Campaigners are outraged as water bills are set for dramatic increases to fund new infrastructure

Water companies in England and Wales announced plans on 2 October to nearly double investment into infrastructure between 2025 and 2030. They’ve said it’s to fix leaks and reduce river pollution. However, they’re going to raise household bills to do it – and people aren’t happy.

Water bills to increase by more than £150

Water UK, the industry association for water companies across the country, said in a statement that the proposed investment will amount to £96bn. That’s a 90% increase in what companies spent between 2020 and 2025. It went on to explain that:

This investment is essential to maintain the highest quality drinking water for a growing population, ensure the security of our water supply in the future and significantly reduce the amount of sewage entering rivers and seas.

Britain’s water companies have faced criticism in recent years for their handling of water and sewage infrastructure. There were 825 sewage spills into rivers across England every day on average in 2022. That figure was around 1000 a day in 2021, and higher still in 2020. Meanwhile, pipes across England and Wales leak billions of litres of drinking water every day.

However, to fund the investment, Water UK announced that water companies plan to hike customer bills. It said that it expected bills to rise by £13 a month, or £156 annually, by 2030.

Severn Trent Water said on 29 September that it has raised £1bn from investors for the work. However, it also estimated the investment will cost £12.9bn. As a result, it will still levy an increase on customer bills – from an annual average of £379 in 2024/25 to £533 in 2028/29.

Disastrous performances

Campaigners reacted with outrage at the news customers would foot the bill. Many commenters on social media also highlighted the amount of profit the water industry has generated. The Guardian reported in August 2022 that, since privatisation at the end of the 1980s, water companies have paid more than £72bn in dividends to their shareholders. Meanwhile, company bosses had made £58m in the previous five years.

They made these profits against a background of spiralling debt. By the end of 2022, the net debt of English water companies was £54bn. That meant an average of 20% of every water bill was used to pay off debts. Some companies’ financial records were so bad that shareholders had to step in. They gave Thames Water £750m in July, and gave £1bn to Southern Water in 2022.

Furthermore, many companies have failed to adequately deliver basic services. As the Canary recently reported, water industry regulator Ofwat ordered 11 water companies to repay customers due to their inept performance in 2022.

Water campaigner and former Undertones singer Feargal Sharkey also shared a November 2021 letter by Ofwat which appeared to show that water companies have already received the appropriate funding to maintain a functioning water and sewerage system:

Ofwat's letter confirming we have already paid water companies all of the money needed to build and operate a properly functioning sewage system.

WCs 'certify' annual they've had our money.

Q: Where's our money gone, what happened to it, when do we get a refund? pic.twitter.com/ReOUlz8NLj

— Feargal Sharkey (@Feargal_Sharkey) October 2, 2023

Water of life

Former prime minister Margaret Thatcher privatised the water network on the promise that private companies would run it cheaper and more efficiently. However, more than 20 years on, figures on both profits and pollution show the industry is in a complete mess.

Even if the water companies fix the deteriorating water network and deliver a competent service, all that money will still pour into the pockets of shareholders. Water, the most essential resource for all life, is being exploited in line with the core of late capitalist ideology: privatise the profits, nationalise the losses. This latest announcement comes as a punch in the gut for people everywhere.

Additional reporting by Agence-France Presse

Featured image via Nithin PA/Pexels