Water Bill [Lords]

Public Bill Committee, 21 October 2003.

Standing Committee D

Water Bill [Lords]

Clause 80 - Flood plans: large raised reservoirs

Bill Wiggin (Conservative, Leominster)

Good morning, Mr. O'Hara, and welcome to the Chair.

The Bill deals with the shortage of water, yet only when we get to this point do we start to deal with the problem of reservoirs. The clause puts in place proper plans so that if a raised reservoir should burst there is a procedure to ensure that the local community suffers no danger or loss of life. That is welcome. However, there are no powers that would enable more reservoirs to be built.

The problem with British water is that although it falls out of the sky regularly, we save no more than 3 per cent. of our rainfall. That is an extraordinarily low amount and it is why water is such a precious resource. It has not rained for some time this month and we have had one of the driest autumns; what better illustration can I draw as to why we should save more water in reservoirs? It is a great shame that the Bill contains nothing that would make it easier, particularly for areas such as Thames gateway where a lot of new housing will be built, to save rainfall.

Elliot Morley (Labour, Scunthorpe)

I, too, welcome you to the Chair, Mr. O'Hara.

The clause deals with flood plans, which are basically contingency planning for reservoir management in the case of a major incident. I do not think that anyone would have any concerns about that. Procedures for the provision of new reservoirs are not in the Bill because they are dealt with in planning legislation. There are powers for companies to produce water resource plans for the next 25 years; that is an existing responsibility. Water companies may, as part of good resource planning, identify future needs for reservoirs. Proposals for reservoirs have to go through the normal planning procedures.

As the hon. Gentleman will be well aware, the building of reservoirs can be very capital intensive. It is therefore likely that companies will have to make a bid to the regulator in the five-year financial planning process to get the necessary capital provision.

Before we start looking at reservoir building it is important to maximise water efficiency. That includes reducing leakage and advocating a more efficient use of water. That can mitigate or postpone the need for reservoir building for some years. Those provisions are

not spelled out in the Bill because they exist in both resource planning and standard planning procedures.

Bill Wiggin (Conservative, Leominster)

I still think it a pity that those provisions are not included. I accept that planning is not part of the Bill, but the Government have managed to include a medical aspect, so it would not have been beyond their wit or imagination to include a planning aspect, and it is a great shame that they have not.

Question put and agreed to.

Clause 80 ordered to stand part of the Bill.

Clause 81 - National security

Norman Baker (Liberal Democrat, Lewes)

I want to speak briefly about flood plans and national security, because the clause gives sweeping powers to the Secretary of State in the interests of national security. In principle, nobody would query the conclusion that there may be instances in which information should be withheld from classes of people. However, the clause allows for zero consultation on and zero publication of flood plans if that is the Secretary of State's decision. Will the Minister explain what

''person or class of persons'',

referred to in the paragraphs mentioned in new section 12B(1), might not be consulted?

It is standard practice, for example, for the Environment Agency to be given privileged information that may have national security implications, and for that to be treated securely with everyone's confidence, so I would not like such information to be excluded. We are discussing designated classes who are statutory consultees, yet the Secretary of State is giving himself or herself the power not to consult them or to produce information in public notices for those classes of people. Who are those classes, and in what circumstances would information not be provided?

Elliot Morley (Labour, Scunthorpe)

There is no intention not to consult people, particularly those in the area who may be affected. However, situations may arise in which there is a need to restrict that consultation, although we would still consult with the undertaker, which would be the Environment Agency, as the hon. Gentleman recognised. There would also be consultation with the local authority, to which the flood plans would be important, as it is responsible for an emergency response.

The new sections are a consequence of clauses 80 and 83, which provide directions for undertakers to prepare the flood plans and extend the requirements of the Reservoirs Act 1975 to the Crown. Normally we want to consult, but, if at the time, there is considered to be a risk to national security, the clause will enable

the Secretary of State to limit consultation. The Secretary of State may also serve a notice on an undertaker requiring them not to publish a flood plan and to withhold access to it. That is because software predictions can, with some accuracy, show the course of flood water from a dam failure and the infrastructure that would be at risk from that.

Norman Baker (Liberal Democrat, Lewes)

I understand the Minister's point and do not disagree with him in principle. I want to clarify that he is saying that a local authority would always be consulted, although matters would have to be treated confidentially. That is a useful guarantee for democratic accountability. Will he say which classes of persons might not be consulted?

Elliot Morley (Labour, Scunthorpe)

I confirm that local authorities would be consulted. Normally, we would expect a flood plan to be published and open to public scrutiny by anybody who wanted to see it. If a particular dam, or the possible effects of a flooding event on downstream infrastructure, were thought to be sensitive, the restriction might apply to the general public and to anyone who wanted to wander in and look at the details and the software. I think that that is what is meant.

Question put and agreed to.

Clause 81, as amended, ordered to stand part of the Bill.

Clause 82 ordered to stand part of the Bill.

Clause 83 - Crown application

Norman Baker (Liberal Democrat, Lewes)

My point is similar to the one that I just made. In new section 27A(4), the Secretary of State reserves the right to limit the power of entry exercisable in relation to what is specified in the certificate, and I entirely understand why that might be desirable. What procedure will be followed when entry for environmental reasons would normally be deemed to be desirable but is prohibited for security reasons? What about the problem that would have necessitated entry in the first place?

Elliot Morley (Labour, Scunthorpe)

I am a little quizzical about that point because the clause deals with the exemption of Crown bodies. Its intention is to bring them into the scope of the Reservoirs Act 1975 and to render them formally subject to the Act's safety regime, so the powers of entry are extended to them. That is the simple explanation.

Norman Baker (Liberal Democrat, Lewes)

I understand that, but it appears that an exclusion is given—[Interruption.] There is a lot of talking; I hope you can hear me, Mr. O'Hara. New subsection (4), which gives the general power to bring Crown premises into the scope of the Act, is welcome, but an exclusion is given for security reasons. That is how I understand the proposal, although I may have misread it.

In the minority of cases where it is deemed inappropriate for entry to be given, what will happen when the need for entry is otherwise identified? What procedure will be followed to deal with the problem that would have necessitated entry in the first place? I hope that the Minister can clarify the matter.

Elliot Morley (Labour, Scunthorpe)

The hon. Gentleman is right. New subsection (4) deals with national security. A site may fall within the powers of the Act, but for reasons of national security the Secretary of State can declare that the powers of entry do not apply. Because these are Crown estates and Crown bodies, in circumstances where there is a matter of security the site is likely, though not certain, to be a Ministry of Defence property. If there were a need for access to carry out duties under the Bill, it would be a matter for negotiation between the Secretary of State for Environment, Food and Rural Affairs and the Secretary of State at the Department concerned.

Question put and agreed to.

Clause 83 ordered to stand part of the Bill.

Clause 84 ordered to stand part of the Bill.

Clause 85 - Water conservation by public authorities

Bill Wiggin (Conservative, Leominster)

I beg to move amendment No. 211, in

clause 85, page 98, line 22, leave out subsection (1) and insert—

'(1) It is the duty of each public authority, 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.'.

Edward O'Hara (Labour, Knowsley South)

With this it will be convenient to discuss the following:

Amendment No. 231, in

clause 85, page 98, leave out lines 23 and 24 and insert

'have a duty to promote water conservation'.

Amendment No. 166, in

clause 85, page 98, line 23, leave out from beginning to 'water' and insert 'further the conservation of'.

Amendment No. 289, in

clause 85, page 98, line 23, leave out from beginning to 'water' and insert

'have a duty to further the conservation of'.

Bill Wiggin (Conservative, Leominster)

The position of the clause is useful because we dealt with the bulk of the argument at the beginning of the Bill. We revisit it now, and it is helpful to have read Government new clause 16, which would amend the Bill to take into consideration the views expressed in another place.

This is an important part of the Bill because it is incumbent on everyone in authority, not just members of the Committee, to conserve water. New clause 16 provides for that, but does not go into the same detail or place the same emphasis on duty as amendment No. 211, which will be popular with hon. Members, as similar amendments have been tabled by Members on both sides of the Committee.

It is extremely important that we get this part of the Bill right. When speaking to clause 80, the Minister was keen to emphasise that there must be

improvements in terms of leakage and water efficiency. In that way, we could avoid the need to build new reservoirs—with all the costs and awkwardness involved—for as long as possible. We are trying again to tackle the same problem, but this time I seek to tighten up the wording so that we put a duty on each public authority.

The alternatives are the named authorities such as the Welsh Assembly or the various authorities named throughout the Bill. The difference is that the duty would apply not just to the authority, but to its members, who would have to further water conservation so far as they could while carrying out their functions and where it was consistent with the exercise of those functions.

The structure of the amendment is different from the Bill, although at first glance they appear similar, because the amendment implies that it is the duty of everybody to conserve water in the way in which they carry out their job. It is a useful amendment and, although I accept that the Government have captured the spirit of it in their new clause, it would do no harm to add this wording. It would shift the emphasis enough to satisfy those of us who want proper conservation to take place at every opportunity, and it would facilitate that process.

