§ Sir Peter Emery
To ask the Secretary of State for the Environment, Transport and the Regions if he will take action to ensure that South West Water reduces its increase in consumer bills. 
§ Mr. Meacher
[holding answer 16 June 1999]Under the Water Industry Act 1991, the regulation of water and sewerage undertakers' price limits is for the Director General of Water Services. Changes in average charges for water and sewerage services must remain within limits202W set by the Director General for each company for each year. The price limits governing South West Water in 1999–2000 are those determined on appeal in 1995 by the Monopolies and Mergers Commission (RPI + 1% on average).
The Director General is currently conducting his periodic review of prices for the period 2000 to 2005. The Government have given guidance to the Director General on the environmental and water quality improvements to be delivered by 2005. We believe that these can be secured while offering reductions of around 10 per cent. in average water and sewerage bills. The Director General expects to announce draft price limits for each undertaker in July.