‘(1) The Secretary of State shall provide in regulations for the introduction of minimum standards for water company social tariffs, by 1 April 2013.

(2) Regulations made under subsection (1) above shall be made by statutory instrument and may not be made unless a draft has been laid before, and approved by resolution of, each House of Parliament.

(3) Ofwat shall publish 12 months after the passing of this Act and every year thereafter a league table of water companies reporting the performance of the provision of social tariffs and the number of households spending more than 3 per cent. and more than 5 per cent. of their disposable income on water bills.’.—(Gavin Shuker.)

Brought up, and read the First time.

Question put, That the clause be read a Second time.

The Committee divided:

Ayes 226, Noes 297.

Question accordingly negatived.

The Deputy Speaker resumed the Chair .

Bill reported, without amendment .

Third Reading

I beg to move, That the Bill be now read the Third time.

I begin by thanking all Members who have contributed to the debates on Second Reading and in Committee today. I pay particular tribute to Gavin Shuker, who was decent in consulting me and put forward articulately how he viewed the Bill and how he believed it could be changed. I am sure we will have many further discussions over future legislation. Many right hon. and hon. Members contributed to the debate. I pay particular tribute to my hon. Friend Miss McIntosh, who spoke with her customary knowledge on this issue.

For the record, I would like to correct an impression I might have given in Committee about the funding of water bills in the south-west. I can confirm the Government’s firm commitment that the funding will continue until the end of the next spending round. The Treasury will fund the bills until the end of the current round, and the impact on DEFRA’s budget in the next round will of course be a matter for us to discuss.

The Bill is straightforward in its intent and drafting. It fulfils two spending commitments set out by the Chancellor in his autumn statement, both of which were designed to reduce the costs of infrastructure investment falling on water and sewerage customers.

Through the amendments that we have discussed today—which I have considered carefully—ran a common thread: a desire to limit and delay Government action to help hard-pressed bill payers. After so many years of debate, we want to get on with funding South West Water to enable it to cut bills for its household customers. We have a separate package to deal with wider affordability problems. We also want to reassure potential investors in the Thames tideway tunnel at an early stage that the Government are willing to provide contingent financial support for exceptional project risk when that offers the best value for money for Thames Water customers and taxpayers.

I shall refrain from discussing the need for the tunnel today in order not to repeat myself, as on Monday the House will debate the waste water national policy statement, which includes a statement of need. On Second Reading, Members rightly mentioned their constituents’ concern about the potential local impacts of the tunnel’s construction; I assure them that they and their constituents can provide input on such issues at all appropriate stages of the planning process.

I also understand the concern that has been expressed about the breadth of the powers in the Bill, but those powers are by no means unusual in containing flexibility for the purpose of future circumstances, and they do not remove the need and opportunity for proper parliamentary scrutiny of Government spending plans in the usual way.

Our water White Paper, “Water for Life”, sent the strong message that we need to be prepared for an uncertain future. The current drought is just a small taste of what may follow if we do not act to make our water supply and sewerage systems more resilient. That will require continuing investment in infrastructure, as well as action by all of us to conserve water.

As I have said, we are confident that our system of economic regulation can ensure that bills remain affordable generally, while the existing WaterSure scheme, together with targeted social tariffs and other support delivered by water companies, can help those in need. More than £90 billion has been invested since privatisation, while bills remain on average around £1 per day. That is testimony to the strength of the current system. However, exceptional circumstances do arise. We have seen it in the south-west, and we have seen it with the Thames tunnel.

Of course, infrastructure investment does not just bring cost. As I said earlier, jobs and growth are central to the Government's agenda. Thames Water currently estimates that the Thames tunnel project would directly employ around 4,200 people in the construction and related sectors, and would provide several thousand secondary jobs in the supply chain and the wider London economy. That is not in itself a reason to support the construction of the tunnel, for obvious reasons, but it is nevertheless a big win for London and for the country in terms of what it can do for our skills base and our economy. Thames Water aims to ensure that local workers make up 20% of its tunnel construction work force.

I am grateful for the swift passage of the Bill, and for the many thoughtful contributions that have been made to our debates. As a number of Members have noted, there has been a cross-party effort by those representing constituencies in the south-west to keep the issue of high water bills in the region on the political agenda. I am pleased that Members in all parts of the House also recognise the need to deal with the sewage discharges that are sullying the most important river going through one of the most important cities in the world.