Robert Key (Conservative, Salisbury)

My hon. Friend's clear explanation of the reason for his amendment is reinforced by amendment No. 166 in my name.

It would be very difficult for us to justify not placing a duty on the Secretary of State—that is the point—but we need to be tougher about that. The time has come when this country must take the issue seriously; either we are serious about it or we are not. For once, rather than listening to the cautions of officials and lawyers, we should have the courage of our convictions to say that water conservation shall be a duty—as simple as that—not ''if and when it might, possibly, one day be desirable, if the sun is shining on alternate Thursdays'', which seems to be the attitude with which we are saddled. I strongly support the amendment tabled by my hon. Friend, and I hope that the Committee will also support amendment No. 166.

Candy Atherton (Labour, Falmouth and Camborne)

I speak to amendment No. 231 in my name. As hon. Members will see from the number of amendments to the clause, there is a desire to push the Government on the level of responsibility that public authorities should have in promoting better management of water. I take pride in saying that mine is the shortest amendment and less of a mouthful than that tabled by the hon. Member for Leominster (Mr. Wiggin).

Amendment No. 231 goes a little further than the duty to further water conservation by making it a

''duty to promote water conservation''.

I do not need to tell the Committee that the need is there. The amendment would put an onus on public authorities to promote water conservation. I will not rehearse all the arguments that we have been through, but I hope that the Minister will look kindly on the amendment.

Norman Baker (Liberal Democrat, Lewes)

As we have just heard, there is a good deal of cross-party consensus on the need to deal with the matter in a more robust way than is suggested in the Bill. Two amendments have been tabled by Conservative Members, one by a Liberal Democrat and one by a Labour Back Bencher. All point in the same direction; they stem from a belief that the Bill's wording is inadequate and suggest that the Minister should strengthen it. I hope that that gives him pause for thought.

There is a rather unfortunate phrase in line 23 of the clause: ''where relevant''. What does that mean?

Robert Key (Conservative, Salisbury)

Not much.

Norman Baker (Liberal Democrat, Lewes)

It means that somebody can say, ''Well, water conservation is not very relevant here, so I shall ignore it.'' In other words, it completely destroys the purpose of the provision. It should always be desirable to conserve water supplied to premises. It may not always be possible and there may be other demands that occasionally act against it for some reason that we cannot specify, but it is always desirable, so why does the phrase ''where relevant'' qualify that?

As has been implied, those seem to be weasel words, producing a clause that is motherhood and apple pie without apples or mothers anywhere being near it. The Minister has admitted to this sort of thing. He should consider the words carefully and make a bold statement, instead of coming up with phrases that can be disowned. In five years, someone could say, ''Well, water conservation wasn't relevant'', or we could have a meaningless discussion in Committee or on the Floor of the House about why no action was taken because someone had decided that it was not relevant. I do not want to have that discussion in five years, so I ask the Minister to act now.

Elliot Morley (Labour, Scunthorpe)

There is no disagreement about the principle of the proposal relating to the duty to promote the wider consideration of water conservation throughout the public sector. However, I remind the Committee that new clause 16 imposes a duty on central Government to encourage water conservation, so the duty is at the heart of Government. Clause 85 imposes a duty on all public authorities to take water conservation into account. It is worded as it is because there is an issue of legal interpretation and the way in which Bills must be drafted. For example, local authorities do not have the primary duty when it comes to furthering water conservation. That cuts across the water companies, for example. It is not the local authorities' primary duty, although we do not disagree that they should have a duty to consider water conservation across their sector.

The legislation is drafted in this way because it takes into account the fact that local authorities have other duties, such as firefighting. I cannot ever imagine a local authority in court, accused of not furthering water conservation by using large quantities of water to fight fires, but those are the legal considerations that must be taken into account when drafting a Bill so that its meaning is clear. What the clause means in respect of promoting water conservation is very clear. It is

drafted in such a way that it meets legal demands, including those of parliamentary counsel.

Bill Wiggin (Conservative, Leominster)

I am afraid that the Minister has failed to convince me. The idea that firefighters would be sued for emptying the village pond when putting out a fire at the local pub is a nice idea, and I am sure that his advisers are doing their best to come up with more innovative ideas as to how the proposal could go wrong, but the principle is that people in any sort of authority should turn the taps off themselves and do their best to ensure that that takes place whenever possible.

The Minister touched on the duty in new clause 16, which, unfortunately, we are not allowed to debate now. The important point is that the duty is there, but not as we have expressed it in the amendments. Having heard the Minister's response, I am not convinced that the Bill's wording is sufficient, and clearly all the people who read the Bill and made the effort to table amendments agree. Although as usual the Minister means well, his explanation is not satisfying the Committee that the duty really is there.

Robert Key (Conservative, Salisbury)

Having spoken to my amendment, I listened carefully to the Minister, who said that the meaning of the clause was absolutely clear. Indeed it is; it is absolutely clear in its indecisiveness. In practical terms, it means nothing at all, so I shall press my amendment to a vote.

Elliot Morley (Labour, Scunthorpe)

I can only repeat that the Bill adds to the duty to further water conservation in carrying out the functions of local authorities and central Government, and places a new water conservation duty on the Secretary of State. That is important. The Environment Agency, too, has a duty to secure the proper use of water resources. Those are all in the Bill and are very clear. I do not disagree with the intention behind the proposal, but I do not see how someone could argue that the clauses undermine it.

Bill Wiggin (Conservative, Leominster)

Is it not already incumbent on the Secretary of State to conserve water? Why does the Secretary of State need to be given this particular power in this way?

Elliot Morley (Labour, Scunthorpe)

It recognises the strength of feeling expressed in the other place and in this Committee that water is an important resource and that we should take steps to conserve it across the public sector, and in the way in which the agency and the water undertakers carry out their duties. That duty is clearly written into the Bill. One might argue about the ifs, buts and maybes, but we are back to the issue of balance. That duty is not the primary function of local authorities, but we recognise that they have a role to play. That role, with regard to the balance of their duties, is reflected in the clause in a rational, responsible and legal way.

Candy Atherton (Labour, Falmouth and Camborne)

I sought to explore the views of the Government and the Minister, and I am satisfied that the duty to promote is in the Bill.

Question put, That the amendment be made:—

The Committee divided: Ayes 8, Noes 14.

Norman Baker (Liberal Democrat, Lewes)

I beg to move amendment No. 290, in

clause 85, page 98, line 40, at end insert—

'(3) To assist public authorities in the pursuance of the duty specified in subsection (1) a Water Savings Trust will be established which shall have duties to—

(a) achieve the sustainable and efficient use of water; and

(b) work with public authorities, water undertakers, water supply licence holders, and abstraction licence holders in pursuance of the duty in paragraph (a) above.'.

Several amendments in the last group sought to include in the Bill a duty to promote the conservation of water. The amendment tabled by the hon. Member for Falmouth and Camborne (Ms Atherton) sought to include a duty to promote water conservation. I can help her out with this amendment, which aims to promote water conservation by establishing a water savings trust.

As Members know, we have had a good summer as we have not had many hosepipe bans or other restrictions. That is partly due to good management and partly to the heavy rainfall last winter, which replenished reservoirs and ground waters. However, we will not always be so lucky, and we need to take measures to avoid future droughts and water shortages. The Government have recognised that,

but they have included only half-hearted measures on conservation in the Bill.

Conservation needs to be taken more seriously throughout society, in particular by the general public. Evidence from surveys and water company research suggests that water customers are increasingly less likely to follow water company requests to curtail their usage during drought periods. A recent technical report by the Environment Agency on Thames Water, on the effectiveness of marketing campaigns for achieving water efficiency savings, highlighted a difficulty of changing customer behaviour when water resources are not considered an environmental priority and are of little public recognition. The establishment of a water savings trust could provide the public marketing, profile raising, impartial guidance and advice needed to drive us towards a water-efficient future.

The Liberal Democrats have been in discussions with several water companies about water conservation. One company said:

''We have a very high profile programme of customer education representing best practice in the industry. However, it would be better if, rather like energy, all companies contributed their water efficiency budgets into a central fund so there was a National initiative, rather like the Energy Efficiency Office. This would enable a central means of giving advice, perhaps grants to replace cisterns with low or dual flush units with a National and co-ordinated campaign.''

There is pressure not only from the Liberal Democrats, but from the water industry to examine water conservation more holistically and in a more joined-up fashion. Why should one part of the country have a water company that is switched on and has measures in place while in other parts the water company is less forward-looking and no such measures are available to customers? That cannot be right. It is up to the Government to give a lead, and the Committee can today push them in that direction.

