Water companies across England and Wales have proposed various bill increases to the industry regulator Ofwat. One company – Southern Water – has proposed increasing customers’ bills by 84% by 2030. The money will help fund £88bn of investment in improving services and the environment.
Ofwat will make its final decision for how much water bills can rise on 19 December. Its interim decision, made in July, said the average bill could rise by £19 per year over five years (£94 in total), excluding inflation. The proposed bill rises would begin to take effect from April 2025.
Four in 10 households would struggle to pay
The CCW has published the findings of an in-depth study of 9,500 households. It gauged billpayers’ views on the regulator’s draft decision to allow water companies to increase bills by an average of 21%, before inflation is added, over the next five years.
A representative sample of household customers served by each water company in England and Wales were asked how easy or difficult they would find the proposed bill rises for their supplier. They were also asked how acceptable they found the five-year investment plans for their area, based on Ofwat’s draft determinations in response to companies’ business plans.
Overall, 40% of customers said they would find the proposed changes to their water bill difficult to afford – more than double the 18% who say they have difficulty paying their current bill. In Wales, these concerns were even more acute, with nearly half (48%) of customers saying they would find the planned rises difficult to afford.
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Customers were broadly supportive of the way their money would be spent to tackle issues like curbing leakage and reducing pollution into rivers, lakes and seas. Three-quarters (75%) of those surveyed found the overall investment package for their company “acceptable”.
The consumer watchdog CCW says the findings show that while the majority of people back the need for investment in water and sewerage services, the price tag would be too much to bear for millions of households.
Calls for more support
The CCW has already voiced concerns that some water companies’ proposals to expand financial support for struggling customers do not go far enough. It pointed out that there remains an urgent need for a single social tariff for England and Wales to end the current postcode lottery of assistance.
Mike Keil, chief executive of the CCW, said: “These bill increases would put an intolerable strain on the finances of millions of households and only a single social tariff can provide the safety net that is needed to ensure water is affordable for everyone.
“People support the need for investment, but there is a strong undercurrent of mistrust over whether water companies can deliver on their commitments. Customers need to see evidence their money is being well spent, otherwise fractured trust in the water sector will never be repaired.”
