43IH Sth.staff 5%

RNS No 6120m
SOUTH STAFFORDSHIRE WATER HOLDINGS PLC
14 April 1999


         SOUTH STAFFORDSHIRE WATER HOLDINGS PLC
     Submission of Strategic Business Plans to OFWAT

South  Staffordshire  Water PLC submitted  its  strategic
business plan to OFWAT on Friday 9 April 1999 as part  of
the ongoing Periodic Review of water charges for the five
years from 1 April 2000. The plan includes:

* A  #92  million investment programme, equivalent  to  a
  spend of #34 per property per annum, to:

     - Address  the  increasing  problems  caused  by
     summer  peak  demands by extending  water  treatment
     capacity  and  a phased introduction  of  compulsory
     sprinkler metering

     - Install  water treatment plant  to  deal  with
     deteriorating raw water quality caused by increasing
     levels of nitrates and pesticides in both ground and
     surface waters

     - Meet more stringent EU standards for lead  and
     increase cryptosporidia monitoring

     - Continue to renew infrastructure during  2000-
     2005 at the same rate as achieved over the last five
     reported years

* Continuation  of  high levels of service  to  customers
  whilst  delivering further efficiency savings  of  1.5%
  per annum

* An initial increase of #4.91 on average household bills
  in  2000,  followed  by  annual  real  terms  increases
  averaging  around  61p for the four  years  from  April
  2001.  This  would result in current average  bills  of
  #81.33  per  annum, the second lowest in the  industry,
  increasing to #88.68 by 2005.

Brian Whitty, Group Chief Executive commented:

"The  Company's strategic business plan should be  viewed
in   the   context  of  its  exceptional  record.   South
Staffordshire  Water has amongst the  highest  levels  of
customer  service and the lowest charges in the industry.
It has abated prices every year and reinvested efficiency
savings  in  infrastructure  renewals  by  over-achieving
outputs.  Financially our return on capital per  unit  of
output  is  the  lowest in the industry by  far  and  our
returns on regulatory value and dividends as a proportion
of turnover are amongst the lowest."

ENQUIRIES:

South Staffordshire Water PLC
Mike  Swallow, Director of Corporate  Affairs    Tel: 01922 618057
Adrian  Page,  Group Finance Director            Tel: 01922 618001

College  Hill                                    Tel: 0171 457 2020
James Henderson
Chelsea Allen


NOTES:

* During  the  years  1995-2000  the  Company  will  have
  completed  a  #76m  investment programme.  During  this
  period   voluntary  abatement  of  prices  have   saved
  customers #3.7 million in total and average bills  have
  fallen by 1% in real terms.

* These  figures  exclude  the impact  of  free  metering
  proposed  in  the Government's current  Water  Industry
  Bill  which OFWAT have stated will be the subject of  a
  separate price determination.

* The  ability of the Company to deliver these objectives
  will  depend  upon OFWAT setting tariffs in  accordance
  with those projected in the plan.

* The  submission of the strategic business plan  is  one
  stage of the Periodic Review process of setting prices.
  OFWAT  will publish a draft determination in July  1999
  and  a  Final  Determination in  November  1999  before
  prices are implemented on 1 April 2000.

* South   Staffordshire  Water  PLC  is   the   principal
  subsidiary  of South Staffordshire Water Holdings  PLC.
  During  the  financial year 1997/1998 the  Group's  non
  regulated  businesses contributed  over  30%  of  Group
  profits.

END

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