Water regulator Ofwat has published its ‘Asset Management Maturity Assessment (AMMA) – insights and recommendations’-report.
A collaborative piece of work between the regulator and companies, the report is set to provide ‘a unique window’ into the sector’s asset management capabilities and identifies a number of strengths and areas for improvement.
John Russell, Senior Director at Ofwat, commented: “To increase their resilience, protect the environment and ensure customers continue to have access to high quality, reliable water services, water companies need to get better at planning with both the short and long term in mind.
“Asset management is an important part of overall resilience so I’m pleased that we’ve been able to work collaboratively with the sector and develop this assessment.
“It has given us a shared understanding of where the sector needs to target improvements to ensure it is resilient now and in the future. The hard work starts now.”
According to Ofwat, asset management is a key part of long-term resilience and essential to ensure the environment is ‘properly protected’ and that customers get ‘an excellent and reliable’ service from their water company.
The report identifies areas where companies were able to show more mature capabilities, such as the use of a clear auditing regime and the integration and embedding of price control outcomes and reporting in how companies run their businesses.
According to Ofwat, across the board companies were also able to show they were improving their asset management capability through organisational wide transformation programmes and focused initiatives.
However, the report also identified a number of cross sector areas for improvement, including the need for increased board oversight and engagement on asset health and operational resilience risks and mitigations, linking short, medium and long-term asset management planning, and many companies also recognised the need for better quality data and information to support decision-making.
These are areas companies will need to focus on as they put plans in place to improve, Ofwat states.
The regulator now expects companies to work together to reflect on the AMMA findings and recommendations and share good practice to improve asset management maturity across the sector.
Alongside this Ofwat is considering how its regulatory regime could change to reflect these findings.
The regulator will report further on progress in implementing these findings early next year.