My Lords, in moving the amendment I shall speak also to Amendment No. 121. The amendment is supported by the Liberal Democrat Benches. It asks that the consumer council for water should be included in Schedule 4.
Amendment No. 121 deals specifically with the codes and obligations that are to be placed on licensed water suppliers, affecting their conduct. I beg to move.
My Lords, Amendment No. 118 would require the Secretary of State or the Assembly to consult the council when proposing to alter the eligibility threshold for competition. The Secretary of State and the Assembly are committed to full consultation on most of the decisions they make. In this case, other than the authority, which has to operate the competition regime, important parties such as the Drinking Water Inspectorate and the Environment Agency, which will be consulted along with the council, are also not listed in the Bill. There is no reason to single out the consumer council for water, especially when the effects of the competition threshold can be just as significant to the interests of the other regulators.
Amendment No. 121 proposes amendments to the clause on standard conditions of water supply licenses. While we agree with the principle that the council should be consulted where appropriate, we do not think the amendment is necessary. If obligations are being imposed, the proposals are likely to be a modification of the standard conditions themselves. Amendment No. 122, which we will be debating next, will ensure that the council is consulted in such cases.
If there were codes to aid or govern the practice of licensed suppliers, we would expect appropriate consultation. In most cases that would involve consultation with the council, but there may be technical issues where consultation with the council would not be required. It would be an unnecessary burden on the council and the authority to insist on inappropriate consultation.
The second part of the amendment would require directors or representatives of the companies that are licensed water suppliers to attend council committee meetings. That is not necessary. The current obligation for undertakers to attend committee meetings is included in the standard appointment condition and is therefore not covered in primary legislation. We would expect a similar licence condition to be applied to licensed water suppliers. That will be consulted on. For those reasons I hope that the noble Baroness, Lady Byford, will not press the amendment.
My Lords, before the Minister sits down, I want to tease out why the consumer council for water should not be mentioned in the Bill. The Bill is very technical, but water is a consumer issue. The consumer does not get much say in any of this. The consumer council for water is an important body. The current WaterVoice people are very helpful. They get deeply involved in all the issues of the organisation and they should be consulted.
My Lords, I could not agree more that the consumer council for water is very important. I am sure that the noble Baroness, Lady O'Cathain, would agree that it is also important to recognise the role of the Drinking Water Inspectorate and the Environment Agency. I hope that that answer satisfies the noble Baroness. If not, I would be only too pleased to clarify the position between now and the next stage.
My Lords, I am grateful to the noble Baroness, Lady Farrington, for that clarification. We continue to feel that the water council should be defined in the clause. She referred to the Drinking Water Inspectorate and the Environment Agency. If she feels that the consumer council, in having its name in the Bill, would take priority over those two bodies, perhaps the Government should consider adding all three names. In that way, all three bodies could be consulted. The noble Baroness suggested earlier that that was not necessary and that the bodies were already in the Bill.
My Lords, I must reconsider the matter.
The Minister was unhappy about Amendment No. 121, especially paragraph (b), which deals with directors and other representatives. In answer to my noble friend Lady O'Cathain, when we drafted the amendment we had not specified whether the directors were executive or non-executive. That is something that I need to clarify.
I apologise to the House for being somewhat unprepared at the restart. I beg leave to withdraw the amendment.
My Lords, noble Lords from the Opposition Benches have tabled amendments that are broadly similar to Government amendments. We said in Committee that we would consider such amendments alongside the intention to extend the council's remit to monitoring licensed water suppliers. We have considered the matter further and agree that the council needs to be kept informed of new and amended licences.
The government amendments differ from the otherwise identical amendments tabled by both opposition parties, in that we have used the term "Council", which is the shortened name of the consumer council for water throughout the Bill. Given that we all have the same objectives, I hope that noble Lords will withdraw their amendments in favour of the Government's, in those cases where there is a slight difference in drafting or placement. I beg to move.
My Lords, I thank the Minister for responding to the long discussions that we had in Committee. Brevity is always an advantage and, although I hate giving way, on this occasion the Government have the edge on us. We are quite happy to accept their amendments referring to the "Council", which obviously means the consumer council for water.
My Lords, Amendment No. 135 seeks to insert the word "quantifiable" into the question of costs, which is what this particular part of the Bill deals with—costs as between water suppliers and water companies.
This is a slightly obscure but very important argument. I wish that I could abbreviate it but I regret that I cannot. A water undertaker—that is a major water company—loses a customer to a licensed water supplier who requests the undertaker to lay some pipes through which he will supply the undertaker's water to the undertaker's former customer. The undertaker is obliged to do so and charges the supplier accordingly. He is entitled to do so and that seems absolutely right.
But at that point the supplier can put up an argument to the effect that the charge is not payable as there are balancing items as follows. The customer is planning to expand his operation and the undertaker would have had to lay an additional pipe in any event. Moreover, there would have had to be an increase in water treatment capacity as the undertaker's pipes are all for domestic quality whereas the supplier, because of the nature of the customer, can use pipes of a lower quality and a lower standard because the customer does not need drinking water quality but he has had to have it because that was the only supply he could get.
This may sound like creative accounting gone mad but what we are dealing with is how we assess the nature of real costs. It is a complex question and the water undertaker could be obliged to pay costs which the water supplier could legitimately argue he would have had to undertake anyway. What we have sought to do is to insert a word which might help if one ever finds that kind of an argument arising between a water supplier and a water undertaker.
I am sorry that the matter is so complex; I wish that it were not. But unfortunately I see no way round the matter. I see immense scope for fruitful argument employing all kinds of experts for a long time at some point in the future. I hope very much that the Minister in his response will be able to clarify what is otherwise a very unclear situation. I beg to move.
My Lords, I agree with the noble Lord's objectives but I do not think that the amendment is necessary. I understand the situation that he described. There could be all sorts of other complicated situations where one has to net off a cost or otherwise. I agree that only quantifiable benefits can be deducted from the undertaker's charges but they would have to be quantifiable if the regulator is able to identify them and calculate them. He will not be able to make a financial determination unless they are quantifiable. Therefore, the regulator is to a large extent already constrained by ensuring that the financial calculations can be made, so "quantifiable" is unnecessary in terms of determining what sum the regulator comes up with.
As in so many discussions that the noble Lord and I have, it would not do any harm to add what an amendment would add—"quantifiable" in this case—in normal parlance. However, the lawyers will always say, "Don't use more words than you have to", although with a Bill this long he would be justified in challenging whether that was a general precept. Nevertheless, that is the view. If the sums are to be reduced to a financial calculation, clearly they have to be quantifiable in any case.
My Lords, I am grateful to the Minister for his explanation. I am not sure that it takes us any further forward, as it seems that the argument will be able to go on in all its intricacy and detail for a considerable time in a number of such cases. That said, I am quite prepared to accept that "quantifiable" may not be the right word. It may be that we could find a better one, or a better way of making the point that we want to make. For now, I shall study his explanation with considerable care, think about it and see whether we can do anything at Third Reading. I beg leave to withdraw the amendment.
My Lords, the amendment is grouped with Amendments Nos. 137 and 138. They all have the same effect, which is to leave out the Secretary of State. We have no particular wish to do him out of a job, but we think that the chief inspector of drinking water or the chief inspector of drinking water for Wales is more appropriate in this instance.
The amendment arises out of a debate on Amendment No. 168ZF, believe it or not, in Grand Committee on 10th April, as reported at col. GC 75. The Minister explained that the wording to which we had objected was a legislative drafting device to enable the authority to consult the Drinking Water Inspectorate, which reports to the Secretary of State. Clause 38 substitutes a new section in the Water Industry Act that specifically gives the Secretary of State or, as the case may be, the authority the powers and duties covered in that Act as general duties in respect of the water industry. It seems ridiculous to lay down such a general duties clause and then say that the authority cannot consult a department reporting to the Secretary of State without his specific permission.
We think that that is very peculiar. It is a very sophistic argument, and we think that our amendment would lead to a considerably clearer situation in the Bill. It would also leave the Secretary of State secure as a final court of appeal, so that if there were any need for such a thing we could speed up the clarification of complaints. If the Secretary of State were involved at an earlier stage, that would be more difficult. I beg to move.
My Lords, I am sorry that the noble Lord viewed the previous explanations as sophistry, but I agree that they are hugely legalistic. The problem is that the Drinking Water Inspectorate does not exist as a legal entity, and therefore cannot of itself have duties. The Secretary of State has duties that are then conferred on the chief inspector of drinking water. Although one can designate in legislation the fact that the Drinking Water Inspectorate could be consulted, that does not impose a duty on it. It is a duty on someone else to consult it. The legal position is that duties cannot be conferred on something which does not have a legal personality. Hence the only way of doing it is to designate the Secretary of State. In commonsense terms, of course, there is a problem in that the Secretary of State can, in certain circumstances, appear later in some of the procedures. But we cannot so designate the Drinking Water Inspectorate under the current structure and conventions.
So while in a sense I accept the logic of the noble Lord's approach, I cannot accept the statutory form in which he is putting it.
My Lords, before the Minister sits down, this is a legislative Chamber and it can establish the precedent that it wishes to establish. If it wants to establish the Drinking Water Inspectorate as a legal entity, surely it can do so. It may be that this amendment is not the appropriate way to do so and that a different amendment is required in order to achieve that, but I ask the Minister why that cannot be done. It seems to me that it would be helpful if it were done.
My Lords, it can, of course, be done, but it would require a definition of the inspectorate as a body with its own identity rather than an amendment in one particular respect. The noble Lord would therefore have to come forward or force the Government to come forward with a large number of substantive amendments. At the moment, the Drinking Water Inspectorate is part of the department and is no different from any other Civil Service branch which cannot be designated as a legal entity—the Secretary of State has to be designated in terms of defining the responsibility of the department.
My Lords, I accept the noble Baroness's rebuke. She is perfectly correct. But it does seem to me that we have an acknowledged anomaly, in the sense that the existing situation is not perfect, but we do not have the appropriate amendment to rectify it. The only question is, therefore, whether the Opposition have to carry out the task of drafting an appropriate amendment and almost certainly get it wrong, or whether we invite the Minister to tackle the issue and perhaps have cold towels round his drafting clerks for a number of nights, and they might or might not come up with the right answer, or might not be able to do it in the time available.
The only thing that seems certain in this situation is that the right thing for me to do at the moment is to withdraw the amendment. However, I should welcome an opportunity to discuss it with the Minister subsequently. I beg leave to withdraw the amendment.
moved Amendments Nos. 139 and 140:
Page 164, line 23, leave out "a" and insert "the"
Page 165, line 13, leave out from "agreement" to end of line 15 and insert "for a supply of water in bulk"
On Question, amendments agreed to.
My Lords, this amendment relates to prohibitions and exemptions. In Committee, we moved a series of amendments designed to probe the meaning of paragraphs 66I to 66K as laid down in Schedule 4. We were unhappy about the prohibition on the ability of water undertakers to prosecute anyone who used their systems to introduce water without permission. We were also unhappy that the Secretary of State could apparently authorise certain people or classes of people to make free of a water system.
The responses that we received were unsatisfactory. It has subsequently been pointed out to me that the negative procedure already exists, but I invite the Minister who will reply to point me to it in the Bill. That would be hugely helpful. I should be glad to have clarification from the Minister. I beg to move.
My Lords, I fully understand that the noble Baroness, Lady Byford, seeks to ensure that the power to grant, by order, exemptions from the prohibition on persons supplying from or introducing water to the undertaker's supply system is subject to parliamentary scrutiny.
I can confirm that an order under this section is already subject to the negative resolution procedure under subsection (6) of new Section 66L on page 168 of the Bill. I am very pleased to have been able to reassure the noble Baroness. I trust that she will be happy with the reply and feel able to withdraw the amendment.
moved Amendment No. 142:
Page 184, line 36, at end insert—
"( ) Section 174 of the Water Act 1989 (c. 15) (general restrictions on disclosure of information) is amended as follows.
