There is always a lot of soul searching before putting pen to paper about such a sensitive issue as the one I have in mind because there is an element of “biting the hand that feeds you” in it, but I am so passionately concerned by some of the current trends in procurement in the water Industry that I feel it is my duty to speak out about them.

First, some background. The standards currently used in the water and gas industries are the outcome of decades of consultation between the utilities, manufacturers and standards bodies and now in the main reflect the requirements of each party.

Historically, policing of these standards has been by the stakeholders headed by third party accreditation through recognised audit bodies. The second line of audit has been through the utilities themselves approving products against their own standards, individual requirements and quality systems. And the third line has been the manufacturers, who design products and select and source materials that meet all the required standards and specifications, including the 50-year design life criterion – all this against the backdrop of a very competitive market-place.

It is also important to remember that the quality implicit in all these requirements is not free. Supplying products that “tick all the boxes” for standards and specifications and conform to industry drivers such as carbon reduction, traceability and inventory and cost reduction requires huge investment; and this doesn’t take into account the considerable cost of retaining local manufacture, market support and continuous product development.

AVK has nonetheless succeeded in rising to all of these challenges, and has grown to become the market leader for valves in the water and gas industries. We have been delivering all the benefits customers need but still getting product to market competitively.....until recently it seems.

A number of worrying trends have emerged in the UK water industry in the last two years or so which are forcing us to reconsider our understanding of the market and its current aims. To state it simply; the industry seems to heading towards a philosophy of “cheapest wins” regardless of any other considerations.

The first of these trends is illustrated by recent decisions on the part of some major utilities to award frameworks for strategically important items wholly or in part to non-manufacturers. To clarify, there have been a number of stores and purchasing organisations within the Utilities that are now run by distribution businesses; these however will purchase and supply product that has been selected through the Framework bid process.

The non-manufacturers I refer to are factorers of packages of products who sell predominantly on price. This would not be so much of an issue if the water companies had not relaxed their insistence on auditing products and manufacturers for adherence to standards. In at least two instances that we know of, the supplier was allowed to ‘self-certify’ that the product conformed to all the customers’ requirements and didn’t even have to declare the name or the manufacturer of the product being supplied. An extreme example of this was in a major utility where the engineer responsible for product selection had not even been informed that tenders had been invited.

The danger of practices such as these are clear – the installation of cheap, poor quality, unregulated, and potentially dangerous products in the water infrastructure.

The second trend we have noticed is the downgrading of product standards in certain applications. One example is the set of very specific and arduous type tests associated with the standard for gate valves in buried service applications, which account for 90% of the thousands of units AVK sells into the UK water industry every year.

These valves are typically installed in buried pipelines with just the top exposed under a metal cover, and operated manually by means of a metrelong lever at a range of time intervals from never to several times a day. The type tests developed over many years for this application ensure that the valves will withstand the tough conditions and the operating pressure of the main, and that they are strong and durable enough to give reliable service for many years.

Recently, however, we have seen a less rigorous version of the standard being adopted – one that is more appropriate for above-ground gate valves that are easily accessible and are typically operated with a device such as a hand-wheel, which imposes significantly lower torque on the valve.

Again, this compromising of standards is opening the flood gates to the introduction of poorly manufactured, probably untested, unregulated and potentially dangerous products.

These are just two amongst other negative trends which indicate a short-termism pervading a once forward-thinking, quality-conscious industry that must ultimately lead to higher costs caused by the need to replace products that fail prematurely, not to mention all the associated expenses and customer service issues.

There is already evidence to support this gloomy forecast. Anybody who has tried to do business with the water industry in Southern Ireland will still have the words resounding in their ears - “You’re too expensive...I can get it cheaper”.

The structure of the Irish water industry is similar to that of the UK before the advent of the water authorities, under which local authorities are responsible for the infrastructure. On paper, the Irish Environmental Protection Agency is responsible for water quality, but both it and the local authorities are under-resourced. Regulation is therefore compromised and has resulted in cheap, poor quality and uncertified equipment becoming the norm, contributing further to already poor water quality and supply issues.

In 2008 approximately 118,000 people in Southern Ireland were affected when boil water notices and restrictions of use* were put in place. The industry inevitably has a dreadful reputation with its own consumers, and a well-publicised fine was recently imposed on the Environment Minister; as a consequence, the government is having to spend money it doesn’t have to recover its position.

As a responsible manufacturer, AVK always tests competitors’ products for its own internal purposes against a fixed set of criteria based on type test requirements for the relevant standards. We would strongly advise UK water companies to do the same; the results may well cause them to review the new and undesirable procurement strategy of allowing manufacturers (and non-manufacturers) to self-certify.

AVK is well aware of the challenges the water industry faces and we have devoted considerable time and resource to helping to address as many as we can. We too are a business and are faced daily with the choice between the price and value of everything, from stationery through machine tools to product components. We have long differentiated between cheap and cost effective and we don’t buy cheap ‘quality’ - it’s not in our culture.

Along with other credible manufacturers, AVK is determined to do all it can to reverse the trend towards “short-termism” in the industry and we are encouraged in this by the pockets of support we are finding around the UK. Our main strategy in the medium term is to present case studies and other evidence to stakeholders that will convince them that a short-term policy of buying cheap will cost them dearly in the long run.

We will continue to monitor standards; we will raise objections when we see products that we know aren’t fully certified or fit for purpose; and we will challenge compromise over approvals – something we have already seen happening with WRAS and Kite Marks.

Finally, if you feel that you want to buy and install a gate valve for a purpose other than that for which it is designed just because it’s cheaper, then come to us, we have one in our range. Ours will be WRAS approved, 100% tested and will give you considerably more peace of mind as an AVK product than the unregulated alternatives that are being considered for or are currently being installed in parts of the UK Water Infrastructure.....go on call our bluff...!