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The water White Paper that we published in 2011 articulated a powerful case for planning now to protect the resilience of our future water supplies. That message was underscored by the events of last year. In 2012 there was flooding on one day out of five, and drought on one day out of four. There were 6,000 flood warnings and alerts, and hosepipe bans affected more than 20 million people. We need to take account of the impact of environmental pressures, population growth and patterns of demand on essential services; to reduce pressure on the water environment that we all rely on; and to reform the aspects of the system that institutionalise short-term thinking, focusing instead on long-term resilience.
To support the required change in behaviour, the clause creates a new primary duty to further the resilience objective. It has been given wide scope, to recognise the fact that water resources are managed in the natural environment and to reflect the need for innovative solutions, demand management and planning and investment that look to the long term.
I know some hon. Members feel that those objectives would be best served by changing the order of Ofwat’s existing duties to make sustainable development a primary duty. We shall have the opportunity to debate that at some length later, but I want to mention now that I strongly support the objective of securing that environmental guarantee and resilience.
Ofwat currently has a duty to take into account sustainable development.
I am pleased to hear the Minister make that commitment to sustainable development in Ofwat’s remit. I am sure that he will elaborate if we have the chance to debate some of the new clauses.
I know that my hon. Friend cares about the issue, and the new clauses that he has tabled are evidence of that.
Clause 22 is focused on resilience, and I hope that the House will support that. The resilience duty has been created to address the specific duties to do with long-term pressures on the industry. Its scope has been made sufficiently broad to allow it to encompass all the activities that water companies can undertake to manage the pressures, including investing in additional water storage, which I know many members of the Committee are keen on; tackling unsustainable abstraction, a huge concern that has already been raised in Committee; and focusing on environmental management across the catchment.
It is my belief that the new duty of resilience addresses precisely the legitimate concerns that Members have raised about the long-term pressures on our water and sewerage services and the water environment on which they rely. I look forward to hearing more debate about such issues later in Committee, but the new duty of resilience that we are discussing is important. I commend the clause to the Committee.
We welcome clause 22 and do not intend to oppose it. However, the Minister will know that we have genuine concerns, and I refer him again to the work of the Select Committee. I know that we do not often discuss the south-west region in this Committee, so let me quote what South West Water said to the Select Committee:
“Currently, an element of capacity is built into the network to accommodate peaks in flows or to ensure continuity of service where an aspect of the system fails. However, in a ‘competitive’ environment, where new entrants will be competing to provide resources and assets at the most efficient cost, it is not yet clear how these critical capacity safety nets will be maintained.”
One unfortunate reality of the British climate is that we veer from droughts to floods. We have heard previously in Committee eloquent speeches about hosepipe bans; in the same regions, six months later, there can be flooding on the catastrophic scale we saw just a couple of days ago. Although we do not intend to oppose the clause, I hope that the Minister will set out how he is ensuring that the serious concerns raised by the witnesses, the Select Committee and the Opposition will be addressed. After all, it is in no one’s interest that we see more flooding on the scale we have recently seen.
The hon. Gentleman makes some important points. I welcome the fact that he and his colleagues are supportive of reforming and increasing the duties to examine longer-term issues. I am pleased that he sees the need for that.
We want to see better management of water resources. The resilience duty will potentially cover a range of considerations about how water is managed, and that might involve storage. As the hon. Gentleman said, and as my right hon. Friend the Secretary of State said on Second Reading, in some areas, a lot of water comes down and that is a problem; if we were able to capture, harvest and use some of that water at times of shortage, we would have a much more resilient system.
Everyone supports the idea of resilience, but the question is about the balance between large capital expenditure and managing water demand, ensuring that we look after our water as it is transferred from the reservoir to the consumer.
That is why I welcomed the evidence from the Environment Agency about the important role it has to play in managing resources and the powers it has at its disposal to do so. We discussed issues such as abstraction when debating a previous group of amendments.
I believe that by introducing a duty of resilience we will put in place another piece of the puzzle that will allow us to look after resources. It will ensure that when Ofwat looks at how companies behave and their business plans it takes into account their plans to invest to ensure that resources are there for the future. The duty of resilience will also require companies to look at environmental considerations. To ensure security of supply, the environmental considerations are aligned with the fact that water is a limited resource in some catchments. It is a win-win scenario.
In evidence we heard some people express concerns about whether we have got the balance of the duty right. I am happy to listen to those arguments. When we debate the new clauses that the hon. Member for Dunfermline and West Fife and my hon. Friend the Member for Brecon and Radnorshire have tabled, we can look again at that issue to ensure that we have the balance right.
The Minister and Members who had the pleasure of serving with him on the Select Committee on Environment, Food and Rural Affairs will recall that the Select Committee’s central conclusion on the issue of resilience was:
“We recommend that Defra revisit this issue, inviting evidence from water companies, consumer representatives and other interested parties both on the likely impact of the reforms and on the detail of their implementation.”
Before the Minister finishes, will he clarify how many meetings he has had on that issue since taking up his post?
I have had a number of meetings with different organisations. I have met with Ofwat and water companies, and I have heard from NGOs about their concerns. The benefit of the current system, unlike the old Standing Committee system for public Bills, is that what people said in the evidence sessions is on the record. I do not think their views have changed greatly from what they said to the Select Committee or in previous consultations.
Following on from what the Select Committee said, we have looked at the resilience duty closely. We have made some changes to the upstream package, for example, which I know the hon. Gentleman is concerned about. I know that he treasures the Select Committee reports and takes copies of them to bed with him every night. They seem to be his most prized possessions, and I look forward to hearing a great deal more from them.
In conclusion, I welcome the fact that Members from both sides of the House see the need for the new duty of resilience and recognise the benefits it can bring. I look forward to debating duties more generally at a later stage.
Adjourned till this day at half-past One o’clock.
Written evidence reported to the House
WB 12 Ewan Larcombe
WB 13 Water Industry Commission for Scotland
WB 14 Lucy Borland
WB 15 John Copley, Head of Environmental Development, Oxford City Council
WB 16 Adaptation Sub-Committee of Committee on Climate Change
WB 17 Ofwat
WB 18 Water Liaison Group