( ) In paragraph (b) of subsection (2), for "or a sewerage undertaker" there is substituted ", sewerage undertaker or company holding a licence under Chapter 1A of Part 2 of the Water Industry Act 1991".
( ) In paragraph (c) of that subsection, for "203(1) or (2)" there is substituted "203(1), (1A), (2) or (2A)".
( ) In subsection (6)(a), after "sewerage undertaker" there is inserted ", or with the carrying on by a company holding a licence under Chapter 1A of Part 2 of the Water Industry Act 1991 of activities under its licence,"."
On Question, amendment agreed to.
My Lords, in moving Amendment No. 143, I shall speak also to Amendments Nos. 144 and 145. The sub-paragraph in question allows a licensed water supplier to transfer to another company or companies sufficient of its activities to protect a strategic supply. That will be done under a special administration order.
I want to ask the Minister what safeguards there will be to ensure that the company receiving the privilege is worthy of it. Will the water undertaker play any part? The court may hear from the Secretary of State or the authority in regard to the licensed water supplier, but will the court hear submissions from anyone with regard to the replacement? Surely if a licensed water supplier contravenes regulations or goes out of business, the logical approach is to give back the right of supply to the water undertaker until a proper application can be dealt with from a new would-be licensed water supplier. That deals with Amendment No. 143.
Amendment No. 144 concerns the ministerial explanation that encapsulates all my doubts about the reasons for this Bill and the way those reasons are being translated into action. At col. GC 82 of Hansard of 10th April the noble Baroness, Lady Farrington, explained that the Bill extends the duty that water undertakers already have to supply water to domestic customers outside their area. It restricts them to competing only through their associated companies and not directly. We discussed that matter earlier today.
We now have a situation where water undertakers will lose their biggest customers to the licensed water suppliers to improve the competitiveness of the industry. Water undertakers will have an extended duty to supply on demand outside their area to non-domestic customers. However, water undertakers will compete outside their area only through their associated companies.
Am I the only person in this House who believes that some convoluted thinking is involved here? Why cannot undertakers compete as themselves? The amendment as tabled is totally inadequate for changing something as profound as this, but I hope that the Minister will address seriously the comments that I have made in proposing the amendment and that she will provide some answers.
I turn to Amendment No. 145. Our concern with this aspect of the Bill is that the water undertaker must pick up where the licensed supplier left off without necessarily being aware that it has left off. It may be possible to incorporate a legal duty on the supplier to inform the undertaker before abandoning the supply, but in some circumstances that one can think of, that would be the last thing that might happen.
There seems to be a presumption that in all cases the supplier will be drawing a continuous, probably steady, stream of water from the undertaker. Will the Minister confirm that in all cases that will be so? Further, will the total supply come from a single undertaker? What is the possible involvement of, for example, the British Waterways Board? What are the chances of pipe supply coming from the Continent? In such an event, who would pick up the duty of continuation after a supplier had pulled out, and how would that duty be notified? I beg to move.
My Lords, I appreciate the tabling of these amendments, which would clarify the situation. I hope that the Minister will give a good explanation because the system appears, as the noble Baroness said, to be very convoluted. It is one of the most impenetrable parts of the Bill.
My Lords, I feel rather inclined to agree that it is one of the more complex parts of the Bill. Amendment No. 143 deals with strategic supply and special administration as they apply to licensees. Its effect is to leave customers without the protection offered by special administration. The special administration provisions will protect customers from the failure of a licensee where the licensee's introduction of water to the undertaker's network is too large for the undertaker to make up the shortfall. Such significant introductions of water into the network will be designated as strategic supplies. If a licensee were to fail financially or be at risk of losing its licence, Ofwat or the Secretary of State can apply to the High Court to put the licensee into special administration.
The special administrator would aim to continue the strategic input of water and to transfer it as a going concern to another supplier. The special administrator may either sell the contract for the provision of the supply to an undertaker or a licensed water supplier, depending upon who they decide is most suited immediately to take over the running of the strategic supply while providing a return to shareholders and creditors.
The special administrator is appointed by the court. It considers who should be sold the contract for the supply. It could be an undertaker or a licensee with the approval of the Secretary of State or Ofwat. Supplies will be considered strategic only where, without them, the undertaker could not fulfil its obligations to supply customers.
On Amendment No. 144, at present undertakers have a duty to supply customers outside their area for domestic purposes but not non-domestic purposes. We have sought to make the duty consistent for all supplies in that regard. The duty to supply will in the future also apply outside the undertaker's area only to customers who are not eligible for supply by a licensed water supplier. Undertakers will be allowed to compete outside their area only through their associated companies. That ensures that there is a clear boundary between the activities of the regulated undertaker and its associated company.
On the question about the boundary between England and France, I shall write to the noble Baroness. I shall return to the matter in a moment. The non-domestic duty is further qualified; it will not apply if in making that supply and supplying all other customers, the undertaker would incur unreasonable expenditure. I hope that that satisfies the noble Baroness in relation to that amendment.
I turn to Amendment No. 145, which would make the duty on the undertakers to provide an interim supply, under new Section 63AC, conditional on the relevant undertaker being aware that a supply from a licensed water supplier had ceased. The effect of that would be to stop the undertaker being able to charge for water that it had unknowingly supplied. We feel that that would not be equitable. We believe that the amendment was tabled in order to protect undertakers from being obliged to provide a supply, without notice, to customers whose licensed supplier failed them. In fact, the provisions are there for the protection of undertakers and customers as well.
If a licensee fails to supply its customer, water will still continue to flow out of the undertaker's pipes at the customer's premises. This provision ensures that whether or not the undertaker is aware that the licensee had stopped making a supply, it is able to recover charges from a customer for the water supplied; it does not depend on the customer informing him.
The customer is protected because, from the time of the licensee's failure, it has at least three months to make alternative arrangements for supply, either by another licensee or by the undertaker. After this period, the undertaker can choose to serve a disconnection notice if no other arrangements have been made. The undertaker is not required to maintain a standby water supply equivalent to the total supplied by the licensees in its area. It will be required to make an interim supply only for domestic needs, unless it has enough water to supply for other purposes.
I tried, with some difficulty, to bring together three amendments that I am delighted were grouped together. If I have failed to answer any of the questions that have been raised, because, as the noble Baroness, Lady Byford, recognised, the matter is extremely complex, I shall be delighted to write to all noble Lords who have taken part.
My Lords, I am grateful to the Minister. I apologise to the House that I linked the amendments. The House may be grateful that I did, but it was an error. Unfortunately I had not looked at my master list. At this stage of the proceedings I should like to read carefully the response given by the Minister. I am still unsure why associates have to be used, as opposed to their own companies. I would be glad of further clarification. I beg leave to withdraw the amendment.
moved Amendment No. 145A:
Page 196, line 45, at end insert—
"In section 72 (contamination of water sources), in subsection (5), after paragraph (b) there is inserted "; and
(c) any pipe or conduit of a licensed water supplier.""
On Question, amendment agreed to.
moved Amendment No. 146:
Page 198, line 14, leave out first "or" and insert "and"
On Question, amendment agreed to.
moved Amendments Nos. 147 to 152:
Page 198, line 25, leave out first "or" and insert "and"
Page 200, line 29, at end insert—
"( ) Section 162 (works in connection with metering) is amended as follows.
( ) In subsection (1A), in paragraph (a) at the end there is inserted "or".
( ) In that subsection, after paragraph (c) there is inserted "or
(d) a licensed water supplier supplies water to those premises using the undertaker's supply system."
( ) After that subsection there is inserted—
"(1B) In subsection (1A)(d) above, the reference to the supply system of a water undertaker shall be construed in accordance with section 17B(5) above."" Page 200, line 31, at end insert—
" ( ) Section 174 (offences of interference with works) is amended as follows.
( ) After subsection (1) there is inserted—
"(1A) Subject to subsection (2) below, if any person without the consent of the licensed water supplier—
(a) intentionally or recklessly interferes with any pipe or any structure, installation or apparatus which—
(i) is vested in any licensed water supplier (in the case of a pipe) or belongs to any such supplier (in any other case); and
(ii) is used in connection with the carrying on by the supplier of the activities authorised by its licence; or
(b) by any act or omission negligently interferes with any such pipe or with any such structure, installation or apparatus so as to damage it or so as to have an effect on its use or operation, that person shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding level 3 on the standard scale."
( ) In subsection (2)—
(a) after "subsection (1)" there is inserted "or (1A)"; and
(b) in paragraph (b)—
(i) after "water undertaker" there is inserted "or licensed water supplier"; and
(ii) in sub-paragraph (ii), for the words from "the stopcock was" to the end there is substituted "subsection (2A) below applies".
( ) After that subsection there is inserted—
"(2A) This subsection applies—
(a) in the case of a stopcock belonging to a water undertaker, if the stopcock was closed otherwise than by the undertaker;
(b) in the case of a stopcock belonging to a licensed water supplier—
(i) if the stopcock was closed otherwise than by the supplier; or
(ii) if the stopcock was closed by the supplier and the person in question for the purposes of subsection (2) above is the water undertaker whose supply system is used for the purpose of the supply made by the supplier, and in this subsection the reference to the supply system of a water undertaker shall be construed in accordance with section 17B(5) above."
( ) In subsection (3), in paragraph (c), for "section" there is substituted "subsection".
( ) After that subsection there is inserted—
"(3A) Any person who, without the consent of the licensed water supplier—
(a) attaches any pipe or apparatus to any pipe which is—
(i) vested in a licensed water supplier; and
(ii) used in connection with the carrying on by the supplier of the activities authorised by its licence;
(b) attaches any pipe or apparatus to any service pipe which does not belong to such a supplier or a water undertaker but which is a pipe by means of which water is supplied by such a supplier to any premises;
(c) makes any alteration in a service pipe by means of which water is so supplied, or in any apparatus attached to any such pipe; or
(d) subject to subsection (4) below, uses any pipe or apparatus which has been attached or altered in contravention of this subsection, shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding level 3 on the standard scale."
( ) In subsection (4)—
(a) after "subsection (3) above" there is inserted "or paragraph (d) of subsection (3A) above", and
(b) for "that subsection" there is substituted "subsection (3) or (3A) above (as the case may require)".
( ) After subsection (5) there is inserted—
"(5A) If any person wilfully or negligently injures or suffers to be injured any water fitting which—
(a) belongs to a licensed water supplier; and
(b) is used in connection with the carrying on by the supplier of the activities authorised by its licence, he shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding level 1 on the standard scale."
( ) After subsection (8) there is inserted—
"(8A) In this section "consumer"—
(a) in relation to a supply of water provided by a water undertaker to any premises, means a person who is for the time being the person on whom liability to pay charges to the undertaker in respect of that supply of water would fall;
(b) in relation to a supply of water provided by a licensed water supplier to any premises, means a person who is for the time being the person on whom liability to pay charges to the supplier in respect of that supply of water would fall."
( ) In subsection (9), for ""consumer" and "water fitting" have the same meanings" there is substituted ""water fitting" has the same meaning"." Page 200, line 31, at end insert—
"( ) Section 175 (offence of tampering with meter) is amended as follows.
( ) In subsection (1)(a), after "undertaker" there is inserted "or licensed water supplier".
( ) In subsection (2), for the words from "consent" to the end there is substituted "appropriate consent".
( ) After that subsection there is inserted—
"(3) In subsection (2) above, the "appropriate consent" means—
(a) if the meter is used by one relevant undertaker, the consent of that undertaker;
(b) if the meter is used by one licensed water supplier, the consent of that supplier;
(c) if the meter is used by two or more of the following persons—
(i) a relevant undertaker;
(ii) a licensed water supplier, the consent of each of those persons.
(4) In subsection (3) above, references to the consent of a relevant undertaker are references to consent under section 176 below."" Page 203, line 11, at end insert—
"( ) In that subsection, in paragraph (c), for "203(1) or (2)" there is substituted "203(1), (1A), (2) or (2A)"." Page 205, line 38, at end insert—
"( ) The WRA is amended as follows.
