Thames Water bucks the trend with inflation-busting price hike
THE MAJORITY of water companies in England and Wales yesterday confirmed that they would keep price increases below inflation for 2014-15, equating to an £8 – or two per cent – hike to the average bill.
But Thames Water, which supplies the London area, is raising bills by 3.4 per cent.
The Consumer Council for Water said it was “disappointed” by Thames Water’s price increase, “at a time when one in eight water customers tell us they feel they cannot afford their water bill”.
Six companies have chosen not to take up their full price limits set by the regulator Ofwat at the last review of prices in 2009, including FTSE 100-quoted United Utilities.
Fellow FTSE 100 firm Severn Trent is raising bills by 1.1 per cent.
“Water companies are in touch with their customers and have made significant efforts to keep customers’ bills as low as possible,” said Pamela Taylor, chief executive of industry body Water UK.
“At the same time, companies will invest around £5bn in the next 12 months…This investment also maintains well over 120,000 jobs in the UK and helps support regional economies.”
Consumer group USwitch said that households had been “hung out to dry” by rising utility costs and said moving to a water meter could save households £50 a year.
The water industry sets prices every five years. Most companies have pledged not to raise bills above the rate of inflation over the next regulatory period, which starts in 2015. But Thames Water has proposed an 11 per cent increase to bills for the next cycle, making it the only firm to submit an above-inflation price increase to Ofwat. It said that the proposal was justified by plans to invest £2.8bn in the Thames Tideway Tunnel.