I commend the Bill to the House.

I agree that we have had a very good debate on the Bill. This week’s drought announcement illustrates the increase in weather volatility, however. If there are floods in Australia, it is likely that there will be droughts in other parts of the planet and we are going to have to plan for a lot more climate change disruptions.

As constituency MPs, we are all mindful of the fact that this April water bills will be rising by an average of 5.7%. At the same time as those bills drop on to customers’ doormats, 20 million people—about a third of our population—will be faced with a hosepipe ban across many parts of the country. The Bill puts in place assistance for the people in the south-west, however, and thereby corrects an historic injustice. It also gives powers to provide finance for infrastructure investment. We shall not oppose it on Third Reading, therefore.

I want to reflect on some of the Minister’s comments about our amendments. Amendments 1 and 2 would have introduced the principle of parliamentary scrutiny. He said Parliament does not examine spending decisions by Government, but, of course, Parliament does do that. Indeed, next week we will have the Budget and a lengthy Finance Bill that will examine Government decisions in detail.

The Water Industry Act 1991 stated that water companies could get money from the Government only if that was in the interests of national security, and that if they were ever to receive money from Government, that should be reported to Parliament. Under this Bill, that important principle of parliamentary oversight of the spending of considerable sums of taxpayers’ money is being broken.

We know that the assistance to the south-west will cost £400 million over the seven or eight years of the scheme. The Minister said it was “unimaginable” that any other water companies and customers would get public money. [Interruption.] I listened to the Minister’s remarks, and he used the word “unimaginable.” He said money would not be “sloshing” about and that the Government would not be “doling out” money to the water companies and their customers. However, in 1991 it was unimaginable to Ministers in the then Conservative Government that any water companies should ever receive money, which is why they stated that very important principle in the 1991 Act. We must not forget that the 22 water and sewerage companies are, of course, monopoly providers. At a time when bills are going up and hosepipe bans are being introduced in what is a monopoly industry, we now have to explain to our constituents why this money is being provided.

Simon Hughes talked about the debt to equity ratio of Thames Water, as well as the structuring of the company and the packaging up of debt. Government infrastructure investment bonds might be useful in this regard. We heard this morning about the new 100-year bonds. They could be a prime candidate to be the long-term investment vehicles to finance large infrastructure projects such as the Thames Water tunnel.

This Bill’s title includes the phrase “Financial Assistance”, and we know that the groups that are most vulnerable to water poverty are single parents, pensioners and jobseekers. However, only a third of such eligible households access the current WaterSure scheme. We want to see much more action from water companies to ensure that the most vulnerable access either national or company social tariffs. As my hon. Friend Julie Hilling said, we should not expect water companies to be philanthropists, and so our new clause

1 was intended to be helpful. I am sorry that the Minister thought it an unacceptable regulatory burden on water companies.

When Labour was in government, we found league tables to be a very effective benchmarking tool in driving up performance in public services—schools and hospitals—allowing consumers, customers and taxpayers to understand where their money goes and where they are getting value for money. League tables provide transparency and equity, and in providing a public service—I cannot think of a more crucial infrastructure one than water—it is very important to end the postcode lottery on people’s eligibility for financial assistance.

Labour Members think that in future financing projects we need to be very careful about the burden we place on water customers, and we use the idea of league tables as a benchmarking tool. Many companies use benchmarking groups, which, on an anonymised basis, provide data to researchers, with the companies then getting the data back so that they can benchmark their performance. We do not see anything wrong, or any regulatory burden for the companies, if these companies are forced, by the regulator, to disclose what they are doing, so that we can bring the poor performers up to the level of the best and spur the best performers on to innovation on social tariffs.

We know that the Thames tunnel will add £70 to £80 to Londoners’ bills. Obviously, a number of questions have been raised about that, but I am concerned that the House may not have a large number of opportunities to debate this infrastructure project in the future, and so we need to make sure that proper consultation takes place. The House has debated the Crossrail Bill, which was a hybrid Bill—I made my comments clear on Second Reading as to why this was not a hybrid Bill. The Thames tunnel will create up to 4,000 direct jobs and our final amendment sought to ensure that the benefit of that £4 billion investment accrues to London and Londoners, as they will be paying for it.

Let me cite the example of what I found when I travelled to the Stade de France in Paris, in 1996, and met people from Bouygues, the big French construction company which was building the stadium. The French Government had taken the decision to build it in Paris Saint-Denis, a very poor suburb. This was about 16 years ago, a long time ago, but I was shown the number of apprenticeships at levels 4, 5 and 6—we are talking about master’s-level qualifications—that would accrue throughout that construction project. As my party perhaps did in government, this Government are potentially letting construction companies off the hook by saying that it is an unacceptable regulatory burden to ask them to do more on apprenticeships. Where does the 20% apprenticeships figure come from? Over a four-year project, why can we not get bright young undergraduates in, give them the on-the-job training and make sure that they then become the next generation of London’s civil engineers?

If I may, I shall leave the last word to my hon. Friend Mr Slaughter. He talked about his young constituent rowing on the Thames, who said that we have a duty to protect our river in this great world city and that his generation is looking to our generation to build something amazing. We hope that that is what will result from today’s discussion, and that we will protect our great global capital city and one of the world’s great rivers for the next century.

It is a pleasure and a privilege to follow Mary Creagh. We have had a good debate and I warmly congratulate my hon. Friend the Minister on delivering this Bill and the official Opposition on their constructive approach. I understand their request for greater parliamentary scrutiny and their case was well argued, sincere and well meant. In relation to clause 1, the explanatory notes state in paragraph 12:

“The power is discretionary and may be exercised for such reasons as the Secretary of State feels desirable.”

Any parliamentarian will relish the opportunity of scrutinising such orders and it need not take long. Unfortunately, the Opposition failed in their quest.

The Bill covers a number of important matters. On the affordability of South West Water bills and funding, I take this opportunity to thank my hon. Friend for his remarks and the clarification. I understand that the commitment is there to fund the South West Water bill until the end of the next spending round. I personally will pledge—I am sure others will do so, too—to give him any support we can in his discussions about the funding with the Treasury.

I endorse what my hon. Friend says about the Treasury, because the situation in the south-west will not go away. We have 3% of the population and 30% of the beaches, and the beaches must be kept clean, which costs a lot of money. We will need help in the future, so if the Treasury could find that money we would be most obliged.

I am grateful to my hon. Friend for his support and I want to record how well represented the Select Committee on Environment, Food and Rural Affairs has been in the debate. He obviously has a particular interest in the south-west, and if the money is available only until the end of this spending round, we will then have to find the money for South West Water at the beginning of the next spending round. The powers are there and the Secretary of State has the discretion to extend the scheme to other areas, but, given the economic turmoil in which the country still finds itself, such a result seems highly unlikely. I shall watch this space with interest.

I know that we will continue the discussion on the Thames tunnel on Monday when we debate the waste water national policy statement, but although it is an extremely exciting project, we must not lose sight of the fact that it is a giant project. Londoners and those of us who spend our working week in London should be under no illusion about the fact that there will be a degree of disruption during its construction. I warmly welcome what my hon. Friend the Minister said about the local work force. That is very good news for the Thames tunnel and, obviously, if we have relevant expertise in Thirsk, Malton and Filey, I hope we can provide some of the work force for it.

The Committee has recently heard evidence on other issues, including the White Paper “Water for Life”, the current drought, water efficiency, regulation and introducing competition. As my hon. Friend knows, I have an interest in implementing all the outstanding recommendations of the Michael Pitt report. There is some argument that this Bill should rightly have formed part of the broader Bill that we are still waiting for, but this Bill will enable the Government to meet the commitment given in the water White Paper and confirmed in the Chancellor’s autumn statement.

The Committee stands ready, willing and enthusiastic and is looking forward to pre-legislative scrutiny of the draft water Bill. It is a matter of some regret that that Bill will be delayed, particularly as regards affordability. The water White Paper proposes that companies should be encouraged to introduce company social tariffs to help poorer customers, funded by a cross-subsidy from the water company’s other customers. The Minister said that there are many tools at the disposal of water companies, but it is appropriate that we should consider the suggestions made in the Anna Walker review.

