WATER watchdog Ofwat's National Customer Council is determined to see that customers are protected in the wake of Yorkshire Water's recent announcement that it wants to transform itself into a mutual society.

"Our sole concern is how will these proposals, if implemented, affect customers," said Sheila Reiter, chairman of the council (NCC).

"We know that shareholders will benefit handsomely, but what do customers stand to gain and lose? We have many concerns and questions to which we will be seeking some answers."

Yorkshire Water is due to become a mutual society owned by its customers. Parent company Kelda said the decision has been prompted by price controls and environmental targets imposed on the industry. It believes customers will benefit from closer involvement in their water service.

Director General of Water Services Sir Ian Byatt has said he will protect the public and give them a voice on the water company's proposals.

Speaking at the launch of the NCC's annual report, Ms Reiter said she wants to see competition in the water industry because it will give customers lower prices and better service, as is the case with other utilities.

"No customer should be disadvantaged, especially financially, by any changes brought about by competition.

"We will ensure that the issues that matter to customers are not overlooked as the debate on the complex economic and technical issues surrounding competition gather pace."

She expressed concern that the Government's new Consumer Council for Water - yet to be established - will not have the strong powers promised by Government.

"In particular it will have no powers to require water companies to act to resolve customers' complaints and it will be prevented from publishing information that could seriously affect a water company, even if it was in the consumers' interest."

The NCC is an independent body set up by Sir Ian to strengthen the representation of water customers' interests nationwide.

lOfwat has organised a public meeting at the Metropole Hotel, Leeds, on Thursday, July 6, to discuss Kelda's proposals.