( ) In section 203 (exchange of information with respect to pollution incidents etc)—
(a) after subsection (1) there is inserted—
"(1A) It shall be the duty of the Agency to provide a licensed water supplier with all such information to which this section applies as is in the possession of the Agency and is reasonably requested by the supplier for purposes connected with the carrying on of activities under its licence.";
(b) after subsection (2) there is inserted—
"(2A) It shall be the duty of every licensed water supplier to provide the Agency with all such information to which this section applies as is in the possession of the supplier and is reasonably requested by the Agency for purposes connected with the carrying out of any of its functions.";
(c) for subsection (3) there is substituted—
"(3) Information provided to a water undertaker, to a licensed water supplier or to the Agency under subsection (1), (1A), (2) or (2A) above shall be provided in such form and in such manner and at such times as the undertaker, the supplier or the Agency, as the case may be, may reasonably require.";
(d) in subsection (4)—
(i) for "subsection (1) or (2)" there is inserted "subsection (1), (1A), (2) or (2A)"; and
(ii) after "undertaker" there is inserted ", to a licensed water supplier";
(e) in subsection (5), for "a water undertaker under subsection (2) above shall" there is substituted—
"(a) a water undertaker under subsection (2) above; or
(b) a licensed water supplier under subsection (2A) above, shall"; and.
(f) after subsection (7) there is inserted—
( ) In section 204 (restriction on disclosure of information)—
(a) in paragraph (b) of subsection (2), for "or sewerage undertaker" there is substituted ", sewerage undertaker or company holding a licence under Chapter 1A of Part 2 of the Water Industry Act 1991";
(b) in paragraph (c) of that subsection, for "203(1) or (2)" there is substituted "203(1), (1A), (2) or (2A)"; and
(c) in subsection (4)(a), after "sewerage undertaker" there is inserted ", or with the carrying on by a company holding a licence under Chapter 1A of Part 2 of the Water Industry Act 1991 of activities under its licence,"." Page 206, leave out lines 14 and 15 and insert—
""(aa) a qualifying licensed water supplier within the meaning of subsection (6) of section 23 of the Water Industry Act 1991 (meaning and effect of special administration order),""
On Question, amendments agreed to.
Clause 59 [Water resources management plans]:
My Lords, in moving Amendment No. 153, I shall also speak to Amendments Nos. 154, 161, 162, 164, 166, 173, 174, 177, 181, 182, 184 and 186. Amendments Nos. 153 and 154 respond to Amendment No. 171AA moved by the noble Lord, Lord Dixon-Smith, in Grand Committee, where he sought to ensure that water companies consult planning authorities for the purposes of preparing their water resources management plans.
The amendments give the Secretary of State the power to prescribe the parties to whom an undertaker must send a copy of its draft water resources management plan. We will ensure that these regulations specify the planning authorities appropriate to the undertaker's area of supply.
Amendment No. 161 is identical to Amendment No. 179A moved by the noble Earl, Lord Peel, in Grand Committee. It limits use of the direction-making power for the preparation of flood plans to those reservoirs subject to the 1975 Act's safety regime.
Amendment No. 162 in Clause 73 enables the Secretary of State to serve a notice on reservoir undertakers requiring them not to publish flood plans or to publish them only as specified. This power would be exercised only if the national security climate required it. The amendment makes clear that the provision applies to all reservoirs and not just the large raised reservoirs.
Amendment No. 164 provides the sanction for the requirement that relevant water mains and service pipes must be vested in a water undertaker if they are to be connected to the public water supply system. We consider that there needs to be a sanction to ensure undertakers comply with the requirement. The most appropriate way of doing this is to make the provision enforceable by the authority under Section 18 of the Water Industry Act 1991.
The remaining amendments are technical, tidy words, avoid ambiguity and deal with consequential issues. If the House wishes, I could go through them in detail. If not, I beg to move.
My Lords, I have no wish to debate the amendments. I want merely to express my gratitude to the Government and to the Minister for her explanation, particularly with regard to consultation and planning. I also thank my noble friend Lord Peel for his suggestion as regards reservoirs. We are grateful that the Government have made these amendments.
moved Amendment No. 155:
After Clause 59, insert the following new clause—
It is the duty of—
(a) any Minister of the Crown (within the meaning of the Ministers of the Crown Act 1975 (c. 26));
(b) any government department;
(c) the National Assembly for Wales;
(d) a person holding office—
(i) under the Crown;
(ii) created or continued in existence by a public general Act of Parliament; or
(iii) the remuneration in respect of which is paid out of money provided by Parliament;
(e) a statutory undertaker (meaning the persons referred to in section 262(1), (3) and (6) of the Town and Country Planning Act 1990 (c. 8)); and
(f) any other public body of any description; in carrying out his or its functions, to have regard, so far as is consistent with the proper exercise of those functions, to the purpose of furthering the conservation of water."
My Lords, in the Bill, with agreement from all sides of the House, we have laid a duty on the Environment Agency to ensure that all water abstracters and users of water do so efficiently. However, we have not yet made an amendment to ensure that all government departments, Ministers, persons holding office under the Crown and any other public bodies do so. The amendment seeks to ensure that they have proper regard for the purposes of furthering water conservation. I do not believe it is reasonable that we should expect everyone else to be efficient in their use of water and not to expect that the Government will be at the heart of such conservation.
The amendment was tabled in Committee particularly with the Office of the Deputy Prime Minister and the planning authorities in mind. I thought I had heard an encouraging response from the Government that they would consider bringing forward an amendment along these lines. I would have thought that such an amendment was in line with what Defra is supposed to do in promoting sustainability across all government departments. The inclusion of such an amendment would help it to do so.
I look forward to hearing whether the Government are regarding the amendment with favour. I beg to move.
My Lords, although our names are not added to the amendment, we have debated water conservation from the day we started debating the Bill at Second Reading. It gives me great pleasure to support it. If for any reason the Government find the amendment unacceptable because it is not technically correct, I hope that they will confirm that they will take the issue on board and return with their own amendment. I, too, had expected to see a government amendment. Perhaps it is taking a long time to find the right wording or perhaps the Government were close to accepting the noble Baroness's wording.
I support the thrust behind the amendment. Water conservation for individuals, public bodies and businesses is most important and I hope that the Government will look sympathetically on it.
My Lords, in Committee I indicated that I would give further, positive consideration to the substance of this amendment. I regret that this has wide implications for the public sector as a whole and will involve some internal discussions. Those considerations are still under way, so I am not this evening in a position to bring forward an amendment. However, if I can, and if the noble Baroness can give me a little more time, I will do so at Third Reading. If not, I have no doubt that we will return to it if the noble Baroness should wish to pursue it. I cannot now agree the amendment.
My Lords, I am sorry to disappoint the noble Baroness. It is not an issue of precise wording, but of whether the Government as a whole can accept the wording. I cannot indicate the Government's position tonight.
My Lords, I am disappointed not to have some more positive news from the Minister at this stage.
It would be absolutely appalling if, in a Bill in which we have laid duties on the private sector and on individuals, the Government were not able to accept a similar duty. I can imagine where the wrinkles lie and where the difficulties are, but some departments may not want to accept this. I accept that in planning terms, it will be difficult. However, given that the Government have admitted that the pressure on water is extreme—in fact, that is one of the reasons for the legislation—they should be most keen to consider it.
moved Amendment No. 156:
After Clause 59, insert the following new clause—
"RESTRICTION ON UNDERTAKERS' POWER TO REQUIRE FIXING OF CHARGES BY REFERENCE TO VOLUME In section 144B of the WIA, in subsection (1)(c) after "prescribed" there shall be inserted "by the Secretary of State, on application by a water undertaker or the Environment Agency,".".
My Lords, the amendment deals with metering. We have heard the same old song many times in the course of the Bill.
The amendment would enable the Environment Agency as well as the water companies to apply to the Secretary of State for an area to be designated as an area of water scarcity. The Environment Agency accepts that real water savings from metering will come only when there is sufficient metering penetration to introduce innovative tariffs that dissuade high domestic use. The agency also recognises that large areas of the South East have unsustainable abstraction regimes. Therefore, we propose to give the agency a formal status in the process of making scarcity designations.
The Government have identified the,
"prudent use of water resources and keeping its use within the limits of its replenishment", as a priority for water policy. They plan to achieve the sustainable management of water resources through a,
"twin track approach of demand management and development of resources".
These sentences are taken directly from Defra's Directing the Flow—Priorities for future water policy, which was published in November 2002.
However, the Government will permit the growth of metering only on a voluntary basis. Under current legislation—the Water Industry Act 1999—those occupying their homes on an unmetered basis may choose whether to be metered, and water companies may install meters in new buildings. The current situation in which free-meter options are offered is ineffective as a demand-management tool. Further, compulsory metering is more economical than optional or selective metering. Optional metering is more costly as meters may be situated in only every third or tenth house. In other words, compulsory metering is the only economic way of applying demand management in a scarce water area.
Water companies can carry out compulsory metering only when the area concerned is designated as an area of water scarcity under the Water Industry (Prescribed Conditions) Regulations 1999. Only the Government—namely, the Secretary of State—can designate an area as an area of water scarcity following an application from a water company. But the areas of the South East that have unsustainable abstraction regimes are not recognised as water scarce.
On 10th April in Grand Committee we tabled an amendment to empower the Environment Agency, instead of water companies, to make an application to the Secretary of State. In reply the Minister argued that water companies should be kept as the applicants as they have the detailed knowledge about water resources in their area, and, secondly, there is nothing at the moment to prevent the agency from proposing changes to the prescribed conditions; indeed, the Secretary of State must consult it on each application.
The Minister also said:
"Although the Environment Agency obviously has responsibilities for the totality of supply and can suggest to the Secretary of State that a scarcity designation be introduced, it is not sensible to limit the initiation of that to only the Environment Agency . . . If the amendment suggested that the Environment Agency should be put on the same footing as water companies, I would at least understand that".—[Official Report, 10/4/03; col. GC 112-113.]
The amendment seeks to address those points by giving the agency and the water companies equal status as applicants. I beg to move.
My Lords, I can see the sense in addressing the issue of metering, particularly in water-scarce areas. Perhaps in reply the Minister can address the fact that the water framework directive will encourage a change in water charging by moving from fixed charges to charges by volume. I believe that it points in that direction.
I believe that metering on a wider basis would be a more efficient way forward than just in water-scarce areas. However, those areas need to be addressed first, particularly in that regard. The noble Baroness referred to innovative powers. On moving from one system of charging to another, I regret that she did not support my amendment on water affordability because with such large shifts, which I believe will be necessary and which will come about, we need a safety net to protect the more vulnerable. That said, I see the need to consider this amendment.
My Lords, the noble Baroness, Lady O'Cathain, is right to draw attention to areas of water scarcity. A point I made in Committee is that in some parts of the country the infrastructure is very lengthy and difficult to maintain but there is plenty of water. In such areas it may not be appropriate to impose a metering regime. As I understand it, the noble Baroness, Lady O'Cathain, is specifically addressing the problem of areas of water shortage.
My Lords, I support the ideas behind this sensible amendment. The noble Lord, Lord Livsey, is right to say that there are areas in the country that have a water surplus. We have to ask whether metering is really necessary is such areas. But there are other parts of the country—East Anglia, Kent and the south—where there will also be increased building and increased demand. While the amendment does not require it all to be metered, it directs that metering should be considered seriously in those areas. I am sympathetic to that.
Whether we live in an area with plenty of water or an area that is short of water, it is still a precious commodity. We have talked about that throughout the Bill. While I accept that it is sensible to look in the first instance at areas where there are shortages of water, it may be that in the longer term we must think again.
In addition, we are going through some extraordinary cycles of climate change. We do not know where they will end. While it is suggested that new buildings should be metered, my noble friend will confirm that it is not compulsory. It is strongly encouraged. As it is not compulsory, it seems sensible to highlight the difficulty in areas where there is a water shortage. I shall be interested to hear what the Minister says in response to the amendment.
