Specification of requirement

Specification of requirementResearch into consumers’ experience of water and sewerage debt

29 January 2015

For more information contact: Robert McGeachy on 0131 550 1069 or at Robert.McGeachy@cas.org.uk

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Specification of requirement

1. IntroductionAbout the Citizens Advice ScotlandCitizens Advice Scotland (CAS), its 61 member bureaux, consumer helpline and Extra Help Unit form Scotland’s largest independent advice network. CAB advice services are delivered using over 250 service points throughout Scotland, from the islands to city centres, and through our helplines. Together, the Citizens Advice service in Scotland helped 300,000 people with nearly 1 million issues in 2013/14.

CAS’s twin aims are:

To ensure that individuals do not suffer through ignorance of their rights and responsibilities or of the services available; or through an inability to express their needs; and

To exercise a responsible influence on the development of social policies and services, both locally and nationally.

On 1 April 2014, the roles and responsibilities of Consumer Futures were transferred to the Citizens Advice service, encompassing CAS and our sister organisation Citizens Advice (England and Wales). CAS now represents the interests of citizens and consumers in essential regulated markets including energy, post and, in Scotland, water. Our aim within the water industry is to challenge and shape policy to ensure it reflects the needs of consumers.

CAS uses consumer research to provide an evidence base to challenge and shape policy to ensure it reflects the needs of consumers. CAS presents research and our policy positions to government and to other water industry stakeholders, and publishes publicly available research based on our research findings.

2. Background CAS is the consumer representative organisation for the water industry. It represents consumer interests, and advocates for change on behalf of consumers.

Different agencies play key roles for the provision of water services to households in Scotland, and for the charging of these services. Domestic water supplies in Scotland are provided by Scottish Water, while local authorities are responsible for the billing and collection of water and sewerage charges.

Research undertaken by Consumer Futures in 20121, which addressed awareness of water service provision amongst consumers highlighted that consumers’ awareness of Scottish Water’s role in delivering water services is relatively high whereas consumers’ awareness of the distinction between Council Tax and water charges is much lower. The research findings also demonstrated that consumers’ awareness of Scottish Water, as the drinking water provider, was high at around 79%. However consumers’ awareness of who to contact if they experienced

1 “Water Outlook - Consumer outlook on water and wastewater services in Scotland”, Consumer Futures, August 2013, http://www.consumerfutures.org.uk/reports/water-outlook

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problems with their water supply was lower at 59%. The research study found that consumer awareness of how much, and on what basis, they pay for water is low2.

The current water and wastewater charging scheme has the following features:

Tariffs are based on Council Tax bands and are the same across Scotland, geography having no influence on the amount households pay for water and sewerage services.

The number of metered households in Scotland is negligible (less than 500). Local authorities collect water charges together with Council Tax using the

same enforcement procedures3. From the charges collected by local authorities, a sum is paid to Scottish Water which provides Scottish Water with a percentage to all monies collected for council taxes and water charges, irrespective of their intended destination, as if they were a single payment4.

Single occupancy households receive a 25% discount (as they do on their Council Tax bill).

Recipients of Council Tax Reduction receive up to a 25% reduction (the discount for households on partial benefits is calculated on a pro-rata basis).

Households with no occupants chargeable for Council Tax (for example, students) or void premises are exempt and pay no water charges.

Previous research suggests water bills rank as a low priority for households. This can be because of the perceived ‘low impact’ of non-payment as water supplies cannot be cut off, but also from a lack of awareness of one’s ongoing liability to pay water and sewerage charges, especially if they are in receipt of Council Tax Reduction5.

Local Authorities need to apply for a summary warrant before they can execute diligence against debtors, in other words take enforcement action such as a bank arrestment or arrestment of earnings to recover charges due.  Debtors will have had reminder letters from the local authority before they apply for summary warrant.  Once the summary warrant is granted by the Sheriff Officers the debt will automatically increase by 10 per cent, and the Sheriff Officers will serve a Charge for Payment on the debtor along with a Debt and Information package advising debtors where they can apply for help.  Although the debtor has no recourse to court before the summary warrant is granted they will be able to use the Charge for Payment to make a repayment offer via the Sheriff Officers, apply to the court for a Time to Pay or declare themselves bankrupt.

