Designing and running C-MeX and D-MeX pilots for 2019 Price Review (PR19)

The main objective of this project is to: 1. Test all aspects of C-MeX and D-MeX so the incentives meet the success criteria, set out in section 1.3 above, and are developed to the point where they can be run in shadow form (as a full scale dry run) in 2019-20, and have financial incentives applied on an annual basis from April 2020 onwards. This involves design and running at least two waves of pilot customer surveys for C-MeX and D-MeX that are consistent with the design decisions of each incentive outlined in the methodology statement 'Delivering Water 2020: our methodology for the 2019 price review'.

Two further subsidiary objectives are to: 2. Provide advice and make evidence-based recommendations on some of the outstanding elements of the C-MeX design not covered by the decisions published in the PR19 methodology statement, including: • whether NPS should form part of the financial incentive; • the weightings of the customer service and customer experience surveys within the C-MeX calculation; • the most appropriate source of data for the cross-sector challenge in C-MeX; and • how to adapt C-MeX, if necessary, based on the results of the C-MeX pilot.

3. Provide advice on and make evidence-based recommendations on how to adapt D-MeX, if necessary, based on the results of the D-MeX pilot.

Scope of Work Stage 1 involves helping Ofwat to devise a detailed methodology for piloting C-MeX and D-MeX. It involves adding the methodological detail to the PR19 methodology statement relating to the design of C-MeX and D-MeX, determining the most appropriate surveying methodology.

Stage 2 involves running at least two waves of the surveys for C-MeX and D-MeX in pilot form. C-MeX consists of two surveys and our current preference is for two surveys for D-MeX so the project consists of running four surveys for two waves.

The provider will be required to familiarise themselves with areas of work referenced and hyperlinked in Appendix 3 on C-MeX and D-MeX. They will also be required to keep up to date with policy developments in these areas, which may include liaising with relevant stakeholders. The successful provider could choose to run stakeholder workshops as part of the project.

The scope will not require the provider to support Ofwat in finalising the selection of the quantitative measures to be included in D-MeX. All decisions on the final design of C-MeX and D-MeX will remain for Ofwat.