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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Oct: ‘Sewage scandal’ in water system
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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Oct: What caused Britain’s sewage crisis?
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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Dec: Thames Water can’t pay £190m
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.”
Business
Ex-Post Office head of IT says Paula Vennells ‘hoped to avoid’ inquiry – and reveals she blocked her number
A former Post Office executive has said she was forced to block ex-boss Paula Vennells’ phone number after the ex-CEO called multiple times asking for help to avoid an independent inquiry into the Horizon IT scandal.
Lesley Sewell, previously the company’s head of IT, told the Post Office inquiry on Thursday that former CEO Ms Vennells had reached out to her four times between 2020 and 2021.
Ms Sewell said that she blocked Ms Vennells’ number due to discomfort with the contact.
In her witness statement to the probe, Ms Sewell said that one of Ms Vennells’ emails referenced the need to fill in memory gaps regarding Horizon and “Project Sparrow”, a committee addressing issues with forensic accountants who identified flaws in the accounting system.
“Paula contacted me on four occasions in total. I recall blocking her number after the last call as I did not feel comfortable with her contacting me,” Ms Sewell said.
“I had not spoken to Paula since I had left POL [Post Office Limited] in 2015.”
Lesley Sewell giving evidence to the Post Office inquiry. Pic: PA
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According to Ms Sewell’s testimony, former chief executive Ms Vennells said that she had “been asked at short notice” to appear before a parliamentary select committee on “all things Horizon/Sparrow and need to plug some memory gaps”.
Ms Sewell says Ms Vennells added: “My hope is this might help avoid an independent inquiry but to do so, I need to be well prepared.”
Ms Sewell, who struggled to contain her emotions and broke down in tears while giving her oath at the start of her inquiry evidence, was offered support and breaks as needed by chairman Sir Wyn Williams.
Sir Wyn told the former executive: “Ms Sewell, I appreciate this may be upsetting for you, Ms Price will ask you a number of questions in a proper and sensible manner, but if at any time you feel you need a break, just let me know, all right?”
Lesley Sewell taking the oath at the Post Office inquiry. Pic: PA
The Post Office has faced significant scrutiny following the ITV drama Mr Bates Vs The Post Office which highlighted the Horizon IT scandal.
The faulty system led to the prosecution of more than 700 sub-postmasters between 1999 and 2015, with many still awaiting full compensation despite government announcements regarding payouts for those with quashed convictions.
London City Airport will on Thursday name its first permanent female chief executive as it targets approval of an expansion plan that would create nearly 1,500 jobs.
Sky News understands that the Docklands airport has told staff that Alison FitzGerald, who has been co-CEO since January alongside finance chief Wilma Allan, has landed the role.
A woman wearing a face mask walks by London City Airport, which suspended its operations during the pandemic
She replaces Robert Sinclair, who left in January after six years to become boss of the High Speed 1 rail link.
The airport is owned by a consortium of Canadian pension funds and Kuwait’s sovereign wealth fund, which have backed a plan to increase its annual passenger traffic from about 6.5m to 9m.
It is appealing against Newham Council’s rejection of a planning application that would see it extend operating hours at the site, which is popular with City commuters.
The airport’s proposals include no increase in the annual number of flights and, in what it claims is a first for a UK airport, a commitment that only cleaner, quieter, new generation aircraft will be allowed to fly in any extended periods.
The runway at London City Airport
The appeal is being reviewed by the Independent Planning Inspector.
Its change of leadership makes London City the second of the capital’s airports to name a new CEO in quick succession, following the arrival at Heathrow of Thomas Woldbye last year.
“London City delivers one of the best passenger experiences in the UK and I’m committed to building on this success even further,” Ms FitzGerald said.
Representatives of Thames Water’s multinational syndicate of shareholders are poised to quit as directors of its corporate entities after refusing to inject the billions of pounds of funding required to bail it out.
Sky News has learnt that a number of board members at companies connected to Kemble Water Finance, Thames’s parent, are expected to resign in the coming days.
City sources described the move as “the logical next step” after the owners of Britain’s biggest water utility said they would not commit more than £3bn to help upgrade its ageing infrastructure and shore up its debt-laden balance sheet.
A default on part of Thames Water‘s holding company debts last month has raised the prospect that the company is heading towards special administration, a form of insolvency that would effectively leave the government liable for managing a utility firm which serves nearly a quarter of Britain’s population.
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Thames Water under threat
Thames Water is owned by a group of sovereign wealth funds and pension funds from countries including Abu Dhabi, Australia, Britain, Canada and China.
A number of the investors are represented on boards which sit at various points in the group’s labyrinthine capital structure.
It was unclear on Wednesday whether Michael McNicholas, a representative of the giant Canadian pension fund Omers and who sits on the board of Thames Water Utilities Limited, was among those in the process of stepping down.
Read more:
Directors hold crunch talks over utility’s future
Even bigger surge in bills proposed under new plans
Along with the rest of the privately owned water industry, Thames Water faces a crucial moment next month when Ofwat, the industry regulator, publishes its draft determination on companies’ five-year business plans.
The draft rulings will be subject to negotiation before final versions are published in December.
Thames Water and a spokesman for Kemble declined to comment.
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