Severn Trent announces it will freeze water bills

By Ian Dipple Tuesday 03 December 2013 Updated: 05/12 17:23

PLANS to freeze water bills and then increase them by less than inflation have been announced by Severn Trent.

The firm has also revealed it will be introducing a new social tariff to help those residents most in need of help with paying their bills.

Prices will be frozen in 2015 and rises over the following four years will be limited to the equivalent of 1.2 per cent below inflation each year.

It means in real terms the average combined water and sewerage bill will fall from £316 to £304 by 2020, but in reality when inflation is factored in residents will be paying £78 more than they do currently.

The details were revealed in the company's business plan between 2015 and 2020 submitted to industry regulator Ofwat.

It also includes plans for a new social tariff to be introduced over the five year period and run by a third party. The move has been backed by 74 per cent of customers.

It is one of a number of measures designed to help people pay their bills including encouraging people living in deprived areas to install water meters with an option to switch back within two years if it is not cheaper.

There will also be new water health checks to promote the support available and ensure people are on the right tariffs. The eligibility criteria for the company's WaterSure scheme, which caps bills to average charges for people on water meters receiving benefits or with a medical condition requiring water, will also be expanded.

The firm aim to help 50,000 people who need support to pay their bills by 2020.

Other measures announced include an investment in the water and sewerage network of £3.2billion over the five year period and measures to reduce leakage from 450 million litres a day to 424million litres a day.

Tony Wray, Severn Trent chief executive, said: "We have a track record of real price reductions over the last five years and for sharing the benefits of efficiency improvements with customers. We plan to maintain this record over the next five years and deliver better value, better services and a healthier environment. This is a plan driven by and for our customers."

Ofwat will consider the plans before making a final decision on prices and investment levels next year.

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