§ Mr. HarveyTo ask the Secretary of State for the Environment what powers the Director General of Water Services has to restrain price increases in water bills; and if he will make a statement on the progress the Office of Water Services has made so far as a regulator.
§ Mr. MacleanWater companies are not permitted to increase the tarriff basket, which includes the bulk of water and sewerage charges, each year by more in total than the increase in the retail price index plus a K factor specified for each company. K factors were set initially by the Secretaries of State; the director general is now making preparation to set revised K factors for the period beginning in April 1995. An interim determination of K can also be made for an individual company if there has been a material change of circumstances.
From April 1992 most companies agreed to increase their charge by less than RPI + K, so saving customers an average of 1 per cent. or a total of £40 million in 1992–93.