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Water companies in England and Wales propose increasing the average customer bill by around nine per cent more than inflation, between 2010-2015, according to a Summary Document issued by Ofwat. Water companies' proposals for investment between 2010 -15 were submitted to Ofwat in August. Companies' proposals mean the average bill will reach £355, before inflation is considered, by 2015. Companies propose these increases to help fund a capital investment of £27 billion in the industry over the five year period, and address the issue of increased operational cost, including rising energy prices. The capital investment programme represents approximately a 37 per cent increase on the current 2005-10 period, where companies' investment totalled just under £20 billion. Water companies plan investment in maintaining assets, looking after the environment, protecting their assets against flooding and securing long-term, sustainable water and sewerage services. The Summary Document highlights the distinct differences between regions. No water company has kept its proposed increases below inflation; a number have kept their proposed increases very close to inflation, and many have proposed significant increases. Regina Finn, Ofwat Chief Executive Officer said, "My job is to ensure customers get a fair deal from the water industry. We need to balance investment in the future with what customers are able to pay now. "We will analyse the water companies' proposals rigorously and challenge them to justify all investment. We will protect customers from any unnecessary price rises."  1. Note: Essex and Suffolk is a water only supplier 2. Note: the industry average is calculated as the total household revenue divided by the total number of household properties Notes to editors 1. The Water Services Regulation Authority (Ofwat) is the economic regulator of water and sewerage companies in England and Wales. It exercises its powers in a way that it judges will allow companies to carry out their functions properly, and finance them. Its duties include protecting the interests of consumers, wherever appropriate by promoting effective competition. 2. Since privatisation in 1990, the water and sewerage sectors in England and Wales have invested approximately £75 billion. This equals average annual capital investment of more than £4.2 billion, compared with an equivalent investment figure of about £2 billion a year during the 1980s. 3. In August water companies submitted their draft business plans to Ofwat. In the plans they proposed what investments they needed to make to maintain their assets and to deliver environmental and water quality improvements. They also outlined how much this might cost customers in their water bills for the period 2010 -15. 4. The Summary document details that all draft business plans are sufficiently robust enough to take forward to the next stage of the price review process. More information about the price review process is available here. 5. Ofwat, in partnership with the Consumer Council for Water, Department for Food, Environment and Rural Affairs, Environment Agency, Welsh Assembly Government, Drinking Water Inspectorate, has started the third and final stage of consumer research. This focuses on what improvements to the water industry customers are willing to pay and not to pay for. This should yield results by late February 2009, which will feed into water companies final business plans.
Or 0121 625 1416/1496 / pressofficeteam@ofwat.gsi.gov.uk  | ||||||
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