Ofwat’s service incentive mechanism (SIM) encourages water companies in England and Wales to provide better service to their customers. The SIM allows comparison of companies’ performance. It measures the following aspects of service delivery:
- Where customers have made contact when something has gone wrong or appears to have gone wrong, for example, phoning about a billing error or writing to complain about a water supply problem.
- A customer survey measuring how well companies have handled all types of customer contacts, not just when things have gone wrong.
Overall service incentive mechanism scores 2018-19
Anglian Water topped the table again this year, increasing its score from 88.3 in 2017-18 to 90.0. Last year’s second best performer – Portsmouth Water – is in second place again. Thames Water is bottom of the table again this year – its score has dropped by over three points since last year from 78.4 to 75.0.
The average SIM score fell to 84.4 out of 100 in 2018-19 from 84.5 in 2017-18.
We are pleased to see the top performing companies doing even better than last year, but disappointed to see a drop in the average industry score, following three consecutive years of improvement. We want to see companies doing better as we know that customers’ expectations continue to rise. The best performing companies have shown that excellent customer service and very satisfied customers are both possible to achieve.
|South West Water||87.6|
|South Staffs Cambridge Water||86.4|
|South East Water||85.4|
|Severn Trent England||81.5|
Previous years’ SIM results are here.
SIM component scores
Customer satisfaction 2018-19 results
The annual SIM survey report shows the results of four customer satisfaction surveys conducted during 2018-19. The survey asks customers how satisfied they are with their water company’s handling of queries and resolving issues. We use an independent market research company to conduct the surveys.
The results show a slight dip, with average customer satisfaction falling to 4.39 out of 5, from 4.40 last year. Overall, customers of Anglian Water said they were most satisfied, with Portsmouth Water and South West Water’s customers in second place. Thames Water and Hafren Dyfrdwy’s customers were least satisfied. Customers were more satisfied with the handling of billing enquiries (4.50) than either clean water (4.21) or wastewater (4.44) enquiries.
Green for water and wastewater companies, blue for water-only companies
Billing dominated the reason for contact with 16% of the total sample contacting their water company due to a recent or planned move, or to make a payment. A further 9% contacted their water company about a blockage in the sewer/drains, 6% about having no supply and 5% about a water leak/burst on the road. Telephone is by far the most common method of contact (88%). A small proportion of customers chose to contact through their company’s website (6%).
81% of customers considered the matter they contacted about fully resolved. Billing enquiries were significantly more likely to be resolved than clean water or wastewater enquiries. Portsmouth Water had the highest proportion of customers who felt their query was resolved. Thames Water had the lowest proportion of resolved contacts.
Download Ofwat SIM survey 2018-19 annual report.
Numbers of complaints 2018-19
Companies report the number of complaints they receive to the Consumer Council for Water.
Unwanted contacts reduced by 2.8% in the year – the best reduction in a single year since 2015-16, when companies began reporting only those from household customers.
The overall trend since 2015-16 is less impressive with unwanted contacts having only fallen by 1.1%.
In contrast written complaints increased by 7.7% in 2018-19 from 69,324 to 74,689, but the four-year trend shows a much bigger reduction of 21.1%.
Incentives to improve
Measuring and reporting relative performance on SIM provides incentives for companies to improve. Additionally, we have explained that we will apply financial incentives of between -12% and +6% of residential retail revenue, based on the relative average scores for each company over the 2015-2019 period.
We have consulted on the detailed approach to do this and the financial consequences to customers in July as part of our 2019 draft determinations (in the Accounting for past delivery technical appendix). This used the latest expectation of the 2018-19 SIM scores.
The consultation has now closed. We will consider the responses we have received and update the four year averages using the actual 2018-19 SIM scores. We will confirm the financial incentives in our final determinations in December 2019.
Future customer service measures
SIM in 2019-20
In 2019-20 we will collect SIM proxy data so that companies who proposed reputational incentives for SIM at PR14 can report on them.
C-MeX and D-MeX
The customer measure of experience (C-MeX) will replace the SIM as the incentive for companies to improve the experience of residential customers from 1 April 2020 onwards. We are also introducing a new mechanism, the developer services measure of experience (D-MeX), effective from 1 April 2020, to incentivise water companies to provide an excellent customer experience for developer services (new connections) customers. We expect to publish companies’ C-MeX and D-MeX performance annually.
Further information can be found here: https://www.ofwat.gov.uk/regulated-companies/company-obligations/customer-experience/