My Lords, I am grateful to the Minister for introducing this debate and to all noble Lords who have contributed. As the debate has gone on, it has become increasingly clear that it is a common misconception that the UK is a damp country. In reality, we are in the lower quartile globally of available water resource per capita.
Extreme weather changes from climate change, coupled with an increasing population, as the Minister said, especially in the drier southern and eastern areas, has put our water system under severe pressure, which is likely only to get worse. Across England, there is now a one in four chance of a level 4 serious drought between now and 2050. If that were to happen, it would lead to huge enforceable water consumption limits, on a scale that the current population has never experienced and would find very difficult to tolerate. To ensure resilience of water provision, we would need an extra 4 billion litres every day by 2050.
Across the UK, an increasing number of areas are undergoing “water stress”. In 2007, the south-east of England was designated as being in “serious water stress” by the Environment Agency. The latest projections show that there will be 4.1 million more people living in the south-east region by 2045, an increase of 21%. By 2080, there could be an extra 10 million. Projections show that if no action is taken, most areas will simply not be able to meet water demand by 2050, with significant water shortages, particularly in the south-east of England.
Adapting to climate change means that we cannot continue with a situation where water companies are losing 20% of water to leaks—2.9 billion litres per day. At the same time, it is imperative that we improve the quality of our freshwater resources as well as tackling drought and unsustainable abstraction. Historically, relationships between water companies, housebuilders and local authorities have been complex and disjointed, without a clear sense of overriding priorities.
There has been a short-term focus on climate change at a local level and as a result insufficient progress is being made, particularly locally. For example, only 43% of local authorities plan at least 15 years ahead. Local authority planning budgets have almost halved since 2010, and over a third of planning policy staff have been lost. Only 42% of local authorities have any kind of climate change strategy. Local authorities are not resourced or geared up to the challenge ahead. They need the help, the guidance and the structure that this kind of report will give them for making decisions.
In this context, the publication of this NPS for water resource infrastructure goes some way towards giving clarity and purpose. However, I agree with my noble friend Lord Adonis that very difficult and often controversial decisions need to be taken, and this document is not sufficiently clear on how those decisions will be taken and who will be making them when the chips are down. It is not just a local authority decision; ultimately, decisions will need to be taken at the national level. There are difficult decisions ahead, and we need further clarity on how they will be handled.
We agree with the priorities set out in the draft document. Obviously, securing long-term resilience and protecting customers is vital, but we also need to ensure that any reforms are affordable and do not have adverse socio-economic impacts. We need to ensure that future policies prioritise sustainability, not profits. The noble Lord, Lord Wigley, illustrated that point extremely well. It is becoming clear that water—which we used to take for granted as being free—has an increased value, and a commercial value. We need to be clear about the ownership and decision-making structures when water sources are being raided.
This also means making some bold decisions about how we can focus back on to protecting our environment, which is not simply nice to have, but absolutely crucial and underpins the decisions that we make. We need healthy rivers and wetlands, combined with protected groundwater levels, to sustain the increasing population. It has always been thought that environment was a nice extra, but it must be put centre stage in the whole planning process. It is particularly crucial because we know that the current levels of water abstraction are unsustainable. As the WWF has reported, nearly a quarter of all rivers in England are at risk because of the vast amount of water being removed for use by farms, businesses and homes. Therefore, we need to be clear that any increase in nationally significant projects and expanded local developments of the kind talked about by the noble Lord, Lord Lansley, who I see is not in his place, is in danger of leading to more overlicensed and overabstracted rivers, which is simply not sustainable. We need to support proposals to measure future planning applications against the environmental impact assessment and the habitats regulations assessment. We welcome the fact that this has been flagged up in the document.
I agree with the noble Baroness, Lady McIntosh, that the concept of SUDS should also be written into and underpin the document. Again, all too often we have seen that the consequence for local developments where that has not happened and for the people who subsequently live in those properties can be catastrophic. Ultimately, there has to be a clear demonstration of environmental net gain, which is fundamental to the planning process for all the reasons we have outlined, and for the ongoing sustainability of our water supply.
The document also rightly identifies the cost of waste and leaks. We need urgent action to reduce water leaks, with demanding and enforceable targets for action by water companies, year on year. This must be combined with greater consumer awareness of the value and potential scarcity of water, so that we all play our part in water conservation. That point was well made by the Minister.
While we support the overarching themes of the proposals, I have some specific questions for the Minister. First, one of the two main priorities listed in the NPS is the protection of customers—ensuring every home and business can depend on a resilient water industry. Unfortunately, this is not the case at present. The House might remember that, in March last year, thousands of homes went without supply for over four days straight. What steps are Ministers taking to ensure that water companies do not leave households without a water supply for prolonged periods?
Secondly, the NPS highlights flood risk—not only how climate change will lead to an increased risk in areas susceptible to flooding, but also the implications for other areas not thought of as being at risk. As the Government consider flood defences, what plans do they have to introduce integrated water management, so that water trapped by flood defences can be used in other water-stressed areas?
Thirdly, it is clear that the changes that need to be made to the infrastructure will come at considerable cost. The NPS points to the conclusions made by the National Infrastructure Commission that the cost to maintain current levels of resilience—relying on emergency measures for more severe droughts—will be between £25 billion and £40 billion to 2050. With these costs anticipated, can the Minister justify the high pay of water executives, especially in light of Ofwat’s comments that this high pay has damaged customer trust?
Finally, it is clear that we must all look towards new technologies to cope with increasing demand on the supply of water in years to come. What assessments have the Government made of rainwater harvesting technology and other future technology applications, such as advanced recycling techniques? How are they being funded and what actions are the Government taking to bring the best ideas to fruition in the shortest time?
We welcome this document, but it is only one in the package needed to shape the future of our water supply and its control. As we go forward, it is important to make the interrelation between these different planning documents clear. My noble friend Lord Adonis asked where the ultimate decisions will be taken and whether we can be sure they will be bold, because we face a severe challenge in the road ahead.