the distribution system
inspections.
28. Turning to the performance against the
targets set in the Code for Enforcement, the Inspectorate has
set targets for itself as follows:
— draft inspection report to be sent
to company within four weeks of inspection;
— final inspection report to be sent
to company within four weeks of receiving company comments;
— consolidated report to be sent by
1 March of the following year.
29. Water company records show that the
draft inspection reports of 13 companies were provided within
the target timescale. For the others times ranged widely and not
all had reached the companies at the time the survey was undertaken.
However, it was possible in these cases to judge whether or not
the target had been met. The longest period recorded was >150
days where the draft report was still awaited (by Severn Trent
Water).
30. Not all companies were able to provide
information on the period between giving comments on the draft
and the provision of a final report from DWI because the draft
report was still awaited at the time of the survey. However, 19
companies had received the final inspection reports of 1998 and
of these 12 (63 per cent) were provided within the target. Information
on the provision of the consolidated reports was too sparse to
form a view as the survey was undertaken before the deadline of
1 March 1999.
31. Only one Inspector in the I & E
section appeared to have met the targets for provision of draft
and final reports in all cases. Another inspector had not met
the targets for any company which he inspected. Thus there is
a wide range of performance against the Code for Enforcement targets
within the Inspection and Enforcement Section although of course
timeliness of reporting is only one aspect of performance.
ENFORCEMENT
32. DWI's procedures for assessment of compliance
changed between 1997 and 1998. For 1997 companies were required
to submit a full data return for the calendar year by 28 February
1998. In 1998 companies were asked to submit monthly exception
reports so that exceedences could be picked up at an earlier stage
and corrective action taken more quickly.
33. Companies were generally pleased with
the accuracy of the Inspectorate's compliance assessment of the
1997 data and the average score given was 4.3 with 21 out of 26
companies scoring it four or higher for accuracy. The lowest score
recorded was three and this arose from some protracted queries
and much "toing and froing" over issues of interpretation.
One of the Inspectors carrying out this work was apparently doing
so for the first time and was therefore to some extent at the
learning stage.
34. Views on the new procedures adopted
in 1998 were mixed. Many companies were initially sceptical but
had then become more positive. At the time of the survey 14 companies
were supportive of the new arrangement, seven did not like it
and preferred the previous system and five remained neutral. However
there was a widespread reservation about the operation of the
scheme in that some companies had received no feedback, others
had received very late feedback and only a small minority had
received prompt feedback throughout the year. The new system clearly
requires a greater DWI resource (and water company resource too)
to operate it and the companies' impression was that there were
inadequate resources available in the Inspectorate to operate
it as intended. In these circumstances a reliable industry-wide
view on the Inspectorate's assessment of compliance of the 1998
data could not be obtained. Those companies which felt able to
offer a score gave values between one and five.
35. Company views on DWI's conclusions on
enforcement based upon the 1997 compliance were generally positive.
However, reservations were expressed about the mechanism and the
concept of it being an exercise in "enforcement". Several
companies wished to offer undertakings but for various reasons
DWI would not accept these proposals nor allow the setting up
of "back to back" undertakings. Other concerns centred
around a "heavy handed approach" and in several instances
apparent inconsistency with earlier years and between companies.
However, overall 18 companies felt the conclusions on enforcement
were generally appropriate and eight felt them to be wrong.
36. The professional knowledge of the Inspectorate
in carrying out compliance assessments and dealing with undertakings
was seen as good with an average score of 3.8 and individual company
scores varied from three to five.
37. Turning to the Inspectorate's performance
against target timescales, these are set in the Code for Enforcement
as providing a preliminary assessment within four weeks of receiving
a complete data set via electronic medium (or within 10 weeks
if sent as hard copy) and issuing a notice of intended enforcement
within four weeks of receiving a company's response to the preliminary
assessment (or within eight weeks of the preliminary assessment
if this is shorter). One company submitted 1997 data as hard copy
only. All others submitted data as electronic medium or as both.
DWI achieved its target of providing a preliminary compliance
assessment within four weeks to 13 water companies (50 per cent).
The maximum time reported by any company was 73 days (in the case
of Tendring Hundred Water).
38. Establishing DWI performance with respect
to issuing letters of intended enforcement proved to be more difficult.
This was because of the dialogue which took place (both by letter
and telephone) between the companies and the Inspectorate following
the issuing of the preliminary compliance assessment. Overall
the period between the end of this dialogue and the issue of the
notice of intended enforcement was of the order of one month although
in two cases (Welsh Water and Yorkshire Water) a period in excess
of eight weeks appeared to have elapsed.
