Water bills to jump 10 per cent

Next spring could see a rise in utility bills, with water increasing by as much as ten per cent.

09:45 03 June 2004

Next spring could see a rise in utility bills, with water increasing by as much as ten per cent.

Downing Street is showing signs of concern as the likely price hikes would be a stumbling block in the government's re-election campaign.

Currently, petrol rises the main concern, but gas, electricity and council tax could all see similar increases by this time next year.

Water companies have now submitted plans to watchdog Ofwat for 22 billion capital spending over five years. This would imply that bills will rise by 30 per cent plus inflation - effectively 40 per cent in total.

If a 40 per cent rise in water bills is evenly spread over five years, the first rise would be in the region of eight per cent. The bigger bills would be hitting doormats between February and April 2005.

However, there is a possibility of a "front-loaded" rise which would see a ten per cent initial increase - adding 25 to the average bill.

Ofwat will give its draft response to the water companies plans on August 5th, and its final verdict on December 2nd.