Takeover bids for the privatised utilities are subject to normal merger control procedures. However, special arrangements apply to mergers between water companies.
Now that the Government's golden shares have been lifted, the privatised utilities will become very juicy targets for a plethora of takeover bids. Why is the Government's regulatory framework so hopelessly weak as to allow massive profits and a host of boardroom excesses? What hope is there for effective regulation if a privatised utility is taken over by a large conglomerate?
As I have said previously when dealing with questions about the Trafalgar House and Northern Electric issue, the powers of the regulator remain, whether or not there is a takeover. I note that there is some argument in the press to the effect that the whole business of the bid for Northern Electric was a factor which led the regulator to reopen the question of prices. I remind the hon. Gentleman that under the last Labour Government the price of electricity went up by 2 per cent. every six weeks. Under the present Government, the price of electricity has fallen. That is the answer to the hon. Gentleman's question.
Is my hon. Friend aware that our water companies' average price is the lowest in Europe and that their investment is the highest in Europe? Surely what is important is the service to the customer, not who owns the individual company.
My hon. Friend is right. The water companies' record not only in the matters to which he has drawn attention, but in terms of investment, has been spectacular and contrasts markedly with investment when they were in the public sector under the Labour Government. Some £12 billion has been invested in the water infrastructure. It would be helpful if Labour Members paid due credit to that.
What powers will the Government use to prevent a takeover in the event of an offer being made for a company such as Welsh Water? That company has a large retained profits level, which only this week has come under criticism from Ofwat in Wales. Will the Minister give an assurance that the Government will intervene to ensure that no such takeover took place?
I should point out two factors to the hon. Gentleman. Not only has significant investment taken place in the water industry in Wales, but, as the hon. Gentleman in particular should be aware, Welsh Water is slightly distinct from other water companies in that the 15 per cent. share which applies in relation to the special shares of other water companies is retained by Welsh Water and can be changed only by a 75 per cent. vote of shareholders. In the circumstances, that should be of some solace to the hon. Gentleman.
I am not sure how that question fits in with the general line of the hon. Member for Carmarthen (Mr. Williams). As so many stories from so many different directions have been produced so often by Opposition Members, I do not propose to engage in rumour-mongering with Opposition Front-Bench spokesmen.