SEVERN Trent Water's average bill will be reduced by around four per cent over the next five years, the regulator Ofwat announced today.

It will mean a fall of £13 for most customers' bills to £292 by 2015.

This is around £26 (eight per cent) lower than what the company asked for.

Ofwat said it will allow the company to invest around £2.5bn over the next five years. Customers' bills over this period will pay for:

Around £6m in flood protection at treatment works which will benefit 650,000 customers by reducing risk of service failure.

More than £115m of investment so that around one and a half million customers will be served by more than one source of water supply to reduce the risk of extreme circumstances, such as flooding, leading to service failure.

Around £10m to survey nearly one million households to identify and then solve low pressure caused by shared supply pipes.

Reduce leakage by 47m litres per day between 2010-2015 to ensure that it has enough water to meet the demands of its customers.

Regina Finn, chief executive officer at Ofwat, said: "We have listened to customers in the Midlands. They have told us that their priority is safe, reliable water supplies at a reasonable cost.

"We've challenged Severn Trent and kept bills £26 lower than they asked for. This is not just about flat bills, but about what customers get for their money."