Most readers have probably thrown away the Splash insert provided with the statement of next year's water bill.

However, page 12 reveals how the Government is wasting your money.

Southern Water has been obliged to spend many hundreds of millions to ensure waste-water quality meets EU regulations.

At the same time, the UK Government has capped the amount the company can collect in charges.

This has forced Southern Water to borrow heavily from the banking system, to the extent that interest payments plus tax amount to a third of revenues collected, £141 million in 2001.

This payment, of course, results in no benefit whatsoever to the customer, most of it contributing to profits derived from lending money.

Southern Water, with its huge customer base, should be able to fund investment from income. There should be no need to borrow.

Customers will be paying many millions of pounds in their water bills merely for the benefit of credit institutions. Instead, this money could be used for further improvements to the supply.

The unelected bureaucrats of the EU and the misguided policies of the Government have led to this huge waste of money, pouring money down the drain by their shortsightedness.

Southern Water inherited the legacy of a poorly-run, underfunded public-sector infrastructure that was incapable of meeting new regulations without massive expenditure.

The EU imposed unrealistic timescales on modernisation. The result, massive indebtedness.

-Richard Dale, Friday Street, Warnham, Horsham