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Thames Water under fire over price rise
5:00pm Monday 26th August 2013 in News
THE water company which is the main supplier to south Bucks has come under fire by a consumer watchdog over plans to increase its prices.
The Consumer Council for Water said it was disappointed over Thames Water’s proposals, which is estimated could see the average water and sewerage bill in the area increase from £354 to almost £400.
The company said the net impact would result in a single, one-off additional cost of about £29 per household in 2014/15, equivalent to nearly £6 per year over the five year period.
The company say their application to the regulator, Ofwat, is to cover a rise in bad debt, costs associated with the 2011 transfer of private sewers to company ownership, and land purchase linked to the Thames Tideway Tunnel.
Sir Tony Redmond, London and South East Chair of the Consumer Council for Water, said: "Many other water companies absorbed the costs that Thames say they are facing - and they have done so without applying for a further price increase. We believe that Thames Water should do the same.
"Our research shows that one in seven customers say they can’t afford their water bill. This is reflected in an increasing number of customers defaulting on payments to their water company. Thames Water’s price hike will add to the problem."
Thames Water has submitted an application to Ofwat for an interim adjustment to prices for the current price control period, which runs from April 2010 to March 2015.
It said the biggest expense was £273m spent on acquiring land required for the construction of the Thames Tideway Tunnel.
Stuart Siddall, Chief Financial Officer for Thames Water, said: "These significant costs could not be quantified at the beginning of the current pricing period, and their scale is unique to Thames Water’s operations, project commitments and catchment area.
"Increasing prices is never good news, which is why the company and its shareholders are encouraging Ofwat to adapt its regulatory mechanism to allow the impact of the price increase to be spread over more than one year to avoid a spike in bills for our customers."
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