2 “A matter of principles – Research into household attitudes towards paying for water in Scotland”, Consumer Futures, March 2014, http://www.consumerfutures.org.uk/reports/a-matter-of-principles-research-into-household-attitudes-towards-paying-for-water-in-scotland3 The features of this process are set out in a number of regulations, including the Local Government Finance Act 1992 and the Council Tax (Administration and Enforcement) (Scotland) Regulations 1992.4 As determined by the ‘ABCD formula’, set out in The Water and Sewerage Services to Dwellings (Collection of Unmetered Charges by Local Authority) (Scotland) Order 2014; see also “Keeping your head above water – A study into household water debt in Scotland”, Consumer Futures, February 2014, p.17, http://www.consumerfutures.org.uk/reports/keeping-your-head-above-water-a-study-into-household-water-debt-in-scotland5 “Keeping your head above water – A study into household water debt in Scotland”, Consumer Futures, February 2014, p.8, http://www.consumerfutures.org.uk/reports/keeping-your-head-above-water-a-study-into-household-water-debt-in-scotland

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A Water Direct pilot scheme is currently being tested within Inverclyde and Fife local authorities. It allows local authorities to take separate third party deductions to cover water and sewerage debt, and an additional deduction to cover current charges if the customer is not keeping up with payments. These deductions are in addition to Council Tax deductions and other debt repayments, such as rent.

3. Definition of the problemWater and sewerage charges debt

Households in receipt of Council Tax Reduction can receive a reduction of water and sewerage charges of up to 25%. However, water debt can be a problem for consumers who through circumstances, low income or lack of awareness of ongoing liability for water and sewerage payments, find themselves unable to pay6. It would appear that some people on benefits and on low income, and in receipt of 100% Council Tax reduction, will assume that they will also be exempt from paying water and sewerage charges. This is not the case. Significantly, even those in receipt of a 100% reduction for Council Tax will only receive a maximum of a 25% reduction in their water and sewerage charges. This is a key factor underpinning levels of water and sewerage charges debt”.

Previous research by Consumer Futures indicated that up to 20% of consumers are in water debt in Scotland7.

4. Why research is necessary Research with consumers to understand their experiences of water debt will build upon previous research published in 20148, which consisted of desk based research as well as interviews with local authority officials. Understanding the causes of water and sewerage debt from a consumer perspective will provide a strong evidence base that will support CAS’ debt policy work with industry stakeholders, including

6 As demonstrated by cases we frequently see within Citizens Advice Bureaux (CABs). This was also explored within “Keeping your head above water”, 20147 “Keeping your head above water – A study into household water debt in Scotland”, Consumer Futures, February 2014, p.8, http://www.consumerfutures.org.uk/reports/keeping-your-head-above-water-a-study-into-household-water-debt-in-scotland8 “Keeping your head above water – A study into household water debt in Scotland”, Consumer Futures, February 2014, p.8, http://www.consumerfutures.org.uk/reports/keeping-your-head-above-water-a-study-into-household-water-debt-in-scotland

CAS therefore wishes to commission research to: Better understand the circumstances and experiences which lead low income consumers to water and sewerage debt. This will be done by exploring consumer understanding and awareness of water charges, and their attitudes towards payment. We also wish to better understand the impact on the consumer of water debt.

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Scottish Water, Water Industry Commission for Scotland, the Scottish Government and local government.

In particular it will inform CAS’s position relating to issues around water and sewerage charges billing and collection, and the extent to which households in receipt of full Council Tax Reduction should be liable for ongoing water and sewerage charges.

5. Research objectivesThe objectives of the research are to understand:

1. Consumers’ awareness of ongoing liability for water and sewerage charges when in receipt of Council Tax Reduction.

2. Consumers’ understanding of water charges.

3. Consumers’ views of water charges, i.e. willingness to pay and priority given to water charges.

4. The circumstances that lead to customers being in debt for water and sewerage services.

5. Consumers’ views of water debt recovery practice, i.e. views on fairness and best methods of collection.

6. Consumers’ personal experience of water debt recovery practices.

7. The impact of water debt and recovery practices on consumers.

The research will progress these objectives by considering the following issues and areas:

Consumers’ self-perception of money managing skills Consumers’ awareness of water and sewerage charges

o How aware are consumers of the distinction between Council Tax and water and sewerage charges?

o Are consumers aware of Scottish Water and its role? Is there a link between knowledge of Scottish Water and knowledge of separate water and sewerage charges?

o Are consumers aware of their continued liability for water charges even if they receive Council Tax Reduction?

