Household water bills in England and Wales to fall by 5%

Household water bills for millions of houses in England and Wales, which run to nearly £400 (€504) per property, must fall by 5 per cent before inflation in the next five years, the water regulator has ordered.

Promising that home-owners will "get more and pay less", Cathryn Ross, the chief executive of the regulator, Ofwat, said pipe repairs up to 2020, will save enough water to serve every home in Birmingham, Manchester and Leeds.

Currently, English and Welsh households pay £396 on average – though there are significant variations between different water companies, but the average, before inflation, will fall to £376.

Some 19 companies are regulated by Ofwat. United Utilities, which supplies the northwest of England has been told to cut its prices by 3 per cent, but Bristol Water has been told that it must cut them by a fifth.

However, Labour Party MP Maria Eagle warned that families' bills will rise to over £400 once inflation is added.

“Prices are still going to be rising faster than wages and that’s why one in five people are struggling with their water bills,” she said. Nearly €45 billion will be spent over the next five years by the companies on maintenance, cutting leaks and creating new sources of supply, which is broadly in line with spending over the last five years.

However, the need for spending is not spread equally geographically, since hundreds of thousands of houses need to be built in the already-populous southeast of England in coming years. Prices vary considerably throughout England and Wales.

Anglian Water in the east of England charges £396.

However, in the southwest the cost is £545. Households supplied by Wessex Water pay £485.

The companies’ lobby group, Water UK, said the regulator had set down tough standards, demanding “more stretching targets” and “greater penalties for poor performance”.

The companies have several months to challenge the ruling.