Water customers can expect to pay around £2 extra each month for the final year of the current price control (PR19).
Average household water and sewerage bills in England and Wales will rise by about £27 to £473 from 1 April. Water-only bills will go up by an average of £10 a year to £224.
The 6% increase to bills in 2024/25 will be accompanied by an increase in financial support for household that struggle to pay their bill. More than 2 million billpayers now receive help from their water company.
Consumer watchdog CCW said companies should do more to help cushion the unwelcome rise at a time when household budgets are already stretched. The organisation urged more of the sector to follow the lead of companies that reinvest profits to fund social tariffs rather than relying as much on customer cross-subsidies.
It urged companies “to join Welsh Water, Severn Trent, Yorkshire Water, SES Water and United Utilities in putting their hand in their own pocket”, to subsidise bills.
Mike Keil, chief executive of CCW, said: “Almost a fifth of households say they struggle to pay their water bill and these rises will heap even greater pressure on low-income customers. If water companies are serious about rebuilding trust in the sector they should use some of their profits to help people who cannot afford another bill rise.”
He pointed to the sector-wide public commitment made five years ago to end water poverty in England and Wales and said that promise must be kept. “Crisis-hit households need immediate relief and the long-term security of knowing they can afford something as essential as water, without having to make painful sacrifices.”
Water UK said the rise is less than last year, and indeed below the rate of inflation. The trade body calculated that if bills had kept pace with inflation since 2014, they would be around £60 higher today.
Chief executive at Water UK, David Henderson said: “Next year will see record levels of investment from water companies to secure the security of our water supply in the future and significantly reduce the amount of sewage in rivers and seas.
“Up and down the country customers will see the results of this investment with more than 2,000 kilometres of pipes being repaired or replaced and more capacity to treat sewage than ever before.”
The sector is set to invest £14.4 billion in the coming year, which is the highest annual spend to date.
While bill rises are laid out in business plans at the beginning of each AMP, they are adjusted annually to reflect inflation. David Black, Ofwat chief executive said the extra charge from April will be a real worry for families already struggling.
“As such,” he said, “water companies must do all they can to protect those who are most in need of a helping hand.”
“Through covid and the cost of living crisis, some water companies have consciously kept average bills lower than they would have been. Bills have remained below inflation easing the impact on customers, while continuing to invest in the network. This year, some of that previously withheld revenue has been added to bills, taking the average to 6.1% or £27.40 a year. Even accounting for this increase, bills in real terms will be lower than they were in 2019/20.”
From 2025, the level of investment is anticipated to more than double as companies rollout infrastructure to boost resilience against water shortages and climate change as well as on environmental schemes.
The sector submitted proposals to Ofwat in October to spend £96 billion across the next asset management period (AMP8). The regulator will publish its draft determinations on the plans, and the bill rises of up to 60%, by June.