Landlords could become liable for tenants' unpaid water bills under Government plans

A new consultation from the Department for the Environment, Food and Rural Affairs (DEFRA) aims to reduce the sums that every water user pays to cover the cost of unpaid water bills, Environment Minister Richard Benyon said. This accounts for an average of £15 a year on bills.

There is currently no requirement that the owners of a building must provide information on an occupier's identity to the relevant water company, although these details must be provided to electricity and gas suppliers. The water industry had to write off approximately £328 million in unpaid bills in 2010-11, mainly from tenants in rented properties, the Government said.

Benyon said that he wanted to consider whether the Government could take action through a voluntary approach before introducing regulation.

"We will consider the consultation responses before making a final decision but we must find a way to fill the information gap which is at the heart of this problem. It is just not right that responsible people have to pick up the bills of those who are not paying," he said.

The consultation proposed the introduction of either a regulatory measure, or a voluntary alternative.

The first option would make landlords liable for the water charges in their tenants' properties if they fail to supply details of their tenants to the water company. Alternatively, landlords and other holders of occupancy data could be asked to share this information on a voluntary basis.

Any changes will only be introduced in England as a similar power is devolved to the Welsh Assembly.

Property law expert Richard Daffern of Pinsent Masons, the law firm behind Out-Law.com, said that the proposal could lead to landlords having to take extra care where tenants change their details.

"If the proposal becomes law landlords and managing agents will have to introduce procedures and possibly additional obligations in leases to ensure that water companies are kept informed of tenants' details to avoid incurring these charges," he said.

The Government published plans for increased competition and deregulation in the water industry in a White Paper (105-page / 4.16MB PDF) at the end of last year. It intends to issue a new draft Water Bill for consultation shortly.