DISTRIBUTION SYSTEMS
39. The vast majority of the distribution
system inspections were carried out by consultants acting under
the direction of an inspector (Milo Purcell). Not all companies
were the subject of distribution system inspections in 1998 but
19 reported that they had been. Audits of distribution schemes
were also carried out of many companies by consultants in late
1998 for AMP3 purposes although some companies appeared to be
unclear in which of the two categories their distribution inspections
lay.
40. Arrangements for distribution system
inspections were considered to be generally good by the companies
and the average score given was 3.9. The lowest score recorded
was two and this arose because the employee used by the consultants
was very inexperienced and had not been provided with all the
relevant documentation.
41. Thirteen companies considered the conclusions
of the distribution system audit appropriate. Three took the view
that they were inappropriate and three were still awaiting the
draft reports at the time of the survey.
42. Companies felt that in general they
had had too little direct contact with DWI Inspectors during the
1998 distribution system inspections to obtain a reliable view
of the Inspector's professional knowledge and expertise. Those
who felt able to offer a score however gave a high score. The
consultants also received a high score for their knowledge and
expertise with an average to 3.9 and a range of two to five. The
score of two was given because of the circumstances described
in paragraph 40 above.
43. The Code for Enforcement targets which
apply to the distribution system undertakings are the same as
those given in paragraph 28 above. The target for provision of
the draft report was met for seven companies (37 per cent), exceeded
for 10 companies (53 per cent) and could not be assessed for two
companies who were awaiting draft reports and were still within
the target period. One company (North Surrey Water) reported a
delay as long as 74 days for receipt of the report of a 1998 inspection
although some companies had experienced much longer delays following
inspections in 1996 and 1997.
AMP3
44. Amongst the companies there was quite
widespread criticism of how AMP3 had been handled and yet curiously
there was a substantial degree of sympathy for DWI amongst the
companies. Many believed that DWI was not the originator of the
difficulties and that the whole process had become highly political.
There is very strong professional respect and admiration for Milo
Purcell who was the lead Inspector for AMP3 but a firm belief
that too much was being asked of him and too few resources given
to him to do what was required.
45. When asked about the quality of advice
on the requirements for AMP3 submissions, scores ranged from one
to five with an average score of 3.0. The highest score was given
by a small water only company with a single AMP3 submission. The
lower scores also tended to come from water only companies and
some smaller water and sewage companies. Their criticism centred
on a lack of clarity, detail and timeliness.
46. The subsequent handling of submissions
was a source of greater criticism. The average score given was
2.6 with individual scores ranging from one to four. The issues
for the companies were that:
— they were often unable to get hold
of the appropriate Inspector to resolve a query although when
they did make contact they received a helpful response;
— the preliminary opinion letters were
very late in arriving; many had not arrived when the survey was
being carried out in February. Some companies put in early submissions
on the understanding that by doing so they would get an earlier
reply. One company (South Staffordshire Water) having done this
and made several subsequent enquiries at all levels had still
received no preliminary opinions on 16 February and the company's
final meeting with Ofwat prior to the determination had already
taken place;
— in discussion with DWI about the
submissions it became clear that in some cases there were important
differences between what the companies inferred from the Information
Letters and what DWI required;
— a consultant was employed to process
and reformat the lead submissions and this added a significant
workload for some companies to eliminate misunderstandings and
errors in the transposition;
— re-profiling by DWI of distribution
system expenditure created difficulties for some.
47. Because many companies were still awaiting
preliminary opinion letters at the time of the survey it was not
possible to get a full and comprehensive picture of whether they
considered DWI's decisions appropriate. However some feedback
was offered.
48. Several companies observed that the
Inspectorate's decisions were very heavily qualified and until
these qualifications were explored and additional information
assembled the decision was not clear. Nine companies gave a qualified
"yes" when asked about the appropriateness of the decisions
received to date, 10 companies felt they were inappropriate and
seven companies had not received sufficient information to offer
an initial view.
49. Decisions on lead appeared to have suffered
the greatest delays and some companies were concerned that DWI
responses on distribution systems which called for re-profiling
of expenditure appeared to have been taken in isolation from company
submissions on lead. In practice these companies would wish to
be looking at some integration of the programmes to provide for
mains rehabilitation and to address the lead problem.
50. Other concerns centred around the rejection
of proposals supported by the Inspectorate's auditor and Ofwat's
reporter and a perceived inconsistency in the DWI approach to
Cryptosporidium. Within the context of AMP3 a precautionary approach
was not acceptable (eg need to demonstrate oocysts in treated
water to justify expenditure) whereas a very different policy
was inherent in the draft Crytosporidium regulations.
