The average household water and sewerage bill in England and Wales is set to increase by 3.5%.
The average cost of a water and sewerage bill will rise to £388.
Customers in the South East face the biggest rise of £23 a year.
The South West is close behind with a £22 increase, while families in Yorkshire will pay around £12 more a year.
Customers' bills are helping to pay for a £25bn investment programme to improve the water supply.
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Barclays is to increase the funds put aside for mis-selling to consumers and businesses by another £1bn, taking the its total to £2.6bn.
The confirmation of the figure comes after Sky City Editor Mark Kleinman revealed the additional set aside last night.
Kleinman said: "The fund for mis-selling of payment protection insurance (PPI) has gone up by £600m and for the interest rate swaps by £400m."
Barclays is also ultimately likely to have to set aside money for potential Libor-related litigation, following its £290m in fines last summer for manipulating the interbank borrowing rate.
The announcement comes just a week before the bank's new chief executive, Antony Jenkins, unveils a blueprint for rebuilding Barclays' reputation.
Mr Jenkins and Sir David Walker, Barclays' chairman, are due to appear before the Parliamentary Commission on Banking Standards.
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BP has set aside a further $4.1bn (£2.6bn) to cover costs relating to the Gulf of Mexico oil spill, as it reported a fall in profit.
It takes the total cost of the explosion at the company's Deepwater Horizon rig in April 2010 to $42.2bn (£26.8bn).
Earlier this month, BP agreed to plead guilty to manslaughter over its role in the incident - which resulted in the deaths of 11 workers - and pay $4.5bn (£2.9bn) in a record criminal settlement.
A trial in the US is expected to begin later this month.
The oil giant said its underlying replacement cost profit fell 18% to $17.6bn (£11.1bn) last year.
In the fourth quarter, BP's profit was $3.9bn (£2.5bn) - a fall of more than 20% when compared to the same period in 2011.
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By Mark Kleinman, City Editor
The group finance director of Barclays is to step down amid an ongoing probe by British regulators into a controversial £7bn capital-raising that allowed the bank to avoid the Government's clutches in 2008.
I can exclusively reveal that Chris Lucas, who has been Barclays' finance director for almost six years, will retire later this year.
The bank will announce Mr Lucas's decision to leave in a statement to the stock market on Monday. Headhunters have been appointed to identify his successor.
It was unclear on Sunday whether Mr Lucas will receive any form of payoff, although insiders described this as "extremely unlikely".
Including bonuses and deferred share awards, Mr Lucas earned almost £4m in each of the last two years.
He was one of several executives who waived an annual bonus for 2012 because of Barclays' involvement in the Libor scandal but may still be in line for an award under the bank's long-term incentive plan for last year.
The news of his retirement will come at an awkward time for Barclays and its chief executive Antony Jenkins, who is attempting to rehabilitate the bank's reputation in the aftermath of a series of scandals.
Barclays has been under investigation for several months by the Serious Fraud Office (SFO) and Financial Services Authority (FSA) for various disclosure issues related to its 2008 fundraisings.
Last week, the Financial Times reported that one of the angles being probed by the authorities was whether Barclays lent the money to Qatari investors which was then used to acquire Barclays shares.
Such an action would be illegal because it would have presented a potentially false impression of Barclays' financial health and attractiveness to outside investors.
There is no suggestion that Mr Lucas or any of the three others under investigation - Richard Boath, a senior investment banker who still works at the bank; Roger Jenkins, the former head of Barclays' lucrative tax-structuring operations; and John Varley, Barclays' former chief executive - are guilty of any wrongdoing, and insiders stressed that Mr Lucas's retirement was unconnected to the inquiries.
The individuals are being investigated by the FSA, while the SFO is looking at the bank.
In July last year, Barclays said in a statement: "The FSA is investigating the sufficiency of disclosure in relation to fees payable under certain commercial agreements and whether these may have related to Barclays capital raisings in June and November 2008. Barclays considers that it satisfied its disclosure obligations and confirms that it will co-operate fully with the FSA's investigation."
