Pre-heat the oven to 150 degrees Celsius /130 degrees Celsius for a fan oven/Gas 2.
First make the caramel. Measure the granulated sugar and water into a clean stainless steel pan. Dissolve the sugar slowly, stirring with a wooden spoon over a low heat. When there are no sugar granules left, stop stirring and boil for a few minutes until the sugar turns a golden straw colour. Remove from the heat and quickly pour into the base of the warmed ramekins. Set aside to cool and become hard, then butter the sides of the ramekins above the level of the caramel. To make the custard, whisk the eggs, vanilla extract and caster sugar together in a bowl until well mixed. Pour the milk into a saucepan, gently heat, over a low heat until you can still just dip your finger in for a moment. Pour the hot milk onto eggs, whisking until smooth.
Strain the mixture into a jug, and then pour into the prepared ramekins. Stand the ramekins into a roasting tin and fill the tin half-way with boiling water. Cook in the oven at 150 degrees celsius (302°F / Gas Mark 2) for about 20-30 minutes or until the custard has set. Do not overcook the custard – check around the edges of the dishes, to make sure no bubbles are appearing. When cool, transfer to the fridge overnight so that the caramel is absorbed into the custard. To serve, place a side plate on top of the ramekins and turn upside down. Serve with pouring cream.