Source · Select Committees · Public Accounts Committee
Recommendation 24
24
Acknowledged
Costs of special administration for insolvent water companies may fall to billpayers
Conclusion
We sought to understand would happen if a water company became insolvent. Defra told us that that the special administration regime will ensure that services are protected.78 Defra also acknowledged that there would be costs involved in setting up such a regime, which the government would seek to recover.79 If government costs cannot be recovered elsewhere, the government now has the power to recover them through customer bills.80 Defra told us that it needed to be careful about this, and the impact on billpayers.81 Roles and responsibilities within the regulatory framework
Government Response Summary
The government confirms that the special administration regime will protect services if a water company becomes insolvent and it has the power to recover costs through customer bills if necessary, committed to protecting customers in such an event.
Government Response
Acknowledged
HM Government
Acknowledged
The Government is clear that the special administration regime will ensure that services are protected if a water company becomes insolvent. The Government has the power to recover the costs of setting up such a regime through customer bills if necessary. The Government is committed to ensuring that customers are protected in the event of a water company insolvency.