The amendment would establish a water savings trust. Further guidance would be needed to establish its aims, duties and funding, so we are debating the principle rather than the nitty-gritty of its operation. I would suggest that its aims and priorities should follow the model of the Energy Saving Trust, which I mentioned earlier. That was established after Rio in 1992. A water savings trust's goals could be to achieve sustainable and efficient use of water, work with a range of partners and deliver practical solutions to households, small firms and the agricultural sector. Such a trust could undertake regular high-profile marketing campaigns to raise the profile of water resources and the need for the public and public bodies to adopt water efficient measures, techniques and technologies. That work is not being done sufficiently at the moment.

We are not talking simply about conservation. If we encourage businesses to save water, we will find that they save huge amounts of money and become more productive and profitable as a consequence. When I was chair of economic development on the county council in my area some years ago, we started a pilot scheme in which businesses were given free advice on environmental practice. We found that those businesses saved lots of money through simple

techniques such as turning the toilets off over the weekend. They saved between £20,000 and £40,000 a year through a combination of simple measures.

We are not talking simply about the energy and water sectors helping the environment; such moves will also make businesses more profitable and save consumers money. If such a trust were introduced with the objectives that I set out, it would be a win-win situation. It could also provide water efficiency information for local authority partners, developers and the public in a co-ordinated way throughout the country.

Water efficiency, and the promotion of water efficiency, will benefit everybody. Nobody would lose by such a trust being set up; everyone would gain. It could be funded by a small levy on extraction licence-holders, or the water companies could simply pool their budgets, as I suggested in my earlier example. In either case, in the grand scheme of things, it would not cost a great deal of money.

The cost of the energy savings trust in 2002–03 was £90.7 million. That trust does a great deal of work, as those who are familiar with it will recognise. However, such a sum of money, or even less, could perform equally well for water savings.

On 16 September, the Minister questioned whether a water savings trust would achieve very much. I hope that I have demonstrated that it would, and that a trust with the aims and duties that I outlined would achieve more than the ineffective, piecemeal, multi-body approach that currently represents what we call water-efficiency measures.

Bill Wiggin (Conservative, Leominster)

It is difficult for me to say anything nice about the Liberal Democrats, in case it appears in a ''Focus'' leaflet in my constituency. However, in these circumstances, I agree with the hon. Gentleman. The amendment is constructive. My only issue with it is that it is perhaps a little compulsory; there is no opportunity for a water savings trust that is successful to stop. However, apart from that small criticism, it is a useful amendment.

The amendment touches on the need for better education and for a parallel to the energy savings trust, which has achieved a great deal. The Minister has already spoken this morning about leaks and waste; he obviously believes that more can be done to save water, despite the fact that Government Members voted against those helpful amendments in the last group.

We should also consider that if the Bill received Royal Assent, the possibility of fluoride leaking into the soil and contaminating it would be a real worry. If we can cut the levels of any of the various types of waste that is produced, a water savings trust would have a second, environmentally supportive role.

I shall not speak for much longer. The hon. Member for Lewes (Norman Baker) covered almost every point in his long speech. However, I reiterate that the amendment is constructive, and we will support it.

Elliot Morley (Labour, Scunthorpe)

As I said before, I have an open mind to those sorts of approaches. The hon. Member for Lewes said that he was discussing the principle and not the detail. I am sure that he would not want to be accused of making worthy suggestions that sound good without any idea of how they would be implemented, their cost or who would pay for or implement them. It would be very unworthy of me to make such an accusation, and I would not wish to do so—[Interruption.] However, the principle is serious; there may be a case for a water savings trust, but that case must be examined. We will have to work out the costs, the benefits and the effectiveness or otherwise of such a trust.

We have discussed a range of new duties and measures to promote water conservation at every level of government; in local government, in central Government and the agencies, and in the Environment Agency. We are already doing many of the things outlined by the hon. Gentleman as being the role of the water savings trust. For example, the Department for Environment, Food and Rural Affairs and the Department of Trade and Industry jointly provide funding for Envirowise to promote awareness of water efficiency and other environmental issues.

Similarly, Ofwat already has a duty to ensure that all water companies take seriously their statutory duty to promote the efficient use of water. Ofwat reports annually on companies' performance, so there is an evaluation of what water companies do, along the lines suggested by the hon. Member for Lewes. If a water company is not pulling its weight, Ofwat has the responsibility and the powers to get it to pull its socks up.

Bill Wiggin (Conservative, Leominster)

Is that not the same as with energy companies? Does not Ofgem also have a duty to conserve energy?

Elliot Morley (Labour, Scunthorpe)

That is absolutely right, although there are differences with regard to energy. For example, it is a lot easier to retrofit loft insulation or draught excluders than it is to retrofit certain water-saving devices.

I return to the fact that I do not want to say ''never'' to the idea of a water savings trust; there may be an argument for it in the future. However, the battery of new measures in the Bill show how seriously we take water resource management, and there are new duties and responsibilities. Ofwat and the Secretary of State have new powers, and the Environment Agency, for example, can stipulate on abstraction licences that water must be used efficiently and take action if that is not the case.

Paddy Tipping (Labour, Sherwood)

Is it not the case that Ofwat, as the regulator, can bring about real changes? By looking at the performance of water companies on leakages, Ofwat has made real progress, but we must continue to work on Thames Water, which has the worst leakage rate in the country. Ofwat's naming and shaming strategy, rather than a trust, will bring changes.

Elliot Morley (Labour, Scunthorpe)

Water leakage is one of the top priorities for the efficient use of water. The measures taken by Ofwat have brought about a 30 per cent.

reduction in water leakage in the UK, which is probably equivalent to the total daily water consumption of London. That is significant and, as my hon. Friend rightly said, as a result of Ofwat's actions, we know the performance of different water companies on water leakage. Poor performers are open to pressure from Ofwat and have a responsibility to adhere to the demands set by Ofwat on the reduction of leakage.

I do not want to be dogmatic, but I suggest that we need to give the Bill a chance to operate, see how the duties work in practice and see what difference it makes. If we still feel that there is a role for a water savings trust, it can be introduced later. I think that the hon. Member for Lewes accepts, as shown in his opening remarks, that work on justifying the trust—what it would cost, what it would do and its cost-benefit analysis—needs to be done. The idea has been around for a while, but it has not been advocated in the necessary detail for us to discuss it seriously.

My answer to him is that the trust is a possibility, but that we should give the Bill a chance and see how its measures work. If it is felt that there is still a role for an organisation such as a water savings trust, we can consider it in the future.

Norman Baker (Liberal Democrat, Lewes)

As a matter of fact, the amendment does not specify a date for a water savings trust to be introduced. It is possible for the Minister to incorporate the amendment into the Bill and introduce the trust at a later date, once he has analysed how the Bill is working. My amendment is consistent with the Minister's line; on that basis, he should support it.

It is slightly disingenuous for the Minister, as he has done more than once in Committee, to accuse Opposition amendments of having no detail when we are raising points of principle. Then, when detail is provided, he picks away at unimportant parts of the amendment, saying, ''This doesn't work; that doesn't work'', and trying to rubbish the amendment on that basis. We see through the Minister's technique. He should address the principle, although to be fair to him, he did in some of his comments. However, I ask him not to go down that line, because it is slightly disingenuous and not entirely fair, although it is par for the course for Ministers of whatever party to adopt that approach when an amendment is difficult to resist.

I am grateful to the hon. Member for Leominster for his support, and promise that he will not appear in a ''Focus'' leaflet, so long as I do not appear in ''In Touch''; that is a mutual promise. The Minister discussed the steps being taken, but failed to explain why what is good for energy is bad for water. None of that came through in his answers, and I am grateful to the hon. Gentleman's intervention, which was absolutely spot-on. The Minister spoke about measures here, there and everywhere—a piecemeal approach—and about the fact that Ofwat is dealing with the water companies. It is doing that to some extent, but that is not the whole story. The amendment refers to

''public authorities, water undertakers, water supply licence holders,''

and ''abstraction licence holders''. We need to take into account more than just the water companies; of course they are important, but they are not the be-all and end-all.

In this debate, and in the discussion on the last group of amendments, the Minister has resisted many opportunities to bolster water conservation and efficiency and relied on mealy-mouthed words that could mean one thing or another. He has asked the Committee to accept that all is hunky-dory in the garden when it is not.

The Minister glided over my quotes from the water company, which is not alone in its view. Water companies are strongly in favour of a water savings trust and I do not know why the Minister does not talk to them more frequently. He ignored their views in his response.

Jim Knight (Labour, South Dorset)

If the water companies want to set up a trust, why do they not get on and do it? Why do we need to leave an open-ended commitment in the Bill in favour of forming such a trust, which is a presumption in favour of regulation and red tape? Is not it best to remove that presumption? If it becomes necessary in the future to force the water companies to form such a trust, we can do it.

Norman Baker (Liberal Democrat, Lewes)

If the proposal were incorporated in the Bill without having an introductory time limit, there would be extra pressure on water companies to come up with a voluntary scheme, which would reduce bureaucracy and obviate the need for such a proposal in due course. What the hon. Gentleman said does not hold true.