My Lords, I correct the noble Baroness, Lady Miller. The water framework directive does not require metering; it requires policies to have regard to recovering costs, which our system can do. Water framework or not, there are already powers relating to compulsory metering in areas of water scarcity. We do not need new, prescribed powers in those areas.
The present powers allow a water company to apply for water scarcity area status. The Secretary of State decides on the basis of that application, after consulting the Environment Agency, Ofwat, and so on, including the people who would be affected. We already have those powers. Despite the concerns about water scarcity, no water company has applied for those powers to be exerted.
The amendment adds the Environment Agency and the water companies together but then prescribes the Secretary of State to act only on their representations. Clearly, the Environment Agency can make representations to the Secretary of State and the water companies have a formal ability so to do. However, it is for the Secretary of State to judge whether the designation of an area of water scarcity—and therefore an area of compulsory metering—should be imposed. The amendment, while in a sense giving a stronger status to the Environment Agency, precludes the Secretary of State making the decision herself that there is an area of water scarcity.
I said earlier that no water company has yet applied for water scarcity area status, presumably on the basis that it might alienate its customers. One could conceive of a situation where it would be necessary for the Government to take the initiative, which the amendment would not allow the Secretary of State to do. While I understand some of the arguments behind the amendment—although I do not completely go along with the line that the noble Baroness takes on metering in general—I understand that in such situations we need to be able to act. In such situations the amendment constrains the ability to act in certain circumstances. It is not therefore appropriate.
My Lords, before the noble Lord sits down, how does it constrain the ability of the Secretary of State to act? The Secretary of State currently has the power to act. The problem is that we are trying to get the Environment Agency on side. After all, the responsibility of the Environment Agency is to look after the environment and to ensure that the water resources situation is good for sustainability. One of the reasons for metering is to limit the consumption of water in areas of great water shortage.
My Lords, the Environment Agency is perfectly able to approach the Secretary of State to suggest that she uses her powers. She must react to an approach from the water company, but she can make a judgment on it, and she would also be able to act independently of that.
The amendment would prescribe that the Secretary of State may designate those conditions only after an application from either a water company or the Environment Agency. A crisis situation could be identified which neither wished to suggest. Therefore, it is a constraining amendment, whether or not it was intended to be. I accept the importance of the Environment Agency being given the right. But the amendment as drafted is restrictive.
The Minister also made the point about customer reactions to compulsory metering, which I am sure is absolutely right. Nobody wants to be the first person to do the nasty thing; in other words, to make metering compulsory. However, if there is a serious shortage of water resources in an area, there is no alternative to longer-term metering; for example, in certain places in the South East the huge water resource problems will be compounded by an increase in house-building in the area. I shall take the matter away and return at a later stage. In the mean time, I beg leave to withdraw the amendment.
moved Amendment No. 157:
After Clause 61, insert the following new clause—
After section 39A of the WIA there is inserted—
"39D WATER RESOURCE MANAGEMENT PLANS AND DROUGHT PLANS: IMPLEMENTATION
In carrying out their respective functions, the Environment Agency and the Authority shall—
(a) take into account the requirements of—
(i) all water resource management plans prepared in accordance with sections 37A and 37D above, and
(ii) all drought plans prepared in accordance with sections 39B and 39C above; and
(b) in that regard co-ordinate the exercise of their respective functions.""
My Lords, the amendment would require the Environment Agency and the water regulator to take into account the requirements of all water resource management plans and all drought plans prepared pursuant to the Bill. That can be seen as advancing the cause of joined-up regulation, particularly in respect of water resources management.
The Government see water resource management plans and drought management plans as major elements of their strategy to manage water supplies and therefore ensure,
"the prudent management of water resources".
Again, I quote from Directing the Flow.
The plans fit into the regulatory regime in two important ways. First, water companies will prepare the plans. Ofwat expects them to take into account the long-running marginal costs. That information will be incorporated into the Environment Agency's updated water resource planning guidelines. Secondly, the Secretary of State will approve the plans.
The amendment ensures that the plans are carried forward into all aspects of the regulator's work. More generally, the Government are already working to achieve a closer integration between economic and environmental regulation; for example, they want the principles of sustainability to inform the work of the economic regulator. The Water Bill includes a specific duty on the regulator to take into account sustainable development. Also, the Government expect the regulators to work together on specific matters; for example, the implementation of the Water Framework Directive and tackling diffuse pollution.
The amendment is a practical step to ensure that environmental considerations, including the prudent management of water resources, inform the work of the new water services regulation authority and are of appropriate importance in that of the Environment Agency.
The amendment was not moved in Grand Committee. On 8th April, in reply to an amendment after Clause 39, the Minister said that he supported more co-ordination but would not favour doing it in such a way as to increase the Secretary of State's powers to override the regulator or undermine its independence.
This amendment enables more joined-up regulation without giving greater powers to the Secretary of State to intervene in the regulator's decisions. I beg to move.
My Lords, I support my noble friend's amendment, which I hope the Government will be able to accept. Even if they cannot accept the current wording, I hope that they recognise the desire behind the amendment and what we hope to achieve. We all agree that we want prudent management. We have also talked about conservation and many other matters today. Joined-up government is essential.
If we are to have sustainable development in the future, we need to look at all aspects of water resource and water resource plans, particularly with regard to drought conditions that could occur. In the past, we have been quite lucky and there have been very few years when we have been so troubled. But that does not necessarily mean that in future years we will not be so troubled. I hope that the Minister will look at this amendment sympathetically. My noble friend has brought an important amendment before us today. I have pleasure in supporting it.
My Lords, there are two issues with this amendment. Turning first to the issue of the drought and water resource management plans, it is important that water companies develop such plans but it is also important to recognise that those plans do not themselves have a statutory basis. As circumstances change, companies will undoubtedly adjust and modify their plans.
The problem with Amendment No. 157 is that it would have the effect of making Ofwat and the Environment Agency enforce plans which may be out of date and on which a company may have changed its mind. It is primarily for water companies to act on their plans and adjust them in the light of changing circumstances. The regulators must take a considered view based on the general management approach and the circumstances that prevail at the time of any change, taking into account their statutory duties.
The second effect of the amendment would be to ask Ofwat and the Environment Agency to co-ordinate their functions in respect of drought plans and water resource management plans. While joined-up government is highly desirable, the comments I made earlier on the rather blanket requirement on co-ordination also apply here. The two regulators have different functions and to co-ordinate every decision, particularly in this area, could lead to confusion as to their respective roles.
While the Government expect the regulators to work together, they have separate duties in this respect. Water regulators need to co-ordinate their activities, and in respect of the earlier more general amendment we said that we would look at ways of setting this out on a less issue-by-issue basis. But this is a matter where, because the respective roles can differ, prescribed co-ordination is difficult to write into this clause.
Clearly, there are other forms of co-ordination. The regulators are jointly committed to the code of practice, and so forth. As I indicated earlier, we recognise the need for greater co-operation between the various regulators, but I do not think that this form of words would be helpful in clarifying the legal duties of the regulators in this particular clause.
My Lords, before the Minister sits down, he said that he wants to have joined-up government but on the other hand the regulators have different duties. But the Water Bill should bring all the regulators and all the agencies together. Is the Minister suggesting that there should be a water Bill for drinking water; a water Bill for sustainability of the environment; or a water Bill for anything else? It just does not make sense. I cannot understand the reaction to this amendment. The Minister could have said, "Look, it is flawed because it is written in the wrong way". Surely, the amendment makes plain common sense. I am very upset about it and I need to test the opinion of the House.
moved Amendment No. 157A:
After Clause 63, insert the following new clause—
After section 16 of the Environment Act 1995 (c. 25) there is inserted—
(1) This section applies in relation to any regional flood defence committee which satisfies (or, upon the coming into force of an order made under Schedule 4 to this Act, will satisfy) both of the conditions in subsection (2) below (a "Welsh committee").
(2) The conditions are—
(a) the whole or the greater part of the committee's area is in Wales; and
(b) no local flood defence scheme is in force in relation to the area of the committee.
(3) The National Assembly for Wales may by order made by statutory instrument make provision determining—
(a) the total number of members of a Welsh committee; and
(b) the method of selection and appointment of the chairman and other members of the committee (including who is to appoint them).
(4) An order under subsection (3) may—
(a) apply either to Welsh committees generally or to a particular Welsh committee;
(b) include such supplemental, consequential and transitional provision as the National Assembly for Wales considers appropriate.
(5) In relation to a Welsh committee whose area is not wholly in Wales—
(a) the power to make an order under subsection (3) above may be exercised only with the agreement of the Secretary of State; and
(b) a statutory instrument containing an order under that subsection shall be subject to annulment in pursuance of a resolution of either House of Parliament.
(6) An order under subsection (3) above shall not be considered local in nature for the purposes of section 58(6) of the Government of Wales Act 1998 (definition of "Assembly general subordinate legislation").
(7) Section 15 above (or, where the order is being made in conjunction with an order under Schedule 4 to this Act, that Schedule) shall not apply for the purposes of making an order under subsection (3) above.
16B Effect of order under section 16A
(1) Sections 15 and 16 above and section 18A(3) below shall not apply to a regional flood defence committee in respect of which an order under section 16A above is in force.
(2) In relation to any such committee, section 18 below shall have effect as if—
(a) paragraph (b) of subsection (4) read "other members appointed in accordance with and subject to the terms of the local flood defence scheme"; and
(b) paragraph (c) of subsection (4), and subsection (5), were omitted.
(3) In relation to any such committee whose membership does not include any member appointed by or on behalf of a constituent council, Schedule 5 to this Act shall have effect as if—
(a) in paragraph 1(1), the words "other than those appointed by or on behalf of one or more constituent councils" were omitted;
(b) sub-paragraphs (2), (3) and (4) of paragraph 1 were omitted; and
(c) paragraphs 2 and 9 were omitted.""
My Lords, the amendments will provide the National Assembly for Wales with the power by order to reform the composition of regional flood defence committees in Wales. The present composition is established by primary legislation. In Wales committees comprise local authority, Environment Agency and Assembly appointees with the local authorities providing the majority.
Flood defence functions in Wales are devolved to the National Assembly, which is the democratically accountable body for Wales. The Bill separately provides powers which will enhance the Assembly's ability to make changes to the structure of flood defence committees and their funding arrangements. It is logical that in considering this the Assembly should be able to determine the membership of its committee(s) which have a key role in delivering flood defence for the people of Wales.
Making the power available to the Assembly does not prejudge how that power will be exercised. If, however, the Assembly decided to exercise this power, any proposed change would be subject to the Assembly's scrutiny and approval procedures.
As current committee boundaries follow river catchment rather than political boundaries, there are parts of England which are served by Welsh committees and vice versa. To safeguard the interests of those living in England and being served by Welsh committees the amendment includes the requirement for the Secretary of State's agreement to changes proposed by the Assembly which impact on England.
Clause 92 is consequential on the introduction of Sections 16A and 16B. I beg to move.
My Lords, I am happy to make a short input into the amendment as a Welsh Member of this House. It is very welcome indeed to see that the Assembly will be able to exercise these powers. I wish to put one or two points on the record regarding membership of regional flood defence committees in Wales. I am pleased that the amendment refers to committees to be specified by the Assembly, and that the Assembly will have the power to alter the composition of the regional flood defence committees in Wales. That is a satisfactory state of affairs.
The method of selection of the committees is the purview of the National Assembly. I wish to make two points which are encapsulated in the present system. Obviously, there is the question of technical expertise and local input. At the present time some of the technical expertise is supplied by the Environment Agency and the local input by local authorities. I am sure that the Assembly will take note of what I have just said and will undoubtedly also take note of what the Minister said about cross-border influences and the solutions to that. I merely point out that we have in Wales at least two river systems, the Wye and the Severn, which cross the England/Wales border. It is obviously important that that aspect is addressed by the Assembly.