A series of share placings and fundraisings in 2008 allowed the bank to raise capital privately and avoid having to take money from the British taxpayer. That enabled Barclays to retain control of its strategy and the ability to continue paying big bonuses in a way which eluded both Lloyds Banking Group and Royal Bank of Scotland.
As Barclays' finance director, Mr Lucas has been an architect of the bank's strategy during the last six years.
His earlier career included a long stint at PricewaterhouseCoopers, the accountancy firm, where for five years he was the partner responsible for auditing Barclays.
The FSA continues to have confidence in Mr Lucas's ability to do his job.
Mr Lucas's departure later this year will complete a clean sweep of Barclays' top management following its £290m fine for manipulating the interbank borrowing rate Libor last June.
Marcus Agius, the former chairman, was replaced by the City grandee Sir David Walker, while Bob Diamond, chief executive, was effectively forced out by regulators, with Mr Jenkins appointed as his successor. Jerry del Missier had only been chief operating officer for a few days when he also resigned over the Libor scandal.
It is unclear whether Barclays has already drawn up a list of either internal or external potential successors to Mr Lucas although one person close to the bank said it was possible that a replacement would be announced imminently.
Last week Mr Jenkins waived his 2012 bonus days after Sky News revealed that Sir John Sunderland, the chairman of Barclays' remuneration committee, had signalled to investors that the board wanted to award him a significant payout.
Mr Jenkins and Sir David will appear before the Parliamentary Commission on Banking Standards on Tuesday, when they are likely to be quizzed about the status of the probes into the 2008 capital-raisings, the bank's culture and the protracted mis-selling episodes which are blighting the balance sheets of the major UK banks.
Mr Jenkins will then present his strategy for Barclays alongside the bank's annual results on February 12.
Last month he told employees that they would have to abide by a strict new ethical code of conduct if they wanted a future at the company.
:: Barclays confirmed the two departures at 7am on Monday.
Britain is set to avoid the feared 'triple-dip' recession, according to a new survey.
Business confidence has now strengthened to the highest level since the second quarter of 2011, the ICAEW/Grant Thornton Business Confidence Monitor (BCM) report has suggested.
The BCM survey suggests GDP will expand by 0.4% in the first quarter of the year, after the 0.3% contraction in the last quarter of 2012.
ICAEW chief executive Michael Izza said: "There was a risk that, combined with the traditional January blues, the bad weather and some high profile retail collapses, talk of a triple-dip recession could become self-fulfilling.
"These results show that we are set to avoid a third period of technical recession, but no one should be complacent.
"There is only one way out of our economic malaise, and that's to increase our economic output. Such a task isn't going to be easy, or indeed quick."
Firms have seen a 1% increase in staff in the last year and plan to increase headcount by another 1.5% over the next 12 months.
One in 10 firms say the availability of management skills is a greater challenge than a year ago, suggesting that companies may struggle to recruit the right people to lead the recovery.
However, although business confidence appears to be widespread, it is most optimistic in Wales and the South East.
The report added that the construction sector, which has been hit hard in recent reporting periods, has renewed confidence along with IT and telecommunications.
Grant Thornton LLP chief executive Scott Barnes said: "Export growth rose slightly this quarter as the global economy picked up.
"This is coupled with an improvement in both profit and turnover growth, which companies expect to increase in the year ahead.
"Despite a rise in confidence though, companies' modest plans for capital investment are a worry as this is crucial to a strong and sustained recovery."
Britain's biggest banks will face "complete separation" if they flout new rules to ring-fence risky operations from savers' deposits, the Chancellor will announce today.
The new legislation will give the Government and a new banking watchdog powers to "electrify the ring-fence" if banks fail to split high street branch operations from the dealing floor.
Launching the Banking Reform Bill today, George Osborne will tell traders that there will be no more "too big to fail".
