THAMES Water has been accused of being “seriously unambitious” in its plans to cut leaks and usage.

The firm – which hopes to hike bills by £29 to an average £483 by 2020 – fears a major water shortage by 2040 and is consulting on a five-year draft plan to manage supplies.

This includes a pledge to put half a million water meters in homes across its network to help reduce water use. Thirty per cent of homes have meters and the company hopes to increase that to 56 per cent in 2020 and 78 per cent by 2040.

Thames Water serves more than 600,000 people in the county and its average customer uses 161 litres daily, about 10 litres more than the UK norm. It wants to cut that to 153 litres in 2020 and 141 in 2040, and reduce leaks by nine per cent.

But Oxfordshire Campaign to Protect Rural England said Thames Water was lagging behind similar firms and had to be more forceful.

A spokesman said: “Although more metering is welcome, the programme seems to be seriously unambitious and falls well behind what other companies are doing.”

Meters help residents spot leaks and the group added: “There must be a case for going further and faster on metering in order to address the number one concern of customers, which is leakage.”

Thames Water has the worst leakage rate in the country, although it does have the largest network. In 2011/12, it spent £3.1m fixing Oxfordshire leaks, including 839 reported by customers and 1,916 “proactive” fixes.

Flood damage victim Janet Keys, of Abingdon Road in Drayton, added: “Thames Water need to act quicker when there is a problem of leakage, it is a good point that people may end up being billed for something that isn’t their fault.”

The company believes fitting a meter reduces water use by 12 per cent on average. Customers pay for exactly what they use rather than an estimate based on regional usage. It said fitting water meters would also enable it to trial new price bands to force down demand.

Michael Richardson, of Cherry Close, Kidlington, has had a meter for five years and said: “Our bills dropped almost straight away, from about £43 a month to something like £18. I’d recommend it to anyone.”

Demand for water in Oxfordshire, is expected to be 14m litres a day by 2040, outstripping supply.

Oxford East MP Andrew Smith said: “To be fair, Thames Water have been hitting their leakage targets in recent years, with a lot of work to replace old pipes.

“That said, they last year leaked more than 600 million litres of water a day, which is an awful lot of water, so I think they should be set a more demanding target.”

Thames Water spokesman Sarah Sharpe said the company would publish its response to feedback on its draft water resources management plan in October.