A new government review could mean residential landlords may find themselves having to settle water bills left unpaid by tenants.

The proposal, as reported in The Times, is part of the wide-ranging Walker review of water charging.

The proposal, says The Times comes as water companies face plunging profits
And rising bad debts. Northumbrian Water, for example, has reported a 10.3 per cent fall in pre-tax profits to £152.7 million for the year to March 31.

Company managing director John Cuthbert said that the company had increased its provision for bad debt from domestic users by £2 million to £30 million. He said that recovering debt from tenants was particularly difficult.

"Quite often by the time we have found out who the tenants are, they have gone," he said. "We are talking to the Government about what help they can give us here. One proposal would be to make the landlord liable."

Research for TDX Group, a provider of debt liquidation solutions for creditors, suggests that up to 5 per cent of all householders (representing 1.1 million homes) could default on their water bills this year, reports The Times.

which would add a further £350 million of debt to water companies' balance sheets by the end of 2009.

John Telford, of TDX, said that last year water companies' bad debt had grown by 11 per cent. "As economic conditions worsen, the situation for water companies is going to get a lot worse as competition among creditors to recover outstanding debts will intensify," he added.
The proposal to make landlords liable for water bills at their properties has been drawn up by Ofwat, The Times reports. Landlords would require property owners or managing agents to identify who is the "liable person" for water charges at any property.

A spokesman said: "The occupier will always be the first person liable, but, as things stand, there is no incentive for the landlord to tell the water company who the occupier is and without this information the water company cannot bill anyone."

The Department for the Environment, Food and Rural Affairs confirmed that landlord liability was "one option being considered by the Walker review", said The Times.

Richard Jones, secretary of the Residential Landlords' Association, was reported as saying that rents would have to rise to cover landlords' extra exposure.