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Water bills to go up £6 - but less than expected

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AVERAGE household water bills should rise just £6 after Yorkshire Water heeded criticism and announced lower bills than expected.

Prices are agreed every five years by industry regulator Ofwat and a 1.6 per cent rise in addition to inflation was originally scheduled.

But the company has now agreed an inflation-only increase of 2.65 per cent which will see bills rise an average £6, rather than £12.

The firm, which was last year accused of tax avoidance, is proposing that bills rise with inflation only for the next five years.

The move was welcomed by Ofwat which had called on water companies to consider whether they needed to take up their increases in full because of the tough economic times facing customers.

The average household bill in Yorkshire from this April will be £373, compared to the UK average of £393.

Cathryn Ross, Ofwat Chief Executive, said: “We are pleased that a number of companies have heard our call, listened to their customers, and taken action. Ten million households will now benefit from lower than expected bills this April.”

The company is investing £239.5m in projects across the region, including a £2.7m overhaul for Eccup reservoir in Leeds.

Richard Flint, Yorkshire Water’s chief executive, said: “We know many customers are feeling the pinch and have taken action by limiting the price rise for this coming financial year.

“We’ve also gone a step further in our proposals for the next five years by suggesting that bills move only with inflation up to 2020.”

The Bradford-based utility, which is owned by a consortium of international investors, uses companies incorporated in the Cayman Islands.

Politicians last year accused foreign-owned water companies of using debt interest schemes to avoid tax at a cost of £1bn to the taxpayer over the previous three years.

The water firm, which made operating profits of £331.5m last year, said yesterday it was “moving to a position where we expect to pay tax in 2014-2015.”

A statement added: “We will pay tax when it is due in accordance with the law and continue to abide by both the letter and the spirit of the law.”

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