A DRINKING water utility company has announced plans to cut household and business supply bills.

Sembcorp Bournemouth Water, which supplies around half a million people in Dorset, Hampshire and Wiltshire, said today that it would freeze prices until April 2015, then cut bills for following 12 months.

Increases in subsequent years up until 2020 will be kept below inflation.

Managing director Roger Harrington said: “We've listened to a lot of customers over the last two years, and taken on board their feedback to help us review and update our plans for the future.

“By cutting bills and improving the service we will be doing more for less, 11 per cent less.”

In plans submitted to industry regulator OFWAT - which will impose price limits late next year - the firm proposes to reduce leakage by five per cent, fix leaks faster, reduce the risk of service interruptions and reduce the amount of energy used to deliver water by eight per cent.

Wessex Water, which supplies water over the rest of Dorset, as well as sewerage services for the whole county, has also announced plans to cut bills.

While the firm proposes to invest around £1.2 billion in improving infrastructure between 2015 and 2020, it says bills will fall in real terms from 2014 with the average household bill in 2019-20 being £454, compared with the current average bill of £479 a year.

Chairman Colin Skellett added: “Although our water and sewerage bills represent just over one per cent of average household expenditure, we recognise that the economic climate means some customers find it difficult to pay, which is why we plan to do even more to help those customers who are struggling to pay by extending our offering of social tariffs and our assistance programme tap – the most extensive range of affordability measures in the UK.”