Interim results 2018
We recognise the great responsibility and opportunity we have in providing an essential public service in the UK. The water industry is fundamental to the health and wellbeing of its customers, the environment and the economy. Building on our strong values, we are committed to lead in our industry, to forge a new relationship between public and private sectors, to restore faith in a responsible long-term commitment to public service and to stimulate a healthy market for innovation.
We are already adopting an open system model within our business, enabling others to partner with us for example by using EnTrade and catchment-based approaches to deliver environmental improvements while also contributing towards the government’s 25-year Environment Plan.
Our mission is the be in the top 20 of all UK service businesses and a leader on environmental performance, so we are determined to benchmark ourselves not just against fellow water companies and utilities, but also against the UK’s very best service companies.
Since privatisation Wessex Water has consistently been an industry leader and stood out in terms of performance. This has been achieved by our commitment both to delivering leading customer service and to becoming a sustainable water company that adds real value to our environment and our communities.
This was recognised in April when we were awarded the Queen’s Award for Enterprise, the UK’s highest accolade for business success, for a third time.. The award specifically recognised our leading performance in customer service, innovation and environmental performance as scored by industry regulators.
In addition, to mark the 25th anniversary of our groundbreaking Watermark awards, we have been supporting local communities to provide water refill points to reduce the use of single-use
Our long-term sustainability vision is embedded in our business plan and was, submitted in September for the period 2020-2025. This plan focuses on our significant role in the community and our catchment-based approaches to delivering our largest environmental improvement programme ever. It has the very strong support of customers.
Our plan, which includes stretching performance targets that further extend our outstanding performance, will require a change in how we and the industry operate. We included a proposal for delivering the improvements our customers want while recognising our community role and increasing our use of markets to engage with stakeholders. This will create new solutions to the challenges that we all face in the 21st century.
Our proposed open systems approach provides an alternative to the political extreme of re-nationalisation on the one hand and the ever increasing burden of regulation on the other. It will create greater community focus with less regulatory burden and enable markets and innovation to thrive.
We have already seen the benefits of this approach in our business plan, most notably by avoiding £104m of cost to our customers through alternative catchment-wide solutions to a portion of our nvironmental programme. We are also extending the capabilities of our successful EnTrade reverse auction platform to help reduce the need for high cost engineering solutions.
Our forward planning also provides resilience for our services to extremes of conditions. This year we were able to maintain services during the extremes of both the Beast from the East in March, and the subsequent hottest, driest summer since 1976. Our newly commissioned water supply grid played a key role in enabling us to maintain uninterrupted supplies during both these situations.
Another aspect of our resilience planning is our preparation for each possible outcome of the government’s Brexit negotiations, including that of a no deal. This is important as much of our supply chain relies on products and services provided from Europe.
We are also continuing to provide excellent opportunities for employment, whether through our apprenticeship or graduate recruitment programmes. Our employees will always be our most important resource and are central to delivering step changes in performance for our customers and the environment.
Our results for the half year show that operating profit decreased by £10.6m from £125.4m to £114.8m, while profit after taxation decreased by £14.3m from £69.3m to £55.0m.
Total revenue increased by £5.0m from £273.1m to £278.1m. Regulated turnover rose by £1.4m while unregulated turnover rose by £3.6m. There was only a small rise in regulated turnover because of an over-recovery in previous years being returned to customers. Price rises were 2.0% for household customers and 1.8% in relation to wholesale charges passed on to retailers for non-household customers.
Operational costs (excluding depreciation and amortisation) increased by £9.1m from £99.3m to £108.4m. There were upward pressures on costs due to general inflation, new obligations, power costs and environmental charges. There were cost reductions that partially offset these increases due to energy consumption initiatives and a reduction in new connections.
Depreciation and amortisation increased by £6.5m from £48.4m to £54.9m. The principal reason for the increase was that last year’s results reflected the disposal of the non-household customer book to Water2Business. Excluding this item there was a small increase from new assets depreciated for the first time.
Net interest payable increased by £5.5m from £40.8m to £46.3m. Interest payable increased by £5.3m mainly because of an increase in the average cost of debt from 4.1% to 4.4% which was a result of higher inflation and a rise in the cost of floating rate borrowings. Interest receivable fell by £0.2m.
Total taxation reduced from £15.3m last year to £13.5m this year, reflecting the reduced level of profits. The corporation tax rate remained unchanged at 19% and the mainstream corporation tax charge decreased to £10.8m this year from £11.6m last year. The deferred tax charge reduced from £3.7m last year to £2.7m this year.
Dividends declared for the six months to 30 September 2018 were £47.0m, a decrease from £50.0m for the same period last year.
