Millions face higher water bills after regulator’s decision is overturned

Millions of households in England will see their water bills rise by more than expected after the UK's competition watchdog sided with five major water companies, allowing them to impose further price hikes. The Competition and Markets Authority (CMA) has provisionally approved requests from Anglian Water, Northumbrian Water, South East Water, Southern Water and Wessex Water to increase their charges. This decision overturns an earlier ruling by the industry regulator, Ofwat, which had set lower limits.

Why are water bills going up?

Water companies have their prices reviewed by the regulator, Ofwat, every five years. In its last review, Ofwat set limits on how much companies could charge customers between 2020 and 2025. However, five companies challenged Ofwat’s decision, arguing that the price limits were too low and prevented them from being able to meet regulatory obligations such as investing in wastewater treatment and delivering better infrastructure. The case was passed to the Competition and Markets Authority (CMA) for a final decision.

The CMA has now largely ruled in favour of the water companies, allowing them to raise an additional £556 million in revenue from customers; however, this was only 21% of the total £2.7 billion the firms had originally requested.

Who is affected by the changes?

If you are a customer of Anglian Water, Northumbrian Water, South East Water, Southern Water or Wessex Water, your bills are set to rise as a direct result of this ruling. The higher charges are expected to be phased in from April 2026. While the ruling only directly affects customers of these five firms, it could set a precedent for the future. Other utility companies may be encouraged to challenge the regulator's decisions more frequently, which could lead to higher bills for more households across the country in the long term.

How much will water bills increase by?

The exact increase will vary depending on the company; however, a panel appointed by the Competition and Markets Authority (CMA) confirmed that bills can rise by an extra 3% on average. An independent group of experts appointed by the CMA have provided the following estimates:

• Anglian Water - 1% increase
• Northumbrian Water - 1% increase
• Southern Water - 3% increase
• South East Water - 4% increase
• Wessex Water - 5% increase

These increases are on top of the previously agreed rises set by Ofwat, which average 36% over the next five years.

What to do if you're struggling to pay your water bill

With household budgets already under pressure, the news of another bill increase will be worrying for many. If you are concerned about affording your water bill, there are several steps you can take:

• Contact your water company immediately - All water suppliers have support schemes for customers who are struggling to pay. They can offer things like flexible payment plans or a cap on your bill through a "social tariff". Make sure that you do not wait until you're behind on payments to get in touch.
• Check out the WaterSure scheme - If you have a water meter, receive certain benefits, and either have a large family or a medical condition requiring extra water use, you may be eligible. This caps your annual bill, regardless of how much water you use.
• Consider a water meter - If you don't already have one, switching to a water meter could save you money. As a rule of thumb, if you have more bedrooms in your house than people, you are likely to save with a meter. You can use the Consumer Council for Water's (CCW) free water meter calculator online to see if it’s the right choice for you.
• Use less water - Simple changes can make a difference. Fixing dripping taps, taking shorter showers, and only using your washing machine for full loads can all help reduce your water usage and lower your bills - if you're on a water meter. Many water companies also offer free water-saving gadgets to their customers.