Do consumers know how much they pay for water and sewerage services (and/or council tax as they may be unaware of water charges)?

o How do consumers pay for water and sewerage services? With Direct Debit, in cash on instalments, through deductions from benefits?

Consumers’ experiences of managing money and debto Do consumers have Council Tax or water and sewerage arrears?o What other debts do consumers have?

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Why are consumers in water debt? What circumstances led them to be in debt for water and sewerage charges?

o How does their experience of managing money compare with the self-perception of their own money managing skills?

What are consumers’ views towards debt for water and sewerage charges? Are water and sewerage services a priority debt?

How do consumers manage multiple debts? How do consumers repay water debt? Through a Repayment plan?, By

payment of a lump sum?, Or through direct deductions from benefit?o (For Fife cases only9) Have consumers had any experience of

additional deductions being taken from their benefits for water and sewerage charges and what impact has this had?

What is the consumers’ view of Council Tax / water and sewerage debt recovery practices?

Hypothetically, what debt recovery practices should be used?o Would the separation of council tax and water charges for debt

collection purposes be fair? Or do consumers regard it as ‘one bill’ which should only be subject to one deduction?

o How would consumers view direct deductions for water charges and arrears, separate from deductions for council tax (as is the case with Water Direct)?10

What impact does debt and debt recovery have on the debtor?o What impact does water debt have?o For those not in Water Direct pilot, what impact would separate Water

Direct deductions have?

6. Uses of informationThe research will be published and will be used to inform policy development within the water industry and by other public body stakeholders. It is anticipated that the research will:

Allow CAS to make specific recommendations to stakeholders, including Scottish Water, the Water Industry Commission for Scotland and the Scottish Government on what is needed to protect and support vulnerable consumers to mitigate the impact of water debt.

Identify if specific water and sewerage third party deductions / debt recovery practices have been helpful to the consumer, or could be helpful to those not in the current Water Direct pilot areas.

9 Note the trial of Water Direct is only within Fife and Inverclyde. We are also collecting evidence on this Water Direct pilot through Citizens Advice Bureaux in the Fife region.10 These questions are trying to ask those who are not in Water Direct pilot if they think the principles behind it are a good idea.

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Specification of requirement

Form part of CAS’ ongoing policy development and advocacy work on water and sewerage debt, and on general debt.

Be used to benefit consumers, including raising consumer awareness about water debt, including the distinction between Council Tax charges and water and sewerage charges.

Inform industry stakeholders about consumer opinion and experience.

Provide baseline evidence for future research into water debt.

Help to inform CAS’ future work plan.

7. Target populationResearch should focus on low income consumers, both with and without employment (in particular MRS Society Grades C2,D,E) who are more likely to face debt issues, and be in arrears for water and sewerage charges. This should include low income consumers who are in receipt of Council Tax Reduction.

It should also take note of respondents’ income status, council tax band, receipt of welfare benefits, age, employment status, disability, local authority. The sample should be broadly geographically representative.

Research participants should be the person (or one of the persons) responsible for paying water charges in the household. In particular, for the purpose of the research it is important that the research includes a focus on Inverclyde and Fife local authorities, as well as at least two other local authority areas in Scotland.

8. Anticipated approachWe anticipate that research will be qualitative. The Supplier can propose suitable methodology, including research methods and interview lengths required to elicit results within the budget specified, and an implementation plan to meet the research objectives, which will be agreed with CAS. Research methodology may include telephone, face to face interviews or focus groups, or a combination of these methods11.

For comparison between tenders, we ask for quotes based on 30 minute telephone interviews with 30 consumers, and also for 30 minute telephone interviews with 50 consumers.

CAS will be involved in developing topic guides and interview prompts in conjunction with the Supplier.

11 We will require assurances that mobile only households will also be sampled in any telephone interviews as many low income households do not now have landline phones. Also, we do not feel that an internet survey approach would be adequate or appropriate, as many low income household cannot get affordable internet access.

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Suppliers should provide details of the interview framework they intend to adopt, their approach to recruitment of participants and methodology for analysing results.

It is CAS’ expectation that the supplier’s activities to progress the research will include a strong focus on the Inverclyde and Fife local authority areas. It is also anticipated that at least two other local authority areas will be covered by the research.