Although a number of water companies approach the matter in a sensible manner and understand the need for a joined-up, formulated approach throughout the industry, sadly, some water companies do not. I do not see why one area should benefit from water efficiency and conservation measures and another should not. My amendment would get round that; it is a jolly good amendment, if I may say so, modestly, and I shall press it to a Division.

Bill Wiggin (Conservative, Leominster)

The Minister's argument was well below his usual best. We accept that the purpose of the Bill is to bring in a large number of new duties, but it is nonsense to bring in something as contentious as fluoride, yet not properly debate a water savings trust. The Government set the timetable for the Bill, so the argument that a water savings trust needs its own time for debate is complete nonsense.

The Committee's purpose is to improve the Bill. This is a clear example of the Government having missed an opportunity.

George Osborne (Conservative, Tatton)

Does my hon. Friend agree that Conservative members of the Committee are happy for the Committee sittings to be extended to provide adequate time to debate the matter?

Bill Wiggin (Conservative, Leominster)

My hon. Friend is my Whip, and no one is in a better position to interfere—I am sorry; I mean to guide me—with the timetable.

Jim Knight (Labour, South Dorset)

We have ample time to debate the principle of a trust and that is what we have been

doing. The issue is that no detail has been given about the basis of the trust and what its aims, objectives and specification would be. That is what is missing from the debate.

Bill Wiggin (Conservative, Leominster)

The hon. Gentleman makes a valid point, but fortunately we have a model in the Energy Saving Trust. There is a fixed way of funding water companies through the agreement that they make with Ofwat; deliberately so, because they are in a monopolistic position. The funding structure is very rigid and the water companies complain that every penny is most carefully accounted for. There is a duty on the Committee to ensure that if we want all the advantages that the Energy Saving Trust provides for the energy sector, we should promote a trust in that way in the Bill.

I raised the matter on Second Reading. The amendment is not very detailed but it is positive and sensible, but I accept the Minister's criticisms. It is not the most perfect wording, but we have a chance to revisit the argument. I urge the Minister to take note of the Committee's wishes, give the matter the thought that he says it requires and return with a better version, with which he is satisfied, on Report.

Elliot Morley (Labour, Scunthorpe)

The hon. Gentleman is mixing two issues. There is the principle of including the proposal in the Bill, which we could do, and the issue that concerns me, which is that the case for doing so has not been made. I do not know at this stage whether a water savings trust would be beneficial, or whether the costs of such a trust would be worth the benefits. I repeat that there are a range of measures in the Bill to promote water efficiency and water saving. The hon. Member for Lewes did not seem to listen to me about the role of Ofwat. Ofwat has the power to ensure that if a water company does not meet the standards of the best in promoting water efficiency, it can take steps to deal with that matter. A range of such powers is in the Bill.

I genuinely do not know whether a water savings trust would be any better, or would give any advantages. We have not had that debate and cannot do so in Committee or by Third Reading. When the measures to promote water conservation and efficiency are implemented, it may be considered that, in relation to costs and benefits, there is a case for a water savings trust. I am not rubbishing the idea, or saying that it has no merit. However, at this stage, the case has not been made, the work has not been done, there are a lot of unknowns and, most importantly, we do not know whether it would do any good or have any benefit to the Bill's range of measures. I can take a reasonable position on that and I do not close the door to a water savings trust. It is an interesting idea; I am always interested in interesting ideas. I am always interested in others' cases for change and different ways of promoting water efficiency, but I have not heard the technical arguments for such a structure.

All the measures to promote water efficiency are in the Bill. Let us apply them and see how it goes; let us see the answers and conclusions to which Ofwat and consumer bodies come. In future, there may be more

detailed arguments about a water savings trust—what it would cost, what it would do and what advantages it might have over the Bill—and if that case is made, we must consider it. However, that case has not yet been made.

George Osborne (Conservative, Tatton)

Is the Minister saying that he would be prepared to let his Department work on the idea and perhaps, at some future point, write to members of the Committee after considering whether it was a good idea, how it could be made to work or what would be the arguments against it?

Elliot Morley (Labour, Scunthorpe)

I am prepared to give that undertaking. We have asked the Environment Agency to review what further steps could be taken to promote and secure water efficiency, and I do not think that it would be unreasonable to ask it to consider the concept of a water savings trust. I can give that serious consideration.

Norman Baker (Liberal Democrat, Lewes)

We are in danger of talking and never meeting. The Minister puts a point, which I rebut; he makes the same point, having not heard the rebuttal. He may accuse me of doing the same thing. He does not explain the difference between energy and water and does not pick up the point that Ofwat deals only with companies, not with any other range of people in the water industry. He said that he is prepared to have some work done on the matter. If he would be prepared to do that seriously within a specific time scale, I would be prepared to sit on the issue for a while. Frankly, I hope that the Government have done some work already, given the pressure that exists for the concept. Can he say something about the detail and the time scale involved, and how he intends to report to either the Committee or the House? That would influence whether I seek to divide the Committee.

Elliot Morley (Labour, Scunthorpe)

I can tell the hon. Gentleman that work is under way. We work on a range of issues. I do not object to asking the Environment Agency to consider the issue. I understand that it will take about six months for the work to be done. As with all our research and analysis, the results will be put in the public domain.

Norman Baker (Liberal Democrat, Lewes)

I am grateful to the Minister, who has moved slightly from rubbishing the amendment to seeing the merits of a water-saving strategy.

Bill Wiggin (Conservative, Leominster)

He has moved a long way.

Norman Baker (Liberal Democrat, Lewes)

He has indeed. On the basis of the assurance that the Minister has given, I propose to withdraw the amendment. But in the spirit of co-operation, I ask him first to supply members of the Committee with details of the terms of Environment Agency's reference, in loose terms and, secondly, to draw our attention to the work when it is completed in six months' time. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 85 ordered to stand part of the Bill.

Clause 86 ordered to stand part of the Bill.

Clause 87 - Control of water from coal mines

Candy Atherton (Labour, Falmouth and Camborne)

I beg to move amendment No. 162, in

clause 87, page 102, line 3, at end insert—

'4D Powers of the Authority with respect to any abandoned mine

All the statutory powers conferred on the Authority in respect of coal mine water discharge may at the discretion of the Authority be exercised in respect of any water discharge from any abandoned mine other than a coal mine on payment to the Authority of such fee and subject to such conditions (if any) as the Authority may consider appropriate.'.

I represent a mining area with a heritage of mining. However, we often overlook the fact that not all mines are coal mines. As in coal mining areas, we are faced with a costly legacy as the mines fall into disuse and decay. The amendment seeks to provide the Coal Authority with a permissive power to deal with non-coal mines so that areas such as mine are not overlooked. The problem of pollution from non-coal mines can be serious. In 1992 there was a serious case of pollution at Wheal Jane in Cornwall. The Environment Agency stepped in on that occasion and has worked with the Coal Authority to tackle the problem.

However, there is a distinction to be made between the Agency's role as regulator and the need for remedial action. There is a need for a more concerted approach to tackle pollution from all mines. There are hundreds of small seepages from metal mines in this country that currently have no mechanism for clean-up. There are also problems identifying who is responsible for the pollution. This is where the Coal Authority can step in. It has a history of expertise and a wealth of skills at its disposal. Indeed, the authority has an impressive track record in the hitherto neglected area of environmental work.

Cleaning up pollution from non-coal mines is also a requirement of the water framework directive, so the amendment would help us to meet our requirements under that directive.

Norman Baker (Liberal Democrat, Lewes)

I am listening with interest and support to the hon. Lady. Will she clarify one point? Who will pick up the tab for dealing with the problems of abandoned mines?

Candy Atherton (Labour, Falmouth and Camborne)

Where there is no dispute about the ownership of the land, the bill obviously would go to the owner of the land, the presumed polluter in the first place. I suspect that there would have to be some discussion among the various agencies, including local authorities, as to the final decision where the land is in dispute. That is partly the current position. The amendment is intended to be permissive and discretionary. However, it will give relevant authorities the means to tackle an important issue and to ensure that no areas such as mine are disadvantaged in comparison with the coalfields.

Bill Wiggin (Conservative, Leominster)

I am grateful to the hon. Lady for tabling the amendment. She put it very well. I should like the Minister to explain why the Bill refers specifically to coal mines rather than mines in general.

Paddy Tipping (Labour, Sherwood)

I am pleased to support the amendment. It gives me the opportunity to praise the

work of the Coal Authority, particularly its chairman, John Harris and its chief executive, Ian Roxburgh. The Bill recognises that over many years, since coal privatisation in 1994, the Coal Authority has been working outside its powers.

Clause 87 will provide a proper statutory basis, which is progress, but I want to press progress a little further. The Coal Authority has developed considerable expertise on mine water discharge; not just coal mine water discharge, but mine water discharge in general. It is perhaps now the leading authority in Europe and further afield, and it is important that we use that expertise to make the best of difficult pollution problems.

