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Small cut in cost of water bills | Small cut in cost of water bills |
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Average water bills in England and Wales will be reduced slightly over the next five years, regulator Ofwat has announced. | Average water bills in England and Wales will be reduced slightly over the next five years, regulator Ofwat has announced. |
It has ruled that typical bills will fall by £3 to £340 by 2015, before the impact of inflation is considered. | It has ruled that typical bills will fall by £3 to £340 by 2015, before the impact of inflation is considered. |
Publishing its final decisions on what firms can charge from 2010 to 2015, Ofwat said bills would be 10% lower than the level companies had asked for. | Publishing its final decisions on what firms can charge from 2010 to 2015, Ofwat said bills would be 10% lower than the level companies had asked for. |
However, Ofwat had initially wanted to cut bills by a larger margin of £14. | However, Ofwat had initially wanted to cut bills by a larger margin of £14. |
It had suggested cutting the average bill to about £330 in its draft proposals, released in July. | It had suggested cutting the average bill to about £330 in its draft proposals, released in July. |
Ofwat chief executive Regina Finn said the regulator had listened to its stakeholders and to customers since its draft was published. | Ofwat chief executive Regina Finn said the regulator had listened to its stakeholders and to customers since its draft was published. |
"[Customers] have told us that certainly what they want is a safe, secure water supply, but they wanted some more things. [For instance] they wanted more money spent on protecting homes from sewer flooding," she said. | "[Customers] have told us that certainly what they want is a safe, secure water supply, but they wanted some more things. [For instance] they wanted more money spent on protecting homes from sewer flooding," she said. |
"So we've put those things in, but make no mistake - we have challenged hard to make sure they get the best value for money and we've managed to keep their bills flat at the same time." | "So we've put those things in, but make no mistake - we have challenged hard to make sure they get the best value for money and we've managed to keep their bills flat at the same time." |
Wide variation | |
The official watchdog, the Consumer Council for Water, broadly supported Ofwat's decision. | |
People can shop around for the best deal on many things, but not water Regina Finn, Ofwat chief executive | |
But it pointed out that bills would vary a lot between individual suppliers. | |
"The prices announced vary from company to company, so depending on where they live, customers will face a range of price changes from a reduction in average annual bills by as much as 7%, to an increase in bills of 13% before inflation," it said. | |
"Customers of companies such as Essex and Suffolk Water (13%), Bristol Water (7%), Southern Water (5%) and Thames Water (3%) will all see rises in average bills. | |
"South West Water customers without a meter could see a 29% rise in bills," the Consumer Council warned. | |
More investment | |
Ofwat said one part of its price deal with the water firms was they must invest more than £22bn during the five years. | |
This figure - which is for the total amount across the industry - amounts to an investment of more than £935 per household in England and Wales. | |
"People can shop around for the best deal on many things, but not water. Our job is to do this for them," said Ms Finn. | "People can shop around for the best deal on many things, but not water. Our job is to do this for them," said Ms Finn. |
"We will now make sure the companies deliver on their promises. If they don't, we'll take action to protect customers." | "We will now make sure the companies deliver on their promises. If they don't, we'll take action to protect customers." |
The £22bn of earmarked investment includes £12.9bn to maintain and improve infrastructure, such as pipes and treatment works, and £4.6bn on improving drinking water and the environment. | The £22bn of earmarked investment includes £12.9bn to maintain and improve infrastructure, such as pipes and treatment works, and £4.6bn on improving drinking water and the environment. |
Scottish water companies have been told they cannot raise their bills for a year from April 2010. | Scottish water companies have been told they cannot raise their bills for a year from April 2010. |
The regulator - the Water Industry Commission for Scotland - said it was likely to extend the price freeze for another year. | The regulator - the Water Industry Commission for Scotland - said it was likely to extend the price freeze for another year. |
Prices cannot rise higher than 5% below inflation over the next five years. Scottish Water has also been told to reduce leaks by a third. | Prices cannot rise higher than 5% below inflation over the next five years. Scottish Water has also been told to reduce leaks by a third. |