Water company to redraw contracts

Thames Water is reviewing its agreements with the housing associations and councils that collect water bill charges on its behalf.

It comes as Southwark Council faces a £26.8m bill to refund tenants after losing a High Court battle in March.

Between 2001 and 2013, the council collected water payments on behalf of Thames Water, and were compensated for voids and a commission fee.

But the judgement found Southwark Council should have passed on this compensation to tenants.

Around 70 councils and housing associations have similar arrangements with Thames Water, meaning they too could be open to challenge.

A Thames Water spokesperson said: “We’re currently working with individual local authorities and housing associations who have requested a review of, or clarification to, their individual contracts.”

However Gareth Mitchell, a solicitor at law firm Deighton Pierce Glynn, warned that it would not be easy for councils to redraw their agreements with Thames Water.

“They’re going to have to consult everybody, they’re going to have to explain the impact of the change, and tenants who understand the issues properly would object.”

Because housing associations have less democratic accountability, they may find it easier to redraw their agreements. The National Housing Federation said in April: “We stand ready to advise and support them as and when requested.”

In the meantime, the ruling could halt many evictions due to water bill arrears because tenants could be due compensation.

UPDATE at 11.55am on 22.6.2016

This story was updated with a statement from Thames Water