Windfall tax 'will hike bills' of Hyder customers

Hyder, the Welsh water and electricity utility, warned yesterday that the government's windfall tax could mean higher bills for its customers and a cut in spending on cleaning up beaches. In a shot across Labour's bows ahead of the Budget on 2 July, Hyder's chairman, Iain Evans, said that an excessive or unfairly distributed tax would force Hyder to re- examine its voluntary annual pounds 9 per customer rebate and an extra pounds 40m in discretionary spending on making Welsh beaches the cleanest in Europe.

Graham Hawker, chief executive, said: "We would be very loathe to withdraw our rebates to customers, but if the tax is excessive, we will have to think again." The group may get a "double whammy" tax hit after Welsh Water bought electricity group Swalec 15 months ago.

Mr Evans said that its consumer friendly image would mitigate. "There wouldn't be a windfall tax if every water company had the same relationship with its customers as we do. We have not had a hosepipe ban in seven years. We're confident that a sensible government will take into account our customer-oriented image."

Speaking at its full-year results, Mr Evans said that an unfair windfall tax would be one calculated on total shareholder returns rather than published information such as turnover or operating profits. "I don't see how a tax based on shareholder returns would work. The key to all this is keeping it simple." Robert Miller-Bakewell, analyst at NatWest Securities, said that the level of tax was the huge uncertainty: "If it's around pounds 200m, then I suppose Hyder will pay up and get on with life. Much above that and the company might start cutting its customer rebates." A pounds 300m hit to Hyder would imply an overall windfall tax of around pounds 10bn.

A spokesman for Labour would not comment on the form of the tax or whether the impact on companies would be revealed in the Budget: "Whether Hyder put up bills is a matter for them and their customers."

Hyder's full-year results showed that operating profits rose from pounds 129m to pounds 284m, including a first full-year contribution of pounds 110m from Swalec and the dividend was increased by 13 per cent to 43.9p. Mr Hawker said that operating two utilities in the same geographic region had enhanced earnings by over 17 per cent.

The company said profits from Hyder's non-regulated business - customer services and managing transport and utility projects as majority stakeholder in the UK Highways consortium - would underpin dividend growth.

Suggested Topics
PROMOTED VIDEO
News
ebooksNow available in paperback
Arts and Entertainment
Inner sanctum: Tove Jansson and friends in her studio in 1992
booksWhat was the inspiration for Finland's most famous family?
Arts and Entertainment
Singer songwriter Bob Dylan performs on stage
films
Arts and Entertainment
booksPhotographer Richard Young has been snapping celebrities at play for 40 years - but he says it wasn’t all fun and games
News
i100
Arts and Entertainment
Jenna Coleman, Peter Capaldi and Nick Frost star in the Doctor Who Christmas Special, Last Christmas
TV
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

Citifocus Ltd: Product Development - Asset Management

£Attractive: Citifocus Ltd: High calibre individual with significant product d...

Citifocus Ltd: Credit Ratings - Banking Sector

£Negotiable: Citifocus Ltd: Leading global bank seeks experienced credit analy...

Citifocus Ltd: Economic Crime Investigation & Analysis

£Attractive Package: Citifocus Ltd: High calibre individual with a high degree...

Citifocus Ltd: Snr Risk Analyst - Capital & Liquidity

£Attractive: Citifocus Ltd: High calibre individual with superior academics an...

Day In a Page

Homeless Veterans Christmas Appeal: Drifting and forgotten - turning lives around for ex-soldiers

Homeless Veterans Christmas Appeal: Turning lives around for ex-soldiers

Our partner charities help veterans on the brink – and get them back on their feet
Putin’s far-right ambition: Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU

Putin’s far-right ambition

Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU
Tove Jansson's Moominland: What was the inspiration for Finland's most famous family?

Escape to Moominland

What was the inspiration for Finland's most famous family?
Nightclubbing with Richard Young: The story behind his latest book of celebrity photographs

24-Hour party person

Photographer Richard Young has been snapping celebrities at play for 40 years. As his latest book is released, he reveals that it wasn’t all fun and games
Michelle Obama's school dinners: America’s children have a message for the First Lady

A taste for rebellion

US children have started an online protest against Michelle Obama’s drive for healthy school meals by posting photos of their lunches
Colouring books for adults: How the French are going crazy for Crayolas

Colouring books for adults

How the French are going crazy for Crayolas
Jack Thorne's play 'Hope': What would you do as a local politician faced with an impossible choice of cuts?

What would you do as a local politician faced with an impossible choice of cuts?

Playwright Jack Thorne's latest work 'Hope' poses the question to audiences
Ed Harcourt on Romeo Beckham and life as a court composer at Burberry

Call me Ed Mozart

Paloma Faith, Lana del Ray... Romeo Beckham. Ed Harcourt has proved that he can write for them all. But it took a personal crisis to turn him from indie star to writer-for-hire
10 best stocking fillers for foodies

Festive treats: 10 best stocking fillers for foodies

From boozy milk to wasabi, give the food-lover in your life some extra-special, unusual treats to wake up to on Christmas morning
'I have an age of attraction that starts as low as four': How do you deal with a paedophile who has never committed a crime?

'I am a paedophile'

Is our approach to sex offenders helping to create more victims?
How bad do you have to be to lose a Home Office contract?

How bad do you have to be to lose a Home Office contract?

Serco given Yarl’s Wood immigration contract despite ‘vast failings’
Green Party on the march in Bristol: From a lost deposit to victory

From a lost deposit to victory

Green Party on the march in Bristol
Putting the grot right into Santa's grotto

Winter blunderlands

Putting the grot into grotto
'It just came to us, why not do it naked?' London's first nude free runner captured in breathtaking images across capital

'It just came to us, why not do it naked?'

London's first nude free runner captured in breathtaking images across capital
In a world of Saudi bullying, right-wing Israeli ministers and the twilight of Obama, Iran is looking like a possible policeman of the Gulf

Iran is shifting from pariah to possible future policeman of the Gulf

Robert Fisk on our crisis with Iran