Water, water everywhere .....

[pipme]

..LATEST:
Last December we set price limits for all water and sewerage companies in England and Wales. The companies have now translated price limits for 2005-06 into charges they will make to customers. Some customers will already have received a bill for the year beginning 1 April 2005. Bills in England and Wales will go up by 12% on average, including inflation, in line with our price limits.

The 'on average' part is the killer ... perhaps they should show max and min values ? The aim for Wessex water is to increase charges by AVERAGE 48% over the next 5 yrs ... and if the Geese don't hiss, then they pluck even more feathers, just wait and see !!
Be interesting to see the returns on shareholdings at year end ...
They are all piling onto the bandwagon --- rip off Britain ...

 

[pipme]

Just recieved my bill ... up 13.1% ... daylight robbery .. includes 3.45% inflation ... what has that to do with the price of fish ????
[code:1]
2004 RPI Per Month
Jan 2.60%
Feb 2.50%
Mar 2.60%
Apr 2.50%
May 2.80%
Jun 3.00%
Jul 3.00%
Aug 3.20%
Sep 3.10%
Oct 3.30%
Nov 3.40%
Dec 3.50%

Av for 2004 2.96%
[/code:1]

Ah ha, suddenly we switch from using an overall 'average' to the mean of the two highest rates of inflation 3.45% ....
Absolute rip off !!
What gives any company the right to 'add inflation' costs from official lists which include goods and housing costs nothing to do with water !!
To my mind they have increased costs - end of story - trying to water the whole thing down with talk of 'inflation' % ...
There are companies boasting of reducing costs through job cuts etc, who still add 'a' percentage for inflation - how come if 'costs have been cut' ? ROBBERY !!
Just make it all a little more complex than a media short 'sound bite' and we put up with it all.

 

[david and julie]

To make matters worse the 48% you mention is a not a true total percentage over the period. For easy figures call it 50% at 5x10.

Take water rates at say £100

Year 1 increase 1x10%= £110--00
2 1x10%= £121--00
3 1x10%= £133--10
4 1x10%= £146--41
5 1x10%= £161--51


So they say they are putting it up by 50% (5x10) over 5 years so the £100 bill should be £150 however it is £161 so it as gone up 61%.

The increase will therefore be 61% instead of the 50% agreed with of*wats. Which is over 20% more than they would have us believe.

 

[pipme]

I obtained the figures from the Ofwat site, in particular "Household charges 2005-06: company specific briefing sheets"
The Separate companys' PDF Briefing Sheets <click here>

I then allowed 3.0% inflation on top for the final four years.
[code:1]
2005- 6 8.90% + 3.45% = 12.35%
2006- 7 4.90% + 3.00% = 7.90%
2007- 8 5.60% + 3.00% = 8.60%
2008- 9 4.00% + 3.00% = 7.00%
2009-10 2.90% + 3.00% = 5.90%

1.1235 x 1.0790 x 1.0860 x 1.07 x 1.059 = 1.4917..

So the average increase MAY be 49.20% .. depending upon inflation. [/code:1]
I guess if inflation falls they'll bleat for more dosh

...Wessex Water can increase its average
charge by the price limit for each year, plus
annual inflation (Retail Price Index inflation in
the year to November 2004).
Individual charges can go up by more or less
than the overall limit. But we check to ensure
that there is no undue preference or
discrimination to any group of customers....

Thanks a bunch Ofwat, boiler plated that didn't we ? No wonder Johnny F is queuing up to buy our utilities and get at our social benefits .. they soon sniff out a ridiculous dosh flushing government .. from as far afield as the USA..
There we go folks tip your wallets upside down again .. smartly there !!

My increase 2005-6 was 13.108% 6.1% greater than the average, apply that throughout and the total increses to 2010 are approx 53%
See how they manipulate the usage of RPI .. RPIX does not take mortgages into account, generally lower than RIP .. shouldn't businesses use that if anything ? We are being systematically milked ...

 

[pipme]

Sadly ....

Customers of Thames Water, Southern Water, South East Water and Bournemouth and West Hampshire Water will be hit with the sharpest hikes of around 20%.
Nearly £17bn is being ploughed into the UK's water and sewage system over the next five years to reduce sewer flooding and improve the quality of drinking water.

Blimey, either tis drinkable or it isn't ?? '.......improve the quality of drinking water...' Or is this another post code thing ... hard luck on those mentioned above ..

 

[kendor]

The Hikes are supposedly for improving a long neglected system though it will be interesting to see if things get better ie no hose bans in the next 6 years or not.

 

[pipme]

They would say that wouldn't they ? Then, I hope it isn't just a profit hike but I bet a good percentage of the increase is just that ... soon hidden in the accounts of large conglomerates.
So much for privatising a strategic national supply ..... I have been paying for repairs and supply - lived here 10 yrs never seen a water or drainage problem (cul de sac off of same) ... Put the pipes under the road then pound 'em regularly with 30 odd tons through 12 tyre footprints -- what can we expect ?
P

 

[kendor]

They would say that wouldn't they ? Then, I hope it isn't just a profit hike but I bet a good percentage of the increase is just that ... soon hidden in the accounts of large conglomerates.
So much for privatising a strategic national supply ..... I have been paying for repairs and supply - lived here 10 yrs never seen a water or drainage problem (cul de sac off of same) ... Put the pipes under the road then pound 'em regularly with 30 odd tons through 12 tyre footprints -- what can we expect ?
P

I think it's the old victorian brickwork that's not standing up to the pounding, new materials available today would hopefully stand up better so reason for the upgrade.

 

[david and julie]

I think it's the old victorian brickwork that's not standing up to the pounding, new materials available today would hopefully stand up better so reason for the upgrade.

Yes the newer materials should last a lot longer, but I think pipme means the fallacy of having them under the road and heavy traffic, rather than the footpath.

The problem is we have a different management system in place here. Normally companies borrow to invest in new products and pay back the borrowings from their profit. These people are using increased revenue to pay instead. One day they will have a completely new system, which we bought them, will they then reduce the price?

I am also curious about their use of averages when mentioning prices. If say the gas or electric raised their unit price by 10%, their turnover would obviously rise by 10%. However for most people the water charge is still based on the old rates system that went out years ago. With the water they charge different ammounts for different properties. The smaller councils in the countryside etc, generally charged less rates, so the water charges are less. The big cities charged more rates so the water charge is more. If we said as a guess that 75% of the people live in big cities this means this means the majority pay a bigger increase than the average. So with water a 10% average increase would not mean a 10% rise in revenue.

I also don't think you will see that much of a rise in profits for the water companies either. They have split into several different outfits some of which we have never heard of. The satellite companies then charge fortunes to reduce the profit of the main one, which is in the public eye, and who's charges are monitored by the(so called) regulators. I would think Gov is also happy with this set up too, because it probably helps keep inflation figures down.

 

[pipme]

Average is a joke really, like average pay, we all know the average employee ain't on £25K per annum ... just look at the job adverts.
The 'modal' or most frequent value paid .. would be more illuminating ... Max and min would also be useful with regard to billed increases.

When the system is pristine .. nah ! never be that pays them to maintain it just about ok ! Then as we forget the increases, back they'll come for more .. I guess that is why the projected increases fall over time .. psychology .. prelude to more above inflation rises !
Crikey, they add inflation even when boasting to shareholders of productivity savings --