Water bills in England and Wales are set to rise by an average £94 over the next five years, the water regulator Ofwat has said.
The figure varies by region with Thames customers seeing an increase of £99 or 23%, Anglian £66 or 13% and Southern Water £183, an increase of 44%.
The typical £19 a year increase is a third less than the increase requested by companies and is intended to fund investment for improvements such as replacing leaking pipes and reducing sewage discharges into rivers and seas.
It comes as suppliers face increasing scrutiny over their environmental and financial performance over a number of years.
Labour has pledged a crackdown on the industry, promising consumers higher compensation for sewage failures and the power to hold water executives to account.
The new Secretary of State for Environment Food and Rural Affairs, Steve Reed, is meeting water company bosses on Thursday to discuss performance issues and ways of improving it.
The government plans to introduce new measures to ensure that money earmarked for investment and improvements are ringfenced and cannot be diverted to pay salaries or dividends.
Customer panels will have powers to hold directors and executives to account while compensation for customers for failures to hit required standards could be more than doubled.
The crackdown comes at a time of rising consumer anger at pollution but also at a time when some companies – including heavily indebted Thames Water – have asked for leniency due to financial distress.
Ofwat’s proposed bill rises can be challenged by the water firms, with a final determination due at the end of the year.
Ofwat chief executive David Black said its plan marked the “biggest ever” investment in the water sector and would mean “sustained improvement to customer service and the environment at a fair price for customers.”
He told Radio 4’s Today Programme it was “very concerned” about the level of bonuses that the companies are paying.
“That’s why we have introduced new measures to protect customers. In the last year, no customer paid for executive bonuses.”
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