THIRD of your water bill goes up the spout!
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More than a third of water bills is spent servicing debt and paying dividends rather than fixing leaks and ending the sewage scandal, figures seen by The Mail on Sunday show. In what campaigners say amounts to 'a £5 billion privatisation tax', an average of 35p in every pound paid by customers for their water goes on interest payments and shareholder payouts, according to research by the University of Greenwich.
The worst offender among the ten water and sewerage suppliers is Wessex Water, which has nearly 3 million customers across South-West England. Almost half of their household bills is swallowed up in debt and dividend costs. The news comes after customers were left reeling by industry regulator Ofwat's decision to hit them with bill increases of up to 53 per cent over the next five years. It means the average household will see their bills rise by £86 next year – before the impact of inflation, which stands at 2.6 per cent.
Ofwat claims the extra cash will be used to fund investment and stop raw sewage polluting waterways. But the latest analysis of water company revenues suggests a large chunk of this will be used to pay interest on their mountainous debts and dividends to investors, many of whom are overseas.
Water waste: More than a third of water bills is spent servicing debt and paying dividends rather than fixing leaks and ending the sewage scandal. Water companies were privatised debt-free in 1989. Since then, bills have almost doubled in real terms (see graphic) while the utilities –which are monopolies with no competition – are now drowning in £60 billion of debts, having taken out £85 billion in dividends. 'This is daylight robbery,' said Cat Hobbs, director of campaign group We Own it.