My hon. Friend the Member for Falmouth and Camborne mentioned Wheal Jane, a tin mine incident, but lots of mining incidents occur throughout the country, and the Coal Authority is often called out to deal with them. Some 40 per cent. of calls to the Coal Authority about mine water discharge turn out not to be coal-related issues. A sensible point is being made, which is that the Environment Agency should act as a regulatory body. At the moment, it is not just a regulator; it is often asked to devise schemes and put them into action.

As my hon. Friend said, the amendment would introduce a permissive power that allows cost recovery. The Coal Authority has the expertise, and it makes good sense to try to use it in a more proactive and thoughtful way. I should be grateful if the Minister told us about any discussions that there have been with the Coal Authority. Has he met John Harris, the authority's chairman, and what is the view of other partners? I am told that the Environment Agency supports the idea in principle, and I know that the Local Government Association does. My understanding is that the Department of Trade and Industry, which sponsors the Coal Authority, is not averse to the approach, although as always it is worried about cost. However, there is a good deal of support for the amendment.

Elliot Morley (Labour, Scunthorpe)

My hon. Friends make a persuasive case for the amendment. The hon. Member for Leominster asked why the power relates to coal. As my hon. Friend the Member for Sherwood (Paddy Tipping) said, the Coal Authority already carries out the work, and the clause will formalise the situation. The Coal Authority is vulnerable to potential liabilities in common law for pollution emanating from underground workings in its ownership. It has some responsibilities as a non-departmental public body accountable to the Department of Trade and Industry, as was stated, too. It also deals with mines where there is no ownership but a potential of mine water pollution.

The Coal Authority has redoubled its efforts on coal mine water in the past two years, and we were keen to see it take on that work. My hon. Friend the Member for Falmouth and Camborne mentioned the problems of tin mines, and I do not deny that they are a problem in some constituencies, but coal mines are a national problem, because of their sheer numbers and the responsibility that falls on the Coal Authority.

My hon. Friend the Member for Falmouth and Camborne was right to say that other mines cause pollution. As my hon. Friend the Member for Sherwood pointed out, it is also true that the Coal Authority has valuable expertise that may be helpful in dealing with particular problems. As it stands, the Environment Agency carries the responsibility for mine water pollution incidents from tin mines in the constituency of my hon. Friend the Member for Falmouth and Camborne. To give the agency credit, it has done a lot of work in recent years and takes the problem seriously.

The question is whether the Coal Authority requires a statutory change of powers in relation to other mines. Is it in a position to take on the responsibility, and can it give technical support and advice without necessarily needing statutory changes to give it an element of flexibility? Could we have closer working between the Coal Authority and the Environment Agency on mine water pollution, particularly if it involves tin mines?

My hon. Friend the Member for Falmouth and Camborne is particularly knowledgeable on that matter and has made the case. She raises an important issue and has been active on it in relation to her constituency. I suggest that she and I have a formal meeting to explore whether there could be better co-ordination and whether there are skills and experience that we can apply to the tin mine sector and potential pollution in a way that addresses her concerns.

Candy Atherton (Labour, Falmouth and Camborne)

I am very grateful to the Minister and I accept his fair offer, but could the Coal Authority be involved in those discussions? That would enable us to move the issue forward constructively.

Elliot Morley (Labour, Scunthorpe)

Yes, I am only too happy to talk to the Coal Authority about this issue. To answer my hon. Friend's earlier comments, let me say that I do not have that much of a connection with the authority, because it is accountable to the DTI, not DEFRA, but it has experience on pollution control and minewater pollution that could be useful to us, so it should be involved.

Candy Atherton (Labour, Falmouth and Camborne)

In view of that, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 87 ordered to stand part of the Bill.

Schedule 5 agreed to.

Schedule 6 - Compulsory purchase under the

Clause 89 - Transfer of discharge consents

Bill Wiggin (Conservative, Leominster)

I beg to move amendment No. 114, in

clause 89, page 103, line 33, leave out 'or 6 above'.

Edward O'Hara (Labour, Knowsley South)

With this it will be convenient to discuss the following:

Clause stand part.

New clause 24—Discharge consents—

'(1) Schedule 10 to the WRA is amended as follows.

(2) After paragraph 7(1) there is inserted—

''(1A) Where any consent given under paragraph 3 or 6 above authorises a discharge—

(a) of any substances defined as a priority substance by Directive 2000/60/EC; or

(b) into any controlled waters which do not meet the definition of ''good surface water status'' set out in Directive 2000/60/EC (except where the Agency is satisfied that the relevant discharge does not contribute significantly to the failure to achieve such status)

the Agency shall review such consent and the conditions (if any) to which the consent is subject to at least once in every period of four years beginning with the day on which the consent takes effect or, if applicable, the day on which any previous review under this paragraph was concluded.

(1B) If, having carried out a review under subparagraph (1A) above, the Agency wishes to exercise its powers under paragraph 7(2) below, but is unable to do so by reason of a restriction imposed under paragraph 8 below—

(a) the Agency shall notify the Secretary of State within one month of the conclusion of such review of the outcome of the review and its recommendations and shall request that the Secretary of State exercise his powers under paragraph 7(4) below; and

(b) taking full account of the Agency's recommendations, the Secretary of State shall consider whether to exercise his powers under paragraph 7(4) below, and shall notify the Agency in writing of his decision and the reasons for it within one month from the date of receipt of the Agency's notification under subparagraph (1B)(a) above.''.

(3) In paragraph 7(3) after ''a review under subparagraph (1)'', there is inserted ''or (1A)''.

(4) In paragraph 7(4), the words '', subject to such restrictions on the exercise of the power conferred by virtue of paragraph (c) above as are imposed under paragraph 8 below,'' are omitted.

(5) Paragraphs 7(5) and (6) are omitted.

(6) In paragraph 8(1), (2), (4) and (5), the words ''or (4)(c)'' are omitted.'.

Bill Wiggin (Conservative, Leominster)

This is not a particularly large or contentious amendment. It would leave out the words ''or 6 above''. We seek to find out whether this is a great improvement on what was in the Bill before. It is a small, tinkering addition and I just wanted a little information as to why the Minister chose to include those words.

Elliot Morley (Labour, Scunthorpe)

The clause deals with the transfer of discharge consents. That is an integral part of the consenting regime, and clause 89 will put in place some minor changes that will improve the efficiency and effectiveness of transferring a discharge consent from one consent holder to another.

The Environment Agency issues discharge consents. It may also, without prior application, issue a consent to someone who is discharging without a consent and where it is likely that the discharge will continue. Such a consent is subject to the same terms and conditions as other consents. There is no difference in the way that it is dealt with.

The purpose of clause 89 is to improve the procedure for transferring consents made under either circumstance, but the amendment would mean that consent holders who obtained their consents via applications to the agency would be able to transfer their consents, but those who had an equally valid consent, obtained by a different route, would not. That is not justifiable, because the consents are treated in exactly the same way and are granted for the same reasons. If the agency is content to issue a consent in those circumstances, there is no reason why consent holders should not be able to transfer their consent if the need arose. One example of that need might be if the company were sold, or put in the hands of a liquidator, because the consent is in the name of the particular company. There is no difference in relation to the company or the terms of the consent. The clause therefore tidies that up.

I understand the concern behind new clause 24, and that proper implementation of the water framework directive is of paramount importance, but the proposed provisions would not add a substantive benefit to the powers already available, so they are not necessary.

Consents are granted for a period of four years or more, but the agency already has the power to review a consent at any time. The Secretary of State has the power to direct the agency to modify or revoke a consent if that appears to be appropriate to give effect to European Community obligations, or to protect public health or relevant flora and fauna. That is not restricted by the four-year non-intervention period.

The new clause proposes that following a review the Environment Agency, if it is prevented from modifying a consent by the restrictions already in force, should notify the Secretary of State and request her to exercise her powers of direction to determine whether the consent should be modified. However, that is already taken care of under the existing powers. The provisions take account of the intention of the new clause, as I hope that I have explained.

Sue Doughty (Liberal Democrat, Guildford)

New clause 24 does rather more than the Minister understands. We return to the problem that the Bill sometimes recognises the water framework directive and sometimes does not. We bump along and then we diverge, and this is another example.

Although the Bill gives us a much more sustainable approach to water resource management, on this occasion it misses a trick with the water framework directive. The directive focuses on water quality, as does the clause. The Government propose to incorporate the water framework directive into law through secondary legislation. That means that, potentially, the approach to the directive could be poorly planned and last minute, as has happened so

often with European directives that affect the environment. The clause gives us the opportunity for pre-planning rather than just for wondering what on earth to do about it.

The Environmental Industries Commission, which has more than 240 member companies, and is the largest association for the environmental technologies and services industry in Europe, is particularly worried about that issue. It also needs to plan, because there is a lot of work to do.

