Decision on water bills increases of up to 73% delayed

Legionella bacteria can be found in water supplies (Peter Byrne/PA)
-Credit: (Image: Peter Byrne/PA)


A hotly anticipated review of how expensive water bills could be over the coming years has been pushed back because of the General Election. Water regulator Ofwat has pushed back the date for its consultation on draft pricing decisions for the sector until July 11.

The announcement had been pencilled in for June 12, but after Prime Minister Rishi Sunak called an election for July 4 it will now be delayed. The consultation will see Ofwat give its initial verdict on water companies' business plans until the end of the decade, which it does every five years.

The future of Britain's biggest water firm Thames Water could hinge on the decision. Thames faces potential nationalisation after investors rowed back on a promise to provide extra funding, putting the company's finances in the balance.

The company has a roughly £15billion debt pile and, along with the other water companies, has become embroiled in a scandal over water pollution. Thames has asked Ofwat to allow it to hike customer bills by an average of 44% over the next five years to help it invest in its infrastructure and balance the books.

Proposed bills hikes across the rest of the industry range from 14% for Northumbrian Water to 73% at Southern Water. That is despite sewage spills into England's rivers and seas more than doubling in 2023.

According to the Environment Agency, there were 3.6million hours of spills last year - equal to about 400 years - compared with 1.75million hours in 2022. Ofwat said it is acting in line with election guidance for civil servants, which says that during the pre-election period, authorities must be cautious on making calls that might impact the campaign.

The regulator added that the new price controls set as part of its 2024 review will still come into effect on April 1 2025, despite the later publication date for its draft decisions.

It added: "Ofwat is currently looking into the impact the date change will have on the rest of the price review process."

A Government spokesperson said: "Investment in the water industry has not kept pace with where it needs to be. This needs to change and we want to see ambitious plans from water companies that meet our targets and deliver for customers.

"Ofwat's job is to ensure that these plans deliver effectively for customers and the environment. This process will resume post-election to ensure customers do not pay for water companies' poor performance."