9. Analysis required Interviews will be transcribed and analysed. Analysis will make reference to consumer age, location, income, work status and council tax band.

We will use the findings from this research to build upon our previous water debt report and to inform our recommendations regarding tackling water debt and work with water stakeholders and local authorities.

10. Deliverables • Draft copies of all key documents, such as the recruitment profile, topic guide

and final reports. These should be submitted in sufficient time for comments to be incorporated and for our approval to be given before producing final versions.

• Top line findings (upon completion of the fieldwork) or an interim report • A full written report (with any specific subheadings and recommendations

agreed with CAS) in Microsoft Word setting out the findings with an executive summary and relevant appendices (including copies of survey questions/interview questions).

• Transcripts of qualitative research.• A presentation of results at CAS offices in Edinburgh with accompanying

PowerPoint slides.

11. Nature of the Report The research report will be used by a wide range of people within and outside of the Citizens Advice service, not just the team involved in commissioning the work.

Along with all of our research reports, it is intended to contribute to the wider knowledge of consumer behaviour and consumer concerns, not just to the immediate research problem. As such, it must be capable of being used as a secondary data source for a reasonable period of time after the research is completed.

For these reasons it is essential that the report:

• Uses language accessible to readers with varying experience of research and consumer behaviour.

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• Contains a comprehensive description of the research method, so that the reader understands what was done and the robustness and/or limitations of the data.

• Organises and, where appropriate, reduces the data so as to lead the reader either to clear conclusions or to a discussion of the implications of the findings.

• Avoids over-summarising or over-simplifying the findings.

• Contains clearly labelled charts, diagrams and tables (if appropriate) summarising and illustrating the results, with a narrative description of what the chart, diagram or table shows – do not leave it to the reader to interpret these.

• Contains a stand-alone Executive Summary, containing a brief description of the background, objectives, method, main findings and conclusions.

Agencies are required to follow best practice in research report writing as specified in the Citizen Advice Research Report Guidelines.

12. Performance and quality requirementsCAS is leading this work, and will require regular meetings, including a project initiation meeting, to be held between the supplier and ourselves to ensure progress is on track and any difficulties are resolved promptly. Any anticipated shortfall in quality or similar failing shall be brought to the attention of CAS immediately.

We advise suppliers to show how they adhere to the MRS Code of Conduct or where appropriate any other professional code of conduct, or quality systems that they have in place.

Ownership of all research outcomes, including the final report and all data produced as a result of the research, lies with CAS.

Suppliers should not discuss study findings in public before a final report has been cleared by CAS, without prior, written agreement from CAS. Following publication, suppliers should not discuss the study in public without prior, written agreement from CAS. Suppliers must also obtain CAS’s prior, written approval to use data or findings from this study for any proposed presentation or publication.

The supplier should consider the wide range of equalities issues, including public duties, and ensure that these are all given due consideration at all stages of the research process.

13. Evaluation criteriaCAS will make its selection on the basis of that proposal which represents the best value for money. The following criteria will apply:

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Evaluation criterion Description Weighting

Technical experience Evidence of providing similar services to other organisations and particular skills/experience relevant to the problem

Also includes your performance on previous projects for Consumer Futures and its predecessor bodies and for CAS

10%

Methodology / Approach Details and suitability of suggested approach, sampling strategy and data collection method

Plans for dealing with any risks and contingencies

20%

Understanding our business needs

Indication of a clear understanding of the problem and the research objectives

10%

Staffing / Resources Details of any proposed staff or sub-contractors to be used for the provision of the services

10%

Implementation plan Details of your implementation plan to meet the timescales

10%

Quality Details of how you ensure that a high quality service is maintained throughout the contract period

10%

Price A full breakdown of all costs should be given

30%

Total 100%

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Tenders are evaluated by scoring against each of the above criteria using a 0-10 scale, where 0=Clearly fails to meet the requirement and 10=Excellent standard with no reservation at all about acceptability. The supplier with the highest overall score will be awarded the contract.

Please note that on completion of all contracts, suppliers are evaluated against these same criteria based on their performance. This post-project feedback will be considered in future tendering processes.

13. Form of proposalAll clarification questions must be made in writing and sent by email to Robert.McGeachy@cas.org.uk no later than 5pm on 5 February 2015. A response to all clarification questions shall be issued to suppliers by 11 February 2015.