It comes after the Parliamentary Commission on Banking Standards, which was set up in the wake of the Libor rate-rigging scandal, called for a reserve power for full separation if banks did not implement reforms.
The Bill proposes different bosses for High St and Investment banks Sky City Editor Mark Kleinman first revealed details of Mr Osborne creating special powers for regulators to break up individual banks if they flout the ring-fencing rules.
Mr Osborne had warned the Commission, against "unpicking the consensus" over reform proposals in the Bill in November, but appears to have heeded their warnings that loopholes could easily develop.
Sir John Vickers, who chaired the Independent Commission on Banking (ICB), has also said he "would not resist" a complete break up of banks if so-called ring-fencing fails to achieve its desired effect.
But the announcement will put the Chancellor on a collision course with the banks, which claim the legislation will damage London's attractiveness as a global financial centre.
Anthony Browne, chief executive of the British Bankers' Association, said: "This will create uncertainty for investors, making it more difficult for banks to raise capital, which will ultimately mean that banks will have less money to lend to businesses."
He said moving away from the universal model of banking undermined banks' ability to provide all the services businesses need.
But Mr Osborne is expected to say: "When the RBS failed, my predecessor Alastair Darling felt he had no option but to bail the entire thing out. Not just RBS on the high street, but the trading positions in Asia, the mortgage books in sub-prime America, the property punts in Dubai.
"I want to make sure that the next time a Chancellor faces that decision they have a choice. To keep the bank branches going, the cash machines operating, while letting the investment arm fail."
Under the Bill investment and high street banks will also have different bosses and a new watchdog will be set up.
Customers will also be empowered and be given the right to switch banks to another provider within a week, under sweeping reforms.
Chancellor George Osborne wants any fine paid by the Royal Bank of Scotland over the Libor scandal to come out of its bankers' bonuses.
RBS, which is majority-owned by the taxpayer, is expected to agree a fine of £400-500m next week with US and British authorities.
It is accused of attempting to rig benchmark interest rates.
Sky's City Editor Mark Kleinman said: "A Treasury source has told Sky News that the money that the US regulators will fine RBS will have to come out of the bank's bonus pot.
Sky's Mark Kleinman said the demand is politically important "It's very important politically, I think, for the Chancellor to be able to say that the taxpayer is not bearing the financial cost of misconduct by bankers who work for a company that is majority-owned by the taxpayer.
"The Treasury is obviously playing hardball on this, and we'll find out exactly how much RBS is going to be paying in fines in the coming days."
The Treasury expects the fines to be paid not just from the bonus pot for 2012 - likely to be around £250m - but money from future years' bonus pots as well.
RBS - which is 81% owned by taxpayers - is also looking to claw back up to £100m from pay deals previously awarded to executives in its investment bank.
The bank's remuneration committee, which is chaired by Penny Hughes, a non-executive director, is assessing plans for a "flat tax" on the pay packets of hundreds of directors and managing directors in its markets business.
The idea would involve about 15% of prior-year pay awards to the relevant individuals being clawed back, netting a total of as much as £100m.
"George Osborne is sending out a clear signal: 'You're paying for this, not us'," said Sky's Glen Oglaza.
"What the Treasury are saying is there won't be bonuses paid this year, but actually your bonuses are going to be clawed back not just this year but probably next year and the year after as well."
Barclays was fined £300m last year for its role in the scandal.
By Mark Kleinman, City Editor
Misbehaving banks could be forcibly broken up, George Osborne is expected to warn the industry, in a move that will pave the way for a further fundamental shake-up of Britain's banking sector.
I understand that the Chancellor is preparing to back a call by the Parliamentary Commission on Banking Standards for regulators to have powers to split so-called universal banks such as Barclays and Royal Bank of Scotland (RBS) into their separate retail and investment banking components.
An announcement by Mr Osborne, which could come as soon as next week, will lay the foundations for arguably the most radical overhaul ever of British banking.
It would potentially go much further than a plan currently passing through legislation for a ring-fence to artificially separate retail and investment banks but allow both to exist within the same corporate entity.