Should the Government accept what is contained in the next amendment—I do not want to pre-empt it in any way—that might have an impact on what the Assembly might wish to do on the question of river basin management. I hope that the Assembly will take note of this debate and the points made in it and in particular the merits of some of the aspects of the Bill to help it come to decisions on how to manage the system. I realise that I am on delicate ground as this is the purview of the Assembly and not of this House. Nevertheless I make these points as a Welsh Member of this House.
My Lords, I am very pleased to follow the noble Lord, Lord Livsey, in responding to the amendment. In doing so, I hope that he will forgive a gentle reminder, prompted by his opening remarks, that he is a Member of this House. He may come from a part of the country that is rather special, but we all come from parts of the country that are rather special, and we none of us represent them.
I am very grateful to the Minister for his letter of explanation, if only because it gave me the opportunity to consult colleagues who knew rather more about the special area that the amendment affects than I do. We have members there, and the Minister will be glad to know that he is acting in complete compliance with their wishes. I am sure that that will give him great reassurance.
The amendments are easy to support, because they are directed at giving control of the local situation with regard to rivers and so on to those who know most about them—the people immediately affected. I have only one comment: what is sauce for the goose is sauce for the gander. The amendment applies to Wales, but others might apply to England. If we are to apply a consistent principle throughout the Bill, proposing something for one area makes it entirely relevant for consideration elsewhere. I am happy to support the amendment.
My Lords, I want to tell the noble Lord, Lord Dixon-Smith, that I know exactly where I come from. I do not come from Wales; I come from Cambridge in England. However, I am here as spokesman in the House of Lords for matters relating to Wales. I am extraordinarily sensitive, as we all have to be, to the fact that we are talking about a devolved matter. It is absolutely appropriate for noble Lords to comment on matters, but we must remind ourselves that those matters have to be considered by the Welsh Assembly. For that reason, I am extremely grateful to the noble Lord, Lord Livsey, for putting on record for consideration by Members of the Welsh Assembly a number of matters in which he was interested and wished to draw to their attention.
moved Amendment No. 158:
Page 81, line 25, at end insert—
"(5) Subsections (1) to (4) above shall have effect until December 2007.
(6) On 1st December 2007 section 14 (regional flood defence committees) of the Environment Act 1995 shall be repealed.
(7) From 1st December 2007 the Secretary of State shall, by order, establish a river basin management committee in place of each regional flood defence committee which will cease to exist under subsection (5).
(9) Each river basin management committee shall include—
(a) elected local authority members from the local authorities which are located in part or entirely within the river basin covered by the committee; and
(b) other members whom the Secretary of State considers to offer substantial local knowledge on issues within the competence of the committee.
(10) Each river basin management committee shall inherit all of the powers and duties of the regional flood defence committee it shall replace.
(11) Each river basin management committee shall develop policies and a river basin management plan in consultation with the Environment Agency.
(12) Each river basin management committee may, where the size of the river basin so necessitates, and after consulting the Secretary of State, establish such sub-basin management committees as it considers appropriate.
(13) From 1st December 2007 the amendments made in subsections (2) to (4) to Schedule 4 to the Environment Act 1995 shall have effect as if references to "regional flood defence committee" or any variant thereof were to "river basin management committee" or the appropriate variant."
My Lords, the clause aims to rearrange the flood defence committees. Before I go any further I had better declare an interest, in that my husband chairs one such committee. The rearrangement of the committees may well be an improvement, but it ignores completely a whole range of issues that the Water Framework Directive—we have been reminded that it will move into national implementation at the end of the year—will require. It is a great loss that Clause 64, instead of grasping that opportunity and creating river basin management committees, simply rearranges flood defence committees.
My amendment does not propose adding another layer of committee. It proposes that we abolish flood defence committees, not immediately but in 2007; I recognise that it may well take that long for the Government to come up with the geographical areas, composition of the committees and exactly how they will operate. By 2007, we need committees that are able to take on the requirements of the Water Framework Directive.
I am aware that there is government resistance to this proposal. The Government, having appointed the Environment Agency as the competent agency to oversee all of the river basin management issues, believe that the agency should be in charge of its own plans with its own discretion as to how and when to involve the public.
The directive makes it clear that public participation must happen. But I do not believe that it is adequate to leave the agency in charge of such an important area and then to say that the flood control element alone can be subject to some kind of democratic accountability.
I anticipate that the Minister may well say that local plans or regional spatial plans are the place for involvement. But at present those bodies have much else to deal with—housing, waste and transport—and they will never devote sufficient time to water and water issues, particularly at the point when the Water Framework Directive is new and needs an enormous amount of energy in terms of its successful implementation. Perhaps after 15 or 20 years the regional spatial plans might be considered the place to deal with water issues. But I do not believe that any of our democratic structures these days are likely to last for 20 years unchanged.
The Environment Agency's role as the competent authority is crucial in terms of giving technical advice and producing the plan. But it is primarily an organisation that is geared to regulating. Its primary function is not as a facilitator of public debate and involvement—indeed, that is not where its expertise lies.
We need a statutory group of people, drawn from the communities of the river basin, to oversee a process which, if successfully implemented, as we have said time and again in this House, will bring great benefits. But if it is unsuccessfully implemented, with inadequate public participation, it could well be disastrous and expensive. To date, the Government's record is not terrific in this area. They have one pilot in the Ribble Valley which was implemented a year or so later than all the rest of the European pilots and after a great deal of debate over whether England would bother with a pilot at all. By contrast, the Scottish Executive already has a national stakeholder forum of representatives of industry, landowners, environmental organisations and the public.
My amendment allows in subsection (9) for a mix of people, but, crucially, it specifies that there must be representatives of the public, elected by the public themselves, as councillors. The Secretary of State can then supplement those from a range of people with the necessary skills and local knowledge.
As to timing, I have specified December 2007. I suggest that that would be enough time for the Government to organise this process. It is also driven by the fact that that is the latest date when the river basin management plans can be produced on time yet enable adequate public input. The preparation of the plans must happen at least three years before they are due to be implemented.
Anyone in this Chamber—I know that there are several—who has been involved in the preparation of a local plan will know that it takes several years to allow for enough public consultation. Given that the Water Framework Directive introduces a new process, I believe that that time-scale is probably just sufficient.
It has been said that the Water Framework Directive will have as big an impact on the management of water in Europe as Roman aqueducts did at the time. I remind the Government that in Roman times the introduction of aqueducts decided whether new towns could develop. They removed water from some and gave it to others. Perhaps the Labour Government should not be compared to a Roman emperor, but I hope that they will have learnt some lessons from that and will encourage genuine public participation, where the agency is not in charge of the process. I beg to move.
My Lords, my name is attached to this amendment. I wish also to mention Amendment No. 159, which is linked to Amendment No. 158. First, I fully support my noble friend Lady Miller in her amendment and wish to be recorded as doing so, particularly with regard to the aspects of the amendment relating to local input, which is absolutely vital in river basin management.
However, my concern is with Amendment No. 159, which relates to non-main rivers. The amendment states:
"River basin management committees shall have the power to direct . . . the Environment Agency to carry out non-main river management schemes".
That is not all. Paragraph (b) states,
"that adequate funds be provided to the Environment Agency to carry out non-main river management schemes to agreed standards".
I am happy to say that I received letters from the Minister and the Environment Agency which are extremely helpful in that regard.
As Members of this House will know, in Committee I pressed particularly hard for non-main rivers to be taken within the purview of the Environment Agency so far as concerns management, flooding and matters of that kind. The Environment Agency responded, saying that the Government are already proposing to transfer responsibility for critical ordinary water courses by reclassifying them as main rivers. I welcome that very much. My only problem is that that apparently does not include all non-main rivers but those classified as critical ordinary water courses.
To inject a lighter note into this matter, the letter from the Environment Agency says that this subject has the unfortunate acronym of "COWS". I suppose that that is the first instance of cows grazing water! Indeed, main rivers are already designated, and ordinary water courses and all other water courses are the responsibility of local authorities or, where they exist, internal drainage boards. I believe that the Government have gone a long way to ensuring that non-main rivers which cause considerable flooding and problems and which at present are not maintained or managed by the Environment Agency will be so maintained and managed in future.
I am a little concerned about what will happen to ordinary water courses which are not critical. As I understand it, this matter will still come within the control of local authorities. Global warming is important these days and is becoming increasingly so. Sometimes communities receive a surprise when smaller rivers which they have not seen flood for a long time suddenly do so because of incidents which are not, and in the past have not been, typical but, sadly, sometimes now are, and they cause much damage to property and to land. Therefore, in proposing this amendment, I am taking note of correspondence that I have received from the Minister.
My Lords, I believe that two issues relating to these amendments are worth mentioning. Having dealt with the previous amendment, which sets out particular conditions for Wales, it seems to me that, in a sense, the Government are conceding the principle behind the amendments so far as concerns England. The Minister may choose to deny that in due course, but that remains to be seen.
However, I believe it has been a consistent argument from our side that those who know most about the local conditions on local rivers and most about where the problems lie are those who have to deal with them. In the past, those organisations have always been the local river board or the local land drainage committee or whatever. In principle at any rate, we would be bound to support the sentiments behind the amendments even if we did not agree with every word in them.
A slightly different issue arose in correspondence that I saw a while ago from our local environment agency. It appeared to fall back on what I believe is still the technical English common law position; that is, ultimately, the responsibility for any particular water course lies with the riparian owner. A local authority may act—it has the power to act if it feels that that is necessary—but it does not have to. I believe that I am right in saying that the same legal position applies to the Environment Agency: it may act—it has powers to act—but the legal responsibility if things go wrong still lies with the riparian owner. I should be pleased to be reassured that the responsibility of local authorities, local drainage boards or the Environment Agency was more clearly drafted than was implied by that correspondence. Whatever answer I receive, I may have to have more interesting correspondence with my local environment agency.
I return to the amendment. In principle we believe that it is correct and I am pleased to support it and those grouped with it.
My Lords, Amendment No. 158 would abolish regional flood defence committees and replace them with "river basin management committees". The intention appears to be that these new committees would deal not only with flood defence but also the river basin management plans under the water framework directive. It is not mandatory under that directive to create river basin management plans and it does not touch other responsibilities of the flood defence committees.
The Government yield to no one in this regard; certainly not with regard to the expressions, with which I totally agree, about the importance of local engagements and local representation on the management boards. We have a query with the structure and timescale proposed in the amendment. The Government have recently announced their own conclusions on the review of flood and coastal defence funding and administrative arrangements. That followed pretty widespread consultation. One of the key conclusions is that a single tier of flood defence committees should be established to improve accountability and reduce administration. At present, some parts of the country have two tiers and others have one tier; it is a total hotchpotch. Clause 64 as currently drafted would allow us to create the new structure and I hope that it would do so within a timescale that allowed us to put the new structure in place by 2005. The noble Baroness's amendment puts that back by two years and would require a further round of changes to the structure and loss of the benefits in the intervening years. More importantly, it leaves us with a structure that relates to river basin catchment areas, several of which are larger than the areas that are currently covered by some of the flood defence committees and might prove difficult to operate effectively.
Respondents to the review emphasised the need for flood defence provisions to be determined by dedicated bodies covering areas that were significantly smaller than the larger river basins.
Flood defence committees would have a very distinct role to play in delivering the flood defence service. The Environment Agency is required to carry out nearly all of its flood defence responsibilities through those committees. They are, in that sense, executive committees. That is most effectively served by the discharge of their powers and functions through regional flood defence committees that are specifically designed for that purpose and not the wider purposes envisaged by the amendment. If we submerged them in a new committee with a much broader remit we could lose the focus on flood defence issues, which is vital to our flood defences.
The role of the Environment Agency was also raised. We have already consulted on the proposition that the Environment Agency will be the "competent authority" for the directive rather than local authorities, and that the agency's functions will include co-ordinating the production of river basin management plans. The agency is developing a strategy for ensuring effective engagement with stakeholders, including local authorities and others, but it will be for the agency to decide whether this might include more formal committee-style arrangements to carry forward the development of river basin plans. That is a separate issue from how we structure our flood defences.
