Water bills to rise by average 6% from April to ‘unlock record investment’
The average household water and sewerage bill in England and Wales is to go up by an average 6% from April to help unlock “record investment”, an industry group has announced.
Water UK said the increases, equivalent to £27 a year, would leave households with an average annual bill of £473.
The body said the increase, while down on the previous year’s hike, was needed to fund infrastructure improvements following a backlash over deliberate sewage discharges and poor water supply resilience.
It announced in October last year that it was seeking permission for a much greater contribution from bill-payers over the second half of the decade.
In return for the money, the proposed business plan promised 10 new reservoirs, to cut leaks and stop the equivalent of 6,800 Olympic-sized swimming pools-worth of sewage spills.
Water UK said the latest hike would unlock a record £14bn investment to ensure supply security and “significantly reduce” the amount of sewage in rivers and seas.
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It said that more than two million low-income households would receive help to meet the increases.
Customers of Wessex Water and Anglian Water face the highest average charges of £548 and £529 respectively, while Northumbrian customers will see the lowest average bills of £422.
Those homes under Britain’s biggest supplier, Thames Water, will see their average charge rise by £15 despite poor performance.
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In June last year, Sky News revealed how fears that Thames could be swept away under the weight of its debt pile had prompted the government to ready a rescue plan.
Its investors later agreed a further £750m of investment.
In December, Thames divulged an 18% rise in pollution incidents during the first half of its financial year – and that its debt pile had grown to £14.7bn.
Among the projects set to receive investment over the coming year is the 25km Tideway super sewer, which will divert storm flows away from the River Thames for the first time.
It aims to reduce sewage pollution poured into the river by 95%.
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Water UK chief executive David Henderson said: “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.
“Up and down the country customers will see the results of this investment with more than 2,000 kilometres of pipes being repaired or replaced and more capacity to treat sewage than ever before.
“At the same time support for customers is doubling with more than two million families now being helped with their bills.
“Anyone with worries should contact their water company and, it is worth remembering, water companies will never cut anyone off or make them use a prepayment meter.”
Chief executive of regulator Ofwat, David Black, responded: “We are very aware, for those who are already struggling, this will be a real worry.
“As such, water companies must do all they can to protect those who are most in need of a helping hand.”
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The rise comes amid ongoing regulatory concern over dividends paid out by water firms to shareholders.
In December, South East Water revealed it paid out £2.3m in dividends to investors despite widened losses and a £3m cost hit from summer heatwaves and supply interruptions.
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Details of the payout came as the supplier – which is under investigation by Ofwat over its service to customers and record in maintaining a water supply – reported pre-tax losses of £18.1m for the six months to September 30, against losses of £12.7m a year earlier.
Just days earlier, Thames announced a £37.5m dividend to its parent company – with the payout being probed by Ofwat over concerns it may have broken rules designed to protect customers and the environment.
The Liberal Democrats’ environment spokesperson Tim Farron MP said: “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.
“This price hike is a disgrace and should be scrapped immediately. There should be no price rises until water firms scrap insulting overseas dividends and exec bonuses. It is a scandal that Conservative Ministers are just letting water firms get away with this.”
Foreign state investors would be allowed to hold stakes of up to 15% in British national newspapers, ministers are set to announce amid a two-year battle to resolve an impasse over The Daily Telegraph’s ownership.
Sky News has learnt that the Department for Culture, Media and Sport could announce as soon as Thursday that the new limit is to be imposed following a consultation lasting several months.
The decision to set the ownership threshold at 15% follows an intensive lobbying campaign by newspaper industry executives concerned that a permanent outright ban could cut off a vital source of funding to an already-embattled industry.
It would mean that RedBird IMI, the Abu Dhabi state-backed fund which owns an option to take full ownership of the Telegraph titles, would be able to play a role in the newspapers’ future.
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RedBird Capital, the US-based fund, has already said it is exploring the possibility of taking full control of the Telegraph, while IMI would have – if the status quo had been maintained – forced to relinquish any involvement in the right-leaning broadsheets.
One industry source said they had been told to expect a statement from Lisa Nandy, the culture secretary, or another DCMS minister, this week, with the amendment potentially being made in the form of a statutory instrument.