51. With respect to the professional knowledge
and expertise shown by the Inspectorate in dealing with AMP3,
six companies said they could not provide an assessment. This
was because either they had had insufficient dealings with the
relevant Inspectors or they felt that the Inspectors were constrained
by political considerations rather than professional ones. The
latter point was also made by a number of companies who did offer
a score on professional knowledge and expertise. The average score
given by the 20 companies was 3.6 and individual scores ranged
from two to five.
INCIDENTS AND
COMPLAINTS
52. Twenty-two companies had experience
in 1998 or incident investigations by DWI. As might be expected
company views on the general arrangements, conduct and thoroughness
showed wide variation. The average score given was 3.7 with a
range of 1.5 to five.
53. Three two-person teams were responsible
for investigating incidents in 1998. Different companies gave
widely varying scores to two of the teams (eg from two to five)
and the average scores for each team for the two key questions
asked ranged from 2.6 to 4.7. Whilst it must be recognised that
the companies were offering a subjective judgement on a potentially
contentious activity, these results indicate that based on company
views there is some inconsistency in incident investigations.
54. In response to the question on the appropriateness
of the conclusions and recommendations a large majority of companies
(18) was in general agreement with DWI. Three companies had some
more serious reservations and five companies had not been the
subject of investigations in 1998.
55. The most widespread comment was that
it was not always recognised that the investigation benefited
very considerably from hindsight which was not available to those
taking decisions at the time of the incident. A further comment
made by a number of companies was that an over theoretical view
was taken of operational practice where pragmatism offered a better
way forward. Furthermore, in the view of some companies the resource
implications and cost of what was recommended was not always appreciated.
56. These views no doubt flowed over into
the companies' assessment of the Inspectors' general knowledge
and expertise. Overall this question attracted an average score
of 3.8 with individual company scores ranging between two and
five. In general, companies had not had sufficient experience
of consultants carrying out incident investigations to offer a
useful view on their knowledge and expertise in this area.
57. The Code for Enforcement sets a target
of signing off all incidents within three months unless prosecution
is being pursued. Eleven companies (52 per cent) said that in
the majority of cases incidents were signed off within this time.
However, 10 companies (48 per cent) said that this target had
generally not been met although some recognised that there were
special circumstances in some instances which had prevented DWI
from meeting its commitment. One company (Portsmouth Water) offered
the comment that an incident (involving Cryptosporidium) which
had occurred in 1997 had still not been closed down.
58. An issue that was raised by a number
of companies was one of communication during the course of an
investigation. They felt that it would be helpful to have more
feedback from DWI and to know for example whether the matter had
been passed to the Treasury Solicitor and therefore the three-month
target would not apply.
LIAISON WITH
THE LIAISON
INSPECTOR
59. Some lack of clarity remains amongst
the companies about the role of the Liaison Inspector. For example
is DWI looking for more communication to be funnelled through
the Liaison Inspector so that he or she remains closely involved
with the company or is the role seen as an occasional one of having
somebody to turn to when it is not clear who in DWI is best equipped
to answer a question? Overall the reaction of the companies to
the concept was positive but their warmth for the idea depended
both upon the individual Inspector concerned and the degree of
contact there had been. There appears to be a need for some Liaison
Inspectors to spend more time getting to know their companies
and contacts better. But in a year when the work pressures have
been very heavy it is understandable that the Liaison Inspector
role has suffered.
60. As contacts with the Liaison Inspector
are normally on technical matters all companies felt that it was
very important for the Inspector to have a high level of professional
knowledge and expertise. Although relationships are still in the
early stages for some companies, 24 companies felt able to assess
the way in which the liaison function had been carried out and
the average score was 3.8 with the lowest being two and the highest
being five. For professional knowledge and expertise the score
was higher with a mean of 4.3 in the same range of individual
scores.
61 There was broad support of the concept
of the Liaison Inspector and a genuine disappointment that (for
reasons already outlined) it had not yet developed as intended
in a number of instances.
CONSULTATION WITH
WATER UK
62. The Code for Enforcement states that
the Inspectorate consults Water UK (formerly the Water Services
Association and the Water Companies' Association) about the contents
of Information Letters. It also says that on issues affecting
all water companies the Inspectorate's normal approach will be
to consult with Water UK.
63. It was confirmed by Water UK staff and
the company employees who represent the industry on drinking water
matters, that consultation generally does take place but not invariably.