The Bill should address the major challenge presented by the legal obligation under the directive for all rivers to achieve good surface water status by 2015. Some 28 per cent. of our rivers are currently defined as being of only fair quality or worse. The majority of them will need upgrading. Even those that are defined as good might need upgrading to meet the water framework directive definition. The task is significant and will need a planned approach. We must consider the consents held by industry to discharge trade effluent into rivers and ensure that they are reviewed and tightened wherever they contribute to rivers not achieving a good status.

Licences for industry to discharge trade effluent into rivers are currently reviewed by the Environment Agency on average less than once every 10 years. That can drop to less than once every 30 years in some regions. Furthermore, there is a legal four-year non-intervention period when the Agency cannot change the consent to discharge without the approval of the Secretary of State. That is not a good basis on which to move forward when we implement the water framework directive.

The amendment requires the Agency every four years to review licences to discharge trade effluent into rivers where those rivers are failing to achieve good status, where the discharge is contributing to that failure, or where the rivers contain particularly serious pollutants. It creates a procedure for the Agency to report to the Secretary of State when it considers that a licence for industry to discharge trade effluent to rivers should be changed earlier than the usual four-year non-intervention period.

In the Lords, Lord Haskel tabled a similar amendment that would have enabled the Agency to review trade effluent consents earlier than every four years without the involvement of the Secretary of State. The Government rejected that because they wanted to give business certainty in planning investment.

The amendment must be agreed to so that there is a procedure whereby the agency can report to the Secretary of State when consent should be changed. It requires the Secretary of State to respond within one month and it ensures that cases of trade effluent discharge not meeting the standards required by the water framework directive are tackled more urgently than every four years. To ensure that such measures are not taken unnecessarily, however, the procedure retains the involvement of the Secretary of State.

A recent report by the Environment, Food and Rural Affairs Committee on the water framework directive concluded that

''Government does not seem to be seized of the urgency of the task . . . our most urgent plea is that the Government adopt a more positive, and more active, approach to the Directive.''

The amendment seeks to avoid the last-minute approach that is so beloved of the Government when considering environment directives. We are giving them a hand because we want to ensure that the costs to mainstream industry are managed, that the planning takes place and that the environmental and services industries can get on with the job. We must do so for our economy and for our environment.

I hope that the Minister takes the amendment seriously because it is necessary to clean up the 28 per cent. of rivers that will not meet the standards in the directive.

Elliot Morley (Labour, Scunthorpe)

The amendment is unnecessary. I repeat my earlier point that the Environment Agency already has the power to do all that the hon. Lady asks for. As for leaving environmental regulations to the last minute, I remind the Committee that the water framework directive does not come into force until 2015. We must transpose the directive by the end of the year and we are currently into our third public consultation on it. We are giving it an enormous amount of time and attention. I take the points made by the Environment, Food and Rural Affairs Committee very seriously. It is a very important Committee and its advice is of a very good quality, but it did not say that the implementation of the water framework directive required any mucking about with the Bill.

Our river water quality has improved dramatically in recent years and I am very pleased to see that. The water framework directive emphasises the biological rather than the chemical quality of water and that makes some important differences to how we measure the standard of our rivers. We have until 2015 to put it fully in place, and we can have a review on discharge consents at any time. Because of the time scales, we feel that we do not have to disturb the four-year non-intervention period, bearing in mind that, if it should become necessary, the powers exist to do that to meet the requirements of the directive.

I ask the hon. Lady to free herself from the obsession that we cannot have the water framework directive without the Bill. The Bill has a set of clear objectives and criteria, some of which will help us to meet the water framework directive. The others will be implemented in the proper time scale laid out in relation to implementing the directive. I have no quibble with the hon. Lady over her commitment to seeing the water framework directive implemented properly and effectively, because that idea is shared by the Government. However, that does not have to be done in the Bill. Indeed, the measures that she is asking for exist in the current powers of the agency and are therefore unnecessary. I therefore urge her not to move her amendment.

Bill Wiggin (Conservative, Leominster)

In my brief opening comments I said that we should leave out the words, ''or 6 above''. It was unclear, from examining the Bill, what the effect would have been on the Water Resources Act 1991, so

I am grateful for the Minister's reply, although I am not sure whether he has touched on exactly what I wanted. However, the purpose of the amendment was to draw attention to the slightly confusing drafting and I feel that I have succeeded. Therefore, I have no hesitation in withdrawing my amendment, but I will have to leave discussion of new clause 24 to the hon. Member for Guildford.

Sue Doughty (Liberal Democrat, Guildford)

I have listened carefully to the Minister's views, and there is nothing wrong with saying that there are cases in which the water framework directive should align with the Bill, but I appreciate that the Government are not keen on it. Indeed the response given to Lord Haskel was not the same as the response given today. It is clear that the Minister has examined it more closely since the Lords scrutiny of the Bill, and further information has come to light and been provided.

I am pleased that the Environment Agency has been given the necessary powers and hope that it will have the funding to get on with the job. We pile a lot on to the Environment Agency, which does a good job, and work will have to take place. Having listened to the Minister's views, we will not press for a vote but will by leave seek to withdraw the amendment.

Edward O'Hara (Labour, Knowsley South)

We will come to that later in the order of business.

Bill Wiggin (Conservative, Leominster)

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 89 ordered to stand part of the Bill.

Edward O'Hara (Labour, Knowsley South)

In light of our progress, we need a suspension for a meeting of the Programming Sub-Committee to reconsider the further timetabling of business.

Committee suspended.

On resuming—

Elliot Morley (Labour, Scunthorpe)

I beg to move,

That the Order of the Committee of 16th September be amended, in the Table, by substituting for the entries in respect of the sittings on 21st October the following—

21st October (8.55 a.m.)

Clause 59, Schedules 4 and 8; Clause 60; Clauses 62 to 87, Schedules 5 and 6; Clauses 88 to 102, Schedules 7 and 9; Clauses 103 to 106; remaining new Clauses and new Schedules (except new Clauses and new Schedules relating to fluoridation).

—

21st October (2.30 p.m.)

Clause 59, Schedules 4 and 8; Clause 60; Clauses 62 to 87, Schedules 5 and 6; Clauses 88 to 102, Schedules 7 and 9, Clauses 103 to 106; remaining new Clauses and new Schedules (except new Clauses and new Schedules relating to fluoridation).

5.00 p.m.

Question put and agreed to.

Clause 90 - Trade effluent consents

Bill Wiggin (Conservative, Leominster)

I just wanted to ask what ''trade effluent'' was. I would be grateful if the Minister gave an example.

Elliot Morley (Labour, Scunthorpe)

Trade effluent and trade premises are expressions used in relation to the trade effluent consenting regime. Trade effluent is simply discharge from manufacturing premises that has been licensed by the Environment Agency. It is as simple as that.

Bill Wiggin (Conservative, Leominster)

My understanding is that the clause allows trade effluent to enter the sewers, but I may have got that wrong. I would be grateful for clarification.

Elliot Morley (Labour, Scunthorpe)

Whatever happens to trade effluent, it must be licensed. Anything that passes from a trade or industry into the sewers is classed as trade effluent and must be licensed. Whether an effluent can enter the sewers very much depends on what the substances are. The powers will enable the Secretary of State to narrow or widen those two expressions and to make it clear, where the discharge is from particular processes, substances or types of activity to the public sewer, that it is subject to the trade effluent discharge consenting regime. The clause makes it clear that there are strict controls on what can go into public sewers and gives the Secretary of State the power—if she chooses—to restrict the definition of what that is. The clause is intended to result in better regulation of the trade effluent discharge process.

Bill Wiggin (Conservative, Leominster)

I am grateful to the Minister.

Question put and agreed to.

Clause 90 ordered to stand part of the Bill.

Clause 91 - Trade effluent consents:

Bill Wiggin (Conservative, Leominster)

This part of the Bill refers to the Water Resources Act 1991. I have looked in that Act for the definition of ''controlled waters'', and the part to which I shall refer does not contain such a definition—that is quite confusing. I should be grateful if the Minister would point me in the right direction. There are definitions of fresh-water limit, miles, lakes or ponds, relevant lakes or ponds and just about every other definition that you could care for, except for ''controlled waters''. Could he give us a definition and an example?

Elliot Morley (Labour, Scunthorpe)

Yes, I can. The clause has more to do with tidying up section 121 of the Water Industry Act 1991, which deals with conditions of trade effluent consents. Section 121(6) contains the meanings of ''harbour'' and ''tidal water'', as set out in the Merchant Shipping Act 1894. We also propose to

include a provision in the subsection referring to the meaning of ''controlled waters'' given by section 104 of the Water Resources Act 1991. That will consolidate all the meanings in one subsection—it is as simple as that. It does not change or do anything; it just makes things much tidier. Section 104(1), as mentioned by the hon. Member for Leominster, deals with controlled waters. It is a tidying-up amendment.