Water affordability is increasingly becoming an issue. Ofwat figures show that 11% of households spend more than 5% of their income on their water and sewerage bill, and we now hear about water poverty as well as about fuel poverty. Company social tariffs can be introduced only where they have the broad support of the company’s customer base. Alternative approaches would be to provide Government funding for social tariffs or to operate customer cross-subsidy at a national level. I am sure we will have the opportunity to explore those ideas in the wider Bill.

Water companies have called on the Government to make available to them information regarding the customers who are most likely to be struggling with their bills—for example, from Department for Work and Pensions data on benefits—to allow them better to target their social tariffs. I listened carefully to what the Minister said and I am not sure that he was able to respond on this point, but the sooner we can make that information available the sooner we can extend these tariffs. I am delighted that the Consumer Council for Water supported this idea in the evidence that it recently gave to our Committee, and the Government have said they are considering this suggestion. I hope we will not be hampered by data protection provisions.

It was shocking to learn in a Select Committee evidence session that bad debt in the water sector costs every paying customer approximately £15 a year. A large part of the problem is the fact that there is no obligation on landlords to provide details of their tenants, which means that water companies do not know who to bill for their services. I welcome my hon. Friend’s comments. It is entirely appropriate to place a statutory obligation on landlords to provide details of their tenants or else be held liable for water bills at their properties. There is an urgent for such measures, as were included in the Flood and Water Management Act 2010. Those provisions have not yet been implemented and the Government have consulted on using a voluntary approach, which is welcome, to encourage landlords to provide information rather than implementing the provisions in the 2010 Act. Clearly, that was a source of disappointment to water companies. In their evidence to the Select Committee, they said that was a rather retrograde step and argued that the Government should implement the provisions on landlord liability as soon as possible. I am delighted to make that case to the Minister today.

The Minister is aware of my interest in and passion for SUDS—sustainable drainage systems—and I hope that we will have early implementation of those. I pay tribute to the work of Gray and the regulatory aspects of the Gray review, to the work of Anna Walker in her review and to the work of Cave in his review. I hope that the Government will give some teeth to the recommendations not only on affordability, in the measures before the House today and in the wider Bill, but also on water efficiency. This is precisely the time when we should be considering those measures because of the imminent drought. I know that the hon. Member for Wakefield will be as concerned as I am that it is reaching parts of Yorkshire, including my area. That is something on which we need to proceed apace.

I shall be delighted if we do not proceed to bring in the provisions of the 2010 Act to reduce the 25,000 cubic metre limit in reservoirs to a 10,000 cubic metre limit. My hon. Friend knows that I have been extremely patient—or not—in waiting for the provisions on reservoir safety. I hope they will come forward sooner rather than later. We are going to need more reservoirs to be built. Increasingly, engineers have a safety issue and I am sure that there would be a benefit from bringing forward that safety review.

I believe this Bill is a great success. It allows water and sewerage companies to raise the finances and investment they need, particularly in relation to the south-west. We very much look forward to the wider draft Bill, but I commend this Bill and wish it a speedy and fair passage through the other place.

Perhaps we should have more of these short Bills as they provoke such agreement between the two Front Benches. It is slightly surprising that there is such a degree of agreement, given that when the Bill is stripped down, it is about two specific initiatives. I have heard the argument about whether it should be a private or a hybrid Bill. It is a public Bill, but unless the Minister wishes to correct me, we are talking, first, about the subsidy to South West Water customers, and secondly, about the underwriting of the Thames tunnel scheme, both of which potentially commit large sums of public money. Given the rhetoric about public money that we have to hear all the time from the pattern book of this Government, and given the concerns expressed from the Opposition Front Bench, we can say that this must be an important measure or we would not be undertaking those commitments.

My first concern is about the Government’s reluctance to support the amendments tabled by the Opposition. I am at a loss to understand why that is the case. I hear what the Government say about the control of finance, as addressed in clause 2, but it seems to me, without going to the lengths to which Simon Hughes went in pinning down the fine detail, it is important that the House continues to have a supervisory role and scrutiny of the finance of projects, particularly given what we have heard about Thames Water, in whatever guise or ownership. The same would apply to other water companies. I believe that the chief executive of Thames Water had a salary package of about £1.6 million last year. There is a lot of money sloshing around in the utilities companies.

