Jess Cook Project Development Manager (Water Poverty)
While fuel poverty is making headlines, water poverty is an issue for many households too. Our research shows that people aren’t just getting in debt, many are undertaking extreme coping strategies…
It’s hard for anyone to ignore the pressures facing millions of people in the UK right now. The last few months have delivered the perfect storm of financial stresses, with each announcement making the struggle harder than the last. The removal of the Universal Credit uplift. The end of furlough. The energy price cap rise. The gas crisis. The cost of living increases due to logistics shortages. The upcoming rise in National Insurance payments. The list goes on, and more and more families fall into severe hardship, barely able to keep their heads above the surface.
With so many pressures, it can be difficult for families to prioritise the things most important. How do you make the decision between turning on the heating or putting food on the table? How can you manage an unexpected bill when you’ve already spent all your money on the essentials? When crisis hits, people look for new ways to cope, and that often involves cutting back on something else.
A water bill is an interesting subject to consider. Water is recognised as a human right, and so can’t be disconnected for non-payment. This is why it’s often considered to be the first bill people stop paying in financial difficulty. It’s the lead indicator of a bigger problem. Yet, despite the economic effects of the last 18 months, water debt hasn’t risen as much as industry experts expected it to.
Customers are cutting back elsewhere
Our new research, undertaken by YouGov polling across August and October, asked over 4,000 GB adults what coping tactics they have, or would, consider implementing to pay their water bill. The results are quite alarming. Over 22% of people with a household income of less than £20,000 say they would cut back on food to pay their bill. Almost 25% of the same income group would cut back on personal hygiene products. And, 41% are choosing to bathe less often to reduce their water bill.
The data also told us that around 15% of GB adults would borrow money to pay their water bill. Some would borrow from friends or family, others through more formal credit arrangements such as loans, credit cards, or overdrafts. This results in increasing levels of consumer debt, when support would likely be available from their water company to avoid this; something only 10% of respondents knew.
One particularly surprising statistic to come from the research was that 10% of all respondents do, or would, shower in public facilities to reduce their home water bills. This is something which wasn’t available due to leisure centre, gym, and workplace closures during the pandemic. Those relying on this as a method of coping may have seen substantial increases to their metered bills as a result and may have struggled to manage this change in bill levels.
What does this mean for identifying financial difficulty and water poverty?
Understanding the coping tactics that customers may use to manage their water bills is an important part of the customer journey. Many implement strategies to reduce their bills, or juggle various priorities. This means customers may not present with issues until further down the line. The first default of the water bill may actually be the indicator that they can no longer cope with the struggle. It should be the trigger to do something to help them before they spiral. This might mean sharing information with other creditors, to ensure early interventions are made across all essential household bills.
But it also reinforces the need for increased awareness of support. As we move into what can only be described as a bleak and brutal winter for thousands of struggling families, we need to do more to help. We need to improve our messaging about the support that is available to them. We must use data to proactively identify those who are struggling. Application processes should be simple, and ideally, the customer should only have to ‘tell us once’.
The daily struggle is not, and should not be, an acceptable way of life, not when there is so much out there to help those reaching crisis point. This isn’t the sole responsibility of one industry or organisation, after all, no-one struggles with one bill in isolation. It’s collective action which will make the most difference. That, and early intervention. It’s time to open our eyes to the bigger picture, and really understand how people are coping with the struggle.