Often too the time given by DWI for an industry response is very
short and there has also been a lack of feedback when DWI decides
not to take up industry proposals or suggestions.
64. Examples quoted were in the areas of
data collection and distribution undertakings. A DWI/Water Industry
working group had looked at the best technical way for companies
to submit data on an annual basis but, at what in the industry's
view was a relatively late stage. DWI raised policy issues of
what and how data should be collected and issued an Information
Letter on this which introduced without warning the concept of
exception reporting. Following an industry complaint a further
Information Letter was produced setting out the details of exception
reporting which was on this occasion offered as a draft for comment
but with an extremely short time for the industry to comment.
65. With respect to distribution undertakings
the industry believed that DWI were not empowered to make the
rules which they did and appeared to ignore the many representations
the industry made on matters of detail. The industry's view was
that the methodology that DWI imposed was too prescriptive and
was not changed in the light of the arguments offered by the water
companies.
66. The industry would welcome more consultation
and consultation at an earlier stage in the gestation period of
a new policy or practice. It believes that both parties can make
important and valuable contributions to the process and that full
and effective consultation is a key feature of a mature regulatory
relationship.
67. The industry representatives were pleased
and impressed that DWI attaches importance to the periodic liaison
meetings and that both the Chief Inspector and the Deputy Chief
Inspector normally attend. They see this as an opportunity for
DWI to sound out the water industry in an informal way and for
both parties to develop trust and mutual respect. It also offers
an excellent opportunity for the Inspectorate to explain its policies
more fully to the industry. Whilst DWI is under no obligation
to do so, such a step could serve to reduce antipathy in the industry,
demonstrate a democratic approach and improve trust and understanding.
68. There have been recent changes in the
UK Water team liaising with DWI and the new team expressed a very
positive and enthusiastic approach to working with the Inspectorate
in what they hope will develop into a professional partnership
which looks forward rather than back—and one which looks
somewhat further forward than the liaison meetings have done in
the past.
SUGGESTIONS
69. The consultant's brief for this study
did not call for recommendations; its purpose was simply to provide
reliable feedback to DWI. The Inspectorate can then use that information
in managing its future performance and in developing its policies
and practices. However some suggestions are offered below which
may assist the Inspectorate in taking forward the findings of
the Survey.
70. It is not known to what extent DWI has
its own system for monitoring and evaluating performance against
targets in the Code for Enforcement. In a quality assured environment
such a system would be seen as key both for internal management
purposes and for reassuring those who are regulated. Whilst it
is good practice to ask water companies for their views on DWI
performance it could be argued that this is not a substitute for
a robust internal performance monitoring system which records
and assesses compliance against targets in a fully objective manner.
71. There is a high level of professional
knowledge and expertise within the Inspectorate and there is no
obvious need for significant personal development in that area.
However much of the Inspectors' work involves communication with
others—both written and oral—and here there was an
indication that some further personal development could be beneficial.
72. Those Inspectors with well developed
interpersonal skills appear to achieve more positive responses
from the companies. This in turn impacts upon resource needs because
less time is spent in dealing with challenges, providing clarification
and smoothing ruffled feathers. Some Inspectors too appear to
prefer written communications to face to face or telephone communication.
Whilst clearly key communications must be in letter, fax, or e-mail
form to ensure that a satisfactory record exists, communications
to explain and clarify could often be done orally with only a
small increased risk to DWI but a significant gain in efficiency.
Clearly if there is serious distrust present in a relationship
then both parties are going to wish to see all communication recorded
in a written form and the very significant costs associated with
this approach must be recognised when budgets are set.
73. The survey suggested that an important
issue for the Inspectorate is one of manpower resources and their
allocation. A number of organisational changes were introduced
at the beginning of 1998 but they were not implemented as intended
because of their resource implications. The Inspector responsible
for AMP3 has had to carry an exceptional burden during 1998 continuing
to have responsibility for distribution systems and act as the
liaison Inspector for four companies. The water companies expressed
a firm view that there were inadequate resources allocated within
DWI to deal with AMP3 and this had important implications for
them.
74. Perhaps the most fundamental questions
for DWI are what sort of relationship is it looking for with the
water companies and what are its long-term objectives? Does it
seek a professional working partnership within a mature regulatory
framework whilst maintaining its distinct role as regulator. Or
does it seek a more confrontational and armslength relationship
with the water industry? DWI and the water companies probably
have more objectives in common than they have objectives at variance
which suggests that the relationship should have a partnership
element in it. There is little doubt that both the DWI and the
water companies want to see the UK water industry as the best
in the world and for it to be internationally recognised as such.
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