On 8 July the Panel met to review the findings of the industry wide consultation on Panel Purpose, Panel Composition and Code Principles as part of the Market Governance Review.

The review, which is part of MOSL’s three-year business plan, seeks to enable an efficient self-governance structure to support the evolution of the market and drive benefits for customers.

The consultation received 35 responses, representing 91 per cent of supply points in the water retail market. The Panel’s Governance sub-group, which was established to review responses and present the findings to the Panel, held two dedicated workshops prior to making a recommendation to the Panel on 8 July.

The Panel would like to thank the proposers – Ofwat and Castle Water - and the sub-group for their time and commitment during the review process. They would also like to thank parties for submitting their responses to the consultations.

Code Changes

The Panel has recommended the following to Ofwat:

• The Panel reviewed three proposals from Ofwat (CPM039 and CPW124), Castle Water (CPM021 and CPW125) and the Governance sub group (CPM039). All three changes make provision for a Strategic Panel and a code change committee with the same compositions of industry, independent and customer representation, but differ in their timescale and how members are appointed. The Governance sub group and Panel considered the consultation responses and agreed all three options were preferable to the current arrangements, with a preference for the CPM039 alternative proposal.

• MAC and WRC Principles: The Governance sub group and Panel also agreed (CPM040 and CPW121) would improve the current principles and supported consultation responses that there should be a primary principle of customer benefit. This might allow proposals which deliver customer benefit to be prioritised whilst those with no clear benefit would not be progressed. Changes with no impact on customers can progress provided they further the supporting principles.

Next steps

The changes on composition and code principles were recommended to Ofwat on 12 July. A decision is expected by the end of this month. If a change to Panel composition is approved, a transition period will be required to implement the new Panel arrangements. If Ofwat rejects the proposed changes to Panel composition, we will start the process of electing/appointing new Panel members under the existing code structures and provisions.

Find out more

The consultation response and the Panel’s recommendations are available on the MOSL webpage and will feature in July’s Market Focus.

The Panel’s Highlight Report and further details can be found on our dedicated Market Governance webpage and the Governance Review consultations webpage.