Although I do not accept that the Thames tunnel is over-specified or is doing more than is needed for the job, we need to keep a close eye on the project. It is, as I said, an unfortunate outcome of the previous Conservative Government’s privatisation strategy that we have, potentially, people running our utilities who are more interested in their shareholders and their remuneration than in the welfare of their water customers. That gives us a particular responsibility, and I cannot understand why the Government will not accept what we propose.

Water bills are rising, and any project designed to relieve the problems of sewer flooding in London or flooding into the Thames will cost a lot of money and will inevitably add to bills. That is another reason for controlling costs and for protecting those who cannot afford to pay. That was the purpose of new clause 1. Again, I cannot see why that has been rejected by the Government at this stage. It is disappointing and shows a lack of concern on the Government’s part about the potential financial impacts of these measures.

Another concern I have—I shall be brief, as I spoke about this on Second Reading—is about those who would muddy the waters, so to speak, on the Thames tunnel project. If anybody can come up with a cheaper project that will have the same or better effect, I am sure it would be extremely welcome and we would all like to hear about it.

I shall say something nice about Mr Binnie, who has had a bit of a rough ride in the debate. He is, after all, speaking as a professional and, given his previous association with the Thames study, as someone who cares genuinely about the quality of water in the Thames. Even at his most sceptical, before his second road to Damascus conversion, he said:

“The full tunnel would be the best thing for the river…Are there cheaper alternatives for producing similar results?”

The same question was posed by the right hon. Member for Bermondsey and Old Southwark. Mr Binnie’s answer, on mature and professional reflection, is no, there is not.

I do not think that that means we should stop looking for ways of bringing down the cost. Indeed, the cost has already been reduced by adapting the route of the tunnel that was previously envisaged. I hope that the Government will take that on board and not simply accept that the current route, the current CSO linkages and such matters are a done deal and a fait accompli. That is important not only with regard to cost, but in relation to the disruption that will be caused where the CSOs are linked to the river—I declare an interest, as one of those CSOs will be in my constituency and two are close by. Substantial progress has been made, because originally many more riverside sites were going to see that level of disruption. We are working on that all the time. Let us not stop working on that and trying to find solutions that will be less disruptive for local communities in London.

As I have said, there are some loud naysayers. I am afraid that the Selborne commission lacked all coherence. Its report did not even contain the proposal for the half tunnel that was in its press release. Anyone who has looked at that proposal will realise that it is simply a nonstarter, and for those who live in west London, as my constituents and I do, it would be a complete nightmare. Not only would it cause greater disruption, because there would have to be more storage points—clearly, there is nowhere for the sewage to go once the tunnel fills up—but the sewage would stay in the tunnel and fester for days or weeks before being taken away by the existing sewerage system. I can see why it might have had a superficial attraction for the right hon. Member for Bermondsey and Old Southwark, because it would not have caused disruption in his constituency, but sooner or later we would have had to face up to the fact that we must have something that works.

When I hear the leader of my local council saying that we cannot afford to make the river clean enough for fish, or my neighbouring MP saying that rowers and sailors are seeking a personal benefit by not having the river flooded with sewage every week, I have to ask that they grow up a bit and are a little more sensible. As the shadow Secretary of State, my hon. Friend Mary Creagh said when quoting my constituent, Conor, a 15-year-old can put us right and tell us that we ought to have the courage and enthusiasm that our forefathers had when they designed the great civil engineering projects of the 19th century, and indeed the enthusiasm we have in supporting schemes such as Crossrail and High Speed 2, which are much bigger than the Thames tunnel. We must bear in mind two slightly contradictory facts as we go forward. First, cost control is not just important as a matter of probity, but absolutely vital, particularly for those on low incomes who will be paying the bills. Secondly, whatever version of the tunnel is finally approved, it has to be fit for purpose not only now, but for the next 100 years.

