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Water bills in England and Wales will rise by an average of 6 per cent from April sparking criticism from consumer groups concerned about the impact on households during a cost of living crisis.
The increase, announced on Friday by trade association Water UK, will raise the cost of sewage and water services by about £27 per month, to an average of £473 per household a year, between 2024 and 2025. However, prices will vary according to the region.
The price of water and sewage services is based on several factors, including November’s consumer price inflation index, which includes housing costs. The CPIH index reading for November was 4.2 per cent.
Water companies have faced a growing public backlash in recent years over poor performance on pollution and leakage.
Water UK said the above-inflationary rise — consumer prices in December increased at an annual rate of 4 per cent — would pay for a record investment of £14.4bn in the 12 months to the end of March 2025 and pledged that suppliers would increase support for low-income households.
“Next year will see record levels of investment from water companies to secure the security of our water supply in the future and significantly reduce the amount of sewage in rivers and seas,” said David Henderson, chief executive of Water UK.
However, the Consumer Council for Water, which represents customers, expressed concern, pointing out that almost a fifth of households were already struggling with water bills and that the increase would pile “even greater pressure on low-income customers”.
Its chief executive Mike Keil added: “If water companies are serious about rebuilding trust in the sector they should use some of their profits to help people who cannot afford another bill rise.”
Water companies in England and Wales offer social tariff schemes, which are designed to lower bills for struggling households. Water UK said more than 2mn families were already being helped with their bills.
David Black, chief executive of Ofwat, said the regulator was aware that for “those who are already struggling, [the bill increases would] be a real worry.”
The annual increase in water bills comes on top of the uplift set by Ofwat every five years. For the 2025 to 2030 regulatory period, water companies have asked to raise bills by as much as 40 per cent.
A preliminary decision by Ofwat is expected in June and comes against a backdrop of the cost of living crisis and public anger over the behaviour of the water industry.
Companies have been accused of paying out excessive dividends and remuneration packages for senior management while presiding over high leakage rates and water pollution.
But the companies are also struggling during a period of sustained high inflation, which has pushed up wages as well as financing and operating costs and increased the strain on highly leveraged balance sheets.
Tim Farron, environment spokesperson for the Liberal Democrats, said the price rise was a “disgrace and should be scrapped immediately”.
“This is a kick in the teeth from the same dodgy water firms who pollute rivers with sewage whilst pocketing millions in bonuses. They have no shame,” he said.
