Your water bills are set to rise by £123 this year – Here’s why

People across the UK are set to be hit with a 26% rise in their annual average water bill.

This means the average water bill will rise from £480 to £603 – an increase of £123 from April 1 this year.

The rise, announced by industry body Water UK, equates to a £10 average increase a month – from £40 to £50.

But millions are set to face even steeper rises than this including customers who use Southern Water which will see a 47% increase.

This means those who use Southern Water will endure a £703 yearly increase.

Hafren Dyfrdwy and South West Water bills will rise by 32%, Thames Water customers bills will be hiked by 31% and Yorkshire Water customers will see a 29% rise.

Matthew Topham, Lead Campaigner at We Own It, told Metro: ‘It is an outrage that the richest firms are profiting over water bill rises.

‘People up and down the UK are having to stomach unaffordable price rises.

‘We know this means that one in four people will cut back on everyday essentials like food to pay these bills.

‘While water bills are not as big as other energy bills, this will push some people over the edge during this sharp cost of living crisis.’

Why are water bills rising?

Water firms need to spend billions of pounds fixing sewers, drains and reservoirs that have dumped pollution into waterways up and down the country.

But because water firms are privatised they need to turn over a profit to get more investment from shareholders.

On top of this many are in debt, with the biggest water companies having a combined debt of £60billion.

Mr Topham explained to Metro: ‘These hikes are only necessary because firms underinvested in sewage and leak prevention while taking on billions in debts to make shareholders and creditors rich.

‘Now their debts are unaffordable and they’ve turned once again to us to pick up the tab. Ofwat has factored in a staggering rate of profit for the fat cats behind our firms. 

‘Scotland’s publicly owned water firm has hiked bills by a fraction of those in England. Why? Because every penny they make goes towards the actual business, not shareholders, and it’s cheaper to run.’

What role does Ofwat play?

All regional water companies submit plans to Ofwat every five years which include how much they will spend upgrading sewers, drains and reservoirs.

Ofwat sends a draft ruling in July and then six months of negotiations start about how much firms can charge.

Ofwat then publishes its final decision in December and Water UK announces the increases.

But these increases are higher than those announced by Ofwat in December because they include inflation.

Water UK chief executive David Henderson said: ‘We understand increasing bills is never welcome and, while we urgently need investment in our water and sewage infrastructure, we know that for many this increase will be difficult.

‘Water companies will invest a record £20 billion in 2025-26 to support economic growth, build more homes, secure our water supplies and end sewage entering our rivers and seas.’

Water UK argue that the water bill increases are only 5% higher than in 2010.

What have critics said?

Critics argue the problem of rising water bills has worsened since privatisation in 1989.

For example, not a single reservoir has been built in England and Wales in those 30 plus years.

Liberal Democrat environment spokesman Tim Farron hit out at the water firms and said it is ‘a national scandal’.

He said companies are ‘failing to invest in fixing leaky infrastructure, whilst company executives are stuffing their pockets with bonuses’.

What has the government said?

Environment Secretary Steve Reed has launched an independent commission to review how Ofwat operates.

He said: ‘The public are right to be angry after they have been left to pay the price of Conservative failure.

‘This Labour government will ringfence money earmarked for investment so it can never be diverted for bonuses and shareholder payouts. We will clean up our rivers, lakes and seas for good.’

What happens next?

People across the UK are now coming to terms with massive hikes to their water bills.

Mr Topham added: ‘The simple answer is to bring water companies under public ownership, something that the UN has called for.

‘This is a fairer way of doing this and 90% of the world already does it.’

Get in touch with our news team by emailing us at webnews@metro.co.uk.

For more stories like this, check our news page.