December 5 2013 Latest news:
Friday, September 13, 2013
Planned price hikes by a London water firm could be reversed after the industry regulator attacked the company’s performance and its demand for extra money.
Thames Water wants permission for a one-off bill increase of up to eight per cent in 2014/15, equivalent to £29, because more customers are struggling to pay their bills and it is having to fund a super sewer under the capital’s streets.
But Ofwat today turned the tables on the company, saying it is exploring whether it has benefited from ultra-low cost of borrowing for big corporations, and if it can claw back money for its 14 million customers.
The regulator launched counter-claims against Thames Water as it believes it has made ‘substantial savings’ by doing less than expected to tackle sewer flooding.
And it said some of Thames Water’s sewerage network is not hitting performance targets, with Ofwat chief regulation officer Sonia Brown saying: “We have been clear that we would challenge Thames’ proposed bill increase.
“So we are looking to see if there are areas where we can claim money back for customers.”
Thames Water, whose current average household bill is around £354 a year, sparked anger when it revealed the planned bill increase last month.
It came just months after it emerged the firm, whose revenues rose to £1.8billion in the last financial year, paid no corporation tax.
A Thames Water spokesman said: “We expected the regulator to set out the format for assessing our application.
“This is part of the regulatory process. We don’t plan to comment until after Ofwat’s draft decision, expected in mid-October.”