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Letters to Managing Directors
MD204 6 June 2005 MODIFICATION OF CONDITION N TO PROVIDE FUNDING FOR THE CCW In June 2004, we consulted on a modification to Condition N, to recover the running costs of the CCW. We had six responses to the licence modification, of these five accepted the proposals. One company suggested we should use number of customers and not turnover to calculate the proportions paid by each company. We do not consider this to be as reliable as the turnover based calculation. We have found two issues that do require clarification in the licence, covering the half year costs 2005-06 and reference to the Water Act 03 provision on amending running costs for one year. The changes are: 1. The recovery of part year costs for the period 1 October to 31 March 2006; 2. Reference to WA03 s37(8) in the proviso at the end of paragraph 3, which recognises the Secretary of State's power to amend the costs in a particular year. These are set out in the attached revised Licence modification. If you wish to comment, please send your responses to this consultation letter to Roger Dunshea, Director of Operations (roger.dunshea@ofwat.gsi.gov.uk) by 20 June. Nil responses are not required. The next steps are for Defra to approve the running costs and set up the budget in early summer. I will confirm this and the cost apportionment for your company when Defra have confirmed the budgets. The previous estimates still stand for both running and set up expenditure. We plan to issue invoices for both in September or October. Philip Fletcher Enc.  |
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