Yorkshire Water has introduced hosepipe restrictions after the region recorded its driest spring in 132 years.

Yorkshire received just 15cm of rainfall between February and June, less than half of what is expected in an average year, pushing the region to an official drought status.

Its reservoirs are 55.8% full, which is 26.1 percentage points lower than what they would normally be at this time of year.

Dave Kaye, the director of water at Yorkshire Water, said action was necessary now to “help conserve water and protect Yorkshire’s environment”.

“From Friday this week, people across Yorkshire will need to stop using their hosepipes to water their gardens, wash their cars or for any other activities. Introducing these restrictions is not a decision we have taken lightly, and we’ve been doing everything we can to avoid having to put them in place,” he said.

The restrictions will come into force on 11 July. They will stop people from using a hosepipe to water gardens, wash private vehicles, fill domestic pools or clean outdoor surfaces.

People can still wash their car and water their gardens using tap water from a bucket or watering can. Businesses can use a hosepipe if it is directly related to a commercial purpose.

Mark Lloyd, the chief executive of the charity the Rivers Trust, said further hosepipe restrictions are likely to come in other areas of the country.

“Sadly, the measures will also probably include drought permits that allow the company to take more water from rivers than normal, which will have severe impacts on river wildlife which is already struggling,” he said. “It will be very surprising if other companies don’t have to follow suit unless the weather changes dramatically.”

The supplier, which serves 5 million customers across Yorkshire and parts of north Lincolnshire and Derbyshire, is owned by Kelda Group.

Yorkshire Water paid £37.5m dividends for the six months to 30 September 2024 to its parent, up from £17.7m during the same period in 2023. The company paid £84.1m in dividends within its group structure in its latest full financial year. The dividends were not distributed to external shareholders.

Last year the chief executive and chief financial officers at Yorkshire Water were handed a combined £616,000 in bonuses for a year in which thousands of its customers were affected for weeks by a burst water pipe.

Under new powers in Labour’s Water (Special Measures) Act 2025, the regulator, Ofwat, can ban bonuses for water executives where a company fails to meet key standards on environmental and financial performance, or is convicted of a criminal offence.

Under the rules, six water providers – including Thames Water, Southern Water, United Utilities, Wessex Water, Anglian Water and Yorkshire Water – were banned from paying “unfair” bonuses to their executives this year.

The boss of Yorkshire Water said she had decided to turn her bonus down this year, before the legislation was introduced. Nicola Shaw, who accepted a £371,000 bonus last year, said it would “not be appropriate” to accept the payment this year, acknowledging that the supplier needed to “do better” on tackling pollution.

It comes as customers must pay higher water bills until the end of the decade, to help fund investment in better water and sewage infrastructure. The average annual bill for Yorkshire Water is £430, according to Ofwat, and is expected to rise by 35% by 2030.

Last month Yorkshire officially moved to drought status after a prolonged period of low rainfall. In May, north-west England also entered drought status, as reservoir levels fell to half their capacity. Much of the rest of the country is in prolonged dry status, which is the step before drought.

Consumers across England have been asked to conserve water as summer begins amid low river flows, groundwater levels and reservoir levels.

The regions at most risk of running out of water at the moment are those which rely largely on reservoirs rather than groundwater.

This is because the wet autumn and winter of 2024-25 allowed for the aquifers – the water below ground – to recharge. This means southeastern areas, which have good aquifers, are in a better position now than those in the Midlands and north of the country.

However, more dry weather could cause the aquifer levels to begin to dwindle as well.

When water supplies run dry, companies often apply for river abstraction licences. But rivers across the country, except in parts of the north-west, are at exceptionally low levels, so any further abstraction would pose a risk of great ecological harm.

Water companies have been criticised in past droughts for not implementing hosepipe bans quickly enough, and accused of not doing so because bosses were too concerned about affecting customer satisfaction scores, which influence their rating with the regulator. As of this year, this rating now dictates whether chief executives can get a bonus.

A divided Reserve Bank of Australia has held rates at 3.85%, in a surprise decision that denies further mortgage relief for millions of households.

The split decision came as a shock to financial markets and a large majority of experts who were sure the RBA board would cut interest rates for a second straight meeting.

Weak growth at the start of the year, easing inflation, and serious worries about the impact of Donald Trump’s trade war on the global economy were all cited as reasons for a third rate cut of 2025.

The RBA board was split, with six voting in favour of keeping rates on hold, and three against, shifting away from recent consensus decisions.

The RBA governor, Michele Bullock, said at a post-decision media briefing the board was united in its view on the direction of interest rates, just not on the timing of cuts.

Bullock said she understood mortgaged households were keen to see interest rates fall, and denied that the surprise decision to hold was a betrayal.

“Betrayal would be to let inflation get out of hand,” Bullock said.

“We’re never going to go back from the level of prices now, but we can at least stop them from rising as quickly.”

Bullock said the board would wait to see if the quarterly inflation data, due out at the end of July, showed another decline before deciding on a possible rate cut.

The monthly inflation data published in late June that fuelled expectations of a rate cut can be volatile and is viewed as less authoritative than quarterly figures.

Split decision

The decision, which was contrary to the near consensus economist forecasts ahead of the announcement, has raised questions over the RBA’s communication strategy, which is an area it had promised to improve on following criticism during the pandemic.

Bullock defended the central bank’s communication on Tuesday.

“I know a lot of people are really certain that they know exactly what to do and exactly how to get there; I’m not quite so certain,” she said.

While the RBA’s rate decision statement shows there was a split in Tuesday’s vote, the records do not show how Bullock, or any other member, voted. Economists at ANZ said the split decision showed a “reasonable degree of divergence for a board that has traditionally tried to arrive at decisions by consensus”.

The RBA will now have more time to weigh up any further fallout from Donald Trump’s tariff regime and its shifting timelines.

Bullock said some global trade risks had abated since the RBA last met, a factor that alleviated the need for an imminent rate cut.

“But this is a very fluid situation, and we will continue to watch the data here and overseas very closely to see how things play out,” she said.

The treasurer, Jim Chalmers, said it was “not the result millions of Australians were hoping for”.

“We have made substantial and sustained progress on inflation which is why interest rates have already been cut twice in five months this year,” Chalmers said.

“We’ve seen elsewhere that when central banks cut rates, they don’t always cut at every meeting.”

The chief economist at Betashares, David Bassanese, was one of a small group of RBA watchers who had expected the central bank to keep rates on hold.

He said after the decision that the anticipated rate cut was “delayed not denied”.

“In that sense, this is very much a rate cut delayed not denied – the millions of Australian mortgage holders have only a few weeks to wait for relief,” Bassanese said.

Falling borrowing costs have added “gusto” to the property market in recent months, with prices at peak levels in Sydney, Brisbane, Adelaide, Perth and Darwin. There has also been a recovery in Melbourne and Hobart.

The RBA’s rate-setting board will announce its next decision on 12 August.