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Consumers' water bills are going to rise by 30% over the next five years, the author of a major review into the sector has warned. Sir Jon Cunliffe told how there had been a "really huge rise in bills" over the past year, and said they will rise by another 30% in real terms over the next five years.
He said: “There are some inescapable facts here. The cost of producing water and dealing with our wastewater is going up. Climate change, higher environmental standards, demographic pressure, the population is going up. Just that need to renew ageing infrastructure.
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“The problem comes when you suddenly go from not investing for a long period to massive investment in order to catch up. We need to help the most vulnerable, we also need to smooth that over a long period so that people can cope with the higher costs of water.
“And the regulators have a really important job in squeezing efficiency, incentivising the companies to be more efficient.”
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Read more: Damning report into water industry says regulator Ofwat has 'failed'
Water bills will rise by an average of ￡123 this year in the biggest hit to customer pockets since the industry was privatised 36 years ago.
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The increases raised concerns that households already facing a squeeze on their finances would face further hardship imposed by water companies, which have also been repeatedly criticised for their track records on sewage pollution and bumper executive pay.
Average water bills in England and Wales are forecast to rise 36% over the next five years, before inflation.
Ofwat said it expected bills to rise sharply this year, with smaller increases over the following years.
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Environment Secretary Steve Reed is set to commit to the creation of a new, legally binding water ombudsman, expanding the role of the voluntary Consumer Council for Water and bringing the sector into line with other utilities.
The new ombudsman will tackle leaky pipes, incorrect bills and other issues people have with water companies, the government has announced.
Environment Secretary Steve Reed has already vowed to halve the number of times water firms discharge sewage by 2030 - the first time the government has set a clear target for pollution spills.
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