Ofwat today published its proposals to fine Tendring Hundred 0.3% of its turnover – a total of £42,000 – for failing to provide the regulator with reliable, accurate and complete information.
In September 2006 (PN 26/06) Ofwat published details of the accounting error that led to the company misreporting information in its June return 2006.
The error affected Tendring Hundred’s revenue projections, which meant that its price limits for 2005-10 were incorrect, and led to its customers being overcharged. In April 2007 Tendring Hundred reduced bills by 7%, meaning customers had their overpayment refunded, plus interest.
Ofwat Director of Regulatory Finance and Competition, Keith Mason said:
“We take the matter of misreporting seriously. We can only regulate effectively and protect consumers if companies provide reliable, accurate and complete data.
“There is no evidence of deliberate misreporting in this case. However, we are concerned that there were inadequate systems and controls in place at Tendring Hundred to identify such a substantial error. This meant that customers paid more than they should have.”
In considering the overall penalty, Ofwat took account of the company’s co-operation with the investigation, as well as the impact that the costs of investigating and rectifying the error have had on a company of its size.
Tendring Hundred will bear the cost of this fine and it cannot be passed on to its customers.