Analysis of water poverty in England and Wales (2024/25)
Water is an essential service for all of us – but for many households the recent surge in water bills, combined with wider cost-of-living pressures, has made paying for this service an increasingly difficult challenge.
One way of understanding the scale of this problem and the extent to which water company support schemes, such as social tariffs, are mitigating the impact is to examine the proportion of household income (after housing costs and adjusted for family size) which is being spent on water services.
Lower-income households that are spending more than 5% of their income after housing costs on water services are generally considered to be facing water poverty.
CCW commissioned the University of York to undertake an analysis of water poverty in England and Wales using 2024/25 national household survey data.
We commissioned this research to:
- provide updated estimates of how many households are experiencing water poverty
- identify which groups of people are most affected
- understand differences between water company areas
- build a stronger evidence base for action to improve affordability for customers
Key findings
Overall levels of water poverty
- around 1.8 million households in England and Wales (6.8%) were in water poverty – spending more than 5% of income after housing costs on water services
- around 4 million households (15%) were spending more than 3% of income on water services
The impact on households
Households experiencing water poverty often face a significant gap between what they can reasonably afford and what they actually pay.
For households in water poverty using the 5% measure, bills exceeded the affordability threshold by a median of around £337 per year.
Who is most affected?
The study found higher levels of water poverty among:
- people from ethnic minority communities
- single working-age adults
- single parents
Water poverty and debt
Customers who had fallen behind on their water bills were much more likely to be in water poverty.
They were more than twice as likely to be experiencing water poverty using the 5% measure.
They were almost three times as likely to be experiencing water poverty using the 3% measure.
Differences across water company areas
The study found that water poverty rates vary across different water company regions.
Some areas showed higher levels of water poverty than others, highlighting that affordability challenges are not evenly distributed across England and Wales.
The statistical reliability of regional data varies depending on the size of the sample surveyed in each water company region. We highlight this in the report.
How will CCW use these findings?
Track water poverty over time
CCW will undertake this analysis annually, allowing us to track water poverty rates over time. This will provide invaluable insights on the impact of rising water bills, and the extent to which this is being mitigated by increased financial support from water companies – including local social tariff schemes.
Improve our understanding of who needs support
The findings help identify the customers and communities most at risk of water poverty, helping us focus attention on where support is most needed.
Work with water companies
CCW will use the evidence to discuss with water companies the support they provide for customers struggling to pay their bills. The report will help us assess progress in reducing water poverty.
Informing decisions about strengthening financial support
The research shows that millions of households face affordability pressures and that the problem varies across different groups and regions.
CCW will use the evidence to help inform future decisions about the need to strengthen and improve the consistency of the current framework of financial support for those households struggling to pay.
CCW believes that a new national social tariff is needed in order to fully address the water poverty challenges facing water customers. The introduction of such a scheme was the headline recommendation of our 2021 review of water affordability for UK and Welsh governments. It was also among the final recommendations put forward in the Independent Water Commission’s review of the water sector.