The whole point of any rationalisation of the current flood defence committee structure is to make it more effective, more focused, and less of a hotchpotch across the country. The effect of this amendment would be to broaden the scope and create some large structures that would be incapable of carrying out that focused activity.
Regarding Amendment No. 159, to which the noble Lord, Lord Livsey spoke, it is true that some classification issues arise, but the distinction between "main rivers" and "non main rivers" needs to be maintained. The main rivers are those on which the Environment Agency's activity is focused, and which provide the highest risk from flood damage. The amendment would suggest that non-main rivers would come under the Environment Agency. I was not sure whether the noble Baroness was referring to the Secretary of State or to my noble friend Lady Young of Old Scone as a Roman emperor—she is not in her place. The idea that all local authorities' functions in relation to non-main rivers should come under the Environment Agency would be met with resistance by the local authorities. In any case, it is not appropriate if the focus of the Environment Agency is on the areas of highest risk.
My Lords, I thank the Minister for giving way. Neither the funding nor the equipment is available to local authorities to manage the non-main rivers adequately. As I understand from correspondence, critical waters are now going to be managed by the Environment Agency. Am I correct?
My Lords, the Environment Agency allocates its priorities according to the highest risks, and those are on the main rivers. Therefore the funding priorities reflect that. I cannot comment on the exact funding situation of any group of local authorities that have been in correspondence with the noble Lord. But priority for flood defence relates to the main rivers—including one or two that may need to be reclassified.
The two amendments go against the outcome of the consultation, and the intention to set up flood defence committees that are capable of delivering the job of flood defence and relate to areas that can be truly reflective, both of local representation and of the flood defence threats presented. I therefore hope that the amendments are not pursued.
My Lords, I am almost speechless. Out of politeness, I thank the Minister for his reply, but I am deeply disappointed by it. He continues to miss the point. I agree that the Government did consult on flood defence committees' restructuring, when they should have been consulting on how to involve the public in the Water Framework Directive. When the Minister said that the committees need simply to be flood defence committees, so that they can focus on floodwater issues, that entirely misses where the Water Framework Directive takes us. It takes us away from dealing with floodwater as simply that, and it encourages us to deal with water as a whole, as a cycle—so that while it could be floodwater, it could also be water helping wetlands to be successful or it could be irrigation water. That will involve the public in all sorts of ways, planning authorities and so on.
I am deeply disappointed that the Government still refuse to see that simply rearranging the flood defence committees will not change fundamentally the attitude to water of the public and public bodies as required for the measure to be successful.
I can see that I shall get no further in obtaining the Government's consent to the amendment. In order to make the point, I shall test the opinion of the House.
moved Amendment No. 160:
After Clause 67, insert the following new clause—
In section 6 of the Environment Act 1995 (c. 25) (general provisions with respect to water), in subsection (2)(b), after "Wales" there is inserted "(including the efficient use of those resources)"."
On Question, amendment agreed to.
[Amendment No. 160A not moved.]
Clause 69 [Environment Agency to be enforcement authority under the Reservoirs Act 1975]:
[Amendment No. 160B not moved.]
Clause 72 [Flood plans]:
moved Amendment No. 162:
Page 86, line 34, after "reservoir" insert "(whether a large raised reservoir or not, as the case may be)"
On Question, amendment agreed to.
moved Amendment No. 163:
After Clause 76, insert the following new clause—
"SUSTAINABLE CONSERVATION OF WATER RESOURCES
(a) that all water resources are ecologically sustainable;
(b) high levels of water quality;
(c) that water quality consistently improves over time;
(d) that compensatory river flows can sustain a river system;
(e) that volumes of water in lakes and reservoirs comply with agreed pre-determined levels;
(f) that oxygen and acidity levels meet agreed parameters;
(g) that fresh water fisheries can sustain the renewal of fish populations;
(h) that actions and targets are laid down as a result of river basin management plans agreed with river basin management committees."
My Lords, Amendment No. 163 is the braces for the belt which is the EU Water Framework Directive. If that does not come through in the Bill, this is a longstop to try to ensure that we have proper environmental sustainability. The amendment deals with the sustainable conservation of water courses. We ask for the Environment Agency to monitor continuously water resources in England and Wales to ensure that all water courses are ecologically sustainable; that there are high levels of water quality; that water quality consistently improves over time; that compensatory river flows can sustain a river system; that volumes of water in lakes and reservoirs comply with agreed pre-determined levels; that oxygen and acidity levels meet agreed parameters; that fresh water fisheries can sustain the renewal of fish populations; and that actions and targets are laid down as a result of river basin management plans agreed with river basin management committees.
That is a longstop if we do not have adequate protection in the Bill. We would like to ensure that the principles of environmental sustainability are contained in this legislation. We believe that the main points are made in the amendment. I beg to move.
My Lords, the noble Lord links this amendment to the Water Framework Directive and in some sense it would appear to be another attempt to put chunks of the directive or what one needs to do under the directive on to the face of the Bill. I know that is what the noble Lord thinks and that is what the Liberal Democrat Benches have been urging on us, but the logic of decisions taken during the passage of the Bill is that, for the implementation of the directive, we are resting on the normal transposition process. Therefore, the Bill does not cover the range of areas covered by the Water Framework Directive. While many of the objectives are desirable and reflect other parts of the Bill, it seems superfluous to have in the Bill a clause that will be dealt with by another piece of legislation, albeit secondary legislation, under the European Communities Act. Therefore, I hope that the noble Lord does not pursue the amendment.
My Lords, I am sure that the Minister will note that I have considerably modified this amendment, which refers to unadopted sewers. The Minister was helpful in Committee. In the report of the Committee proceedings of 29th April 2003, one can read that the Minister assured the Committee that as far as the new build was concerned, any new sewers would be the subject of a protocol that was established as a result of a consultation in 2000,
"which sets out the key elements of design and construction of sewers for all new developments".—[Official Report, 29/4/03; col. GC 161.]
That is what the Minister said when we discussed another, similar amendment. He stated then that,
"the situation is far more complicated with regard to existing private sewers".—[Official Report, 29/4/03; col. GC 161.]
At that time, the Minister said that he would shortly issue a consultation paper seeking views on possible solutions to deal with the problems.
In this amendment, I am not asking for precise commitments from the Minister in the Bill, but I am asking for parity with new developments as far as unadopted sewers are concerned. We are asking for a protocol for unadopted sewers, in the same way as the Minister outlined that there is a protocol for new sewers. This would be a commitment from the Government to ensure that these unadopted sewers would be the subject of a protocol and would be brought up to scratch over time. It gives the Minister more leeway than I gave him in previous amendments in Committee.
I doubt whether there is any Member in the other place who is not afflicted with the problem of unadopted sewers in his constituency. They are a blight on housing, and a huge problem. If the Minister will accept this and produce a protocol that lays down the conditions for unadopted sewers to be brought into the system in a way of the Government's choosing, many residents throughout the country would be eternally grateful. This is important, and I beg to move the amendment.
My Lords, it is a regrettable fact that unadopted sewers have an awkward parallel with unadopted roads. Sometimes, trying to put the situation right is a moot point. If people have lived with unadopted sewers and unadopted roads, often the problem of getting them into a state in which they can be adopted—which means lifting them to a standard where they are of comparable quality and comparable stamina to existing public roads or sewers—places the householders with considerable financial liabilities.
It may be a regrettable reality, but if the Secretary of State produces a protocol on the matter—it would not cost the Exchequer exorbitant sums of money—there will be great difficulty and disappointment. The Secretary of State can, and probably should, come up with a protocol. But none of us should begin to assume that the protocol will necessarily provide relief or an immediate solution to those who must live with such problems, if there is a problem.
The situation will be rectified only when property owners who are affected eventually dip into their pockets and lay out the necessary capital, as has been the case with unadopted roads. If they do so, and must subsequently put their property on the market, they will normally get their money back in enhanced value. But that does not alter the fact that many of them will not want to sell their property; nor will they want to put their hands in their pockets. This is a quite fruitful way of causing divisions in what are often tight-knit communities.
That said, I agree entirely that, where such problems exist, they should be tackled if possible. However, they can be tackled only with the voluntary agreement and co-operation of those who have enjoyed the benefit of living for so long with an unadopted sewer.
My Lords, I recognise some of the points and problems referred to. However, the amendment is slightly misconstrued. The protocol to which the noble Lord, Lord Livsey, and I referred deals with the design, construction and adoption of new sewers and the process of development. In this amendment, for the most part, we are talking about what should be done about existing unadopted sewers. It is doubtful that a protocol for unadopted sewers would be parallel to that which has been produced for new development.
The next stage of the work is to look at existing private sewers. We will shortly produce a consultation paper engaging with everyone concerned about solutions for dealing with existing private sewers in England and Wales. I am not sure of the outcome of the consultation. However, it will not be the same sort of protocol to which I referred in Committee. Therefore, it is premature, and probably inappropriate, to stipulate a protocol in this part of the Bill. I must therefore resist the noble Lord's amendment.
My Lords, I thank the noble Lord, Lord Dixon-Smith, for his support of the amendment. I note what the Minister says; however, as he said previously, there will be a consultation paper on unadopted private sewers. I am sure that we will all be anxious to know the outcome of that consultation. It is not asking much of the Minister in these circumstances to produce a protocol and to give a commitment that it will incorporate the findings of the consultation paper. The amendment was deliberately loosely framed, but we seek a commitment.
In the circumstances, it may be necessary to return to the matter on Third Reading. In the mean time, I beg leave to withdraw the amendment.
moved Amendment No. 166:
Page 108, line 43, leave out subsection (8) and insert—
"(8) The substitution by subsection (7) of section 101 of the WIA does not apply in respect of requirements notified under section 98 of the WIA before subsection (7) comes into force."
On Question, amendment agreed to.
Clause 91 [Communication with public sewers]:
moved Amendment No. 167:
Page 113, line 42, at end insert—
"(2A) For paragraph (b) of subsection (2) there is substituted—
"(b) to discharge directly or indirectly—
(i) foul water into a sewer provided for surface water; or
(ii) except with the approval of the undertaker, surface water into a sewer provided for foul water; or"."
My Lords, in moving Amendment No. 167, I shall speak also to Amendments Nos. 168, 169 and 170. The background to these amendments is that sewerage and drainage systems are designed to cope with existing and planned development. Systems have to be managed to cope with excessive rainfall or demand. However, water companies have no discretion as to where a developer or householder connects to the drainage and sewerage systems. Some developments are designed with sustainable drainage systems such as soakaways. That may mean that there is no surface water sewer. Currently, there is nothing to prevent a householder from connecting his surface water run-off to the public foul sewer. Such overloading of systems can lead to flooding.
There is a case for allowing water companies to reject or amend developers' plans or householders' requests for connection in cases where it may lead to problems for existing infrastructure and to suggest alternative connection solutions. The amendments will allow sewerage undertakers some discretion as to whether to allow connection of private surface water sewers and drains to public sewers in circumstances where less costly provision for surface water disposal could be made. It will enable sewerage undertakers to develop a sewerage system planned and managed in a sustainable manner, to reduce the risk of flooding from sewers and to ensure consideration of sewerage and ancillary works at an early stage of the development and construction process.
In Grand Committee, the Minister acknowledged the importance of sewerage and the necessity for developers to take account of the problems that can arise if the developer does not recognise what has happened there already and what will be needed in terms of increased pressure on the system. He said that the Government were in discussion with water companies and the ODPM about sewerage development. He continued, recognising the problems. He responded that sustainable surface water drainage systems are being considered by a working group under the chairmanship of the agency. He suggested:
"If we can develop such systems, they can significantly reduce pressure on the sewerage system by collecting, treating and disposing of surface water locally into the ground. ... We also need to establish the responsibilities and the costs of building and maintaining such systems".
The Minister referred to the consultation paper launched on 22nd May.
