Thames Water has been given the highest charge as water companies are being forced to slash customer bills by more than £67 million next year in England and Wales.

Many of the companies failed to live up to standards set by themselves and regulator Ofwat.

Thames Water, the supplier for the London region, will have to slash bills by £53 million in the year ending March 2023.

It was given the highest charge out of 17 water and waste-water suppliers across the two nations.

Southern Water will also have to forgo nearly £46 million and Southwest Water more than £15 million.

Others blew through their targets and will be allowed to reap rewards, with United Utilities able to charge their north western customers an extra £20 million and Severn Trent £25 million.

Water companies hold a monopoly on services in their area so they are rewarded, or punished, according to a series of targets to encourage them to invest in their networks and customer service.

The regulator said: “Ofwat has today confirmed the payments due to companies or customers as a result of water company performance against their 2020-21 performance commitments. Overall, £67 million will be repaid to customers.

“The largest outperformance payment will be to Severn Trent Water, which will receive £25 million. Thames Water and Southern Water will return £53 million and £46 million to their customers respectively.”

The payments will not be made up front, rather they are deducted from customers’ bills in the next financial year.

It is unlikely to save customers a huge amount of money.

Thames Water, for instance, serves around 15 million households, suggesting an average saving of around £3.50 each over the year.

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