Water scare payouts set to top £20m as supplies clear

The bug which contaminated water supplies in large parts of Lancashire for a month could end up costing United Utilities more than £20m.

Friday, 4th September 2015, 7:11 am
Franklaw Treatment Plant

The company has announced it will be paying around 300,000 customers compensation of between £50 and £60 each for the inconvenience of having to boil all drinking water.

Each one of the 300,000 households affected by the boil water scare will get between £50 and £60, depending on how long they have been without clean supplies.

The domestic payouts will cost the company between £15m and £18m - even before it considers business claims.

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Franklaw Treatment Plant

And with companies expected to slap in bills totalling several million pounds for loss of business and the cost of bottled water for thousands of employees, the final figure is expected to be well over £20m.

United Utilities chiefs have assured the public that the cost of the month-long crypto scare will not be passed back to customers on their bills next year. It will be borne, they insist, by the company itself.

The level of compensation has been set in talks between the firm and the customer champion, the Consumer Council for Water.

The exact amount for each customer will depend on when the boil water notice was lifted in their postcode area. But it could take until the end of the month for everyone to be paid.

United Utilities' Gary Dixon

Fylde MP Mark Menzies said: “I think the figure of £50 or £60 is woefully inadequate and in no way reflects the inconvenience people have been put through over the last month without any drinking water.

“I am disappointed because when I met with United Utilities last week they said they were consulting on how much they should be giving consumers and were unable to even speculate on the figure.

“I urged them to be generous in their estimates as a goodwill gesture to their customers and now they are announcing this as a fait accompli.

“Many areas in Fylde are still without wholesome drinking water and have been extremely understanding.

Mark Menzies

But for a company that made almost £700m in profit last year to offer this paltry sum is a disgrace.”

Gary Dixon, customer services director, said: “We recognise that our customers have been significantly inconvenienced over the last few weeks and they rightly deserve to be compensated.

“The payment reflects that inconvenience and takes into account the additional cost for boiling the water and a refund for water services over the period.

“In addition to receiving this payment, businesses that incurred extra costs or loss of earnings as a direct result of the boil water notice, will receive a separate letter on how to claim.”

“We will review these on a case by case basis which will take longer but we will aim to deal with each as quickly and fairly as possible. We are grateful for our customers’ co-operation and patience over the last few weeks.” All 300,000 customers affected were subject to boil water restrictions for at least three weeks after the parasite was found in water from the Franklaw Treatment Plant near Garstang.

The first areas, totalling 80,000 properties, had the warning lifted eight days ago. There have since been three more announcements, with more than two-thirds of homes now back to drinking clean water, leaving around 80,000 consumers still restricted.

The company expects to sound the all-clear for the vast majority of those by Sunday.

For all our previous coverage on the water contamination situation in Lancashire visit the links below: