The Government has repeated its view that water bills must remain affordable, and customers cannot be expected to pay the price for years of underperformance in the past.
Commenting on today’s announcement by Ofwat that water bills are set to rise 36% after the regulator approved a £104 billion investment programme over the next 5 years by the water companies, Secretary of State Steve Reed said:
“Under the Conservatives, our sewage system crumbled. They irresponsibly let water companies divert customers’ money to line the pockets of their bosses and shareholders.
“The public are right to be angry after they have been left to pay the price of Conservative failure.
“This Labour Government will ringfence money earmarked for investment so it can never be diverted for bonuses and shareholder payouts. We will clean up our rivers, lakes and seas for good.”
A briefing note accompanying the statement by Steve Reed said:
“The Government has introduced reforms so that funding for vital infrastructure investment is ringfenced so it is spent on upgrades benefiting customers and the environment – not diverted for bonuses, dividends or salary increases. If that money is not spent on investments, it will be returned to customers.
“We are committed to a water sector that delivers for customers and the environment. Bills must remain affordable, and customers cannot be expected to pay the price for years of underperformance in the past. ”
The PR24 (Price Review) process, which determines bill rises for 2025 – 20230, is “fundamentally a matter for the independent financial regulator Ofwat”, the note says. “It is the responsibility of Ofwat to review company plans to ensure they meet legal requirements and government targets to give customers the best value for their money.”
CCW warns at least 2 in 5 households will find these increases difficult to afford
Commenting in response to this morning’s announcement from Ofwat, Mike Keil, Chief Executive of the Consumer Council for Water (CCW), said:
“These bill rises may be less than what water companies wanted but they are still more than what many people can afford. Customers will be hit particularly hard from April with a large chunk of these increases frontloaded into next year - on top of inflation.
“We know at least 2 in 5 households will find these increases difficult to afford but the support being offered by some water companies lacks ambition. People want to see more investment, but this must be coupled with a strong safety net for customers who will struggle to pay. The case for a single social tariff to end the current postcode lottery of support has never been more compelling.”
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