UK watchdog: Water firms pocketed profits

Britain’s water companies have pocketed at least £800m (€703.3m) of unexpected profit which could have been used to cut bills, the UK spending watchdog said yesterday, pointing to failings in the regulatory system.

The water industry, privatised in 1989, had held on to savings made from falls in interest rates and corporation tax, leading to net windfall gains in the last five years, the National Audit Office said.

The comments are likely to be seized on by campaigners who argue that the privatisation of major infrastructure assets lead to higher bills for consumers.