Gross capital investment for the six months was £127.4m being an increase of more than 30% compared to £97.1m last year. An increase in capital maintenance expenditure was the main reason.
Net debt increased by £43.8m from £1,985.5m to £2,029.3m in the six months to 30 September 2018. The net cash inflow from operating activities was £181.8m less net capital investment of £122.8m, less interest and finance lease payments of £36.2m, less tax payments of £12.6m, less dividend payments of £46.0m and an increase in bond accruals of £8.0m.
Liquidity at 30 September 2018 was £150.0m which comprised undrawn committed bank facilities.
We work hard to ensure we are able to avoid, cope with and recover from any disruption to our business operations.
Full details of our governance procedures and processes are available in our annual report and accounts document, which can be found on our website. In summary, the board annually reviews and approves the delegated authority register (DAR), terms of reference for all committees, advisory groups, executive management groups and job roles. Collectively these are the organisational control arrangement (O&CA), which set out the framework for control of our affairs. The O&CA also specifies requirements for the competency of members of the board and its committees, for effective management of the company.
The principal duties of the board, the matters reserved for its decision and the terms of reference of its committees are fully documented and copies are available on our website. Matters reserved to the board include strategy, charges, material changes to the company’s management and control structure, board appointments, approval of material contracts, oversight of information provided to Ofwat, risk management, health and safety policies, disposal of material assets, approval of the annual operating budgets, employee pension arrangements, significant changes in accounting policies and defence and settlement of material litigation.
We regularly assess our risks, both in terms of business-wide risks (including operational and financial) and corporate specific risks. These risks form the corporate risk register, maintained by a risk group comprising senior managers from throughout the business.
The risk group reviews all business risks, including emerging and strategic risks and all risks are assessed by experts responsible for the relevant part of the business. Where a high scoring risk is identified, the risk group considers additional measures to reduce its impact to an acceptable level. The risk group meets through the year and submits the current corporate risk register and summary report to a risk management advisory group comprising the executive directors and key senior managers, twice a year. Any significant new risks are reported to the advisory group as they arise.
The advisory group scrutinises and challenges the risks included within the register and requires additional work where necessary to better classify the risk or explore alternative mitigation methods.
The Managing Director submits a bi-annual risk review paper to the Board for its consideration and approval. This paper sets out the risk review process and identifies the current principal risks to the business and the mitigation measures in place. It also records the status of emergent risks that have been identified and provides details for the board of any changes in the National Risk Register and the National Resilience Planning Assumptions.
Our approach to assurance is set out in our regulatory assurance manual, which is updated annually and is available on our website. As part of our annual review, the board signs a risk and compliance statement, ensuring that we have the appropriate systems and processes in place to make us resilient to risks that arise.
We have recently published our information risks, strengths and weaknesses statement on our website. It notes that we have made good progress on all the risks identified last year and identifies our key risks matching the themes of the business plan submitted in the price control (PR19) process, ensuring that we continue our work to identify and support vulnerable customers. We have clear plans in place to mitigate these risks and work has already begun to deliver them.
Our 2020-25 business plan
In September we published our business plan setting out our service levels, investment and bills in detail up to 2025. The plan sets out our vision to be in the top 20 of all UK service companies and how we will continue to be an environmental leader.
We will deliver great customer service by:
- improving from often industry leading levels to meet growing customer expectations
- being available seven days a week, with seamless and hassle-free services
- being fully accessible and personalised, recognising that any of us could sometimes need more help and that every customer matters
- being open, transparent and offering excellent value to customers, developers and retailers.
Our services will be affordable for all, achieved by:
- cutting bills in 2020 so that, by 2025, they’ll be 4% lower in real terms than now, despite increased investment
- adjusting bills based on ability to pay, more than doubling the numbers on our social tariffs
- increasing help for customers to use water wisely
- understanding we can’t solve water poverty alone, working with partners to increase customers’ ability to pay and introducing new services to reduce their outgoings.
We will champion innovation and promote competition
- our open systems strategy will champion new, disruptive ideas from within Wessex Water and outside
- we’ll make our data and services open to the market, encouraging others to help us find the best and lowest cost solutions
- we’ll improve efficiency by 11%, doing more for less, without risking essential services.
Our services to customers and the environment will remain resilient to stresses and shocks.
- we’ll retain our simple and transparent financial structure, underpinned by the long-term stewardship ethos of YTL
- our catchment-based approach considers resilience holistically and promotes a sustainable water management system that benefits everyone
- our previous investment has made our services more reliable to stresses and shocks than other companies, but we’ll make targeted investments to:
- further reduce leakage and water use
- reduce sewer flooding risk and pollution events through network investment and increased focus on sewer misuse
- ensure continued cyber-security.
Our plan has been submitted to Ofwat who will scrutinise it before making a determination in December 2019.
