Scotland business

Regulator pledges to hold down Scottish Water bills

Running tap Image copyright Thinkstock
Image caption A total of £3.5bn is set to be invested in Scotland's water network over the coming years

Scottish household water bills will rise by no more than £5 a year until 2021, the industry regulator has said.

Scottish Water has been told it can raise its prices by 1.6% per year, under a draft ruling from the Water Industry Commission for Scotland.

During that time, £3.5bn is to be spent improving infrastructure in the water and sewerage networks.

The draft ruling also noted there should be no increases in the maximum amount charged to business customers.

The draft proposals released by the Water Industry Commission for Scotland will be decided on in October, and would come into force next year.

Proposals include limiting charge rises to 1.6% a year until 2018, with an expectation that would continue through to 2021.

A major investment programme improving infrastructure in the water network has also been proposed, at a cost of £3.5bn over six years.

Although part of the cost would be met in savings made by Scottish Water, the programme would need £120m a year from the Scottish government's capital budgets.

Alan Sutherland, chief executive of the commission, said the draft proposals were "good news for customers and the environment".

He added: "We have ensured that the prospects for future prices are not compromised and that all of the Scottish government's environmental and drinking water quality objectives for the industry can be delivered."

Economic pressures

The plans were drawn up by the commission following discussions with the Customer Forum for Water in Scotland.

They will be out for consultation until 12 June, ahead of the final decisions being published in early October.

Forum chairman Peter Peacock said he was "very pleased" with the agreement that had been reached.

He said: "Such an arrangement is in stark contrast to what customers have seen from other utilities, and recognises the circumstances of many customers facing difficult economic pressures right now.

"At the same time, we will see services continue to improve across a range of fronts.

"Scottish Water has taken the views of its customers very seriously throughout this new process and I believe the outcome is one that can be seen as a good deal for customers in meeting their needs, and for Scottish Water in being able to deliver for customers."

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