Yorkshire’s private water entity has handed a multi-million pound contract to consultancy Arup and engineering contractor Costain Group, following a competitive tender process. The four-year contract will see the joint venture provide services to help Yorkshire Water improve its affordability and efficiency, amid heightened criticism of the water service sector.
A recent study from consultancy Atos suggested utility providers are facing a “race to transform” – with those companies able to understand and respond to the rapidly evolving market in the best position to win. However, while electricity customers certainly seem more likely than ever to shop around, water companies seem to be insulated from this apparent revolution. Indeed, since the provision of water and wastewater services was moved from the public to the private sector in 1989, the firms involved have routinely been criticised for the operation of regional monopolies.
Due to this privileged position, water companies have implemented price rises unchecked by the fear of competitors, while poor standards of maintenance have often led to major leakages, with the costs ultimately also passed on to the public. One example of this saw the only water tariff in England and Wales with no standing charge withdrawn in 2016, with two-thirds of customers seeing their bills rise as a result. The 300,000 people impacted in Lincolnshire, Cambridgeshire, Norfolk and Suffolk were unable to change providers.
As a result of such practices, debt for water use has become the most common form of arrears among the UK’s poorest households. In turn, this has led to growing demands for the UK’s water to be renationalised. Unsurprisingly, an industry-funded estimate by the Social Market Foundation think tank suggested a hefty cost of £44 billion could be incurred by this; calculations for the Financial Times by rating agency Moody’s estimate the book value of the 15 English water companies’ shareholder equity actually stands at £14.5 billion, lending to the mounting calls for change.
Amid this heightened criticism, water providers are keen to demonstrate they can alter their behaviours to prevent such a renationalisation. Yorkshire Water is a water supply and treatment utility company servicing West Yorkshire, South Yorkshire, the East Riding of Yorkshire, part of North Lincolnshire, most of North Yorkshire and part of Derbyshire, in England. In order to address key affordability challenges in the efficient delivery of its AMP7 investment programme, the company has brought on board a joint venture of professional services firms to help oversee one of the key frameworks involved.
Engineering consultancy Arup will work with Costain on the Health and Safety Assurance consultancy framework contract, which is worth £2 million. The framework contract aims to facilitate the delivery of resilient assets and drive exceptional service for Yorkshire Water customers by supporting its health and safety assurance needs, promoting collaborative working, innovation and continual operational improvement across the Yorkshire Water supply chain.
Paul Robins, Continuous Improvement Manager at Yorkshire Water, said, “Following a twelve-month selection process, we are delighted to be working with Costain and Arup on our new Assurance Framework. The framework supports our enhanced assurance approach which is aimed at providing specialist, targeted assurance to meet the challenging needs of AMP7. Costain and Arup bring a range of specialists to support our Health and Safety assurance needs, promoting collaborative working, innovation and continual improvement within the Yorkshire Water supply chain.”
Costain Group is a British technology-based construction and engineering company headquartered in Maidenhead. It was part of the original Channel Tunnel consortium, and has since been involved in providing smart infrastructure solutions to a number of key national energy, water and transportation projects. The contract will see Costain collaborate with Arup to provide expertise in construction, design and management regulation compliance, design phase process and construction site safety over the next four years.
Maxine Mayhew, Group Capability Director at Costain, remarked, “We are delighted to have secured this important consultancy framework to support Yorkshire Water as part of its AMP7 investment programme. Costain brings industry-leading health and safety management insights and process safety expertise that will help Yorkshire Water improve efficiency to drive value and service for its customers.”
Mark Fletcher, Arup Global Water Business leader, added, “UK water companies are facing significant challenges in AMP7 around affordability, operational resilience and increasing expectations from regulators, stakeholders and customers. The Costain-Arup partnership is committed to supporting Yorkshire Water and its supply chain in providing exceptional service for its customers by assuring the delivery of safe, reliable and resilient assets.”