I congratulate all those Members, particularly those from the south-west, who have contributed and campaigned, in many cases for two decades, to achieve what is certainly a positive outcome—I will not describe it as a triumph—and one that is richly deserved and will certainly alleviate some of the pressure that many South West Water customers have had to endure for a very long time. When the Government bring forward this measure, it is important that they look at ensuring that South West Water delivers it efficiently and effectively and reflect on the impact it will have on water affordability for customers in the south-west.

Mary Creagh, the shadow Secretary of State, following the words of the Minister on the issue, implied—I think, because this has been a fairly consensual Third Reading—that there was somehow a risk of some of the money benefiting the company itself. But I was reassured earlier in the debate by the Minister’s response, in that not one penny should fall by accident or design into the pockets of the company or its shareholders. It should not touch the sides as it goes through to benefit customers, and it is really important that that—certainly the Minister’s reassurance—is delivered after the Bill is enacted.

My right hon. Friend Simon Hughes, through his amendments, raised some important concerns that I know my hon. Friend the Minister will take on board as the contracts for the tunnel are let. I recognise that issues of probity and the effectiveness of regulation, in ensuring that the taxpayers’ interest—the public interest—is protected by the way in which this essential project is rolled forward, will need to be taken account of.

I hope that the contribution of my right hon. Friend and others to today’s debate—it is reassuring having two learned Members watching what Thames Water will do—indicates the manner in which the company will be handled and the manner in which concerns, one could argue, might reasonably be raised about any benefit to its customers, because it is important that as this essential project is rolled out those central public and taxpayer interests are clearly protected. I know that my hon. Friend the Minister will be seized of that great importance.

Given the comments that have been made, certainly by the hon. Member for Wakefield and others, perhaps the Bill has been incorrectly titled now that we reflect on it. Instead of being called the Water Industry (Financial Assistance) Bill, it might have been called the water customer (financial alleviation)—or (financial protection)—Bill, because in effect that is how the Minister described the Bill’s purpose, and that is what the Bill attempts to do. I do not propose on Third Reading to introduce an amendment to the title of the Bill, but by making that point I hope simply to emphasise its importance in protecting customers and taxpayers. I certainly hope that that is taken forward.

Finally, I congratulate the Government, and especially the Minister, on the elegance, charm and good humour with which he has brought forward the Bill. It explains how the Bill was brought forward so quickly and effectively, with cross-party support and consensus. The debate has been very constructive, and I am sure that the Bill will not be held up in another place but will be enacted quickly and be to the benefit of customers in the south-west and in the Thames region.

Briefly, I too welcome our constructive debate over the past few weeks and the Minister’s helpful response. I have two things to say.

First, I want to flag up the important point, made by a Labour Front Bencher but supported by Members across the House, that as we do big infrastructure projects we absolutely have a general interest to ensure that they maximise the development and use of our home-grown talents and skills—I do not say that in a racist way; I mean those people who live in this country, who have skills to contribute and who are here—so that for generations to come, one generation’s learning, whether in engineering, building or all the rest, can be carried on. If the Thames tunnel goes ahead, either in its currently proposed form or as a variation on it, I hope that from the beginning we build in such a plan that, as it were, sweeps in the work force and the training with it. If we do that, it will command much more public confidence as well us giving us continuing skills and opportunities for the future.

My hon. Friend Mark Field, who is not in his place at the moment, was fully engaged in the earlier debate about the financing of major projects and asked me about the five-year cost-profit ratio figures for Thames Water. I could not answer him at that point, but I have since had the figures checked, and I will put them on the record.

In the year ending 2007, the cost-profit figure after tax for Thames Water’s activities was £234 million and the dividend paid was £594 million. That represented an excess of £360 million in dividend payments over income—exceptional, unusual and clearly not good precedent as normal practice. In the following two years, there was a much more normal pattern, with £382 million of cost-profit and £105 million of dividends, and therefore a net retention of profits of £276 million. In 2009, there was £285 million of cost-profit and £226 million of dividends paid out, thus retaining a sum of £58 million. In the past two years, the picture has slipped back to something much less healthy. In the year ending 2010, there was £237 million of cost-profit, after taxation, on activities, with dividends paid out of £295 million, and therefore £57 million more paid out than money retained. In the last financial year for which we have figures, cost-profit was £247 million and dividends paid out were £262 million, with therefore a net excess payout of £14 million.

