Water firm United Utilities has said it plans to cut household bills by 4.1% in real terms over five years after its initial price strategy for the period was given the thumbs-down by regulator Ofwat.

The company, which provides water and sewerage services for Wirral had previously said it would make a 2.3% reduction over 2015-20.

It was one of three companies which were given further time to review their plans due to a "very material gap" between their expenditure projections and Ofwat's view in its draft determination (DD) on them.

The firm responded today following "detailed discussions" with the watchdog.

It said: "In providing our response to the DD, we have reflected our aim to continue to provide the best service to customers, at the lowest sustainable cost and in a responsible manner while delivering value for shareholders.

"In light of this, we have challenged our efficiency plans further and set, where practical, more stretching targets beyond those contained in our original business plan submission.

"Our revised plan would result in average household bills falling by 4.1% in real terms over the 2015-20 period, compared with a 2.3% reduction in our June plan."

Ofwat said in August that household water and sewerage bills were set to be about 5% lower on average in real terms over the five-year period.

The figure, which excludes inflation, was based on its draft determination on price controls for all 18 water companies in England and Wales. A final decision on bills will be made in December.