Homeowners will find their utilities bills in relation to water will increase in line with inflation over the coming year, Ofwat has revealed.

The water regulator said that the average bill is set to rise by 4.6 per cent, meaning households can expect to pay around £356 per year.

Regina Finn, Ofwat chief executive officer, commented: "People can shop around for the best deal on many things, but not water. Our job is to do this for them."

She emphasised that no-one wants to see their utilities increasing, especially as economic times are still very tough for some individuals, which is why the views of customers have been taken into consideration.

Consumer Focus recently said that people need to be reassured that they are paying the right price for their energy after British Gas announced a 24 per cent rise in pre-tax profits for last year.