I hope that those figures are accurate, as I am reliably informed that they are. They make the general point that when the Government are being asked to support private sector activity and private sector companies, we should ensure—whatever those companies’ relationships with each other in a collection of companies—that they have had disciplined financial activity that does not result in taxpayers, council tax payers or ratepayers being asked to foot bills that should be met by the companies themselves but are not being met because they have paid off the money elsewhere to shareholders who walk away with the profits. When they come to the table in future to say that they want joint enterprises, supported by Government, for major infrastructure projects, whether they be tunnels, roads, bridges, schools, hospitals or whatever else, we need to make sure that there has been ethical and appropriate financial accounting.

My plea is that we should learn these lessons across the regulatory activities and across public finance to ensure that the Treasury is not put into a difficult position. I hope that Thames Water and the other water companies all over the UK hear this message loud and clear: “We are watching you, and as a Parliament and, I hope, a Government we will be very insistent that there is good value for the taxpayer, council tax payer and water rate payer, and that you do not take out money from projects that should be there for investment but pay your full and proper share.”

It is a great pleasure for those of us from the south-west to be talking about some measure of help for our constituents who have laboured for a long time under an unfair burden of very high bills. That is a legacy given to them by privatisation, which has hardly been mentioned without the word “botched” in front of it, certainly in the case of Government Members, but also Labour Members; I am delighted that they have followed the same pattern.

Two great injustices were done to my constituents at the time of water privatisation in the late 1980s and early ’90s. The second one, sadly, has become topical in the context of this debate.

The first injustice, as I have said, was the lack of a sufficient green dowry to deal with the huge cost of cleaning up the sewage along the beautiful coastline of Devon and Cornwall. That work has been done and has been funded by the bill payers of the south-west, through extra debts taken on by the company. We have praised the steps that the management of the company have taken in recent years to engage with the Government, Members of Parliament and their customers to get to where we are today. I would also like to pay tribute to former Members of this House who are not here to blow their own trumpet, although I am sure that they would be too modest to do so anyway. Linda Gilroy has been mentioned. I would also like to mention Julia Goldsworthy, the former Member for Falmouth and Camborne, who did a great deal both inside and outside this place to advance this cause.

The second injustice followed the incident in July 1988 in which 20 tonnes of aluminium sulphate was dumped into the water at the Lowermoor water treatment works. For about a fortnight, 20,000 residents in that part of North Cornwall were unaware that they were drinking a potentially poisonous cocktail. The aluminium sulphate generated acids that flushed out everything else in the pipes and it was in the water supply for many days. My predecessor, Lord Tyler, campaigned for a full inquiry into that issue before he was elected to this place and afterwards. Mr Meacher, when he was a Minister, at least commissioned a committee to look into the issue.

I am grateful for your forbearance, Mr Deputy Speaker, in allowing me to raise this matter today. The reason I do so is that Michael Rose, the West Somerset coroner, has issued a narrative verdict today on the sad death of Mrs Carole Cross in 2004. Her husband, Doug Cross, was one of the members of the committee, along with Peter Smith, a lay member who was from the area and experienced the incident. Doug Cross has been a tireless campaigner on behalf of the people who were affected by the incident. It is tragic that he lost his wife.

The coroner’s verdict today was that there was a “very real possibility” that the ingestion of aluminium contributed to the death of Mrs Cross. He also criticised the South West Water board for

“gambling with as many as 20,000 lives” by not telling people about the incident for a fortnight. There was also evidence, thanks mostly to the work of Lord Tyler, the Western Morning News and others over the years, of a cover-up at the time of privatisation. The coroner said that it was “deeply suspicious” that the incident was handled in the way it was, due to the impending privatisation.

People in North Cornwall and elsewhere will want to reflect on what the coroner has said today. However, I believe that the many people who have been arguing for years in the face of the response from Government that what they experienced did not really happen and that the medical consequences were all in their minds will feel that there is some real progress. I hope that we will now start to get the answers that people should have had at the time of privatisation. I hope that the way in which the Minister and his colleagues have today dealt with the injustice of the inadequate green dowry will be matched by a proper inquiry into and discussion of the incidents following the pollution of the water at Lowermoor in 1988.

Question put and agreed to.

Bill accordingly read the Third time and passed.