Prime Minister Andy Burnham is set to intervene to prevent water companies from introducing surge pricing, Downing Street has confirmed. The move follows reports that Ofwat, the industry regulator, planned to allow firms to build surge pricing into bills from April during periods of water scarcity.
A Downing Street spokesman told The Telegraph: “The Prime Minister has been clear that customers cannot be treated as a blank cheque, and we will always challenge water companies where they seek to pass unnecessary costs onto households.”
Government pledges to challenge unnecessary costs
The spokesman added: “The industry clearly hasn’t been working for people for too long, and we are determined to drive reform so that it works for the public, gives them more control, and keeps bills as low as they can be.”
“We will always challenge companies where they seek to pass unnecessary costs onto households, and any new charging structures must be proven to make bills fairer and more affordable while encouraging efficiency,” the spokesman said.
Prime Minister criticises record pollution and leaking pipes
On Friday, Burnham said he is angry with water companies for treating their customers as a “bottomless source of funding” after more than a dozen firms were given the green light to raise bills even higher. The prime minister said the companies must not be allowed to treat bill payers like a “blank cheque”, after Ofwat approved proposals for billions of pounds of spending on repairs and infrastructure.
Burnham said he was “angry” that households “have been asked to pay more for years, yet serious pollution incidents are at record levels and the pipes are still leaking. None of which is the bill payers’ fault, who should not be treated as a bottomless source of funding for other people’s failures.”
He added: “Customers cannot be treated as a blank cheque. Where water companies seek to pass unnecessary costs on to households, they will be challenged.” Burnham also repeated a promise that the government would study “how we can give the public more control and help keep bills as low as possible”.
Labour MP calls for public ownership
Clive Lewis, a Labour MP on the left who supported Burnham for the leadership, said: “I’ll bet you these projects will never see a large chunk of that money. We pay for the system through our bills. Yet almost third of them go to returns for investors and creditors.”
“We pay for the infrastructure, for the debt, for the profits. And they keep asking for more. The only way to end this is public ownership,” Lewis said.
