Thames Water defends bill rise

Thames Water director Richard Aylard has told ITV News that the water regulator Ofwat didn't plan ahead for their big infrastructure projects, such as the Thames Tideway Tunnel, despite knowing the funding would be necessary.

He told ITV News Business Editor Laura Kuenssberg the company would have taken responsibility for funding the project, if they had been allowed to make an allowance for the scheme.

The Lib Dems deputy leader Simon Hughes has called on the water regulator Ofwat to reject a request from Thames Water to raise their prices to pay for the Thames Tideway Tunnel.

A spokesperson for the Liberal Democrats confirmed that the party would present an alternative method of paying for the Thames Tideway Tunnel later this month.

Industry regulator Ofwat has said revisions to price limits of water bills would not apply to customers' bills before April 2014, after Thames Water proposed to add an one-off fee of £29 per households. Ofwat chief executive Regina Finn said:

Plans for Thames Water to charge their customers a one-off surcharge of approximately £29 have been greeted with anger on social media site Twitter.

Thames Water have applied to water regulator Ofwat to charge customers a one-off surcharge on top of their bill of £29 pounds. The company said they have been forced to deal with "unquantifiable" costs that they were not aware of when Ofwat set price limits back in 2009. Increased costs include:

• Increases in bad debt as a result of the economic downturn
• Increases to Environment Agency charges
• The costs of operating and maintaining the additional 40,000 km of sewers that were transferred to Thames Water by the government in October 2011

• Costs of land acquisition and other preparatory work required for the construction of the Thames Tideway Tunnel

Thames Water has written to Ofwat, the industry regulator, to ask permission to charge customers an addition one-off fee of about £29 per household.

The money is to cover the costs they have spent on acquiring new land for the construction of the Thames Tideway Tunnel. In a statement, Thames Water said:

"Thames Water has submitted an application to Ofwat, its industry regulator, for an interim adjustment to prices for the current price control period, which runs from April 2010 to March 2015.

"The biggest item of expenditure involved is £273m spent on acquiring land required for the construction of the Thames Tideway Tunnel.

"If approved by Ofwat, the net impact would result in a single, one-off additional cost of about £29 per household in 2014/15, equivalent to nearly £6 per year over the five-year period. "

Read: Thames Water denies 'tax dodge'