The Housing & Finance Institute says Government should be able to force water companies to support faster house building with quicker connections where they are slowing down housebuilding.
The new report calls for a merger of Ofgem and Ofwat to drive better performance and delivery standards.
Natalie Elphicke, who previously authored the Treasury-sponsored Elphicke-House housing report says that a lack of local infrastructure on new housing sites is slowing down the rate of new homes coming onto the market.
Natalie Elphicke, Chief Executive of The Housing & Finance Institute, commented: "In industry discussions, water, electricity, gas, broadband and roads are most often cited as the practical barriers to speedy housing growth. There is land; there are planning permissions, there is appetite to do more. To get homes built faster requires better performance from utilities companies who are currently failing to deliver on the homes the country needs.
“There is mounting evidence that a continuing failure of performance of water companies is delaying housing growth. All but one water company failed to meet the agreed targets for connecting water and sewerage supplies. This dreadful performance by the water industry impacts on large and small builders alike.
“The Government should merge the regulators - Ofgem and Ofwat – and give the Secretary of State more powers. Utility companies should be made to deliver.”
New research in the report reveals the scale of the failure currently being seen around the UK.
Of the water connection performance, only Dee Valley, which operates in Wales and Cheshire, secured 100 per cent of connections for new homes. While for sewerage, all companies in England failed on their performance targets; with only Welsh Water coming up to scratch.
The company that has failed its performance targets most dramatically is Affinity Water. Affinity Water services critical housing growth areas in the South East, Essex and around London. In the first quarter of 2015 it failed its performance target by nearly 60 per cent. Affinity’s average performance over the first three quarters of 2015 saw its performance fail by nearly 40 per cent.
Other significantly poor performances were recorded for Thames Water, Southern Water and South Staffordshire. These companies saw 20-25 per cent failure rates in at least one quarter of 2015.
This failure of the water industry, and to a lesser extent the electricity companies, to support the national needs for house building is serious and demonstrates the need for reform as recommended in the HFI’s report.
Natalie Elphicke continued: “There is a strong case for providing the same legal framework for water as there already exists for electricity.
“Given that there are so few utilities providers for water and electricity, there is a powerful case for a single utility regulator to drive more collaborative and planned local utilities provision and higher standards across all regulated entities.”
The Report also calls for new power for councils to force the release of disused public land for house building. As well as setting minimum build out rates on strategic sites through their planning agreements and providing practical support to councils to help them dispose of sites and force faster housing delivery in their areas.
Natalie Elphicke said: “There are some sites that have been vacant for 10, 15 or 20 years or more and that are not being brought forward for building in a timely fashion. There are some sites which are permissioned for building with an acceptance that 25 years or more is an acceptable rate at which to build out a site.
“Across the board we need to see more homes built, faster. So consideration should be given to beefing up the planning conditions imposed by councils to set agreements about the rate of building on sites, giving Councils more practical support to help them dispose of sites and drive through faster build out rates.
“There should be new statutory powers for the Secretary of State for Communities and Local Government to ‘Step In’ to strategic sites which are not building out to the required rate.”