Since April 2015, our five-year and long-term plans have been organised around the 10 outcomes shown below, identified as the highest priorities by customers. There are a series of measures or performance commitments to deliver the outcomes, with relevant targets set over the five years.
Overall, we continue to make good progress against our performance commitments and the outcomes we set out in our business plan as shown in the table below and reported on in the commentary that follows.
Excellent service for customers
Excellent customer service is one of our key outcomes and we put customers at the heart of everything we do.
We don’t simply want to be the best for customer service in the water sector; in our recently published business plan for 2020-25 we said we will benchmark ourselves against the best service providers and will be ranked in the top 50 consumer-facing UK companies from 2020, and in the top 20 by 2025
We are a member of the Institute of Customer Service and in this summer’s UKCSI survey we were five points away from the top 50, so there is work to do. We hold the Institute’s ServiceMark with Distinction for our operational contact centre, one of only 14 companies in the country to hold this accreditation with distinction.
This summer was a challenge for our call centres and customer facing teams owing to the impact of the hot weather on contact volumes and pipe repairs. Despite this we continued to score at distinction level when we carried out the interim surveys for our accreditation. Next year we will be widening
ServiceMark to our whole customer facing business, targeting distinction for our operations and repairs and maintenance areas.
We continue to be a top performer on the Service Incentive Mechanism for customer satisfaction as a result of our focus on continuous improvement of the customer experience and delivery of our Customer Excellence Programme. We are part of a small industry group working with Ofwat as they develop C-Mex, the replacement for SIM.
We engage on a day-to-day basis with our customers through a variety of channels and in any one year we talk to around 60,000 customers as part of this routine engagement – their voice makes a difference to the services we offer and the communications we provide.
Our real-time feedback tool provides invaluable insight into areas where we can do better or where we do well to meet the increasing expectations of our customers. This year we have been developing new and improved reporting tools for our feedback to help us circulate the information in the most useful way to all our front-line teams. Our continuous improvement group also uses this information, under the guidance of our customer experience group comprising senior managers from across the business
Insight shows that our high performance on satisfaction and ease of resolution measures is due to our prompt, warm voice telephone answering, wide choice of communication channels, quick response times, first-time resolution of problems and keeping customers informed of what we are doing at all times.
We intend to offer a truly seven-day-a-week service for our customers’ convenience so we’ve asked our Have your say online panel to help us shape that in terms of expansion of contact channels and opening hours for our call centres, times/days they would like us to visit to diagnose any problems and repair any pipework or apparatus in the street.
As part of our Customer Excellence Programme we are in the final stages of installing our new customer relationship management system. Our digital job tracker has proved successful with customers allowing them to track the progress towards resolution of their contact online, similar to the delivery of a parcel, and this is being rolled out across all contact types by the end of November. We have also completed the first phase of improvements to our eBilling service and the number of customers signing up continues to grow
We continue to make wider use of proactive text messaging and social media posting during operational problems such as burst water mains. This helps to keep customers informed as we get them back into water supply.
Our alternative, digital contact channels, such as Live Chat, texting and online self-service, are increasing in popularity and we are constantly improving the customer experience in this area. Our new website goes live early next year.
Our new look bill was launched at the start of this year and feedback from customers, including our Have your say online panel, has been very positive. The information graphics on metered bills to help customers compare their water use over time have been welcomed but we have work to do to improve these further. Additional changes will be completed over the next few months.
We have launched our Young People’s Panel 2018 and have found this to be an excellent way to engage with our customers of the future and involve them in solving real business problems. This year, as part of our Hydrate feel great initiative, the 22 students are helping us understand attitudes to drinking tap water amongst their generation and developing a water refill initiative. This will help us design and locate our water refill points in local communities and encourage their use
We are fully committed to making our service inclusive and accessible to all customers and this is particularly important if a customer becomes vulnerable, which can happen at any time. Our approach to customer service and customer care, coupled with the support schemes we offer customers in financial difficulty or who have specific additional needs such as a disability, has enabled us to retain the British Standard for Inclusive Services for another year, one of our performance commitments.
Alongside our business plan, we launched our revised vulnerability strategy, Every Customer Matters – an inclusive service for all. This has been co-designed, reviewed and endorsed by a variety of customer organisations and stakeholders as well as customers themselves
The number of customers on our Priority Services scheme is increasing and we are embarking on several initiatives through our strategy to raise awareness and increase take-up of our support schemes. Our pilot projects with energy companies to share data have been expanding and we are aiming to be an early adopter of the industry wide initiative to share data nationally with energy. We want to reach the point where customers who need to be registered for Priority Services only need do it once
We have retained our government Customer Service Excellence award and hold the best practice mark for our continuing support for the Keep Me Posted campaign. We are currently working through our action plan with Action on Hearing Loss to retain our Louder than Words charter
As part of the overall engagement for our business plan, we talked to more than 140,000 customers, our largest and most innovative engagement programme ever. Every customer has had the opportunity to shape the future of their water services. This year we’ve concentrated on testing our business plan with customers to make sure we’ve heard them correctly and developed a plan that meets their expectations. We’re pleased to say that 96% of our customers found the plan acceptable and 93% felt it represents good value for money.
