Question to the Department for Environment, Food and Rural Affairs:

To ask the Secretary of State for Environment, Food and Rural Affairs, what discussions he has had with Ofwat on the potential impact of proposed changes to employers National Insurance contributions on the financial resilience of water companies.

The Secretary of State has not had any discussion with Ofwat on the potential impact of changes to employer National Insurance contributions. Given the principle of regulatory independence, Ofwat conducts the price control review process at a distance from the Government. It would not be appropriate for the Government to interfere in this process.

As part of Ofwat's price review process, companies are given an allowance for their total expenditure. Ofwat expects companies to manage their costs within that allowance. Expenditure in excess of allowances may place pressure on a company's financial resilience, and this is an area that Ofwat closely monitors to ensure that companies are able to carry out their functions.

Ofwat will publish its final determinations for its 2024 price review in December, which will confirm the total expenditure for water companies for the next five years.