Bill Wiggin (Conservative, Leominster)

The Minister did a valiant job there, and I could see messages passing backwards and forwards. I was pressing him for an example and I have not had one yet, but I hope that some scribbling is taking place and perhaps something will be produced. As I understand it, this has to do with the various parts of the sea. I think that is what the Minister means; I should be grateful for his confirmation of that. I do not seek to delay him or to confuse the Committee, but it is not clear—from what I have seen—what he meant.

Elliot Morley (Labour, Scunthorpe)

The hon. Gentleman is right that the definitions are in the Merchant Shipping Act 1894—I am sure that I can get those definitions for him. I understand that the definition of ''controlled waters'' is in section 104 of the Water Resources Act 1991. That is: all surface waters and coastal waters. I hope that that answers the hon. Gentleman's points.

Bill Wiggin (Conservative, Leominster)

I do not wish to pursue the matter further. I have asked the right question; I am not sure that I have had the right answer. However, we are getting somewhere. It sounds like a catch-all definition of controlled waters, and I am not sure that that is what the Government intended, but unless I am intervened on, I shall stop now. It would have been helpful to have a better definition. I accept that section 104 is unclear and needs to be tidied up. I suspect that the Government mean well in connection with the clause.

Amendment agreed to.

Clause 91, as amended, ordered to stand part of the Bill.

Clauses 92 to 95 ordered to stand part of the Bill.

Clause 96 - Provision of public sewers

Edward O'Hara (Labour, Knowsley South)

With this it will be convenient to discuss new clause 10—Appeals: 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''.'.

Bill Wiggin (Conservative, Leominster)

New clause 19 would change ''Environment Agency'' to ''Secretary of State'', in respect of the further duty to provide sewers. Sewers are one of the most contentious subjects when things go wrong, as anyone who has had constituency or personal experience of such problems is well aware. It

is a most aggrieving, unpleasant and awkward situation. We propose that the powers be given back to the Secretary of State where they belong, rather than being with the Environment Agency. I hope that the Minister will agree with the proposal and although we cannot vote on it now, I shall be grateful for his constructive comments on the measure.

Elliot Morley (Labour, Scunthorpe)

I understand the thrust of the hon. Gentleman's argument on this important issue.

In section 101A of the Water Industry Act 1991, sewerage undertakers have a duty to provide first-time mains drainage in an area where non-mains sewerage arrangements, such as cesspits and septic tanks, are causing an environmental or amenity problem. They must provide a public sewer if certain eligibility conditions, similar to those in statute and in guidance, are met. The hon. Gentleman's amendment would not change that, apart from the power being with the Secretary of State rather than the Environment Agency. It does not alter the fact that it is not an obligation; criteria still have to be met.

If the sewerage undertaker disputes whether the conditions have been met and refuses to provide a public sewer, the applicants can appeal to the Environment Agency and that is what the hon. Gentleman's proposal would change. There is an argument about whether the Environment Agency is the most appropriate body to consider any section 101A disputes or whether the Secretary of State should do so.

In a dispute of that kind, the Environment Agency has the expertise to deal with such matters as it has knowledge of the areas where the proposed sewers are requested. I am not sure that it is practical for the Secretary of State to consider such appeals, because there is all sorts of legislation that states that the Secretary of State should consider appeals on lots of different things. That power is with the Secretary of State, who, in practice, generally refers the appeal to a specialist body and in this case, the Environment Agency is the most appropriate.

There are guidelines that fix the conditions for appeal, so there is no additional policy element that requires the Secretary of State's overview. I appreciate that considering disputes can sometimes take time, especially when the decision is then challenged by sewerage undertakers through a judicial review, which they have the right to do. Given that it is a job for an external, specialist agency, I hope the hon. Gentleman will accept that it should be the Environment Agency.

Bill Wiggin (Conservative, Leominster)

I am grateful to the Minister for his reply. I agree that the Environment Agency would be the agency or specialist to which the Secretary of State would delegate the power to take the decision. That is how things should proceed and we debated it in earlier parts of the Bill. The new clause aims to provide a short cut so that the Environment Agency automatically acts on behalf of the Secretary of State. Instead of its being an automatic action on behalf of the Secretary of State, the Secretary of State is not mentioned at all in the clause as it stands.

A person who finds that his house is polluting and causing damage to the environment and is told that it

must be connected to the sewer may not wish that to happen. He will appeal to the Environment Agency, whose mandate is to put the environment above all else and so he will lose. He will receive a large bill and will complain to his MP and ask him to appeal to the Secretary of State. Normally that is what would happen. The Government are being a little sharp in seeking to cut these corners. That is what my amendment seeks to rectify.

The reality is exactly as the Minister describes. The Environment Agency will recommend to the Secretary of State that the sewer be connected. The net result will be the same. It is the process that is important. The Minister will recognise from his many years of experience that people expect the process to take all the customary steps. While I recognise what is going on in the Bill, my new clause seeks to do the opposite of streamlining the process. People who are in this position, either as a polluter or as someone who wishes to be connected to a sewer because of environmental damage that might be taking place against his wishes, should be able to appeal to the Secretary of State. That is all that the new clause seeks to ensure.

David Drew (Labour/Co-operative, Stroud)

I shall be brief. I seek clarification. I do not want to pre-empt the debate on the new clauses. Some of us think that sewerage, notwithstanding my hon. Friend's commitment to bring forward changes in this area, is an important aspect of the Bill. This is a good time to deal with some of the issues. I hear what the hon. Member for Leominster says and I am sure that the Minister will respond about the appropriate way to look at not just who is involved in discussions but the degree of accountability.

My hon. Friend knows that I am a great proponent of alternative solutions to the normal approach of putting in a sewer, come what may. I would be keen to know what the process could and should be under the Bill if there is no agreement on the best way to dispose of the waste products. Clearly there is a presumption that putting in a sewer is the ideal solution. Increasingly people, including water companies, are concluding that that is not necessarily the best method. There are soft technology solutions, including reed beds, that should be considered. I should like an assurance that, if the office of the Secretary of State is not involved, the Environment Agency will be open minded to these other solutions and will talk to the water companies, the builders, the developers and the householders about what could be a better and, dare I say it, more affordable series of solutions.

Robert Key (Conservative, Salisbury)

I am concerned that the Bill will miss a golden opportunity in respect of the connection of sewers to new properties. The Minister's comments confused me about what is happening. Let me take a practical example. There are many villages in my constituency where one new house can have a dramatic impact on sewerage. The sewers were designed 100 years ago and are carrying more and more sewage. The planning authority cannot say no to a development on grounds of lack of sewerage and the water company, as the sewerage company, is not a

statutory consultee who can also say no to the new development.

One example of what happens is in Hanging Langford in Wiltshire, where every winter the springs rise and the sewers are flooded. As more houses get built, the water company has no option but to relieve the pressure on the local village sewage works by letting it flow into the river, which is a candidate special area of conservation river. The Environment Agency wrings its hands and says that damage could be done, but as there is no other option, it issues an exceptional licence for discharge. That happens year after year, even though the water company does not want to do it. The company has applied to Ofwat for a capital programme to upgrade the sewers but has been told that it cannot because Ofwat thinks that the consumers will have to pay too much for it.

Every year the environment is damaged in a river that is important to not just the UK, but Europe. We go round in circles, and I would put money on the fact that we will see sewerage problems in that village and many others again this winter. If the Secretary of State is saying that he is happy for the Environment Agency to be the judge, nothing will change. The pollution of the river will continue, as Ofwat will not allow the water company to do the work to the sewerage that allows it to cope with the problem. More houses will continue to be built, and the problem will get worse. Unless I have missed something, we are missing an opportunity.

Elliot Morley (Labour, Scunthorpe)

The latter point raised by the hon. Member for Salisbury (Mr. Key), for which I have some sympathy, is not covered in this clause. Clause 96 is about simply replacing cesspits with sewers, not planning or new developments. I would not claim to be an expert on planning law, but I know that in my authority an application was turned down because the drains were inadequate. I should have thought that the sewerage was a planning issue for his local authority to take into account, although I do not know the ins and outs of the particular issue. However, it is not covered by clause 96.

Planning guidance urges authorities to work closely and at an early stage with water undertakers so that new water supply and disposal infrastructure is timed to coincide with the development. The logic of that is that if that work is not so timed, planning permission should not be given. The hon. Gentleman might want to pursue that issue with his local planning authority.

Norman Baker (Liberal Democrat, Lewes)

I am conscious of straying from the clause, but the Minister should understand that although such planning may be easier for brand spanking new developments, for which everything can be planned properly, it is far more difficult to deal with matters during incremental growth on the existing system.

Elliot Morley (Labour, Scunthorpe)

I understand that. However, if the application is new, the facility of the existing infrastructure is a consideration. There might be a problem where outlying planning permission has existed for a while, as that restricts planning authorities, but we are beginning to stray from the

clause. Although the point is important, it does not relate to what we are dealing with.

