THAMES Water has been told is must go back to the drawing board and cut more costs from its business plan.

The company, which provides water to homes across Oxfordshire, has been told it needs to 'substantially rework and resubmit' the plan it unveiled with much fanfare last year.

Regulator Ofwat has been giving its initial assessment of all the plans put forward by Britain's water companies to cover the period 2020-25.

Passing only three of 17 plans, it said the others need to be resubmitted by April 1 with changes.

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Thames Water's £11.7bn scheme unveiled in September promised to improve infrastructure, service and efficiency across its network.

But Ofwat was not convinced leakage could be reduced and said costs were 25 per cent higher than expected.

It was placed in the bottom category of requiring 'significant scrutiny'.

Ofwat's chief executive Rachel Fletcher said: "We’re seeing an increased focus on the things closest to people’s hearts such as keeping bills affordable, cutting leakage, protecting the environment and helping those most in need.

"Three companies have already stepped up to the mark with high quality plans and stretching commitments to customers for the next five years.

"The rest of the sector now needs to meet this high standard so that customers across the country get better and more efficient services”.

Steve Robertson, chief executive of Thames Water, said the group was 'disappointed' with Ofwat’s announcement.

He said: “We are seeking Ofwat’s permission to invest more in areas where we know it is needed. Instead, it appears that we are being asked to reduce our current levels of spending.

“We are concerned that this will make it harder to meet the needs and expectations of our customers, amid the challenges of population growth and climate change.

“We’ll now study the feedback in detail and look forward to engaging constructively with Ofwat throughout this process."