Asset Health and Resilience: Reflections on the Independent Water Commission’s ‘Cunliffe Report’

The conclusions from the Independent Water Commission’s Cunliffe Report are difficult to challenge, as they accurately pinpoint some fundamental issues that have negatively impacted investment plans since privatisation. These issues have left the sector with a portfolio of aging assets requiring increasing investment to maintain functionality and service quality.

The report highlights a critical gap in our understanding of asset health, which needs to be addressed as a key part of making informed, long-term asset decisions. These decisions should be built around a wider range of values than just monetary considerations.

One promising approach to address this gap is the adoption of multi-capital methodologies. Multi-capital approaches, which consider various forms of capital (such as financial, manufactured, intellectual, human, social, and natural capital), are being developed within the Water Industry Forum and The Institute of Asset Management (IAM). While this thinking is progressing well, it has yet to be fully embedded through the delivery models in the sector.

As Patron members of the IAM, Sweco and I naturally support the principles of good asset management. We challenge the current decision-making processes, particularly during the asset creation phase where capital cost tends to dominate in the world of infrastructure. Effective asset management should prioritise whole lifecycle thinking and the long-term value of assets, rather than focusing solely on initial capital costs.

Procurement models have grappled with, but so far failed to, establish effective contractual mechanisms that incentivise whole life asset value. These models should embed clearly defined metrics that drive desired behaviours and promote sustainable practices. The Commission’s call for a forward-looking infrastructure resilience framework and standards at a national level is a step in the right direction. It aligns well with IAM principles, advocating for strategic planning, data-driven decision-making, and enhanced regulatory roles to ensure that investments are sustainable and effective in the long run.

By addressing the insufficiencies in our understanding of asset health and implementing multi-capital approaches, we can ensure that the water sector makes informed, resilient, and sustainable decisions. This will ultimately lead to a more robust infrastructure that can withstand future challenges such as climate change and population growth, providing safe drinking water and effective wastewater management for generations to come.

The role of consultants in understanding water sector asset health and resilience frameworks

Consultants have a pivotal role to play in enhancing the water sector’s asset management maturity. Their expertise can help water companies navigate the complexities of infrastructure development and resilience planning by focusing on several key areas:

Strategic Planning

Consultants can assist in formulating long-term strategic plans that ensure sustainable infrastructure development. This involves considering future stresses such as climate change and population growth, and integrating whole lifecycle thinking into decision-making processes. By doing so, they help clients prioritise investments that provide lasting value and resilience.

Asset and System Risk Assessments

Conducting comprehensive risk assessments is crucial for understanding potential threats to both assets and critically overall system performance. Sweco has long recognised the value of systems thinking. Consultants evaluate risks, including environmental and customer impacts, and develop strategies to mitigate these risks effectively. This proactive approach ensures that water companies are prepared for various challenges and can maintain service provision even under adverse conditions

Recovery Planning

Developing robust recovery plans is essential for minimising the impact of disruptions on service provision. Consultants work with water companies to design strategies that ensure rapid recovery from failures, thereby enhancing system resilience and reliability.  The Commission has highlighted the need for forward looking resilience standards that can be applied consistently across the sector and consultants can help the regulator here also.

In addition to these areas, consultants can enhance the water sector’s understanding of asset health through detailed condition surveys that supplement existing data. This raises an area close to my heart: working with clients to utilise more of the data already collected, particularly through Operational Technology.

Performance and maintenance data, when combined with asset, time, weather, and other environmental data, provide valuable insights into asset health. This approach enables clients to move from analysing historical data to interpreting future performance, thus making more informed decisions about maintenance and renewal and will hopefully be a part of any new resilience standards.

At Sweco, we work closely with water companies across the UK to strengthen asset management maturity, improve resilience planning, and make better use of operational data. Whether through strategic planning, risk assessments, or recovery frameworks, our focus is on delivering long-term value across the asset lifecycle. As the sector responds to the Commission’s findings, we’re committed to supporting a more sustainable and informed future for water infrastructure.