Water companies will be allowed to offer concessionary rates to charities and sports clubs under a change in the law to be announced today by Hilary Benn, the environment secretary.

Thousands of groups including voluntary organisations, places of worship, football clubs and tennis clubs reacted angrily after a new "rainwater tax" introduced in April 2008 left them with crippling bills that forced them to cut back on their activities or face closure. The water companies complained that they were unable to offer discounts to charities under laws that ban them from subsidising one group of customers at the expense of another.

But Benn will announce in his speech to the Labour conference in Brighton today that the government will be introducing legislation to enable water companies to offer concessions on drainage bills to specific groups such as clubs and charities. The move will be included in the floods and water management bill, which was announced in June as part of the government's draft legislative programme.

Drainage bills for voluntary groups were previously based on rateable value, often calculated as zero. But last year several companies including United Utilities, Northumbrian Water and Yorkshire Water started charging the full cost of draining rainwater from roofs, car parks and other surfaces with no natural drainage.

The Scouts, the Church of England, and former England sports stars Brian Moore and Mike Gatting were among the tens of thousands that protested about the change in policy, while a petition against the "rainwater tax" topped the No 10 website's list for several months.

Nick Herbert, the shadow environment secretary, said today: "Before the summer, ministers resisted our calls for legislation to help vulnerable community groups, saying that new guidance would be sufficient.

"Charities and amateur sports clubs have been rightly concerned about how they can afford sharp rises in water bills and if only ministers had followed our proposals at the time then months of uncertainty could have been avoided."

Source: The Guardian 28/09/09