Severn Trent in 'robust' talks with Ofwat over water bill rises

Severn Trent, the Midlands-based water company, yesterday gave the clearest indication yet that it may take the industry regulator to an appeal if it fails to get approval for a sufficiently large increase in bills.

Severn Trent, the Midlands-based water company, yesterday gave the clearest indication yet that it may take the industry regulator to an appeal if it fails to get approval for a sufficiently large increase in bills.

Ofwat will publish final price controls on Thursday setting out how much suppliers can raise domestic bills by over the next five years. In the summer, the regulator produced draft proposals allowing Severn Trent to raise prices by 16 per cent - half the increase it had applied for - to finance a £2.5bn investment programme.

The company said that since then "robust representation" had been made to Ofwat, arguing the case for the regulator to amend the draft proposals.

Robert Walker, Severn Trent's outgoing chief executive, said the City had the mistaken impression that the company had emerged relatively well from Ofwat's initial proposals, but this was not case and there were a number of areas where it was seeking leeway to impose higher prices. Mr Walker said Severn Trent would not decide whether to take Ofwat to the Competition Commission until next January and then the decision would be one for his successor, Colin Matthews, who formally takes over as chief executive in early February.

Mr Walker was speaking as Severn Trent reported a 10 per cent fall in first-half profits to £126m, mainly because of higher pension charges. The company is putting an extra £32m into its fund this year to help reduce a £236m pension deficit.

Profits before interest, tax and amortisation in the regulated water business rose 1.3 per cent to £181m. Profits at its subsidiary Biffa, the UK's largest waste collection and second largest landfill operator, rose 12 per cent to £44m on the same basis, but profits from the group's services division, which include its US laboratories, fell 9 per cent to £18.7m, due to the weakness of the dollar and a fall in US government spending.

Mr Walker refused to be drawn on the timing or outcome of its internal investigation into alleged accounting irregularities, which a member of its finance department had brought to Ofwat's attention.

He maintained that the company had not affected the group's accounts, nor had customers been overcharged.

Suggested Topics
PROMOTED VIDEO
News
people
Life and Style
Upright, everything’s all right (to a point): remaining on one’s feet has its health benefits – though in moderation
HealthIf sitting is bad for your health, what happens when you stay on your feet for a whole month?
News
Kristen Stewart and Rupert Sanders were pictured embracing in 2012
people
News
President Obama, one of the more enthusiastic users of the fist bump
scienceBumping fists rather than shaking hands could reduce the spread of infectious diseases, it is claimed
Sport
Mario Balotelli posed for this selfie during AC Milan's 5-1 defeat to Manchester City
sport
Sport
Laura Trott with her gold
Commonwealth Games
Arts and Entertainment
Gal Gadot as Wonder Woman
arts + ents
News
ebookA unique anthology of reporting and analysis of a crucial period of history
News
Bryan had a bracelet given to him by his late father stolen during the raid
people
Sport
France striker Loic Remy
sportThe QPR striker flew to Boston earlier in the week to complete deal
Extras
indybestSpice up your knife with our selection of delicious toppings
Sport
sport
News
Orville and Keith Harris. He covered up his condition by getting people to read out scripts to him
People
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Training/Learning and Development Coordinator -London

£28000 - £32000 per annum: Ashdown Group: Training/Learning and Development Co...

Training Programme Manager (Learning and Development)-London

£28000 - £32000 per annum + benefits: Ashdown Group: Training Programme Manage...

.NET Software Developer (.NET, C#, ASP.NET, front-end)

£30000 - £45000 per annum: Harrington Starr: A Global Financial Service Organi...

C# Web developer (C#,MVC,ASP.NET,SQL)

£30000 - £40000 per annum + Bonus+Benefits+Package: Harrington Starr: C# Web d...

Day In a Page

A new Russian revolution: Cracks start to appear in Putin’s Kremlin power bloc

A new Russian revolution

Cracks start to appear in Putin’s Kremlin power bloc
Eugene de Kock: Apartheid’s sadistic killer that his country cannot forgive

Apartheid’s sadistic killer that his country cannot forgive

The debate rages in South Africa over whether Eugene de Kock should ever be released from jail
Standing my ground: If sitting is bad for your health, what happens when you stay on your feet for a whole month?

Standing my ground

If sitting is bad for your health, what happens when you stay on your feet for a whole month?
Commonwealth Games 2014: Dai Greene prays for chance to rebuild after injury agony

Greene prays for chance to rebuild after injury agony

Welsh hurdler was World, European and Commonwealth champion, but then the injuries crept in
Israel-Gaza conflict: Secret report helps Israelis to hide facts

Patrick Cockburn: Secret report helps Israel to hide facts

The slickness of Israel's spokesmen is rooted in directions set down by pollster Frank Luntz
The man who dared to go on holiday

The man who dared to go on holiday

New York's mayor has taken a vacation - in a nation that has still to enforce paid leave, it caused quite a stir, reports Rupert Cornwell
Best comedians: How the professionals go about their funny business, from Sarah Millican to Marcus Brigstocke

Best comedians: How the professionals go about their funny business

For all those wanting to know how stand-ups keep standing, here are some of the best moments
The Guest List 2014: Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks

The Guest List 2014

Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks
Jokes on Hollywood: 'With comedy film audiences shrinking, it’s time to move on'

Jokes on Hollywood

With comedy film audiences shrinking, it’s time to move on
It's the best of British art... but not all is on display

It's the best of British art... but not all is on display

Voted for by the British public, the artworks on Art Everywhere posters may be the only place where they can be seen
Critic claims 'I was the inspiration for Blanche DuBois'

Critic claims 'I was the inspiration for Blanche DuBois'

Blanche Marvin reveals how Tennessee Williams used her name and an off-the-cuff remark to create an iconic character
Sometimes it's hard to be a literary novelist

Sometimes it's hard to be a literary novelist

Websites offering your ebooks for nothing is only the latest disrespect the modern writer is subjected to, says DJ Taylor
Edinburgh Fringe 2014: The comedy highlights, from Bridget Christie to Jack Dee

Edinburgh Fringe 2014

The comedy highlights, from Bridget Christie to Jack Dee
Dame Jenny Abramsky: 'We have to rethink. If not, museums and parks will close'

Dame Jenny Abramsky: 'We have to rethink. If not, museums and parks will close'

The woman stepping down as chair of the Heritage Lottery Fund is worried