Thames Water makes waves with price rise proposal Thames Water is on a collision course with the industry regulator and consumer groups after proposing an 8 per cent increase in bills on top of that agreed for the final year of the existing five-year pricing settlement. The proposal, on top of a 1.4 per cent increase above inflation already agreed with Ofwat from next April, would add £29 to the average Thames Water household bill that now stands at £354. The UK's biggest supplier of water and sewerage services by customer numbers blamed the cost of bad debts among customers, preparations for the construction of the £4.1bn Tideway Tunnel to prevent sewerage overflows into the Thames, and the added burden of making repairs to 40,000km of private sewers. Stuart Siddall, chief financial officer for Thames Water, said Ofwat could agree to an annual price increase of £6 over five years rather than a one-off £29 charge. On Monday Regina Finn, Ofwat's chief executive, said: "We will challenge these proposals and question the company strongly on their reasons." Sir Tony Redmond, London and South East chairman of the Consumer Council for Water, said: "Many other water companies absorbed the costs that Thames says they are facing - and they have done so without applying for a further price increase. We believe that Thames Water should do the same. A final decision by Ofwat will be made in November. But at a conference with City investors last Friday, a senior Ofwat official also hinted that Thames risked angering its 14m customers by applying for the additional price rise. Keith Mason, senior director of finance and networks, said: "We really do wonder how comfortable a [further] increase in bills would sit for customers ahead of when they [Thames Water] are putting forward their business plans [for 2015-20] - particularly when other companies have said they are going to absorb these costs and not come forward for interim determinations."