"Until that work is completed and decisions have been taken on it later in the year, I believe that it would be premature to accept the amendment as it stands and to see whether . . . we should amend Section 106 of the 1991 Act".—[Official Report, 29/4/03; col. GC 163.]
There is a lot of good reasoning in the Minister's arguments. We understand that the Government will publish its own consultation on SUDs in the autumn, along with a consultation on private sewers—should these be adopted by the industry. We are concerned that there is no guarantee that these amendments, if withdrawn, would feature in a subsequent Bill, which we assume would be the environment Bill.
Supporting the case against the Minister's arguments, subsection (4A)(a) in Amendment No. 168 states that where,
"it is feasible for an alternative method of drainage to be provided, utilised, maintained and kept in repair", and in (b) that it is,
"justifiable taking into account the relative cost to the applicant".
The fallback position for the industry would be to seek assurances that provisions covering the amendments would be incorporated within a subsequent environment Bill. I beg to move.
My Lords, we support the amendments, particularly those which relate to foul water. It is a huge problem in some areas and a very serious degradation of the water environment.
My Lords, I recognise that and the problems which this group of amendments seek to address. But I repeat what I said in Committee. We have issued the Framework for Sustainable Drainage Systems in England and Wales as a consultation paper which, among other things, focuses on the issues of sewerage, including the problem where foul sewers also carry surface water and the surcharge and discharge that results from that.
That consultation is quite complex. I am still of the view that we should await that consultation before proposing amendments to the 1991 Act, to which these amendments are directed.
A further consultation stage may be necessary later this year so that we can consider further all the specific disposal arrangements, including the issue of enforceable ownership and arrangements relating to the connection and maintenance of private sewers. Until we have gone through that process, it is premature to amend Section 106 of the 1991 Act.
Therefore, while registering similar concerns to the noble Baroness, I would not wish to see the amendment in the Bill. However, as a result of the consultation, it may be that some other piece of legislation may be appropriate to carry forward similar amendments.
My Lords, at the end of the consultation period we will take decisions in the light of the consultation. It is conceivable that one of the options would be to do nothing. I very much doubt it however; this is too serious a problem for no action to be taken.
moved Amendment No. 171:
After Clause 91, insert the following new clause—
"DISPUTES OVER DUTY TO PROVIDE SEWERS
(1) Section 101A of the WIA (further duty to provide sewers) is amended as follows.
(2) In subsections (7) to (10), wherever the words "Environment Agency" appear, there is substituted "Secretary of State"."
My Lords, when the Environment Act was drafted in 1995 it was considered that the Environment Agency was the appropriate body to consider disputes arising from a sewerage undertaker's decision. It had, and still has, the expertise for dealing with such matters. I know that there are concerns about the pressure on the Environment Agency with the time taken to deal with such disputes; particularly those challenged by undertakers through a judicial review. But were they to revert to the department, as the noble Baroness's amendment suggests, the department would still have to depend for its expertise on the Environment Agency's advice.
So that would not avoid pressurising the Environment Agency; it would merely lead to a degree of duplication between the department's responsibilities and the expert advice and guidance from the Environment Agency. I am therefore not persuaded that such a change is necessary.
My Lords, I heard what the Minister said, but I can imagine a situation where if the Secretary of State had responsibility, he or she would have more clout than the Environment Agency to get things done more quickly than at present. I will probably have to come back to the matter. In the mean time, I beg leave to withdraw the amendment.
moved Amendment No. 172:
After Clause 91, insert the following new clause—
(1) In section 144 of the WIA (relating to the liability of occupiers for charges), in subsection (1), after "of this section" there is inserted "and of section 144AA below".
(2) After section 144 of the WIA there is inserted—
"144AA LIABILITY OF OWNERS ETC FOR CHARGES IN PRESCRIBED CASES
(1) In respect of any premises of a class prescribed for the purposes of this section, section 144 above shall take effect as if for the references throughout that section to the occupier or the occupation of premises there were substituted references to the owner or ownership of such premises.
(2) Regulations made for the purposes of subsection (1) above may also modify or extend the application of that subsection in one or more of the following respects by providing that—
(a) in relation to any specified types of premises within the class of premises prescribed for the purposes of subsection (1) above, for the references to the owners and ownership of such specified premises, there shall be substituted references to such other categories of persons and to such rights as may be prescribed by the regulations;
(b) specified classes of persons who are—
(i) owners of classes of premises prescribed for the purposes of subsection (1) above, or
(ii) within those categories of persons prescribed for the purposes of subsection (2)(a) above, shall be excluded from the application of the regulations;
(c) the owner or occupier of any premises of a class prescribed for the purposes of subsection (1) above which are provided with any service by a relevant undertaker in the course of carrying out its functions shall, when requested in writing to do so by the undertaker, provide the undertaker with such information as may be prescribed concerning the ownership or occupation of those premises;
(d) such statutory undertakers or public bodies as may be prescribed shall, when requested in writing to do so by a relevant undertaker, provide the undertaker with such information as may be prescribed concerning the current or former ownership or occupation of any premises of a class prescribed for the purposes of subsection (1) above which are or have been provided with any service by the undertaker in the course of carrying out its functions.""
My Lords, the purpose of the amendment is to remedy a deficiency in the water industry legislation. It does not define who is the water industry customer in houses in multiple occupation; for instance, holiday lets, bedsits, lodgings or bed-and-breakfast accommodation. It is important that all water industry customers should be properly defined so that relationships can be established and, in particular, so that customers who receive water and sewerage services can be charged for those services and any debt can be collected.
The Water Industry Act 1991 gives statutory water and sewerage undertakers—the water companies—the power to levy water and sewerage charges on the occupiers of properties supplied with water or drained directly or indirectly into a public sewer. That is consistent with the statutory duty on water companies to provide water and sewerage services to the occupiers of such premises under Section 144(1).
The Water Industry Act, with all its amendments, does not define the meaning of the word "occupier". In many cases, that is not a difficulty, but it is a serious problem for houses in multiple occupation. Without a clear definition of "occupier", water and sewage undertakers are having difficulties imposing charges on houses in multiple occupation. Property owners operate such properties as commercial businesses. The existence of a water supply is required to render the property lettable, and in many cases has been provided at the request of the owner.
Owners argue that they are not responsible for charges and that the water companies should bill the occupiers. However, there is no requirement on them to tell the industry who the occupiers are. Moreover, in many situations the tenants' occupation is far too transient and temporary to enable a water company to levy charges to each multiple occupant. Indeed, water companies would be in breach of privacy if they inquired on a monthly basis about the number of tenants or bedsitters in each lodging for the past month, whether they were single or a couple and therefore what fraction of the bill attributable to the property could be sent to each named individual. That simply does not make sense, but that is the ridiculous situation that directly results from a lack in a definition in law of the term "occupier".
The water industry has sought legal opinion and has been advised by Queen's Counsel that the definition of the term "occupier" in cases of multiple occupation can be secured only through further legislation. The water industry is in a unique situation in that companies have a statutory duty to supply, whether or not they are paid by their customers. In that respect, their legal situation is similar to that of local authorities, which provide services such as rubbish collection to individual properties and to people living in them, irrespective of whether council tax has been paid.
The amendment draws on the solution that enables local authorities to levy council tax in cases of multiple occupation. It provides for regulations to define the body of individuals liable to pay water or sewage charges for particular properties by establishing a clear definition of the term "occupier". There is, therefore, an in-built flexibility as to which properties will be affected. The liable individual could be the owner or someone else as determined by regulation. The amendment would also require the owner or occupier of a class of dwellings prescribed by regulations to provide the statutory undertaker with information concerning the ownership and occupation of those dwellings. That would be useful where water companies needed information to ascertain who was the occupier in the case of a particular property.
Importantly, the amendment would not impose a liability on housing associations and local authorities where the usual single landlord tenant relationship exists. Also, it would not change the direct relationship that exists between any person using tap water who needs to get in touch with his or her local water company on matters to do with the actual water supply.
There is a good case for changes in primary legislation. The failure of the water industry to recover costs from the people using multiple occupation premises places a significant additional and unfair burden on the customers who are charged and do pay their bills. Domestic customer debt, generally, has been estimated at between £5 and £10 per customer per year. Debts from multiple occupancy dwellings account for a disproportionate share of this burden. We must remember that multiple occupancy of the transient kind is very often practised by upwardly mobile professionals and similar groups who cannot, by any stretch of the imagination, be described as vulnerable or in long-term poverty.
I have some figures which have been estimated from data provided by three large water companies, Northumbrian Water, Essex and Suffolk Water, and United Utilities. Together, those companies represent 11 million customers out of 52 million served by the industry in England and Wales—more than one in five customers. The figures represent both measured and unmeasured households, in both urban and rural areas, both in the north and the south of the country. We find that, within the industry, approximately 6 per cent of chargeable properties are houses in multiple occupation, but those properties accounted for 13 per cent of household debt written off in 2001–2. That means that those properties account for more than double the debt cost that the water industry incurs for other kinds of property. That is before we look at outstanding debt, not yet written off, which has been steadily growing in the last few years, when sanctions and terminated supply were stopped.
Water industry debt is a complex problem which needs to be addressed from several perspectives. The figures I have just quoted show that there is a special problem with houses in multiple occupation, which stems from a lack of definition in law for the customer receiving water services and responsible for paying water charges. The deficiency can be remedied only through targeted specific primary legislation. I beg to move.
My Lords, I thank my noble friend for bringing forward a very important amendment for us to consider. I shall not go into the detail that my noble friend covered. The amendment asks who is the water industry's customer in houses in multiple occupation. That is a problem that needs addressing.
My noble friend clearly stated that within the industry approximately 6 per cent of chargeable properties are houses in multiple occupation but that those properties accounted for 13 per cent of debt written off in 2001 and 2002. Those properties account for more than double the debt cost which the water industry incurs from other kinds of property. It is an important issue. I hope that if the Government are not able to accept my noble friend's amendment in its present form, they will recognise publicly the difficulty that afflicts water companies and come up with their own proposals for moving forward on the matter.
My Lords, I recognise the difficulties caused by the problem of debt and how it is often related to absconding tenants. But the solution the noble Baroness puts forward is a revolutionary proposal with rather wide ramifications. Effectively it would make landlords responsible for their tenants' debts. So far as I am aware there is no other situation where that is the case. It has ramifications in relation to other suppliers of services such as utilities and other private services. I am not sure that it benefits water conservation. Presumably in metered premises—many HMOs are metered—there is no incentive for the tenant to save water if the landlord always stumps up for the bill. Therefore, I am not sure that the amendment would achieve many of its aims but in any case it raises such wide issues that I do not think that one could introduce such an enticing but radical concept.
It is not just a simple question of redefining who is the client. The matter goes to the heart of the landlord/tenant relationship in the context we are discussing and in other contexts. I do not accept that we should adopt the measure in respect of water debt. Difficult though that situation is for many water companies, we should try to find another solution.
My Lords, before the Minister sits down, I accept the comments he has just made about the difficulty in regard to landlords and tenants. As a landlord I worry about that, but my let property is not a house in multiple occupation. There is a serious problem here that needs addressing. This Bill may not be the right place to do that. However, I support my noble friend's amendment as the matter we are discussing is a growing problem. As we said in earlier debates on the Bill, it is easy for people to walk away from the responsibility of paying their water bills.
Perhaps the time has come to give additional thought as to how this kind of problem can be overcome. If it is a case of non-payment for gas or electricity, the supply gets cut off and there is no charge for it. But water is still there; the water has to be supplied. Although I fully understand and accept the Minister's logic and I declared an interest as a landlord, there are problems here. I hope that the Government will reconsider the matter. I am not suggesting that they come back with another amendment. The problem is long term and needs to be addressed as it will not go away. Unfortunately, it is on the increase. That is why I support the thrust of what my noble friend is trying to achieve in defining where the buck stops.