One of our key outcomes is to ensure bills are affordable for all now and in the longer term. In our recently published business plan, bills will be lower in 2020 and support for those on lower incomes, through our tap programme, will increase.
Tap offers customers tailored solutions to their affordability problems via a range of schemes and low rate tariffs to help them afford their ongoing charges and repay their debts, along with practical help to reduce their water and energy use.
We provide this support through long standing and very effective partnerships with the debt advice sector, either face to face, by telephone or online.
Under the guidance of our expert affordability advisory group, the number of customers supported through our programme has increased once more and there are now around 40,000 benefiting from tap, 35,000 receiving lower bills.
Our network of advice partners is constantly expanding and we launched our online partner hub earlier this year, to make two-way engagement with us even easier. The hub allows our partners to obtain information on the support we offer, request resources and application forms, apply for schemes on behalf of their clients, advertise and request our attendance at community events, and network with one another online. The hub has proved a great success and we aim to add more functionality over this year.
We continue to fund holistic debt advice and have so far funded 12 innovative community outreach projects in areas with high poverty where customers might find it harder to access help. This is in addition to funding core debt advice across our region.
We work with the Quartet Community Foundation to deliver our Money Matters awards, which are now in their sixth year. Since Money Matters began, we have provided grants to 33 different organisations delivering financial capability and money management projects across our region.
Supporting customers to reduce their water use is a particularly important area for us. Our Money Back Guarantee continues to be a successful promotion to encourage customers to opt for a meter. In the first six months of the year, more than 2,600 customers applied for a meter and 1,200 have been metered through our change of occupier metering policy.
Our water efficiency services continue to offer active customer engagement – including practical assistance in the home. In the first half of the year we delivered our Home Check service to nearly 3,200 households, taking the total to more than 18,300 since the service was launched in September 2016.
Technicians provide water and energy efficient device installations and bespoke behavioural advice to customers. Each visit leads to savings of approximately 45 litres per household per day and has been very well received by customers (average SIM equivalent score of 4.99 out of 5).
Other water efficiency work continues, including advice and information, a schools education service and a free water efficiency pack. Customers have requested over 2,600 packs and more than 8,400 devices so far this year.
To date we have achieved nearly 90% of the savings required by March 2020 to meet our performance commitment, equivalent to 2.83 litres per head per day.
Health and safety
As a responsible
employer, the health, safety and welfare of our staff, and the people with whom we interact as we carry out our daily activities, is paramount. We continue to embed a positive health, safety and welfare culture in our day-to-day operations that targets zero accidents and supports our aim to be a great place to work in which all employees can work safely and reach their full potential.
Safety performance to date in 2018 for incidents reportable under the Reporting of Injuries, Diseases and Dangerous Occurrences Regulations (RIDDOR) is currently within our
target. However, there are challenges to our overall performance and we continually strive to find new ways to ensure the safety of all our staff. We monitor all incidents, near misses and observations reported by employees and the incident and observation reporting app introduced in September 2017 has seen increased uptake and usage during 2018.
The app, which allows all staff to quickly report safety observations, both good and bad, and incidents, is in regular use across the business and we continue to develop reporting tools that allow analysis of all reports to highlight emerging trends.
We have continued to work with our contractors to ensure that they share and implement our health and safety values. We have supported contractors’ investigations into any incidents to identify the root cause and, where necessary, input to contractors’ improvement plans to ensure that unsafe working practices do not persist. Wherever possible we look to share innovation and best practice.
A new mobile app for reporting daily and weekly vehicle inspections and defect reporting went live for drivers of liveried and hire vehicles on 1 June 2018. This follows a period of development and user acceptance testing involving all parts of the business. Uptake and usage across the vehicle fleet of 900 vans has demonstrated significant improvements compared with the number of vehicle checks reported using the previous text-based system.
Our continued commitment to safety and performance has again been recognised with our highly commended award in the RoSPA Construction Engineering Industry Sector awards
for 2018. This follows us winning the Sir George Earle trophy in 2016 and the Construction Engineering Industry Sector award in 2017.
Highest quality drinking water
Mean zonal compliance with drinking water standards for January to June 2018 was 99.97% which is in line with our 2017 performance of 99.96%. There have been four exceedances affecting the index in the six months, a similar level to the five failures in the equivalent period last year.
ll the exceedances were caused by issues at customer properties, one attributed to the service pipe, and three to internal plumbing.
