MSE News

Water compensation to double for some in England – you could be due £100s for outages, poor service and more – here's what's changing

Senior Energy & Utilities Analyst

1 July 2025

If you experience problems with your water supply, such as low pressure, outages and poor service, companies in England will pay more in compensation from Wednesday 2 July.

The changes are being introduced under mandatory new rules set out by the Department for Environment, Food and Rural Affairs (Defra). These will be overseen by water regulator Ofwat.

Until now, guidelines on compensation payouts in England had been voluntary. These had been in place since 2000 and were also monitored by Ofwat.

Payouts for problems will double in some cases

From 2 July, all water companies in England must adhere to Defra's new compensation rules. This includes increased payouts for problems already recognised under the existing voluntary scheme, as outlined in the table below:

Compensation increases for water problems

Water problem	Compensation payable until 2 July	Compensation payable from 2 July
Account queries, requests to change payment arrangements & complaints not being actioned on time	£20	£40
Provider fails to show up to scheduled appointment	£20	£50
Less than 48 hours' notice of a planned supply interruption of 4hrs+	£20	£50
Supply not being restored within planned time	£20, plus £10 for each subsequent 24 hours	£50, plus £50 for each subsequent 12 hours
Low water pressure	£25 (once per financial year)	£50 (up to five times a year), or £250 a year if ongoing
Internal flooding from sewers (1)	100% of your annual sewerage charges (min £150, max £1,000)	100% of your annual sewerage charges (min £300, max £2,000), plus £100 - £500 per repeat occurrence within a year
External flooding from sewers (2)	50% of your annual sewerage charges (min, £75, max £500)	50% of your annual sewerage charges (min £150, max £1,000), plus £50 - £250 per repeat occurrence within a year
Failure to pay automatic compensation	£10 - £20 depending on the problem	£40

(1) When sewage water enters your home, due to overloaded sewers flooding and severe weather events. (2) When sewage water enters your land or property, including outbuildings.

You'll soon be eligible for compensation in more scenarios

From 1 October 2025, Defra will add the following water supply problems to its criteria for compensation:

New problems eligible for compensation

Water problem	Compensation payable from 1 October
Failure to install a water meter within eight weeks if requested (subject to some exceptions).	What you would have paid, had you been on a meter – from when it should have been installed, up to the date it is installed
Failure to read your water meter at least once every 13mths	£40, plus £80 for each subsequent 13-month period it fails to do so
Failure to send an 'outstanding charges notice' to give households in debt the opportunity to make payment arrangements before debts are passed on to Credit Reference Agencies, or legal proceedings begin	£150
Failure to comply with services agreed upon in response to an incident for those on the 'Core Priority Services Register'	£100
Failure to restore supply within 48hrs following a 'Do Not Drink (boil) notice'	£40, plus £20 for each 24hrs the notice is in place up to a maximum of your annual water bill (not including sewerage services)

Compensation should be paid automatically in most cases

Here are the key points to know on the new rules:

You can be paid compensation for more than one of the issues detailed above. Though there are some situations, such as in the event of extreme weather, when a water company will not be liable to pay any compensation.
Compensation should be paid automatically. With the exception of external flooding, which must be claimed for. Your water company should proactively get in touch to ask if you'd like to have it paid by bank transfer, cheque or bill credit.
In the majority of cases, compensation must be paid within 20 working days of the issue occurring. Or 10 working days for breaches relating to keeping of appointments, account queries and requests about payment arrangements.
You're entitled to £40 in additional compensation if your original compensation isn't paid within the specified timeframes.
Defra will review the compensation amounts annually. When the Consumer Prices Index (CPI) measure of inflation is 10% or more, it will increase the compensation amounts by CPI, to the nearest £5.

Water company isn't playing ball? Complain to the Consumer Council for Water

If your water company refuses to provide compensation and you believe it's owed, you should first complain directly to it using its complaints procedure. You can also get help making a complaint from Citizens Advice via its consumer helpline.

Your water company should respond within 10 working days. If it doesn't, you can ask it to escalate your complaint. It will then have another 10 working days to respond.

If, after this time, you're still unhappy with your water company's response, you can contact the Consumer Council for Water by calling 0300 034 2222 (England). It will conduct an independent review of your complaint and the service you received.

What are the rules elsewhere around the UK?

In Wales: Water providers follow the same voluntary Ofwat guidelines that have been in place in England. However, Welsh water companies are currently undergoing their own review of these measures, alongside Ofwat.
In Scotland: The main water provider, Scottish Water, has its own service standards and compensation arrangements. Some payments are automatic, others you need to claim for.
In Northern Ireland: You need to complain to NI Water if you experience issues with your supply or service.