Exclusive: Angela Eagle tells utility bosses next price review ‘must focus on value for money for customers’
Ministers will make an unprecedented intervention in water bills and how companies prioritise investment, directing bosses to bring down costs and stop leaks and sewage overflows. Angela Eagle, the environment secretary, has told suppliers in England and Wales she plans to intervene in the next price review – conducted by the water regulator, Ofwat.
Context
Sources at the Department for Environment, Food and Rural Affairs (Defra) said Andy Burnham’s 10-year plan, which will follow next week’s budget, would hand the government more robust powers to lower bills and direct local investment. However, sources close to Eagle indicated that immediate action is necessary as companies begin to make decisions before the next price-setting process, expected to conclude in 2029.
There has never been government intervention in the five-year review process, which is run by Ofwat. This body analyses companies’ business plans and determines how much can be charged to customers in their bills to fund investment and running costs.
Key Points from Eagle's Letter
Eagle has written to regulators and water company chief executives, stating that the process must meet specific government priorities, including:
- Offering bill payers much better value for money
- Focusing on investment in new technology to save money
- Early intervention on leaks and sewage
- Improving communication and decision-making power for local communities and leaders
The letter emphasizes that the first priority must be affordable bills, asserting:
““Affordability means a laser focus on value for money for customers.”
Eagle noted that the public is clear about the objectives for the industry:
““They want clean rivers. They want reliable water services. They want to know that their money is being spent wisely, and that bills are kept affordable. And they want confidence that the system is working in their interests.”