Tenders must be sent to the project lead Robert McGeachy by 5pm on 13 February 2015.

Bidders should complete tenders in the format indicated below. All questions must be answered in full.

Company overview and previous experience• Please provide a brief overview of your organisation. This must include a brief

history and include detail of your capability and capacity.• Please provide detail of your understanding of the requirement and evidence

your skills and experience for carrying out the services.• Please provide brief details of two case studies that evidence your ability to

deliver the services required. This must include details of the remit of the research project from which the case studies are taken, how you delivered the project, and the objectives that were achieved.

• Please provide the names, addresses, and contact details of two referees that could be contacted to provide a reference of your ability to deliver the services.

• Please declare if there is a conflict of interest in carrying out this work.

Key personnel• Please provide a copy of your organisation chart.• Please provide details of the personnel who shall be responsible for the

delivery of the services. This must include a CV for these individuals that highlight their relevant skills and experience.

Methodology and delivery of the services• Please provide a detailed methodology of how you propose to deliver the

services and objectives detailed in this document. This methodology must describe the project from end-to-end; from finalising the conception to delivery of the final report.

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• Please provide a detailed project plan for the delivery of the proposed methodology. This must clearly define who shall carry out the tasks in the plan and the number of days for completion.

Commercial offer• Prices shall be quoted in pounds sterling unless otherwise stated and

presented separately from the rest of the tender in the downloadable pricing schedule. Prices should be quoted as inclusive of VAT, and VAT should be shown separately as a strictly net extra charge. Please detail any other costs associated with the provision of the services under this agreement. Any costs not detailed will be deemed to have been waived.

• Attached as part of the tender documents are the Citizens Advice Scotland Terms & Conditions of contract. Please confirm your acceptance to the terms. Bidders should note that failure to accept the Citizens Advice Scotland Terms & Conditions of contract will result in their elimination from the tender process following initial evaluation.

• The Pricing Schedule attached below should also be completed, and returned with the tender document.

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14. Procurement timetableCAS will be working towards the following procurement timetable:

Activity Date

Issue Invitation to *Tender/Quote 29 January 2015

Closing date for clarification questions 5 February 2015

Date for responses to clarification questions

11 February 2015

Tenders/quotes received 13 February 2015

Evaluation of tenders/quotes 16 February 2015

Contract awarded 17 February 2015

Contract commences 18 February 2015

Top Line Document 16 March 2015

Draft report due 23 March 2015

Final report due 13 April 2015

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GLOSSARY OF TERMS AND ABBREVIATIONS

Term Description

Draft Report The ‘draft report’ should not be a rough version of the report, but the full report (proof-read, spell-checked and sense-checked) for review by the client project team.

Final Report The final report is intended to have resolved all queries and comments.

Sources

“A matter of principles – Research into household attitudes towards paying for water in Scotland”, Consumer Futures, March 2014, http://www.consumerfutures.org.uk/reports/a-matter-of-principles-research-into-household-attitudes-towards-paying-for-water-in-scotland

“Keeping your head above water – A study into household water debt in Scotland”, Consumer Futures, February 2014, http://www.consumerfutures.org.uk/reports/keeping-your-head-above-water-a-study-into-household-water-debt-in-scotland

“Water Outlook - Consumer outlook on water and wastewater services in Scotland”, Consumer Futures, August 2013, http://www.consumerfutures.org.uk/reports/water-outlook

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PRICING SCHEDULE

Research into consumers’ experience of water and sewerage debtPricing schedule Service

price quotation Table 1:

Key personnel

Role Title Role LevelOther

Descriptions(T&S etc.)

No. of Days

RequiredDaily Rate

£Total Price

£

VATTotals

Table 2: Other costs (If Applicable)

Other Descriptions Item Quantity Item Price

£

Total Price£

VATTotals

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Total Price – Table 1 and 2

Total Price£

Table 1Table 2

Total VATTotal incl. VATTotal Price

All service price quotes must be in GBP. VAT, where applicable, should be shown separately as a strictly net extra charge. The price quoted must be fully inclusive of everything indicated by the Invitation to Tender documents such as supply, delivery, expenses and where applicable, support.

Dated this … … … . . day of … … . . . . . . . . .. . . . . . . . . . . . 2015

Signature: Full

Company name:

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