THERE'S no doubt that, with its record of inflation-busting charges, North West Water's bills are not the family favourite - and that the prospect we see today of them going up by a third more over the next five years will be greeted by more groans.

But what's this? NWW and the water industry watchdog, Ofwat, are combining to say the increases would not be so steep if the company did not have to go so fast at its £3.7 billion programme to make rivers and beaches cleaner.

And they say their market research shows customers want the clean-up, but would prefer to slow it down so that the impact on their bills - predicted as a 5.8 per cent increase on top of the rate of inflation every year until 2005 - is lessened.

But whether or not consumers really do want a less-improved environment in return for less-horrendous bills and whether or not NWW might prefer a reduction in their outlay and borrowings in order to deliver this, is there not another aspect to this equation - that of the shareholders' contribution? Surely, as with all the other above-inflation increases on NWW's charges, are not the ones now in the pipeline aimed to give sustenance not just for the company's services and environmental improvements, but also for its frequently-immense profits and the shareholders' dividends?

That factor, of course, was put in the equation by privatisation.

And if privatisation had not occurred, bills would not have gone up relentlessly so much above the cost of living like they have and would not continue to do so.

This would have been the case no matter how big an investment programme this undertaking had to be involved in, and no matter at what pace, and whether or not the industry was subject to under-investment in its services and environmental improvements in the era before privatisation.

The fact is that the shareholders' dividends are a cost on consumers - and one which this newspaper has always believed is too great simply because, unlike the privatisation of other utilities, water has no competition.

And instead of Ofwat having the sort of intimate relationship with NWW that permits it to join in market research that suggests that this clean-up should be slowed to keep bills down, it should be less of a lapdog - and bark about the dividends that keep them so high.

Converted for the new archive on 14 July 2000. Some images and formatting may have been lost in the conversion.