Millions of families could be FORCED to install water meters after government U-turn

Water companies are to be given new powers to force meters on millions of families.

The installation costs will add billions of pounds to water bills over the next decade - equivalent to £200 per household.

The Government claims paying for water by the gallon is the fairest option and will protect the country against future droughts by reducing use.

However, critics argue it amounts to rationing by price and could particularly hit families with lots of children and some disabled households with big increases in bills.

Labour campaigned against the installation of water meters before it came to power in 1997 on the basis it would hurt poorer families.

A recent U-turn by environment minister Phil Woolas has seen the Government sign up to an industry spin campaign that meters bring lower bills.

He said: 'Our water strategy said that we believe we will need near universal metering by 2030 in seriously water stressed areas.

'The Government's forthcoming independent review will look at charging and metering, including a range of social tariffs to help protect the vulnerable, save water and bring prices down.'

In fact, short-term reductions in bills will be swamped by higher tariffs in the long term to fund meter installation, replace sewers, build new reservoirs and clean up water released into rivers and the sea.

Water companies are seeing a fall in consumption and their income from customers who have switched to meters in recent years.

However, industry regulator Ofwat will allow them to make up this fall with bigger increases in the price per gallon in future years to ensure they have sufficient money for their building programmes.

The Government has already announced plans to allow the industry to force meters on all customers in areas which are considered to be at risk of drought - particularly the South East - by 2030.

However, it is now launching a consultation exercise looking at whether to require meters for all homes on the basis of 'efficiency and fairness'.

Putting a meter in every one of the 26 million homes in the UK would cost an estimated £5.2 billion - a bill that would be passed on to homeowners.

A consultation document on Government action to conserve water laid before Parliament this week details plans for extended water metering.

It supports use of meters, stating: 'Metering gives customers the financial incentive to save water, and can therefore promote water efficiency measures resulting in water saving.

'On average, households reduce their water consumption by around 10per cent after a meter is fitted.

'The Government ...plans to commission an independent review to advise on how metering and charging should progress beyond the application that water companies may wish to make in the seriously water stressed areas.'

Industry critics argue that companies should be forced to do much more to stop the waste of water through leaky pipes, before expecting customers to use less.

Water companies are wasting 3.42 billion litres every day through leaking pipes, or the equivalent of two full baths for every household in the country.

More could also be done to capture the vast quantities of water that falls from the skies.  There have also been calls for a pipeline and river grid to bring water to the south east from Wales.

However, the Government and industry favour cutting the water consumed.

The National Consumer Council and the Consumer Council of Water(CCW) are worried that any move to universal metering will hit poorer families particularly hard.

CCW chairman, Dame Yve Buckland, says while the organisation broadly supports meters to conserve supplies: 'We...have argued consistently that compulsory metering will make it difficult for low income, larger households to afford their water bills - and there is currently no credible support system to help them.'

A spokesman for environment department Defra said: 'There is now a good case for examining the costs and benefits of metering and appropriate tariffs outside areas of serious water stress, in the context of a wider review of charging that will look at issues of efficiency and fairness.

'This independent review will... make recommendations for a fairer system of charging that is right for the 21st century.'

She said it will particularly consider 'how to protect vulnerable groups, like those on low incomes and the elderly'.