Following Ofwat’s publication of their Price Review 2024 (PR24) Draft Determinations, the water industry regulator has been criticised over the amount that average customer bills will increase by over the next five years.
Ofwat sets the amount that households will pay, factoring in the amount of investment the industry needs in order to achieve its goals. In the draft determinations published on 11th July, the regulator said average household bills would increase by £94 over the five year period of PR24 (1 April 2025 to 31 March 2030), which is around £19 per year.
But critics from both consumer groups and unions have said customers should not be picking up the bill for years of under-investment.
Mike Keil, Chief Executive of the Consumer Council for Water (CCW), said:
“Millions of people will feel upset and anxious at the prospect of these water bill rises and question the fairness of them given some water companies’ track record of failure and poor service. Customers understand investment is urgently needed but they need reassurance that every pound of their money is going to be well spent. Trust in water companies has never been lower and that won’t change until people see and experience a difference – whether that’s having the confidence to swim at their favourite beach or receiving help if they are struggling to pay their bill.”
“We estimate about 2 million households in England and Wales currently cannot afford their water bill and while the increase in financial assistance is welcome it falls short of what is needed. Over the summer we’ll be carrying out research with customers of every water company to gauge whether they feel the regulator’s proposals are affordable and deliver what people want. We expect Ofwat to listen and act on what customers tell us.”
The GMB Union, which represents around 10,000 water industry workers, agrees with Ofwat’s statement that water companies should fork out to clean up the mess they’ve made, but not at workers’ expense.
Their concern is that the £19 per year increase is a third less than the bill increases the water companies requested in order to achieve their five year plans, forcing water companies to consider cutting costs.
Gary Carter, GMB National Officer said:
“Ofwat is right that water companies should fork out to clean up the mess they’ve made – not customers.
“But that can’t be at the expense of water workers’ terms and conditions – which are the first things to be cut when companies plead poverty.
“Shareholders have trousered fortunes from UK water – they must be the ones to stump up the money the industry so desperately needs.”
