This report reviews the work of the group during its first year of operation and briefly looks ahead to the areas it intends to focus on in the coming year.

Across the areas of engagement and discussion common challenges from the ICG have been the need for SW: to stand in customers’ shoes to see issues in all parts of the organisation from the customer rather than the provider perspective; to use language and concepts that customers will understand; to see customer and community centricity (C&CC) as the “golden thread” running through all parts of the organisation and to resist the creation of new silos.

In addition to the specific areas of engagement outlined below, the ICG draws on its members extensive background, experience, and networks to add value to the work of SW. 

Key Areas of Engagement

The Group made a formal submission to SW on pricing proposals for 2022-23. The Group was closely involved in the background research commissioned by SW: in commenting on the brief, in the development of the materials used to ensure the format and language were accessible to participants, and in observing focus-group sessions.

The final outcome announced in February 2022 was for an increase of 4.2%, within range of the view they had expressed.
The ICG sees the Benefits Framework as a key instrument in ensuring that at both a strategic and individual project level the views of customers and communities, and the potential for wider public benefit, are reflected in investment decisions. 

The Group have challenged SW to develop quantitative and qualitative criteria in parallel, to achieve the aim of delivering community-centric decisions; highlighted the need for the framework to be sufficiently flexible to ascribe weightings which reflect local priorities and values; flagged the need to involve communities and stakeholders in determining community and wider benefits; and supported the use of the National Performance Framework as a template for wider public benefit.
The Group identified business customers and the wholesale market as a section of the customer base which was sometimes overlooked in the emphasis on household customers. 

The ICG was encouraged to see the progress made in defining a “great wholesaler” and identifying actions required to earn that description; welcomed the move to establish direct communication between SW and end business users; flagged the need for joined up working across SW in relation to end users; suggested potential opportunities for collaboration with energy providers for joint approaches on water conservation and reducing energy costs; welcomed the trial on smart metering and encouraged early consideration of how smart data could be used to introduce innovations in the charging structure for LPs to incentivise water efficiency and assist the net zero challenge for both Scottish Water as well as business customers.
The ICG welcomed the drive for transparency and consistency behind the approach but was looking for reassurance that there would be sufficient flexibility to capture local circumstances where communities may be particularly sensitive. The Group stressed the need for SW to understand the locations they were working in, joining up information across SW to look at issues on a catchment-wide basis rather than piecemeal; to learn from approaches adopted elsewhere. In particular, the Group has worked closely with the SW Flooding Team to co-create the Flooding Management Approach in the areas of enhanced sewer response and customer aftercare.
The National Engagement and Partnership Strategy (NEPS) has gone through several iterations with detailed ICG input at each stage. The ICG’s early focus was on the need for a structured approach showing how the different types of engagement fit together; clearer articulation of what the NEPS would mean in practice for customers and communities and how they would benefit; clear communication within SW that engagement is a two-way process which would lead to better decision making. 

Throughout subsequent developments, the challenge posed to SW has been: to develop a compelling, overarching narrative setting out in accessible language the challenges to services posed by ageing assets, climate change and net zero, to be used as the backdrop for all engagement activity; to be clear about their aspirations in relation to C&CC engagement and how customers and communities are defined and segmented; and to develop a structured approach as to where, why and how to engage.
SW sought views on the proposal to combine the Code of Practice and the Consultation code into a single ‘Customer Promises’ document. The Group supported the proposal; questioned whether some of the commitments were sufficiently ambitious (for example, targets to reconnect water supplies; and whether, from a customer perspective there is justification in exclusions around industrial action); stressed the need for the language and format of the promises to be accessible to customers and drew attention to the inadvertent use of opaque jargon. Detailed comments have been all been reflected in the subsequent draft document.
The ICG has re-established and chairs the Research Coordination Group (RCG). The Terms of Reference were developed with water sector stakeholders. Given the wider membership and to focus the work of the Group, it has been decided to rename it the Customer Research Coordination Group.  

Early tasks for the CRCG have been to update the research register established under the previous RCG and to develop a research framework to guide the new Research Group’s work. 

Current subjects under consideration for research are customer expectations of Scottish Water, and attitudes to pricing.
As Transformation moves from analysis and diagnosis to action and implementation; and in order to cover the ground, the ICG plans to capitalise on the interests and experience of members by moving towards to a model of more informal subgroups working with SW officials and reporting back to the Group. It also hopes to augment its knowledge by undertaking some site visits.

The ICG fully recognises the scope and scale of the challenges facing Scottish Water and its commitment to achieving the ambitions set out in the Vision and the Strategic Plan. The Group has greatly appreciated the open and positive way SW staff have approached their interactions and discussions with the ICG and the Group looks forward to building on that constructive relationship in the coming year. 

The main proposed areas of focus for the ICG from April 2022 - March 2023 are: Charges; C&CC Strategy activation plan; Strategic Table; Benefits Framework; Performance Measurement and KPIs; Wholesale; and Management Approaches; Research (under the aegis of the CRCG); and potentially also: Partnerships and Solutions Hub workstreams.