The predicted Compliance Risk Index (CRI) for January to June 2018 is 0.24 which is an improvement on our June 2017 score of 0.49. CRI is a measure comprising scores for exceedances at water treatment works, service reservoirs and customer taps.
The number of customer contacts about the acceptability of our drinking water quality is slightly higher than last year, mainly due to the impact of the summer heatwave, but still much lower than in previous years due to our ongoing maintenance activities.
This year we gained support from the Drinking Water Inspectorate to construct blending solutions to manage increasing raw nitrate levels at Fonthill Bishop and Sturminster Marshall water treatment works, and also gained support for continuation of our industry leading lead strategy. Delivery of these projects will be managed through legal instrument notices issued by the DWI under Regulation 28 of the Water Supply (Water Quality) Regulations 2018, and will begin in 2020.
We have continued our strategy to trial sustainable solutions, such as catchment management, ahead of constructing new chemical treatment at sites where raw water quality deterioration has occurred. Our extensive programme of catchment management continues and we are planning to trial use of our innovative EnTrade platform to manage metaldehyde, the active ingredient of slug pellets, in the Durleigh catchment.
Construction of our integrated water supply grid was completed earlier this year enabling greater security of supply. Construction and commissioning of major water treatment plant upgrades have also been completed at Burton Road, Codford, Deans Farm and Litton Cheney water treatment centres.
An important part of managing our supply capacity has been our focus on reducing leakage across our 12,000 km of mains and 600,000 service connections.
We set ourselves a challenging five-year leakage reduction target for this asset management plan (AMP) period, down from 70Ml/d to 66.5Ml/d. Last year we successfully achieved our 2017-18 leakage reduction target, finishing just below our figure of 67.9Ml/d despite the difficult end of year conditions with the Beast from the East.
This year’s summer heatwave has been challenging in managing demand and leakage because of dry weather related ground movements. The business is focused on meeting the end of year 2018-19 leakage target and delivering another cut in leakage.
The summer heatwave increased the number of significant customer reported leaks and our repair teams have been working at full capacity ever since,.We should achieve our target of fixing 80% within a day by the end of the year.
We maintained supply to all our customers throughout the very dry summer this year, without any restrictions, for the 42nd year in succession. Demand in June and July was some 48 Ml/d higher than the equivalent period last year and we experienced the highest sustained period of demand since 2006.
Our investment in the integrated water supply grid enabled us to move water around the region to meet demand, despite the reduction in our licensed abstraction volumes of 24 Ml/d which came into force in April 2018. We ran focused campaigns to encourage customers to use water wisely. Pre-emptive operational planning helped to make sure sources were available. We are actively planning for a reasonable worst case scenario of a dry winter followed by another dry summer.
We continue to drive down all supply interruptions, particularly those lasting more than three hours which are now less than half what they were a few years ago. We have a number of ambitious projects in place to further reduce supply interruptions in future.
The number of water main bursts is up this year due to a combination of the recovery from the Beast from the East and the ground shrinkage caused by the summer heatwave, but we expect to end the year just below our performance commitment.
Rivers, lakes and estuaries protected
Our plan includes a performance commitment to improve 70 waterbodies by 2020 and we are on course to achieve and slightly exceed this number. This will mainly be achieved
through improvements to the discharges from our water recycling centres (WRCs). During 2018-19 our WRC improvements will improve 15 waterbodies.
We have continued to design and implement enhancements at several of our WRCs to further improve the rivers and lakes in our region.
The number of pollutions from the sewerage system we operate has slightly increased from last year and four have been classed as significant. Most pollutions still arise from blockages in the network and we are increasing our efforts to encourage customers to stop thinking of their toilets as waste bins.
We have made an early start to implementation of a pollution reduction strategy developed for the PR19 business plan. The strategy is a long-term multi-track approach focused on the sewerage network, where the vast majority of pollution incidents occur, including:
- customer engagement about sewer misuse
- further targeted sewer jetting
- additional monitoring of flow and depth in our sewers
- enhanced data analytics.
Following several incidents this year, we have started installation of additional flow monitoring on our sewer rising mains. As with water supply, operational resilience in this area will be delivered through a combination of working with customers and infrastructure investment in parallel with improved monitoring and response.
Our effluent and sludge treatment compliance remains good and we are forecasting an end of year position with a ‘good' rating in the Environment Agency’s revised environmental Performance Assessment. This includes two amber measures: one for major waste water pollutions and one for incident self-reporting.
