Sept 29 (Reuters) - British water supplier Severn Trent said on Friday it would raise 1 billion pounds ($1.2 billion) in new equity to help finance an investment drive and clean up rivers.

The firm, whose shares were up about 4% in early trade, also said it planned 12.9 billion pounds in total expenditure across the next five-year regulatory period in a programme expected to create 7,000 jobs across central England.

Britain's water companies have come under fire from customers and government for their environmental record.

A jump in the number of sewage releases across Britain over the last five years has shattered confidence in a privatised model which has permitted shareholders and executives to profit at the expense of clean rivers and beaches.

Severn Trent also laid out plans to reduce spills and pollution in its five-year plan.

CEO Liv Garfield said in a statement that "commitment to a sustainable future" was at the heart of the plan, ensuring "healthier rivers, to providing thousands of jobs, fewer leaks and a water supply ready for the impacts of climate change and population growth".

The equity increase, including raising 500 million pounds from Qatar's sovereign wealth fund, is expected to represent about 19% of the firm's issued share capital.

Qatar is currently the third-biggest shareholder in Seven Trent with a 4.6% stake, according to LSEG data.

The London-listed firm said it had made a good start to the financial year and remained on track to deliver at least 50 million pounds in customer outcome delivery incentives - a performance gauge used by regulator Ofwat - this year.

The new share issue comprises a non pre-emptive placing to insitutional investors to raise 500 million pounds and a subscription of 500 million from the Qatar sovereign fund. There is also a retail offer for 8 million pounds. (Reporting by Aby Jose Koilparambil and Yadarisa Shabong in Bengaluru; Editing by Mark Potter and David Holmes)