Average water bills in England and Wales will increase by 36 per cent over the next five years, water regulator Ofwat has said.
The increase is significantly higher than the expected average rise of around £20 a year per household, outlined in the regulator’s draft proposals in July.
Ofwat said the increase would pay for a £104 billion upgrade of the water sector to deliver “substantial, lasting, improvements for customers and the environment”.
Despite the average £31 a year increase figure, households will face a heavy average hike of £86 or 20 per cent in the next year, excluding inflation, with smaller percentage increases in each of the next four years.
Southern Water customers will experience the biggest bill rise of all eleven water and wastewater companies, a 53 per cent hike. The company had sought an increase of 83 per cent.
Wessex Water customers will see the lowest increase with a 21 per cent bill rise. Meanwhile, around 16million Thames Water customers will see an increase of 35 per cent.
Ofwat chief executive David Black said: ““Alongside the step up in investment, we need to see a transformation in companies’ culture and performance. We will monitor and hold companies to account on their investment programmes and improvements.
“We recognise it is a difficult time for many, and we are acutely aware of the impact that bill increases will have for some customers. That is why it is vital that companies are stepping up their support for customers who struggle to pay.
“We have robustly examined all funding requests to make sure they provide value for money and deliver real improvements while ensuring the sector can attract the levels of investment it needs to meet environmental requirements.
“This has seen us remove £8bn of unjustified costs compared with companies most recent requests. In addition, our approach to setting a rate of return has saved customers £2.8 billion.”
