Average water and sewerage bills forecast to rise 3.5%

First published in Business Daily

WATER watchdog Ofwat is forecasting the average household water and sewerage bill in England and Wales will increase by 3.5% or about £13.

That takes into account a rate of inflation of three per cent and will mean an average bill of £388 in 2013/14.

In 2009 Ofwat made its decision on how much water and sewerage companies could charge customers between 2010 and 2015.

The regulator's challenge of companies' proposals means that across England and Wales average bills have remained broadly in line with inflation and that bills are 10 per cent lower than what companies asked for.

That is before inflation is factored in. The rate of inflation is added to bills on a year-by-year basis. Since 2009/10, the average bill has risen slightly below (by 0.7%) the rate of inflation.

Regina Finn, Ofwat chief executive, said: “Customers can’t choose their supplier. It’s our job to make sure they are protected.

“Back in 2009, companies wanted bills rises of 10 per cent above inflation. That didn’t chime with what customers told us they wanted, so we said they could only increase bills in line with inflation.

“We understand that there is huge pressure on household incomes and any rise is unwelcome. Inflation is driving these increases.

“These rises will help pay for investment of around £1,000 for every household in England and Wales. This will deliver real benefits - from continuing to improve the reliability of supplies to dealing with the misery of sewer flooding for thousands of customers.

“We will make sure customers get value for money and if companies fall short in delivering their investment promises we will take action. In the past seven years, we have made companies pay out around £550 million where they have underperformed.”

The bill changes for this year will come into effect on April 1 and apply until March 31, 2014. The impact of the new charges will vary for individual household customers, depending on the company that supplies them and whether or not they have a water meter.

Customers’ bills are helping pay for an investment programme worth around £25 billion between 2010 and 2015. It is intended to allow companies to ensure customers continue to see improvements and receive a safe, reliable supply of drinking water.

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