Water companies in England and Wales have that the average change in water and sewerage bill for 2014/15 compared to the previous year will be £8, or 2% - a rise below the rate of inflation - attributed by Ofwat to pressure it exerted to get a better deal for customers.

The bills, which come into effect on 1 April 2014, are the final ones of the current five-year AMP5 pricing period.

Pamela Taylor, Chief Executive of Water UK, the body which represents the water companies at UK and EU level, said:

“Water companies are in touch with their customers and have made significant efforts to keep customers’ bills as low as possible.

“At the same time, companies will invest around £5bn in the next 12 months to ensure our drinking water quality will remain amongst the best in the world and our rivers and beaches become even cleaner. This investment also maintains well over 120,000 jobs in the UK and helps support regional economies.

“Companies will also continue to allocate millions of pounds to give struggling households money off their water bills as well as offering a range of extra support and advice measures.”

The bill changes for the forthcoming year 2014/15 will come into effect on 1 April 2014 and apply until 31 March 2015. 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.

Companies are allowed to add the RPI rate of inflation to their bills on an annual basis. The inflation figure used this year is 2.7% - the Retail Price Index (RPI) annual inflation in November 2013, as released by the Office of National Statistics in December 2013.

The national average bill figure for England and Wales of £393 does not factor in the Government Contribution to South West Water’s household bills. The national average bill figure therefore incorporates an average South West Water household bill of £545.

Water industry regulator Ofwat has attributed the below-inflation increases to the pressure it has put on the companies to ensure a better deal for water customers.

Half of the companies were already facing below inflation increases this year following Ofwat’s 2009 decision on price limits. In October Ofwat called on all companies to consider whether they needed to take up their full allowed increases, in recognition of the difficult economic circumstances facing many of their customers. Ofwat said it welcomed the decision by six water companies (Affinity, Anglian, Southern, United Utilities, Wessex, Yorkshire) to reduce their allowed bill increases in 2014 -15.

Cathryn Ross, Ofwat Chief Executive, said:

“It’s our job to make sure customers are getting a fair deal. We know that customers are having a tough time. In the last five years bills have risen with inflation, yet we are well aware customers’ incomes haven’t. We are pleased that a number of companies have heard our call, listened to their customers, and taken action. Ten million households will now benefit from lower than expected bills this April."

“We are now focused on getting the best deal for customers over the next five years.”

Ofwat is currently analysing and challenging companies’ business plans for the period 2015-20. Final decisions on these prices will be made by January 2015, with new bills coming into effect in April 2015.