Water bills are projected to increase by as much as 30% in the next five years, according to a significant report aiming to overhaul the troubled industry. Sir Jon Cunliffe, former Bank of England chief, highlighted a substantial surge in customers’ bills in the past year. Water UK has cautioned that the national average water bills for the upcoming year (2025-26) are estimated to climb by £123, equivalent to a 26% increase, or roughly £10 per month.
In an interview with BBC Breakfast, Sir Jon emphasized that bills are expected to rise by over 30% in real terms over the next five years due to escalating costs associated with water production, wastewater management, climate change, higher environmental standards, demographic pressures, and the necessity to update aging infrastructure.
He stressed the importance of assisting the most vulnerable and implementing measures to ease the burden of higher water costs over an extended period. Additionally, he pointed out the crucial role of regulators in driving efficiency improvements within water companies.
Sir Jon’s remarks coincided with the release of more than 80 recommendations from the long-awaited Independent Water Commission established by the Labour government. He proposed replacing the current regulator Ofwat, described as inadequate by Environment Secretary Steve Reed, with a more robust and unified integrated water regulator as recommended.
The existing system has faced severe criticism for overseeing water companies as they distributed profits to shareholders, accumulated significant debts, and witnessed deteriorating infrastructure and rising sewage discharges.
Water minister Emma Hardy echoed the sentiments, labeling the water system as “broken” and asserting that consumers have been let down repeatedly. She endorsed the findings of the Independent Water Commission, calling for comprehensive reform to address the crisis. Hardy criticized the 26% increase in water bills, attributing it to the deteriorating infrastructure.
Overall, the water industry is undergoing significant scrutiny and calls for transformative changes to ensure sustainability and affordability for consumers.