During the first six months of this year we constructed schemes to remove phosphorus from our Taunton, Wellington and Cheddar WRCs. This is required under the Urban Wastewater Treatment Directive (UWWTD) to reduce the risk of eutrophication in two sensitive rivers, the Tone and Congresbury Yeo. We have also progressed with the construction of a further six schemes, at our Chilcompton, Erlstoke, Seend, Sutton Benger, Tetbury and Trowbridge WRCs to remove phosphorus to meet
the objectives of the Water Framework Directive.
There are a further 16 improvement schemes to remove phosphorus, which are required later in the AMP. Design work is progressing well on all these, which are all on programme.
There are two schemes where we have been working with landowners, the Environment Agency and Natural England to promote more sustainable solutions for removing phosphorus from our watercourses. These are Brinkworth Brook, where a catchment management approach is being taken, and Cromhall where a constructed wetland is being provided instead of chemical dosing. Both schemes are progressing well and are expected to provide more environmentally sustainable solutions.
We have continued to develop and expand our innovative catchment-wide permitting process to apply to phosphorus removal projects across the Bristol Avon river catchment area. To date, we have reduced an additional nine tonnes/year of phosphorus beyond the target set for this calendar year.
We have completed the detailed design of two projects to reduce the levels of ammoniacal nitrogen discharged from our WRCs at Westbury and Thingley. The objective is to avoid any deterioration to river water quality due to development in the WRC catchments.
The increasing success of our online auction platform, EnTrade, means it is now a core part of our catchment-based nutrient removal strategy. To date we have exceeded
the 40 tonnes per year reduction target each year, where all auctions have been oversubscribed. Based on the results so far, we estimate that EnTrade can provide an auditable source of nitrate reductions for a quarter of the cost of an equivalent asset solution at a sewage works. We are currently developing the platform to include phosphorus and biodiversity offsetting.
We host the Bristol Avon and Dorset Catchment Partnerships and these have secured funding to deliver a number of projects to increase the wider environmental resilience of these catchments. This has included funding for a strategic project to enhance the Bristol Frome and a natural flood management and heathland.
We own or lease nearly 2,950 hectares of land, which includes operational sites, tenanted agricultural land, nature reserves and amenity, or recreational land. We have a duty, under the Water Industry and Natural Environment and Rural Communities Acts, to conserve and enhance biodiversity on this landholding.
Our performance commitment in AMP6 is to assess 100% of our landholding for biodiversity, with a view to bringing as much as feasible into appropriate management. To date, 86% has been assessed in line with this year’s KPI target.
We have maintained our high levels of compliance with the Defra target, with more than 99.5% of nearly 300ha of Sites of Special Scientific Interest (SSSIs) in favourable or recovering condition, of which 62.5% are in favourable condition. Future SSSI management work will focus on increasing the area in favourable condition. We have developed a PR19 performance commitment to focus on improving the condition of our SSSI landholding.
We are celebrating 20 years since the first publication of our Biodiversity Action Plan (BAP) in 1998 - the first for a water company. Our BAP includes three aspects:
- the Partners Programme which provides funding to projects carried out by wildlife
- our environmental assessment work to enhance biodiversity on our land, such as the
sites of treatment works
- our conservation, access and recreation work which outlines our duty of care in the
Phase 5 of our Partners Programme began in April 2015, running for the duration of the AMP until March 2020. This programme supports external organisations across our region to conserve and enhance biodiversity outside our own landholding and to deliver biodiversity gain in line with our core functions. The projects focus on three themes, including science and research, partnership working and catchment scale delivery.
The four flagship projects we are funding are:
- Wessex Chalk Streams Project – Wiltshire Wildlife Trust
- Dorset Wild Rivers – Dorset Wildlife Trust
- Floodplain and Coastal Grazing Marsh – Avon Wildlife Trust
- South Wiltshire Farmland Bird Conservation – Cranborne Chase Area of Outstanding
Managing our abstractions
Our new reduced abstraction licences for the Bourne and Wylye Catchments came into force on 1 April 2018. These licence changes, providing greater environmental protection in sensitive catchments, were made possible by the investment in our integrated grid. Overall compliance with abstraction licences currently stands at 100% - we have had some minor non-compliant events and are liaising with the Environment Agency where necessary.
Following 20 years of investigation, modelling and community liaison, in early 2019 the abstraction licences for our sources in the Malmesbury area will be reduced to improve 33km of river flows in the Bristol Avon catchment. We are in the final stages of completing the construction and commissioning of a new pipeline between our Cowbridge source and Bristol Water’s Shipton Moyne source, this infrastructure is a key element of the new abstraction licences.
