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Ofwat today published draft price limits for Dwr Cymru, Dee Valley Water and Severn Trent Water for the five years from 1 April 2005. The picture varies from company to company, but for those customers who receive both water and sewerage services from Dwr Cymru their bills would increase by an average of £51 to £337, before inflation, over the period. This compares with the company's proposal for an increase of £76 over the period. However, £34 of the increase would be required in the first year, April 2005, to reflect the impact of costs on the company. For Dee Valley Water, which provides water services only, there would be a small average reduction before inflation of £3 compared with the £5 increase sought by the company. Customers who receive water and sewerage services from Severn Trent Water would see their bills increase by an average of only £36 to £257, before inflation, over the period. This compares with the company's proposal in their business plan for an increase of £63 over the period. Ofwat has closely scrutinised the companies' plans. It believes that these proposals would strike a fair balance. Customers should pay no more than is necessary for the companies to continue to deliver safe, reliable and efficient services, and for further investment to improve the quality of drinking water, to clean up rivers and estuaries and to help deal with the problems of sewer flooding. They would enable Dwr Cymru to invest more than £1 billion to carry out, for example:
Philip Fletcher, Director General of Water Services, said: "I believe that these proposals are fair to customers in Wales, and to the companies. Although the average rise in bills for Dwr Cymru customers is more than the average for England and Wales as a whole, I am convinced after reviewing the company's business plan carefully that it is necessary. Customers have told us how important it is to maintain a water service in which customers can have confidence. "Much of this increase is needed to safeguard essential water and sewerage services and to make the further improvements to drinking water quality and to the environment that the Welsh Assembly Government wants to see delivered. The increase will also help to enable the company to maintain secure supplies for customers now and in the future. "I am very conscious that these proposals may present problems for customers on low incomes. We have worked hard to ensure that the price limits are no higher than they need to be. The longer term picture is that customers of Dwr Cymru would by 2009 be paying only 1% more on average, before inflation, than they were paying in 1999. "The Welsh Assembly Government and the UK Government are currently looking into the issue of affordability of water charges for customers on low incomes. Ofwat is playing its full part in those reviews. "Although in Ofwat we have thought hard about these proposals, we shall consider carefully all the comments which we receive before reaching conclusions on our final price limits in December." Notes to Editors: 1. The Director General of Water Services is the economic regulator of the water and sewerage companies in England and Wales. He exercises his powers in a way that he judges will allow them to carry out their functions properly, and finance them. 2. The draft determinations document, 'Future water and sewerage charges 2005-10' - Draft determinations', will be available from the Ofwat library on 0121 625 1373 and on the website at www.ofwat.gov.uk 3. The figures quoted in all the attached tables are before inflation. The price limits for Dwr Cymru represent the maximum the company could charge on its current rebated bills. Average household bills in both tables are presented in 2004-05 prices. 4. Representations from water companies are due by 15 September 2004 and from others by 13 October 2004. 5. Ofwat also published today new research into the impact of internal and external sewer flooding on customers. The publication, 'Customer Research 2004: Survey of customers affected by sewer flooding', will be available from the Ofwat Library on 0121 625 1373 and on the Ofwat website, www.ofwat.gov.uk Media enquiries to Ofwat Press Office on : 0121 625 1416/1496/1442. Out of hours enquiries to pager: 08700 555 500 water 503/509.  | ||||||
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