Households across Greater Manchester could see money taken off their upcoming water bills due to a crackdown on supplier underperformance from the industry regulator. Ofwat is proposing to hit a raft of firms across the sector with penalties for not meeting targets on environmental and customer service in the 2025-26 financial year, which will be returned to households and businesses through their bills.
The total net bill reduction under the draft plans is £240 million by 2029-30, with £107 million being returned through customer bills in 2027-28. Despite the penalties, many households may see little financial relief. The cuts to bills are likely to be offset for many customers by recent plans to allow water companies to hike annual tariffs by an extra £3.4 billion – on top of the 36% average rise agreed over the five years to 2030.
United Utilities faces £13.4m charge
Yorkshire Water faces the largest underperformance penalty, returning £75 million in April 2027. This translates to an average bill cut of around £27 per customer. United Utilities, which provides water and wastewater services in the North West of England, faces a total net charge of £13.4 million.
A United Utilities spokesperson told the MEN: "In 2025/26, we improved year-on-year performance across more than 80% of our key performance measures. Where targets are missed, the regulatory framework ensures money is returned to customers through bill adjustments."
They added: "While there is more to do, we are making strong progress and delivering on the priorities that matter most to customers and for the environment through the largest investment in water and wastewater infrastructure in the North West for more than a century."
Final decision due in December
Ofwat emphasised that exact bill changes will depend on a range of factors and will vary significantly by company and customer type. A final decision on the outcome delivery incentive (ODI) payments will be made by December 15, taking effect on customer bills starting April 1, 2027.
Speaking on Wednesday (14 October), a Government spokesperson said: "This Government won’t allow customers to be treated as a blank cheque, and we are committed to protecting households from cost-of-living pressures."
"We will always challenge water companies where they seek to pass unnecessary costs onto households," they added. "We will deliver a strengthened Water Bill that puts people first, ensuring affordable access to clean water, driving down pollution, and strengthening public control."