A senior Treasury source has told me that Mr Osborne and Vince Cable, the Business Secretary, agreed in recent weeks that the Government should back the Parliamentary Commission's blueprint for 'electrifying' the ring-fence. Mr Cable is also expected to publicly support the move next week.
The news will delight Andrew Tyrie, Chairman of the Parliamentary Commission, which was set up last summer by Mr Osborne and David Cameron in the wake of Barclays' £290m fine for rigging Libor benchmark interest rates.
The Chancellor is expected to outline his views in the same week that RBS settles with regulators for its role in the Libor scandal.
RBS, which is 82%-owned by the taxpayer, is likely to pay more than £400m in fines and is fighting to avoid a criminal prosecution by the US Department of Justice.
In the last few days, the industry's reputation has again been dragged through the mire with the City regulator ruling there had been widespread mis-selling of products designed to help small businesses manage the financial impact of sharp rises in interest rates.
"The Coalition is totally joined-up on this," one source said.
The precise detail of how Mr Osborne would want the new reserve powers to operate was unclear on Saturday.
However, he is likely to back the judgement of Mr Tyrie and his colleagues on the commission that the industry regulator should have the ability to identify individual banks which are abusing the ring-fencing framework and pursue – subject to a veto from the Treasury - full separation of that banking group's high street and investment (or "casino", as Mr Cable has dubbed it) divisions.
The Chancellor is also expected to endorse the idea put forward by Mr Tyrie that there should be periodic reviews of the effectiveness of the ring-fence across the banking industry, with the first independent review taking place four years after the new structure is in operation.
Mr Osborne has already set in process far-reaching reforms of bank regulation. The Financial Services Authority, which was created by Gordon Brown in 1997, is to be abolished, and its powers are to be divided between two new bodies: The Financial Conduct Authority and the Prudential Regulatory Authority, which will sit within the Bank of England.
In its interim report last month, the Parliamentary Commission warned that banks were likely to attempt to manipulate the ring-fencing system for their own benefit. Mr Tyrie said the current banking reform proposals "fall well short of what is required".
"Over time, the ring-fence will be tested and challenged by the banks. Politicians, too, could succumb to lobbying from banks and others, adding to pressure to put holes in the ring-fence," he said when the report was published in December.
"For the ring-fence to succeed, banks need to be discouraged from gaming the rules. All history tells us they will do this unless incentivised not to. That's why we recommend electrification. The legislation needs to set out a reserve power for separation — the regulator needs to know he can use it. Furthermore, we need periodic reviews of the sector to reassure us that the ring-fence as a whole is working."
The banking industry has lobbied furiously against the electrification move, claiming that the existence of such reserve powers to break them up will deter big City investors from buying their equity and debt.
A powerful City lobbying group, the Association of British Insurers, recently published a report on the investment case for the major UK banks, in which it argued that regulatory uncertainty was among a number of factors preventing investors from being able to commit their money to the industry confident that they would secure a commercial return.
That message will have sting in the tail for Mr Osborne, who is responsible for tens of billions of pounds-worth of taxpayers' investments in Lloyds Banking Group and RBS.
If the investor groups are correct, and the electrification proposal exacerbates that uncertainty, it risks permanently impairing the value of those shareholdings and denting the chances of ever recovering the money injected during the 2008 financial crisis.
Whitehall insiders said that the endorsement of the Parliamentary Commission's report by Sir John Vickers, whose Independent Commission on Banking (ICB) came up with the ring-fencing proposals in 2011, had "tipped the argument in favour of backing Tyrie".
Mr Osborne's move will contain a silver lining for the big banks in that he will not be endorsing the most draconian approach to policing the industry, which would have meant implementing full and immediate separation of each group's retail and investment banking operations.
The Treasury declined to comment on Saturday.
China operates the most "prolific and sophisticated" computer hacking operation in the world, according to Google chairman Eric Schmidt.
