Aashna Shroff, personal finance expert at money.co.uk, comments:

"The proposed cut to water bills will be welcomed by customers and environmentalists alike.

"Investment into the infrastructure will not just benefit consumers due to the reduction in their bills, but will also have a significant impact on the environment.

"The amount of wasted water from leaking pipes is simply not acceptable. And the fact that only three out of 17 water firms passed the last review by Ofwat, highlights the need for more money to be invested in an ageing infrastructure.

"It's just a shame it took intervention by the industry regulator to demand the water firms change their ways or face punitive penalties.

"Hopefully this is the shot across the bows they needed.

"It's about time they gave something back to their customers, and Ofwat should be commended for the tough stance it's taken."