Water

Why do some areas have more steep rises in water bills?

Jennifer Harpy
BBC News

Image Source, Getty Images
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Experts say there are large regional differences in the number of people receiving support

The cost of living crisis has caused fuel and energy bills to rise sharply – but water users in some parts of the country are also noticing their bills have risen. BBC News asked why.

Which water companies have higher gains?

Of the 11 water and wastewater companies in England and Wales, Northumbrian Water (10.8%) and Severn Trent (7.1%) saw the highest increases in average customer bills.

Some of the other companies’ customers have actually seen the average bill drop.

How are customers reacting to these changes?

Customers expressed anger.

Steve Willey, from Sherwood, Nottingham, is served by Severn Trent Water, which has the second-highest average rise in the country. He said the price increase was “unfair”.

“The cost of living has been going up at the moment. It seems like the bills are going up and National Insurance is going up,” he said.

“It’s going to be difficult for people to heat their homes at the moment. I’m very annoyed by that – very pissed off.”

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Steve Wiley says he’s angry about the rise

MPs also criticized the increases, with Ashfield’s Lee Anderson saying: “I understand their argument that there is an extra cost, but when in the rest of the country about 3-4% it’s a 7% increase – they really need to look at it again.”

What’s the reason for the rise?

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Water companies also have environmental responsibility

Inflation is the main reason, according to regulator Ofwat.

All water companies are able to increase their bills based on inflation. As a result, some bills are skyrocketing due to rising inflation.

However, some water companies are also allowed to charge customers more.

The companies operate on a five-year business cycle, most recently until 2025, when Ofwat will approve the services they will provide and how much they will charge.

A review by the Competition and Marketing Authority (CMA) approved some of the investments that Ofwat initially ruled out.

This means a change in price control for four companies – Anglian, Bristol, Northumbrian and Yorkshire.

Are customers paying for environmental issues?

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Activists worry about impact of sewage discharge on many rivers

According to the Consumer Council of Water (CCW), customers will not currently bear the cost of fines to water companies for failing to meet standards.

This means that when companies such as Severn Trent are fined £1.5m for sewage discharge, it eats into their profits rather than being billed.

However, customers do end up financing the cost of raising the standard – challenges in different regions are part of the reason for the difference in billing.

Environment Minister George Eustice said concerns over water companies discharging untreated sewage into rivers could affect the next negotiations in 2025 – with customers ultimately paying for it.

He told the BBC: “The truth is that you can’t make the investment we need to improve sewage infrastructure without paying something.

“That’s why we’ve decided not to remove all storm overflows overnight, because the cost of doing so could be in the hundreds of billions of pounds, and water bills will increase very, very dramatically.

“But we are taking a pragmatic approach to reducing the most harmful storm spills, which will have associated costs.

“Ultimately, everything has to be paid for in some way.

“If you’re going to achieve your goal of reducing sewage spillage into the water, there’s a cost to building that kind of infrastructure.”

How high was the initial bill?

While Northumbrian Water and Severn Trent will see the highest increases in 2022/23, their average bills – £365 and £389 respectively – are still lower than the rest of the country.

In Cornwall, Devon and parts of Somerset and Dorset – serviced by South West Water – the average bill was £472.

Customers in the area can enjoy government concessions due to the region’s long coastline and the amount of bathing water that needs to be maintained.

Users of Wessex Water, which also supplies water to Somerset and Dorset, as well as Bristol and Wiltshire, cost an average of £470.

Experts say the huge difference in bills comes down to factors such as the degree of population distribution – dense, urban areas tend to be cheaper to supply – and how much coastline the area has.

“Providing our services over a vast geographic area that includes about one-third of the country’s bathing waters means we need more treatment works and thousands of miles of pipeline,” South West Water said.

A Wessex Water spokesman said: “The bill in this area is slightly higher than in other parts of the country because there are more pipes to maintain per customer and the cost of delivering water in our area is high.”

How much help did the family get?

Image Source, Andrew White
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Andrew White said the current support system was a postcode lottery

While the water industry says it supports anyone struggling to pay their bills, consumers worry that there is also a lack of standardisation.

Consumer group CCW said there were large regional differences in the percentage of households receiving support.

It said the problem was particularly acute in areas such as the North West, where 12 per cent of households needed support but only about 3 per cent were currently receiving such help.

In the Severn Trent area, only about 21% of people facing water poverty have escaped the area through current support schemes.

Plans vary across the country, depending on the arrangements companies have with their customers — whose bills fund such support.

Andrew White, senior policy manager at CCW, said: “This is a big issue for us and we have put forward a number of different proposals to replace the current postcode lottery support.

“Water is often one of the first bills to be owed because you can’t disconnect from the water supply. But there are also many families who suffer silently, paying for water but making sacrifices on other costs like food. “

Christine McGourty, chief executive of British Water, a trade association representing water companies, said: “I would urge anyone concerned to get in touch with their water company.”

What does the water company say?

Image Source, Northumbria Water
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Northumbrian Water says they are working on some improvements

Both Severn Trent and Northumbrian Water said that while they had the highest increases, they were still charging less than the average bill in the rest of the country.

Northumbrian Water said: “Our bills remain the lowest in England for water and sewerage and continue to be lower than what our customers paid for water in 2019/2020.”

They said they were working on projects in the north east to improve the company’s environmental performance, such as a £30 million improvement to sewers in County Durham and a survey of bathing water at Marsden Beach in South Tyneside.

They said they had also spent £145m on the supply network in County Durham and Teesside to replace parts that were more than 100 years old.

Heidi Mottram, chief executive of Northumbrian Water, said: “These necessary investments, combined with rising inflation costs, mean we need to raise prices slightly.”

A spokesman for Severn Trent said: “Recent changes in customer bills have been linked to inflation and reflect the increased cost of living we are experiencing across our supply chain.

“It also affects our level of investment in infrastructure and the environment.”

Will the government intervene?

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Nadia Whittome calls for water companies to return to public ownership

Labour MP for Nottingham East, Nadia Whittome, has called for private companies to be brought back to public ownership.

“There is a monopoly on water, which means people don’t have any choice about who their water supplier is. Companies like Severn Trent can charge what they want, and privatization is actually costing us more,” he said. she says.

But so far, the government has proved lukewarm on the proposals.

It said the rising bills were in line with revenue controls set by Ofwat.

Regarding water poverty, CCW wants the government to support a single water tariff assistance scheme, which will standardize support.

But that may not happen until 2025 – and campaigners argue that many customers need help now.

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