The Chinese are willing to use such underhand technology tactics for industrial espionage that it puts foreign firms at a disadvantage, Mr Schmidt says.
US firms will not retaliate because of tighter laws and a sense of "fair play", he claims.
The Google chief made his views clear in the pages of a book he has written, entitled The New Digital Age, which is out in April.
In it he writes that China is "the world's most active and enthusiastic filterer of information" and "the most sophisticated and prolific" hacker of foreign companies.
Mr Schmidt recently visited North Korea to urge more internet freedom He continues: "The disparity between American and Chinese firms and their tactics will put both the government and the companies of the United States at a distinct disadvantage" because "the United States will not take the same path of digital corporate espionage, as its laws are much stricter (and better enforced) and because illicit competition violates the American sense of fair play.
"This is a difference in values as much as a legal one."
The book has been co-written with Jared Cohen, the director of Google's 'Ideas' division, and the early drafts have been seen by the Wall Street Journal.
In recent days it has emerged the Washington Post, The Wall Street Journal, Bloomberg News and the New York Times have all had their systems hacked by the Chinese.
Mr Schmidt visited North Korea last month, in an attempt to encourage the regime to allow its citizens greater access to mobile technology and the internet.
By Mark Kleinman, City Editor
Tamara Mellon, the businesswoman who built Jimmy Choo into a globally-prominent fashion brand, is plotting a $25m comeback that will see her name adorning stores in leading cities around the world.
Sky News can exclusively reveal that Ms Mellon has lined up figures including Michael Spencer, the boss of broking firm Icap and former Conservative Party treasurer, and Tommy Hilfiger, the tycoon behind the eponymous fashion business, as investors in her new business.
Expected to be called Tamara Mellon, her lifestyle business will mark an ambitious return to the business world 15 months after she left Jimmy Choo. A non-compete agreement signed when she departed expires this month.
Ms Mellon has set her sights on securing the funds in the hope of replicating her success at the maker of upmarket women's footwear.
Her other backers will include David Ross, co-founder of The Carphone Warehouse, Lord Marland, who recently stepped down as a trade minister in the Coalition government, and Tory Burch, the fashion entrepreneur who is a close friend of Ms Mellon's.
People close to the fundraising said that Ms Mellon was keen to secure a significant amount of British investment for her new venture.
Although she now lives in the US, Ms Mellon is a British citizen and remains a Business Ambassador for the Government, which involved promoting British trade on overseas visits. She also sits on the board of Revlon, the global cosmetics group.
WH Ireland, the City broking firm, is believed to have been assembling the fundraising for Ms Mellon, which is at an advanced stage.
The new venture is understood to include plans for flagship stores selling a wide range of upmarket fashion and other products in London, Los Angeles and New York, with further openings likely as the business expands.
City sources said the fundraising deal could be announced within the next few weeks.
Ms Mellon's track record is impressive, having walked away from Jimmy Choo with an £85m fortune following its sale to Labelux, the Swiss-based fashion label collection, in 2011.
In an interview with The Sunday Times last year, Ms Mellon was candid about leaving the company she had founded and worked for since 1996.
"I didn't like the equity plan that had been put in place. The management team were asked to invest their own money in the business and hold their shares for seven years, which would then be subject to income tax and not come under capital gains. I felt it was unfair," she told the newspaper.
Ms Mellon began her fashion career from the modest foundation of a stall on Portobello Road in London, where she sold T-shirts. She later worked at the UK edition of Vogue magazine, where she met Jimmy Choo, a Malaysian-born Hackney cobbler. She went into business with him, launching a store in Knightsbridge.
The company was a huge success, making big returns for a succession of private equity-owners, although Ms Mellon has since been critical of the buyout industry, telling another newspaper last year:
"What happens in private equity is they come in and they say we're going to be a great partner. We want to hold this long term and we're going to help you nurture and build this brand, [but] the day after signing, they talked about selling the business."
A spokesman for Ms Mellon declined to comment.
