Water Bills to Increase by up to £4.2 billion
Published: 21 June 2011
By Julian Stone Leave a Comment
Updated: 21 June 2011
In a radical change, water companies are taking over responsibility for private sewers – potentially adding as much as £4.2 billion to water bills across the UK. So how will you be affected?
Have you ever had problems with the sewers beneath your house? If so, then you’ll know it’s your responsibility to maintain and repair them – and that can be both disruptive and expensive.
But things are about to change. From October, responsibility for the 125,000 miles of private sewers in 10 million homes across the country will no longer rest with homeowners, but with the water companies instead.
The move could save some households huge plumbing bills, but the new cost to water companies will also be passed on to customers.
Defra (the Department for Environment, Food and Rural Affairs) has estimated that the move will cost water companies £4.2 billion over the long term.
While it has been reported that this figure is equivalent to £162 for every household, this figure fails to acknowledge that businesses also pay water bills and that the costs are calculated over 40 years.
A Defra spokesperson said: “The cost of the transfer of private sewers to water company ownership will not lead to an extra £162 on household water bills. The actual cost is estimated to be between £3-14 per year and the transfer will give customers additional peace of mind from the nasty surprise of being charged for repairs to pipes which they did not know they were responsible for.”
However, the water companies themselves have been reluctant to speculate on costs. James Bullock at industry body Water UK said, “It’s a significant undertaking of assets and we don’t know much about them, their state of repair or even where they are. The costs will be met by industry straight away, but these are not reflected in customers’ water and sewerage bills.”
Under an agreement between water companies and Ofwat, the industry regulator, water bills should not increase by more than the rate of inflation until 2015. But water companies still have the right to negotiate increases to customers bills in exceptional circumstances – which they argue this transfer of responsibility is.
Moneyhighstreet comments: “While £4.2 billion may sound like a lot, it’s not going to come all at once, and it’s likely to be passed on over the course of decades, rather than years.
“That said, the move will cause household bills to bite even more, at a time when prices are rising because of increased inflation.