Our performance commitment to minimise exports from our groundwater source at Mere when river flows are low, has been influenced by a planned outage at the source
in 2018. The export to Whitesheet was turned off in March prior to a full site outage from the end of May to facilitate work for a disinfection improvement scheme. The source has been returned to supply in October at full output (in export mode) for a couple of weeks to enable environmental data collection for the Environment Agency. We do not anticipate any difficulties in meeting the performance commitment to manage the export to be <100Ml in="">
Improved bathing waters
96% of the designated bathing waters in our region are passing EU standards. The two failing bathing waters (Burnham Jetty and Weston Main) are both on the Severn Estuary.
We have almost completed the £38m programme to contribute towards improving Burnham’s bathing water quality. Recently completed schemes include a new pumping station at Combwich STW, provision of UV treatment at Cannington STW, 3000m3 of storage at West Quay and 5000m3 of storage at Colley Lane, Bridgwater. Only one scheme in this bathing water programme remains, which has a March 2020 regulatory target date.
We continue to install event duration monitoring equipment at combined sewer overflows (CSOs) throughout our region. We are monitoring more than 70% of our overflows
that could affect the environment. The DWMP webpage shares for the first time the annual performance of the monitored CSOs and shows our ongoing programme on installing monitors.
Sewage flooding minimised
The year began with a very wet month but the dry summer has meant that the number of flooding incidents, especially inside people’s houses, is low. We are on track for a stable risk score.
We have a dozen flooding schemes on target for completion by March 2019 including the large scheme in Weymouth. The £5m flooding scheme in Brent Knoll was completed, reducing the risk of flooding at 31 properties.
The first part of the £15m North Bristol strategy sewer, the Frome Valley relief sewer, has been completed, ahead of the regulatory date of March 2019.
The second part, the Trym relief sewer, is progressing well, and is on track for delivery by the March 2022 regulatory date.
The Drainage and Wastewater Management Plan (DWMP) framework has been published on the 21st Century Drainage Programme website to encourage visibility
of long-term sewerage planning. We have developed a DWMP webpage to support this framework, where we have published some drainage strategies, infiltration reduction plans and case studies. Full implementation of the framework is required by 2022.
Reduced carbon footprint
All sludge generated from the sewage treatment process is recycled safely and in a way that meets mandatory standards. Around two thirds of our sludge is treated using the anaerobic digestion process which reduces the volume for recycling while generating renewable energy, reducing our costs and carbon footprint.
We have a performance commitment to increase the proportion of self-generated energy and are investing in upgrades to our sludge digestion facilities to increase the proportion of sludge we digest. This includes the installation of advanced anaerobic digestion at Trowbridge and Taunton and additional digestion capacity at Berry Hill, Bournemouth.
During April to September 2018, our renewable energy generation was equivalent to 25% of total electricity use. Our operational carbon footprint was estimated at 45 kilotons carbon dioxide equivalent net emissions, and 58 tonnes gross emissions. Both our gross and net emissions are well on track to meet our annual performance commitment of 122 kilotons net emissions.
We diverted 99% of all non-sludge waste from landfill for the first six months of the year. The only remaining waste now sent to landfill is contaminated wastes and a small amount of general waste. We continue to explore recycling routes for these remaining materials to move towards a 100% landfill diversion rate.
Education and community involvement
Over the summer months we attended events across our region supporting local communities with our new water refill units as part of our Hydrate feel great campaign. We provided water at the Corfe Mullen Carnival, at Clatworthy Family Fun Day, Southmead Festival and Yeovil Show among many others.
Our Water Force volunteers have been busy working with charities and local community groups. Beckington children’s play park, near Frome, benefited from a clear up by a
senior management team, while other teams have cleaned beaches and provided water for events such as the Portland Round the Rock 10k run.
Our three education advisers are continuing to visit students of all ages and community groups. They now teach topics ranging from the water cycle at key stage 1 to visits tying in with geography and science A levels, as well as helping with the Eco-schools Green Flag Award.
To mark the 25th anniversary of our Watermark awards, our additional funding to address the urgent need to reduce the use of single-use plastics is encouraging groups to provide a local refill point for water. Freshford Galleries community shop is one group which has done so, raising funds in their local community and from
the Watermark scheme.
Our work to deliver behavioural change through better customer and community engagement continues.
Last year’s Young People’s Panel designed some engagement materials to support our campaigns around sewer misuse. We used the hashtag #toiletiquette and a humorous video to engage with communities during the start of the new university terms. We had stands at the Fresher’s Fair events at the University of West of England and University of Bath at which we gave face-to-face advice and free toilet rolls, plughole hair traps and a bespoke leaflet to encourage only Pee, Paper and Poo to go down the loo and the correct disposal of fats oils and greases.
Peak summer demands and considerable media interest gave us good engagement opportunities involving water saving device promotions and messaging on our social media channels, advertorials in local print media and radio and television appearances.
