A very unwelcome Christmas present for water customers is in store, particularly those in the South West who will see their already highest water bills in the UK rise by a further 25% plus inflation over the next five years.

This morning's announcement by Ofwat means that water bills in the UK will increase on average by 18% over the next five years.

The 18% increase is larger than expected, although the figure falls short of the 29% increase demanded by water companies.

Average bills will rise by £46, from £249 now to £295 (not including inflation) over the five years from April 2005, with half of the rise for most customers in England and Wales coming in 2005-06.

The biggest rise will see customers of Southern Water, South West Water and Wessex Water paying an extra 25% over five years on their current average bill. South West Water will still have the highest average bill by 2009-10, at £444.

Maurice Terry, WaterVoice Chairman, said: "This is bad news for the millions of water customers who will find these increases neither affordable nor acceptable. The government must act immediately to ensure that customers on low and fixed incomes receive effective help to pay their water bills, through the mainstream tax credits and benefits system."

"The current system of support is widely seen as inadequate and in need of immediate reform. Yet the government's report on its review, announced in March, of financial assistance to water customers is still awaited. Our view is shared by the Parliamentary Select Committee on Environment, Food and Rural Affairs, who in yesterday's Water Pricing follow-up report urged the Government to address the growing difficulties of water customers on low incomes."

Mr Terry added: "Some customers have difficulty paying water bills as it is: the latest figures on debt show £893 million of outstanding revenue from household bills across England and Wales at the end of 2003-04, £527 million of it more than 12 months old. Next year could see thousands of customers dragged into debt for the first time."

Despite the big increases announced, WaterVoice welcomed news that funding to tackle sewer flooding had been increased very significantly over the five-year period.

Mr Terry said: "We are delighted that Ofwat has listened to our calls for a substantial increase in spending to reduce the risk of this appalling emotional and environmental blight. It is also good to see funding of improvements to deliver a secure, reliable, supply of drinking water."