30 November 2005
Scottish Water has been told by the industry regulator that it must keep any price rises below inflation.
Domestic customers served by the company should now see rises of 0.5 per cent below the rate of inflation between April 2006 and March 2010, after the Water Industry Commission for Scotland said that the company could meet objectives imposed by the Scottish Executive without dramatic increases.
This means that the firm's customers could be paying the third lowest household bills in the UK by the end of the decade.
The Scottish Executive's objectives include improved drinking water for 1.5 million Scots and the cleaning of 330 miles of rivers and coastal waters. The company had put a £3.3 billion figure on the associated costs but the regulator said that £2.15 billion would be enough for the tasks' completion.
Sir Ian Byatt, the commission's chairman, said: "Our price limits will finance a very large capital programme and will enable Scottish Water to carry out one of the largest programmes per customer, and per head of population, ever undertaken in the water industry in Britain."
Scottish Water said it would consider the implications of these financial targets on its perceived ability to meet the executive's demands.
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