Clean-up will add pounds 65 to water bills

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HOUSEHOLD water bills could rise by as much as pounds 65 a year to pay for an pounds 11bn programme of environmental improvements, the water regulator Ian Byatt said yesterday.

This would be the equivalent of charges rising by 30 per cent more than the general inflation rate between 2000 and 2005, he added. The estimates are based on figures supplied by the water companies and assumes no offsetting efficiency savings.

Mr Byatt said he disputed calculations made by the industry and estimated that the improvements could be achieved for an additional pounds 18 a year on bills.

Shares in water companies fell on fears that the regulator would force the industry to bear more of the costs of meeting various European directives on environmental improvements. The programme includes measures to cut lead and pesticides in water and improvements in river water and sewage disposal.

Mr Byatt has written to John Prescott, the Secretary of State for Transport, Environment and the Regions, seeking guidance on what level of improvements to the water system the Government wants.