BRADFORD-based Yorkshire Water has been told to offer cheaper bills to poorer families – or risk losing its licence

Labour unveiled plans to hand the water watchdog power to strip companies of their licences if they fail to help customers who are struggling to pay.

And it ‘named-and-shamed’ Yorkshire Water among 16 companies that currently fail to provide cut-price ‘social tariffs’.

The water company responded by sayiong it was "examining options" for introducing a social tariff in the future, adding that it was committed to helping customers who were in hardship.

In her conference speech, Maria Eagle, Labour’s environment spokesman, said water bills were rising, with “one in five customers struggling to pay”.

Yet, last year, the water companies paid £1.8bn in dividends to shareholders, which amounted to 90 per cent of the £2.03bn they made in profits.

Meanwhile, only six of the UK’s 22 water and sewerage companies provided voluntary social tariffs – to a puny total of just over 25,000 customers.

Miss Eagle told delegates: “We need a new deal with the water companies and Labour will deliver it, focused on affordability and fairness for all.

“We will reform the industry, creating a national affordability scheme – compulsory for all water companies - to help people struggling to pay their bills wherever they live in the UK.”

Miss Eagle said the new powers for regulator Ofwat to modify water company licenses would be the first since privatisation of the industry, in the 1980s.

A Yorkshire Water spokesman said the firm did not provide discounts to poorer customers, claiming those households did not want such an offer.

But he added: "We already help our most vulnerable customers who are genuinely struggling to pay their bill, amounting to more than £3m of support to such customers last year alone.

"However, we are currently examining options for introducing a social tariff in the future. We remain committed to help customers who are in hardship and encourage them to contact us to understand the help we can provide.”

In a speech at the same conference, Ms Eagle also announced that local councils would be given the power to combat air pollution in their area under a Labour government.

Miss Eagle said the coalition Government had forced councils to pay European Union fines for missing air quality targets in their areas yet there was no national framework to tackle pollution.

Labour would therefore devolve powers to local authorities so they can take measures to bring pollution down.

Miss Eagle also announced that Labour would create a national plan for low emission zones to encourage greener vehicles.