Severn Trent water bills to rise by an average £7

WATER giant Severn Trent has defended price rises which will see the average household bill for Derbyshire customers increase by £7 this year.

Water regulator Ofwat has approved the rise in water and sewerage bills for 2013/14, which it said were mainly due to inflation, which stands at 3%.

Severn Trent supplies more than eight million customers, including the majority of homes and businesses in Derbyshire.

Its increases will see the average combined sewerage and water bill go up by £7, to £335, which is an increase of 2.2%.

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Nationally, the average bill will rise by 3.5%, or £13.

Despite the increase, Severn Trent said Derbyshire customers would continue to have the lowest average combined bills in England and Wales.

The firm also said the money would be used to fund its ongoing investment programme, which includes building two new reservoirs near Ambergate.

The firm is currently spending £3 million on renewing water pipes in the Normanton and Arboretum areas of Derby, which it said will benefit 4,500 customers.

Simon Mullan, credit manager at Severn Trent Water, said: "Any price rise, however small, is unwelcome in the current economic climate but we have worked hard to keep bills as affordable as possible for our customers.

"Our customers will be paying an average of 92p a day – that's less than the average cost for a litre of bottled water."

The bill changes will come into effect on April 1 and will apply until March 31, 2014.

Regina Finn, Ofwat's chief executive, said: "Back in 2009, the water companies wanted bill rises of 10% above inflation. That didn't chime with what customers told us they wanted, so we said they could only increase bills in line with inflation.

"We understand that there is huge pressure on household incomes, and any rise is unwelcome. Inflation is driving these increases.

"These rises will help pay for investment of around £1,000 for every household in England and Wales.

"This will deliver real benefits – from continuing to improve the reliability of supplies to dealing with the misery of sewer flooding for thousands of customers.

"We will make sure customers get value for money, and if companies fall short in delivering their investment promises, we will take action."

In the past seven years, Ofwat has made companies pay out around £550 million where they have under-performed. This includes Severn Trent, which in 2008 was fined £2 million after it misreported leakage figures in 2001 and 2002. It was also fined £35.8 million for providing false information and poor customer service in a period up to 2005.

At the time, Severn Trent said all the matters related to actions of a previous management.