Water bills to rise by an average of £123

Households can expect their annual water bill to rise by an average of £123 from April, more than the amount announced by the regulator last month , the sector’s industry body has said.

According to Water UK, the average bill in England and Wales will jump from £480 to £603 in the year from 1 April, in a move the Water UK chief executive acknowledged would be “difficult for many”.

Some areas are set for even steeper rises. Maquarie-owned Southern Water – one of the country’s worst performing water companies – has told customers they can expect a 47 per cent hike to their water bills, while households in the catchment of South West Water have been warned of a 31 per cent jump.

The final average figure, which has been adjusted upward to take into account inflation and changes in population forecasts, represents a sharp increase on the £86 average bill hikes announced by Ofwat in December as part of its long-awaited price review.

The review sought to set prices and investment in the scandal-hit water industry over the next five years. Water companies had been lobbying intensely for steeper price rises, which they claimed were necessary if they were to fix creaking infrastructure, and prevent leakage and sewage discharges.

Ofwat ultimately allowed a 26 per cent hike to bills; a steep rise, but lower than the amount that many water companies were demanding.

Water UK said the final bill rises would pave the way for a record £20bn of investment between this April and March 2026, the sector’s highest ever capital expenditure in a year. It also committed to over £20bn of investment in five years.

The funds will be funnelled into the construction of nine new reservoirs, as well as vital upgrades to 1,700 wastewater treatment works to help reduce the regularity and severity of storm overflows.

The industry body also committed to increase the support available to low-income households, which, it said, would mean over 3m households would receive reduced bills over the next half decade.

David Henderson, chief executive of Water UK, acknowledged that increasing bills was “never welcome”.

“We know that for many this increase will be difficult,” he said. “This is why water companies are more than doubling the level of financial support for customers.”

David Black, chief executive of Ofwat, said: “While bills are rising, the £104bn investment we have approved over the next five years will accelerate the delivery of cleaner rivers and seas and help to secure long-term drinking water supplies for customers.

“This is an ambitious programme of work… Where companies underperform, or investment isn’t delivered, we will hold companies to account and protect customers.”