Shock rise in water bills

Water bills in London are set to soar by almost 40 per cent over the next five years.

Thames Water said today it wants to raise the average bill from £201 now to £280 by 2010 to pay for a £4billion modernisation programme.

The 39.3 per cent increase, higher than expected and likely to be the steepest in Britain, must be approved by industry watchdog Ofwat.

The bulk of the rise would come next year with a 25 per cent surge to about £250 - some 12 times inflation. Smaller increases would follow over four years.

The German-owned company insisted the rises were equivalent to only £1.50 a week on a typical bill and were essential to the biggest-ever investment plan for the capital's Victorian water and sewer network.

However, consumer groups said customers were being "fleeced" and water companies risked protests like those against the poll tax. The plan would see more than 1,000 miles of Victorian water main replaced by 2010.

Thames Water Utilities chief John Sexton said: "We know no price rises are popular, but we hope our customers will recognise the longterm benefits this investment will bring."

The proposed rise compares with an average of about 30 per cent for England and Wales.

Andrew Marsh of water consumers' group WaterVoice said: "Most customers will be very shocked by the scale of this. If you are a pensioner on a fixed income, where are you going to find the money?"