My Lords, I am very grateful to my noble friend. I am also grateful to the Minister for his comments. He said that the amendment would not benefit water conservation or the environment, but the problem is a drain on the resources of every customer in the land. We all pay more for water because of what are called wanton non-payers—they are not poverty non-payers—who seem to be getting away scot-free.
We ought to do something to tackle the problem. Other ways have been suggested, and perhaps we should look at them, although it is too late to introduce them to the Bill. We are hoisting the warning cone to say that the situation that has gone on since the sanction to cut off water was taken away cannot go on. I beg leave to withdraw the amendment.
moved Amendments Nos. 173 and 174:
Page 117, line 19, after "enactments" insert "and instrument"
Page 117, line 19, after "repealed" insert "or revoked"
On Question, amendments agreed to.
Schedule 7 [Minor and consequential amendments]:
moved Amendment No. 175:
Page 181, line 48, at end insert—
"( ) In Schedule 4A—
(a) for paragraph 1(2)(a) there is substituted—
"(a) a private dwelling-house constituting the whole or any part of household premises,";
(b) at the end of paragraph 1 there is added—
"(3) In this paragraph, "household premises" shall have the same meaning as in section 17C of this Act.""
My Lords, the amendment corrects a deficiency in the Water Industry Act 1991 which was introduced through the Water Industry Act 1999. The amendment would make it easier to distinguish between business and domestic customers by extending the clear-cut definition in Schedule 4 to the Bill to other parts of the Water Industry Act where definitional clarity is needed.
The Water Industry Act 1999 amended the 1991 Act so as to provide two new rights for domestic customers—the right not to be disconnected for non-payment of water charges and the right not to be metered compulsorily in normal circumstances. Both those new rights require that a clear distinction is made between domestic and business customers. Unfortunately, the Act did not clearly distinguish between domestic and business customers in the case of mixed-use properties—for example, where a landlord lives on top of a pub, a janitor lives on industrial premises, or a groundsman resides at a golf club.
In a letter to Water UK of 11th January 2000, the then Department of the Environment, Transport and the Regions said that, in the case of mixed premises,
"only the courts can decide definitely what the law means".
That of course is correct of all legislation, but we should now seize the opportunity to improve the quality of our laws by removing as much uncertainty as possible.
The uncertainty is damaging not only for water companies, but for customers, who do not know which legal provisions apply to them and whether they are to be considered as business or domestic customers. An example is the owner of a large family home who decides to convert it to a bed-and-breakfast establishment while still living in a small flat at the top. After conversion, the house becomes a mixed-use property. I understand that that happens regularly in the South West. An important financial consideration for such a customer is whether he or she will go on paying the same water charge based on the ancient rateable value of the family house, or whether the property will be compulsorily metered as a business property. That may make a significant difference to the customer's operating costs; therefore the law needs to state clearly what the situation is.
As the Bill contains a renewed attempt at creating definitional clarity between business and domestic mixed-use premises, in connection with the extension of competition in the water industry, I propose the amendment to extend the improved distinction to other parts of water industry legislation where the distinction is important for industry customers. I beg to move.
My Lords, when the Water Industry Act 1999 was passed, there was considerable pressure on this area of the legislation to protect consumers and give a wide definition. I would be reluctant therefore to take on something that would appear to narrow the definition of that protection. Even if we were to consider the redefinition of what was enacted in 1999, the substitution of a definition of "premises" in Schedule 4 would not be appropriate. That use is for the quite different purpose of distinguishing those customers to whom competition will apply, and will be set out in regulations. It would be difficult to frame a definition which tried to achieve different policy purposes.
To take just one example, the 1999 Act does not protect second homes against disconnection. On the other hand, second homes are still within the definition for the competition regime and that is appropriate. One cannot just transfer that definition into an improved definition in connection with disconnection and other protections for the consumer.
I am not persuaded that this is a sensible way to go, although I recognise some of the concerns behind the amendment.
My Lords, this amendment is linked with Amendment No. 180—which is also linked with Amendment No. 188 tabled by the noble Lord, Lord Whitty. I shall be brief. I have been more fortunate in this amendment than my noble friend, ploughing heavily away on some of hers.
We raised this issue in Committee. I am grateful that the Minister realised that there was a problem. The Government have reacted to my amendment in bringing forward Amendment No. 188. At this stage, I should like to record my thanks to the Government. I beg to move.
My Lords, I am very pleased to accept Amendments Nos. 176 and 180. As the noble Baroness, Lady Byford, has noted in her amendment, the restriction on abstraction from the Thames below Teddington Lock is no longer required to protect public health. To this end, Amendment No. 188 has been tabled by the Government as an amendment to the Long Title of the Bill to accommodate this. I commend the amendment to the House.
moved Amendments Nos. 177 to 179:
Page 206, line 21, column 2, at beginning insert—
|"In section 21(9), the words from "in that subsection" to the end."|
Page 207, leave out line 9. Page 207, leave out line 13.
On Question, amendments agreed to.
moved Amendments Nos. 181 and 182:
Page 208, column 2, leave out lines 32 to 34.
Page 208, line 46, at end insert—
|"National Assembly for Wales (Transfer of Functions) Order 1999 (SI 1999/672)||In Schedule 1, in the entry relating to the WIA— (a) in the paragraph relating to functions under sections 2, 5 (etc), the references to section 2, sections 18 to 22, sections 68 to 70, section 93A and section 205, (b) the paragraph relating to section 28(4)."|
On Question, amendments agreed to.
Clause 94 [Specific transitional and transitory provisions]:
moved Amendment No. 183:
Page 118, line 7, at end insert—
"( ) Any person who—
(b) following the coming into force of this Act does require such a licence in respect of that abstraction, shall make an application for the licence within two years of the coming into force of section 7 of this Act, and the licence will be deemed to be granted on the terms of the application until the final and lawful determination of the application."
My Lords, Amendment No. 183 deals with transitional matters relating to applications that will need to be made for licences, where activities are coming under control for the first time.
What is being proposed here affects all such activities and sets out in principle what the Government intend to happen anyway. We have stated as much in Taking Water Responsibly. However, legal advice is that such matters are not necessary on the face of the Bill and that the proper place for these is in the transitional regulations that are provided for under Clause 95 of the Bill. I can assure noble Lords that appropriate provisions comparable to this amendment will be incorporated within transitional regulations that will be placed before Parliament in due course.
Amendment No. 185 seeks to ensure that the mining, quarrying and engineering construction industries will be included in compensation arrangements should a licence not be granted. As I said when this issue was raised in Grand Committee, where any previously exempt activity is unable to continue as a result of the introduction of any new controls by the Bill, Clause 95 already provides that regulations can deal with the payment of compensation.
We recognise that in some instances existing quarrying operations will require an abstraction licence for dewatering only once the Bill has come into force. We also recognise that under the current clause compensation may not be possible in those circumstances. We are still considering how to address this potential gap and will table a suitable amendment at Third Reading. With those reassurances, I hope that noble Lords will feel that the amendments need not be pressed tonight.
There is one other related issue to which I must draw attention. In considering the nature of the risks and harm or damage leading to what is to be classed as an "emergency abstraction" by quarries, and so on, we have identified the need to amend the provisions of Clause 7. That, in turn, has led us to consider further the scope of environmental damage in Clause 27. I take this opportunity to inform noble Lords that we shall bring forward amendments to both clauses at Third Reading.
moved Amendment No. 187:
After Clause 96, insert the following new clause—
"CONSOLIDATION OF WATER-RELATED LEGISLATION
My Lords, we return to the issue that we raised in Committee when we stated very clearly that we were all having difficulty in working through the many Acts which have been revised along the way. Therefore, Amendment No. 187 states that, following Royal Assent, the Secretary of State will consolidate the Bill with previous water-related Acts to form a composite body of legislation on water-related topics.
On 28th May on the "PM" programme on Radio 4, it was reported that Romano Prodi had commented that the draft European constitution document was a wasted opportunity and that it was, in effect, too bland and anodyne. The programme's presenters interviewed Patricia Hewitt. They began by suggesting that those comments justified the Government's refusal to allow a referendum on the subject of the draft constitution. Miss Hewitt's response was that the draft was merely the putting together of four different treaties and that the action was "modernising" and "clarifying". Her whole attitude was that this draft represented some form of common sense and good practice.
We are led by a Government who utter "education, education, education". Another mantra is the oft-repeated one concerning "joined-up government". When the subject of consolidation of water legislation was discussed in Committee, the Minister was dismissive. He stated at col. GC 179:
"Indeed, the convention is that the priority for consolidation Acts is determined by the Law Commission rather than by a government department".—[Official Report, 29/4/03; col. GC 179.]
This is not a government department. This is—or I hope that it will soon be proved to be—the will of the House. Anyone who has tried to follow the responses from the Benches opposite, let alone the wording of the Bill, will be only too aware of the muddle that water legislation is in already. On top of that, as the noble Baroness, Lady Miller said, we will have the Water Framework Directive.
The water industry is regulated by the following Acts, which are mentioned in Schedule 9 to the Bill: the Reservoirs Act 1975, the Water Act 1989, the Environmental Protection Act 1990, the Water Industry Act 1991, the Water Resources Act 1991, the Competition and Service (Utilities) Act 1992, the Environment Act 1995, the Competition Act 1998 and the Utilities Act 2000. That says nothing of the changes that were made in between. If one then goes through the record of changes that have been made to, for example, the 1991 Water Resources Act, one finds that it is derived from a further set of laws including the Water Act 1989, the Water Resources Acts 1963 and 1968, the Water Act 1973 and the Drought Act 1976. That is quite a mouthful. At this time of night, I say, "Well done, Hazel, for getting that mouthful together!".
That is confusing and I am glad to see that the Minister is slightly amused. Even the army of civil servants who are employed in their various ways and at different times on this Bill—we have been well supported by civil servants throughout our debates on the Bill—have found it difficult to point us quickly to the correct source or reference. I believe that it is part of our duty as a revising Chamber to ensure, so far as we are able, that the law is clear, understandable and enforceable. I cannot in all conscience say that of this body of legislation. I beg to move.
My Lords, I am pleased to support the amendment and must say, "Well done", to the noble Baroness, Lady Byford, for listing all of the Acts to which we have had to refer during the course of the Bill. Ultimately, it is not for our convenience if there is a consolidation Bill but it is very much for the convenience of the eventual users of legislation, be they industry, individuals or consumers. It would take some time and effort on the part of civil servants to consolidate the Bill but that would be a service. In this country we are not good at making our legislation comprehensible to the general public. We must improve on that; it would be extremely good if we started with water, which is of such general interest to everyone. For those reasons, I am pleased to support the amendment.
My Lords, I have considerable sympathy with the intentions of the amendment. I was not being dismissive earlier; I was merely stating the constitutional convention that consolidation of legislation and establishing priorities therefor are a matter for the Law Commission rather than the Government or the House when they react to one particular Bill.
The situation in relation to water is complicated but I am sure that the noble Lord, Lord Dixon-Smith, will agree that local government legislation or the criminal justice system could do with a bit of consolidation here and there. I am sure that there are many other areas that we could think of, even at this time of night, that are rather lacking in clarity for legislators, let alone the average citizen.
It is normal practice at the end of each Bill for us to report to the Law Commissioners about whether issues of consolidation are raised. I shall ensure that the House's views are brought to the attention of the Law Commission. Indeed, noble Lords will be aware that the Select Committee on the Constitution earlier expressed concern about the difficulties that were thrown up by the Bill. Although it was reassured by my statement that I should pass those concerns on to the Law Commission, that underlines the need for me to do so. I hope that that will be sufficient for this time of night.
My Lords, I am grateful to the Minister. As he knows, when we originally met to look at the Bill, the matter was a huge problem, because we had to go to one authority, and then look at Butterworth, and then we had to look at something else. I am sincerely grateful for his comments that he will refer the contributions that have been made, particularly regarding the amendment. That is an extremely encouraging note when we are drawing towards a close—although we have not finished—at this late stage of the Bill. I beg leave to withdraw the amendment.