Other than RedBird, a number of suitors for the Telegraph have expressed interest but struggled to raise the funding for a deal.
The most notable of these has been Dovid Efune, owner of The New York Sun, who has been trying for months to raise the £550m sought by RedBird IMI to recoup its outlay.
Another potential offer from Todd Boehly, the Chelsea Football Club co-owner, and media tycoon David Montgomery, has yet to materialise.
RedBird IMI paid £600m in 2023 to acquire a call option that was intended to convert into ownership of the Telegraph newspapers and The Spectator magazine.
That objective was thwarted by a change in media ownership laws – which banned any form of foreign state ownership – amid an outcry from parliamentarians.
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The Spectator was then sold last year for £100m to Sir Paul Marshall, the hedge fund billionaire, who has installed Lord Gove, the former cabinet minister, as its editor.
The UAE-based IMI, which is controlled by the UAE’s deputy prime minister and ultimate owner of Manchester City Football Club, Sheikh Mansour bin Zayed Al Nahyan, extended a further £600m to the Barclays to pay off a loan owed to Lloyds Banking Group, with the balance secured against other family-controlled assets.
Other bidders for the Telegraph had included Lord Saatchi, the former advertising mogul, who offered £350m, while Lord Rothermere, the Daily Mail proprietor, pulled out of the bidding last summer amid concerns that he would be blocked on competition grounds.
The Telegraph’s ownership had been left in limbo by a decision taken by Lloyds Banking Group, the principal lender to the Barclay family, to force some of the newspapers’ related corporate entities into a form of insolvency proceedings.
The newspaper auction is being run by Raine Group and Robey Warshaw.
The DCMS declined to comment.
Burberry, the UK’s only global luxury brand, is to cut around 1,700 jobs worldwide over the next two years after reporting a steep financial loss.
The company lost £66m in pre-tax profit in the year ended in March as luxury goods sales fell across the world and the company weathered an “uncertain” environment and a “difficult macroeconomic backdrop”.
A year earlier, it recorded £383m in profit.
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It’s suffered in recent years with the share price falling to such an extent the business was removed from the FTSE 100, the index of most valuable companies listed on the London Stock Exchange.
Despite the financial performance, the company was upbeat, with chief executive Joshua Schulman saying “I am more optimistic than ever that Burberry’s best days are ahead and that we will deliver sustainable profitable growth over time”.
What cuts are being made?
The retailer did not specify any shop closures – in the past year, it closed 26 and also opened 26 stores – but did highlight shift cuts and consolidations.
“We don’t have a store closing programme, per see,” Mr Schulman told investors
The night shift at Burberry’s Castleford factory will be cut, it proposed, saying the shift has resulted in overproduction.
“Significant” investment in the facility will be made, however, as the ambition is to scale up British production “over time”, Mr Schulman said.
Changes to the retail network across the world will be made with shop staff being scheduled around “peak traffic”.
Burberry will be “realigning” shop staff, he said, “so that we can offer the best service” at the busiest times.
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There will also be a “simplification” of Burberry’s regional structure and a “rebalancing” of central and regional responsibilities to reduce duplication and “accelerate decision making” through the retail network.
But the majority of changes will be made to “office space teams” around the world, the CEO said.
Commercial and creative teams have already been consolidated, Burberry’s annual results said.
What’s gone wrong?
Aside from the global slowdown in luxury goods sales over recession fears, additional headwinds have come in the form of President Trump’s tariffs.
“Clearly, the external environment has become more challenging since mid-February”, Mr Schulman told investors.
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Tariff risks were higher than first planned, the annual results said.
It led the US market to be described by Mr Schulman as “choppy” since February when Mr Trump began announcing tariffs on Mexico, Canada and China, as well as on goods such as steel and cars.
Sales also fell in the Asia Pacific region by 16%, the results showed.
Criticism was levelled at the 2021 British government decision to withdraw VAT refunds for overseas visitors, “which has made the UK the least competitive destination in Europe for tourist shopping”, the results read.
“Business in our UK home market continues to be seriously impacted” by the move.
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