Clause 31 - Water resources management schemes:

Water Bill [Lords] – in a Public Bill Committee at 4:45 pm on 18 September 2003.

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Photo of Norman Baker Norman Baker Liberal Democrat, Lewes 4:45, 18 September 2003

I beg to move amendment No. 204, in

clause 31, page 35, line 17, leave out from beginning to 'or' and insert 'reasonable terms'.

Photo of Mr Bill O'Brien Mr Bill O'Brien Labour, Normanton

With this it will be convenient to discuss amendment No. 205, in

clause 31, page 35, line 20, leave out from 'on' to end of line 21 and insert 'reasonable terms'.

Photo of Norman Baker Norman Baker Liberal Democrat, Lewes

The clause concerns referrals to the Secretary of State, and one of the triggers is when arrangements appear to the Environment Agency to be reasonable. I am trying to apply a harder test on the agency so that it does not have to determine whether something is reasonable before it is referred, but whether it is reasonable in general. That might mean the same thing, but in terms of subsequent appeals and the way in which it is considered by the Secretary of State, it would be better if it were considered neutrally, rather than in the agency's opinion, which might be at gross variance with that of the other party. I do not insist on the amendment, but that is my reason for having tabled it.

Photo of Elliot Morley Elliot Morley Minister of State (Environment and Agri-Environment), Department for Environment, Food and Rural Affairs

The provisions that the amendments seek to change come into effect only when the Environment Agency has already found that it cannot reach agreement with the water undertaker or other abstractor over the terms of a water resources management scheme. In that situation, the matter will be referred to the Secretary of State, which is reasonable. It is appropriate that the agency should reflect on whether it considers its terms to be reasonable before it proceeds with the referral. However, the amendment seeks to change that consideration into an objective test of reasonableness. Sometimes such tests are appropriate—one can justify them—but in this case they would have unwelcome consequences.

If there is an objective test as to whether the terms are reasonable to be considered even before the reference is made to the Secretary of State, the only way in which the matter could be determined would be by an application to the courts. We know that the other party to the proposed agreement objects to its terms, so would not consider them reasonable. That would tend to encourage litigation rather than a reference to the Secretary of State and an appeals procedure. Despite the delay and expense of going to court, all that the court could determine would be whether the terms were sufficiently reasonable to be referred to the Secretary of State for consideration.

The court is not equipped to take policy decisions about water resource planning, and the management is a matter for the Secretary of State—in reality, it is a matter for an inspector, who considers the situation and advises the Secretary of State. The decision of the Secretary of State is subject to the usual safeguards, including judicial review, so the party has not lost anything by allowing the appropriate decision-making procedure to run its course before considering further action. I do not imagine that there will be many cases

of this kind, as the agency has a good record of reaching agreements. However, I hope that the hon. Gentleman realises that such procedures are the most efficient way of dealing with such a dispute.

Photo of Norman Baker Norman Baker Liberal Democrat, Lewes

The Minister has persuaded me on this occasion, although I admit that it may not be the greatest achievement. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 31 ordered to stand part of the Bill.