Management shortfalls at NI Water

It is thought the error will result in a £20m shortfall per year

Northern Ireland Water committed serious management shortfalls and possibly breached its licence.

The verdict was delivered by the Utility Regulator which has told the company to fix what it calls "major deficiencies".

The investigation was launched after it emerged the company had miscalculated its projected income, leaving consumers facing higher than expected bills.

The regulator said it had found significant weaknesses in management.

In February, NI Water admitted it had made a miscalculation in its projected revenue.

The shortfall is estimated to be £13m this year and £20m next year.

Ian Osborne, chief executive of the regulator, said it pointed to a breach of the company's licence.

He said NI Water had been ordered to commit immediately to an action plan to improve its major deficiencies.

"NI Water has already given us an assurance that they will commit to implementing an action plan to improve deficiencies identified by our investigation," Mr Osborne said.

"We welcome this constructive approach from the company, and we will take the necessary action to make sure that the water company delivers on their assurances."

Chris Mellor, chairman and chief executive of NI Water, said the company welcomed the report's findings.

He said: " My team and I are acutely aware of the impact that the cost apportionment issue had on public confidence and it was important that the facts surrounding it were subject to robust and independent scrutiny."

The company's former chief executive, Katharine Bryan, left her post in May with a significant pay-off following discontent over the company's error.