The Queensland Government is planning to increase the cost of water by 3.5 per cent next month.

Bulk water charges will increase by $3.94 per quarter for the average bill, a rise above the rate of inflation.

The new rates were set before the outbreak of COVID-19 by the Queensland Competition Authority.

Deputy Premier Steven Miles was asked why the state is slugging people more for water at a time of extreme economic distress. He said the Government is easing the cost of living for families in other ways.

Queensland residents will receive a $200 COVID-rebate on their water and electricity bills this quarter.

“The decision we made was that the best way to relieve the financial pressure on households was that $200 rebate and that's what we've implemented,” Mr Miles said.

“That's the kind of targeted initiative that we are using to relive the financial pressure on Queensland families.”

South East Queensland provider Urban Utilities has put a six-month freeze on current water and sewerage prices, but as of next year, Urban Utilities will apply a 2.7 per cent price increase in Brisbane, and between 1 per cent and 4 per cent in other areas.

The double price-hike should mean a total price rise of about $10 per quarter for homeowners in the Brisbane area.