We have also been furthering our water citizenship trial in Chippenham where we have been engaging with staff and local community organisations including the town
council and environmental groups. We are seeking to strengthen the relationship our customers have with their local water system and services and the value they place on it. The programme has involved co-creation workshops, the roll out of our Home Check water efficiency service and a partnership project with the Bristol Avon Rivers Trust to raise community awareness of the connectivity of surface drains and watercourses through painting Yellow Fish near drain covers.
We continue to develop the innovation culture in Wessex Water including practical measures such as two new tools on our intranet:
innovation database which acts as a record of projects carried out in the last 10 year
- an innovation ‘funnel’, which provides information on projects that are currently under way – whether as initial exploration, trials or becoming embedded.
We are also working on ways to improve staff engagement through top-down challenges and ‘ask us anything’ roadshow events. Innovations are reported in our annual Innovation report.
Technology trials underway include:
- a containerised algae bioreactor as a means of stripping phosphorus from effluent
- using radio frequency ID technology to understand flow paths within sand filters
- remote sensing technologies to measure water quality in rivers and lakes.
We pay close attention to disruptive technologies entering our sector, including artificial intelligence and vehicle electrification, among others. Our Futures Panel devoted a session to the former, looking at some of the most promising applications as well as socio-cultural implications.
Early careers, talent and skills attraction
Recently, the development of early careers
talent, including apprenticeships, has been a priority for Wessex Water. During the past five years we have seen an increase of more than 300% in the number of employees under 20 years old working in the business and over the past year we have reviewed our early careers recruitment process to enable more schools and young people to engage with us. Of our recent technical apprentice intake, 18% has come from non-traditional backgrounds for the construction and engineering sector. Women employed on technical apprenticeships has increased 12% in two years and, in 2018, we saw our first female apprentice groundworker.
Weston College of Further Education and Bridgwater & Taunton College are our approved apprenticeship providers of choice. Through a competitive process both colleges not only illustrated high quality training, but also strong links to supporting our communities right across our region. With partnership and innovation at the centre of our apprenticeships, we are very much looking forward to what these associations will bring.
Graduates and internal development programmes have been a key focus this year. Our new graduate management programme received a record number of applications, and almost 50 other graduates or interns have joined the business. However, we’ve not forgotten our existing staff; we are building the skills of our line managers through the new leadership and management apprenticeship, proving that career development never stands still at Wessex Water.
Leadership and management development
Developing our people remains a key priority for us. All employees have access to a flexible, blended learning approach and we will continue to build appropriate online resources and develop programmes which offer both online and face-to-face training methods. As well as the bespoke Wessex Water courses for managers and leaders, we are working in partnership with Weston College to provide more programmes to support and increase our people managers’ knowledge, skills and behaviours in line with the apprenticeship standards for team leaders/supervisors and departmental managers.
Coaching and mentoring remains a key focus and we continue to add to the current leadership and management provision and the development of these skills.
Diversity and inclusion
We have continued to build on our work around diversity and inclusion with the formation of a senior management subgroup to take the lead and direct our work on diversity. As reported in our gender pay gap action plan (here), we have a range of initiatives we are progressing to develop diversity and inclusion across our business.
In September 2018, we had a total of 2,540 employees, of whom 557 (22%) were women and 1,983 (78%) were men. There are 13 board directors of whom 11 are men and 2 are women and 57 senior managers of whom 10 are women and 47 are men.
Focus on flexible working
We recognise that flexible working can increase motivation, promote a better work-life balance and improve both performance and productivity. We also know that flexible working is not just about childcare or gender as both men and women, as well as non-parents, can benefit from a better work-life balance and many employees may wish to work
flexibly at different stages of their career.
We have made a number of changes to our current approach to make flexible working more accessible. These changes included removing the requirement for employees to provide a reason for their flexible working request and allowing all employees, regardless of length of service to be able to apply to work flexibly. This means all employees can
apply to work flexibly and we go above and beyond the statutory requirements.
To mark our ongoing commitment to flexible working we have signed up to the Working Families campaign, the UK’s leading work-life balance charity, and we are advertising vacancies as available for flexible working, where operationally feasible.
Health and wellbeing
The wellbeing of staff is important to us and we have focused on proactive support on health and wellbeing and on mental health wellbeing. We have trained 30 mental health first aiders across the business and are currently training a further 60 by the end of the financial year. The first aiders come from across the business and provide confidential support to colleagues who raise mental health concerns. In support we have developed a Take 5 to Take Care training programme that will help colleagues improve their own personal resilience by learning practical ways in which people can manage and deal with concerns relating to their own stress.
There has been greater promotion and awareness of topics that staff feel affect them, which has included prostate cancer, mental health and the impact of physical wellbeing on our mental health.