Labour reveal plans for crackdown on water firms

Labour will bring in a new deal for water companies that avoid corporation tax on their profits the new shadow Environment Secretary has said.

Maria Eagle said it should be compulsory for firms to offer lower bills for poorer households in a national affordability scheme and revealed she would be investigating whether Ofwat has enough powers to deal with water firms, in an interview with the Yorkshire Post newspaper.

The cost of living has been heavily debated in recent months. Credit: PA Wire

Ms Eagle claimed water firms were spending too much effort on engineering their finances to avoid paying tax on their profits, and not enough time on helping customers struggling to pay their bills.

"I think we've got to look at having a new deal with the water companies. I will be developing this over the next period of time. It's got to have something to say about tax - you routinely have them avoiding corporation tax on the profits they generate."

Labour leader Ed Miliband has been focusing on the cost of living and last month called for an energy bill freeze.