Page last updated at 15:27 GMT, Tuesday, 7 April 2009 16:27 UK

Water companies ask for more cash

Bewl Water near Lamberhurst in Kent, 2006
Water supplies are under pressure in many parts of the country

Water and sewerage bills in England and Wales are likely to rise above inflation from 2010 to 2015.

The 10 big combined water and sewage companies have asked for permission to raise their annual charges by an average 1.7% a year above inflation.

The water regulator, Ofwat, is being asked to approve an average rise in bills of £23 per household over those five years.

The firms say they need the extra cash to improve drinking water and sewers.

"Some companies are not looking at any increase, really, just up and down with inflation. The most we are looking at would be an extra £48 over five years," said Pamela Taylor of the water companies' organisation Water UK.

Extra spending

The increase in bills over those five years will, if approved, range from just £2 above inflation at Welsh Water, to £48 at Thames Water.

Some companies seem to be making a late call for higher prices
Dame Yve Buckland, Consumer Council for Water

The 21 water companies, including the smaller water-only suppliers, plan to spend a further £24bn on improving their services and infrastructure.

Projects include new pipes, better reservoirs, improved water testing to meet higher standards, improved waste treatment and the need to protect sewers from the effects of flooding.

Ofwat will now scrutinise the plans and make its decision in November 2009.

A water consumer watchdog was critical of some companies' plans, especially those of some smaller water suppliers.

"We recognise that some price increases may be necessary to enable companies to meet the pressures being put on water companies from growing populations, climate change, and tighter EU and UK standards," said Dame Yve Buckland, Chair of the Consumer Council for Water.

"However, some companies seem to be making a late call for higher prices, which is of concern."

The smaller water-only companies have asked for their next set of charges to be pushed up by an average of 17% above inflation over five year, to an average of £162 - £23 more than at the moment.

The biggest rise is being sought by Bristol Water, up 29%, and the smallest by Three Valleys, at just 6%.

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