Dr Carolyn Snell [email protected] Water poverty in England and Wales Dr Carolyn Snell Professor Jonathan Bradshaw.

Dr Carolyn Snell [email protected]

Water poverty in England and Wales

Dr Carolyn Snell Professor Jonathan Bradshaw

Dr Carolyn Snell

Defining water poverty

The accepted definition is:

Where a household spends more than 3% of its net income on water and sewerage

Dr Carolyn Snell

Background: why study water poverty in England and Wales?

Cost

• Water poverty is a growing problem as a result of increasing water prices• Increases in the level of water prices coincide with increasing fuel charges

and food prices• Water charges are relatively low compared to other bills, but are inelastic

Variation

• Regional variation in water bills - water companies hold regional monopolies

• Regional variation in bills creates a unique difficulty in arriving at a national policy solution

Dr Carolyn Snell

Average Water and Sewerage Charges by Company

0.00

100.00

200.00

300.00

400.00

500.00

600.00

19

89

-90

19

90

-91

19

91

-92

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-94

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-96

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-97

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-98

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-99

19

99

-00

20

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20

01

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-03

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-07

pro

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7-0

8 p

rov

Year

Ave

rag

e C

har

ge

(£)

Anglian

Dwr Cymru

North West

Northumbrian

Severn Trent

South West

Southern

Thames

Wessex

Yorkshire (incl. York)

Dr Carolyn Snell

Dr Carolyn Snell

Policy

• Before 1999 it was not illegal to disconnect water supplies, linked to an increase in dysentery and hepatitis in the early 1990s

• The nature of water poverty as a policy problem has changed significantly since 1999, when it became illegal to disconnect household properties.

• Since 1999 the number of households falling into arrears has increased

Social Support

• WaterSure – the only social tariff - has a very low take-up and its eligibility criteria mean that it is limited to a small sub-section of the customer base.

Dr Carolyn Snell

Background: why study water poverty in England and Wales?

Dr Carolyn Snell

Background to the research

Study funded by the Consumer Council for Water (CC Water) between May 2008-April 2009 to investigate two main research questions:

1. What are the characteristics of households in water poverty in England and Wales?2. Can a passport benefit be identified?

Dr Carolyn Snell

Methods: quantitative analysis of water poverty in England and Wales

• Data from the FRS (2006-7) was used to analyse the socio-economic characteristics of those at risk of water poverty in England and Wales

• The main limitation of this approach was that water company regions differed from the regions used in the FRS

Dr Carolyn Snell

Headline findings

1. Analysis found that 14.6 per cent of the population were in water poverty under the current definition

2. The water poverty rate is double the average for: • single pensioners• the bottom income quintile • workless households• households on means tested benefits

3. There are substantial differences across the FRS regions

Dr Carolyn Snell

What are the characteristics of households in water poverty in England and Wales: Government Office Region (not water company region)Region

% spending more than 3% water

Composition of those spending more than 3% on water

Composition of the sample

North East 12.7 4.3 4.9NW/Mersey 17.9 15.5 12.6York/Humber 13.2 8.7 9.6East Midlands 14.9 8.4 8.2West Midlands 15.0 10.2 9.9East 12.9 9.2 10.4London 10.8 10.3 14.0South East 11.9 12.4 15.2South West 19.9 13.3 9.7Wales 20.2 4.3 4.9Total 14.6 100 100

Dr Carolyn Snell

What are the characteristics of households in water poverty in England and Wales: Household type Family type Average £ per

week on water% spending more than 3% water

Composition of those spending more than 3% on water

Composition of the sample

Single 4.86 23.4 23.7 15.0Couple 5.96 6.8 7.6 16.4C+1 6.07 6.5 3.0 6.6C+2 6.85 6.0 3.4 8.1C+3 7.09 7.8 1.2 2.2C+4+ 7.01 7.7 0.4 0.8LP+1 5.68 24.6 5.1 3.0LP+2 6.31 19.9 2.7 2.0LP+3+ 6.60 15.4 0.9 0.9Pensioner single 4.77 30.7 30.7 14.5

Pensioner couple 6.06 14.4 13.1 13.2

Multi-unit 6.50 7.0 8.3 17.3

Dr Carolyn Snell

What are the characteristics of households in water poverty in England and Wales: Household income & employment

1. Of those in the lowest income quintile, 54.9 per cent are in water poverty.

2. Of all those in water poverty, 71.3 per cent are in the lowest income quintile.

3. Of households with no workers, 28.5 per cent are in water poverty.

4. Amongst all those defined as water poor, 71.6 per cent are households with no workers.

Dr Carolyn Snell

What are the characteristics of households in water poverty in England and Wales: Benefit receipt

Tax/benefit class

% spending more than 3% water

Composition of those spending more than 3% on water

Composition of the sample

IS or JSA 30.9 17.2 8.1HB or CTB 28.3 28.9 14.8

PC 24.7 11.6 6.8PC or HB or CTB 28.3 28.9 14.8

CTC or WTC 10.2 12.0 17.1CTC & at risk of

poverty33.3 7.3 3.2

Any of the above 18.2 37.1 29.5

IB or DLA 18.4 14.1 11.0Any of the above 12.4 54.3 35.6

None of the above12.4 54.3 64.4

Dr Carolyn Snell

Can a passport benefit be identified? % spending over 3% of on water

% of total 2006-07 water poor

Out of work households

Pensioner single on PC 73.0 7.8Pensioner couple on PC 67.2 2.0Single not working 16 hours, on IS/JSA, 16-24 95.5 1.2

Single not working 16 hours, on IS/JSA, 25-64 97.6 6.6

Couple neither working 16 hours, on IS/JSA 97.0 1.0

Lone parent + 1, not working 16 hours, on IS/JSA 85.3 2.8

Lone parent + 2, not working 16 hours, on IS/JSA 81.0 1.5

Lone parent + 3, not working 16 hours, on IS/JSA 52.6 0.4

Lone parent + 4, not working 16 hours, on IS/JSA 44.4 0.1

Couple +1, neither working 16 hours, on IS/JSA 75.4 0.4

Couple +2, neither working 16 hours, on IS/JSA 70.6 0.4

Couple +3, neither working 16 hours, on IS/JSA 42.7 0.2

Couple +4, neither working 16 hours, on IS/JSA 7.9 0.0

Total 78.1 24.2In work households

Working tax credit recipients 53.7 6.5

Dr Carolyn Snell

Can a passport benefit be identified?

1. A scheme targeting out of work households in water poverty will help up to 24.2 per cent of the water poor

2. A scheme based on working water poor could help up to 6.5 per cent of water poor households

3. A benefits focused solution will still not overcome the regional variations

Dr Carolyn Snell

Conclusions

• Water poverty is suffered by a range of households in very different circumstances

• A benefits focused policy response is problematic because of the relatively small proportions of the water poor that would be helped

• The regional variation in charges creates a unique difficulty in arriving at a national policy solution

This is a difficult policy problem because: