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6 Paying for water services 6.1 Understanding the history of the water industry is important in understanding why we pay for water in the way that we do. There was much debate in 19th century London over whether water should be paid for through the rates (see paragraph 6.3) as a public service or should be metered and paid for according to the amount used. Eventually, the argument that water should be a publicly owned service – available on the basis of Figure 6.1 Average water and sewerage bills 2008-09 Thames Severn Trent Northumbrian Yorkshire Industry average United Utilities Wessex Anglian Water D r Cymru Southern South West Portsmouth Cambridge South Staffs Southern Dee Valley Northumbrian Bournemouth Severn Trent Veolia Three Valleys Yorkshire Bristol Industry average Sutton & East Mid Kent Essex & Suffolk South East United Utilities D r Cymru Tendring Hundred Anglian Water Thames Folkestone & Dover Cholderton Wessex South West universal, constant provision and managed for the good of the community – gained official acceptance 87 . The Metropolitan Water Board was established in 1903 to take over the water services originally provided by private companies in London. 6.2 The Metropolitan Water Board’s service area covered the whole of the County of London and the majority of the built up area at that Average sewerage bills Average water bills £0 £50 £100 £150 £200 £250 £300 Industry average bill Companies supplying water in London
82 The Mayor’s draft water strategy time. The Water Act 1973 amalgamated the Metropolitan Water Board with many of the other municipal and private water companies in the Thames Valley to form the Thames Water Authority. It was privatised in 1989. Veolia Water Three Valleys, Essex & Suffolk Water (now part of Northumbrian Water), and Sutton & East Surrey Water continued to operate in the private sector. 6.3 The majority of London households continue to pay for their water and sewerage services on the basis of the rateable value of the property. The rateable value is the estimated value of a property, based on the annual rent it (with vacant possession) would fetch on the open market. The rateable value was the basis on which householders generally paid for their local authority services until 1990. Community Charge (frequently referred to Table 6.1 Water use and related costs in eight European capital cities (2004) City Average individual use (m 3 /p/a) Average number of people per household Drinking water services Average bill (in euros) Share of the household budget as the poll tax) replaced it, and then later Council Tax. Paying for water services is now the only purpose for which domestic rateable values are used. The introduction of meters as the basis for charging for water, discussed below, will affect how much households have to pay, and any changes will be judged against the current rateable value based charges. 6.4 As explained in more detail in paragraph 6.24, there are two components to domestic water customers bills. One part covers water supply and the other sewerage services. Figure 6.1 overleaf show the average bills for customers of the companies serving London relative to companies in other part of England and Wales. The bills for sewerage services are generally higher than the bills for water supply. Wastewater services Total Average bill (in euros) Share of the household budget Average bill (in euros) Share of the household budget Amsterdam 57 2.3 237 0.8% 270 1.0% 506 1.8% Athens 61 2.7 107 0.5% 64 0.3% 171 0.8% Berlin 43 1.8 162 0.6% 227 0.8% 389 1.4% London 54 2.4 169 0.5% 143 0.4% 312 0.9% Madrid 61 2.9 135 0.5% 72 0.3% 207 0.8% Paris 52 1.9 105 0.3% 124 0.3% 229 0.6% Rome 104 2.6 114 0.4% 115 0.4% 229 0.8% Stockholm 77 2.0 129 0.5% 192 0.7% 321 1.1% Source: BIPE 88
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