New water charging regime announced

The changes to the present system include an end to disconnection for non-payment of water bills for homes, schools and hospitals; increased choice in water charging; protection for vulnerable groups with high essential water use; and the removal of the restriction on the use of rateable values as a basis of water charging after 31 March 2000.

Legislation will be required for the proposed measures and although an early legislative slot was sort, Mr Meacher said he could give no guarantee as to when that might be.

It will mean customers will have a new right to remain on an unmeasured charge in their present home where they are using water for essential purposes only. Customers should also be able to opt for a meter, to be installed – free with the protection that those who request a meter can revert to an unmeasured charge within a year of requesting the change.

Commenting on the end to disconnection for non-payment of bills, Mr Meacher said nine water companies had already adopted this policy on a voluntary basis and it was the Government’s firm belief that “no-one should be deprived of water because they cannot afford to pay”.

With regard to people who can pay but won’t pay he commented: “We certainly would wish to encourage the water companies to use the options available to recover money due to them either by way of the court or the use of bailiffs.”

Those households on low incomes, particularly large families or those with special needs, will have the option of a bill based on average household use.

Mr Meacher said he was also looking to the water companies to come up with sophisticated and innovative tariffs for metered bills. “The companies could offer water free of charge, or at a lower cost, for initial essential use with a higher amount to cover optional use.”

Concern has already been expressed by the Ofwat National Customer Council that the offer of free meters would result in households not on a meter picking up the bill for the costs of installation and also any income lost by the companies.

*Disconnection figures for the first six months of 1998-99, released by Ofwat this month have shown another fall. The number of households disconnected for non-payment of their water supply bill fell by 35% to 640, compared with the same period last year. Water UK – the trade body representing the English and Welsh water companies and the Scottish and Northern Irish water operators – said that the latest drop in disconnection figures is further evidence that the Government does not need to ban disconnections. Pamela Taylor, chief executive of Water UK, said: “Removing the disconnection option as the Government plans to do would simply give a green light to the ‘won’t pays’ to rip up their water bills. And that means the vast majority of our customers who do pay could end up footing the bill for even more non-payers.”