Labour gets tough on water companies and increases compensation levels, with payments set to double – here’s how it works

Households in England and Wales are to receive extra compensation from ‘bankrupt’ water companies due to a government crackdown on customer service.

This year has already seen households forced to boil tap water because it is unsafe to drink, people getting sick from contamination and people running out of water, but so far there has been no ban on the use of hoses.

But the amount of compensation households can get has been almost insignificant compared to the level of inconvenience caused by the disruption of water supply.

The government now plans to amend the compensation for water bills, in some cases more than doubling the amount water companies have to pay.

Here’s everything you need to know about water bill offsetting and how any changes will affect you.

What are my current rights to compensation on my water bill?

If your home is flooded with sewage, you may be able to get up to £1,000.

If your water is cut off you will receive around £20, plus £10 for every additional 24 hours if this situation continues.

If you have low water pressure, you can get a one-off payment of £25 a year, while if water companies are slow to act on complaints, you’ll get £20.

If a water company makes an appointment and then fails to honour it, you are also entitled to £20.

How could water compensation be improved?

The Government wants to increase compensation in the following ways:

• Flooding in homes due to sewage: maximum compensation increases by 100% to £2,000
• Water cut-off: £50, with an additional £50 every 12 hours
• Low water pressure: maximum five payments of £50 per year
• Water company handles complaints poorly: £40
• Water company misses appointment: £40

The government also wants to introduce new water-related issues for which households can receive compensation.

These include automatic payments for boil-water notices, which advise households to boil water before drinking or using it for cooking.

The minimum a household can get in compensation for a boil notice will be £50 under the Government’s plans.

When will the new compensation rules come into effect?

There is no set date yet. The Government is currently consulting on the plans and will then consider the responses and move forward with its plan.

The new compensation requirements are also not yet confirmed, but are what the Government intends to introduce unless it hears compelling evidence as to why not.

Environment Secretary Steve Reed said: “Our water industry is bankrupt. After years of failure, water companies have repeatedly let down homes and businesses.”

‘The new Government will clean up the water industry and reverse the course of destruction of our waterways by ensuring that water companies protect the interests of their customers and the environment.’

What about our polluted waterways?

The government also plans to crack down on the contaminated water scandal, which has seen water companies criticised for pumping wastewater into rivers, lakes and the sea.

Water companies have already signed up to Labour’s initial reform plans, which include more money to fix Britain’s neglected sewerage system, much of which dates back to Victorian times.

Labour also wants more private sector investment in reservoirs, water pipelines and storm protection systems.

If a water company does not spend the money intended for these improvements, it will return it to customers.