Severn Trent Warns of Consumers' Bill Struggles

More and more householders are to experience difficulty in paying their water bills, a provider has claimed.

Severn Trent Water said yesterday that "bad debts" at the firm, which are generated by such failures to pay, could now grow beyond their normal rate of two per cent of turnover. "While we have not experienced any material deterioration [in the rate], this remains a risk to our outlook over the remainder of the year," the firm said in a statement.

The "current economic climate" - which has seen prices for goods and services rise and the availability of credit diminish for consumers - was blamed by Severn Trent for their concerns.

Customer bills from the firm have also risen by around five per cent in April, despite the fact that overall consumption has declined over recent months, according to the statement. With less consumption comes less corporate profit for the firm, which warned investors that the trend could lead to a £14 million loss in revenue.

The water supplier's gloomy outlook is backed up by new figures from data firm Mintel, released earlier this week. According to the study, the number of people who consider themselves "comfortably off" has fallen from 64 percent to 51 percent over the past year; 40 percent also told the firm that they were currently struggling to make ends meet.