My hon. Friend the Member for Stroud (Mr. Drew) asked whether other options could be considered rather than expensive mains sewerage. The answer is yes—there is a range of new technologies. There have been interesting developments in relation to sewage treatment, and he mentioned reed bed technology as one. Legislation sets out that the undertaker must take account of all relevant considerations, which is interpreted as including new technologies. That might be a more realistic option than expensive engineering, the cost of which has to be picked up by the local authority or, sometimes, by a household.

The hon. Member for Leominster asked whether the Secretary of State or Environment Agency should be the judge. There are various points to make, and I hope to persuade him that his proposal is not the best way forward. An appeals process will be delayed if the case goes first to the Secretary of State. He or she will have to deal with it in relation to the administration within the Department and then put it out to an external agency, which would do the actual work. If that is the Environment Agency, that would achieve nothing except add another level of bureaucracy. That would delay the process, which would not be in the interests of the people concerned.

An appeal to the Secretary of State would suggest further policy consideration; that is the whole point of an appeal. In fact, under what has been suggested, the Secretary of State would set the policy framework and the agency would work within it. That is how things would work, so there would not be much point in going to the Secretary of State.

With regard to hearing the appeal, the Environment Agency would work in accordance with the guidelines set by the Secretary of State. That is the current situation. The Secretary of State has an involvement in setting the guidelines that the agency must follow in the appeals process. That means that if people have issues about the process, they can raise them through Parliament. If there is a case for change, the Secretary of State can alter the guidelines and the framework set for the agency. The hon. Member for Leominster wants some accountability with regard to the Secretary of State; it exists, and it can be called upon. I understand the case that he has made, but his suggestion would add an unnecessary level of bureaucracy and would slow down this entire process.

Bill Wiggin (Conservative, Leominster)

I take on board the point about the extra layer of bureaucracy but, in reality, the letter that the Secretary of State receives would simply be passed on to the Environment Agency, which is not an insurmountable layer. If people disagreed with the Environment Agency's decision, they would appeal to the Secretary of State in any case. We are missing a trick by not allowing that to be clearly stated in the Bill. My main fear is that we are empowering an unelected agency.

Elliot Morley (Labour, Scunthorpe)

The appeal would not go to the Secretary of State, even under the hon. Gentleman's suggestion. If people were unhappy with the

Environment Agency review, the next step would be a judicial review.

Bill Wiggin (Conservative, Leominster)

I am grateful to the Minister for that comment, but it flies in the face of the argument about adding another layer of bureaucracy.

I am deeply unhappy that the Environment Agency is being empowered in this way. I suspect that this will have to be addressed again at a later stage. The Minister should take on board our fears about empowering agencies. However, at this stage, I am grateful for what he has said, although it does not give me as much comfort as I would have liked.

Question put and agreed to.

Clause 96 ordered to stand part of the Bill.

Clause 97 ordered to stand part of the Bill.

Clause 98 - Adoption of lateral drains

Edward O'Hara (Labour, Knowsley South)

With this it will be convenient to discuss new clause 19.New clause 19 Power to require adoption of private sewers

New clause 19 - Power to require adoption of private sewers

Paddy Tipping (Labour, Sherwood)

I am pleased to discuss new clause 19 and to have the support of some long-standing campaigners on the issue that it addresses; my hon. Friends the Members for Stroud, for Falmouth and Camborne and for Birmingham, Northfield (Richard Burden), as well as my hon. Friend the Member for Rugby and Kenilworth (Andy King) who has the important and unique distinction of being the chairman of the all-party sewers and sewerage group. While I am giving out accolades, I should also mention Stephen Battersby, who runs an organisation called the Campaign for the Renewal of Older Sewage Systems. He has been a strong advocate of the need to make progress on the issue of private sewers.

Sometimes amendments are described as probing. Let me be clear; this is a prodding amendment. I want to prod the Minister, who needs no prodding on the issue. Since he took on his extended post, he has shown a great deal of interest, commitment and action on the issue. The problem is a long-standing one, which has been around since the privatisation of the water industry back in 1991. I looked at the Water Industry Act 1991; the Committee sittings took place

in this Room 12 years ago, and I suspect that similar discussions to those we are about to have took place at that time.

The position is perfectly simple. Throughout the country there are a large number of properties with sewers that are not adopted. In the ambit of Newark and Sherwood district council—an area that part of my constituency covers—there are more than 1,400 properties that are not connected to adopted sewers. I should put on record my thanks to Newark and Sherwood district council, and particularly to Jeremy Hutchinson, one of its environmental health officers.

Bill Wiggin (Conservative, Leominster)

Will the hon. Gentleman clarify his point about the number of houses that he said were not connected to an adopted sewer? Are they connected to a sewer that has not been adopted, or are they not connected to any sewer at all?

Paddy Tipping (Labour, Sherwood)

They are connected to sewers, but those sewers are not adopted by the sewage undertaker. That is not just a problem in the Sherwood area.

Andy King (Labour, Rugby and Kenilworth)

They are eventually connected to a public sewer, which is adopted.

Paddy Tipping (Labour, Sherwood)

We are talking about the bit in the middle, a subject that has been considered by consultants W.S. Atkins who were commissioned by the Minister and reported in June. The report is important and interesting. It shows that there are between 80,000 and 200,000 km of unadopted sewers. There is a big variation between those figures, which reflects the difficulties of the matter. Atkins also looked at the call-outs that took place; the number of calls that local authorities received from householders with blocked sewers that were found to be private sewers. It reported that there were 108,000 such reports in any one year.

The research went further and suggested that the number of calls, if the sewage undertakers are taken into account, was 282,000. It is a big, long-standing problem and we need to do something about it. The Atkins report provides a basis on which to do solve it. In fairness to the Minister, he put the report out for consultation in June with a closing date of 26 September. We are beyond that closing date, and perhaps the Minister will tell us the number of organisations that have replied.

I gently chide my hon. Friend the Minister; I was in front of him on the matter and tabled a parliamentary question that was answered on 16 October. I simply asked whether he would list the number of people who had replied to the consultation, and give us a feel of their responses. I am grateful for his reply, in which he said that the consultation period of the paper, which was published on 1 July, extended until 26 September. He said that the responses from organisations or individuals that were not marked confidential would be placed in the Library and a summary of responses would be published when ready. That adds an awful lot to the debate, but we might go a little further.

I suspect that, during the consultation, people have responded in favour of the Atkins option, which, in a sense, passes the ownership of the sewers to the sewage undertakers. That is the clean and clear way of dealing with the problem. That discussion took place back in 1991, but the then Government neglected to take the issue forward. There are costs involved, because if that approach, which I favour, is adopted, sewage bills will go up across the country. Everyone who pays a water bill will take on, over a period of time, collective responsibility for the cost of adopting the sewers.

All that I would say at this stage is that this is a big problem, and not one that an individual householder can sort out. The sensible way forward is to bring sewers up to adoptable standards. Again, sewage undertakers have been more relaxed, careful and thoughtful in their approach to that. But private sewers often affect not only individual householders but a group, in which case there is a collective cost across that group. It takes only one householder to decide not to continue with the scheme designed by the local authority or sewage undertaker to put the kybosh on it. That problem has existed for a long time.

We are on the road to progress, and many of us would like to make progress more quickly. I am sure that the Minister and his officials have looked carefully at the new clause. At the end of the day, it provides a permissive power—a hook in the Bill—so that when the consultation has finally finished, the Minister has the opportunity to introduce by regulation any scheme that he thinks fit. No option is closed off and no specific option is included, but the means is provided to sort out a long-standing problem. If we can achieve that, there will be cheers across the country. This is a tough issue, which causes much concern to many thousands of households.

Robert Key (Conservative, Salisbury)

I commend the hon. Member for Sherwood for introducing the new clause. Logic says that the Government should reject it; pragmatism says that they should accept it. The hon. Gentleman did not mention the practical impact on thousands of families up and down the country who buy a house on a private development, ignorant of the fact that the sewer is unadopted, and then face sewage flooding winter after winter. They are then told that all that they have to do is to make their sewer, which links into the main sewer, up to standard; but they cannot afford it, and the problem continues.

I have experienced that all over my constituency, as have other hon. Members. I am thinking of the villages of Winterslow, Alderbury and most recently, Beech grange in Landford. Once again, Ofwat is involved. Southern Water has said that there is a double or triple sewerage problem on that estate because it was built on wet ground where there are land drains and another water main and a main adopted sewer crossing it. All the intermediate parts of private sewer linking together cause the problem because when there is a flood in winter, the sewerage cannot accept the ground water, which causes flooding.

Southern Water has sealed 12 manholes on the estate so far to try to solve the problem but that has just meant that the poor people at the lower end of the estate have twice as much sewage in their garden every

winter. However, the company says that it has asked Ofwat for increases to its budget to allow it to undertake work. Ofwat has said no, as that would be too expensive for the consumer. I am sorry, but the consumer will have to pay more one way or another. The individual families—often elderly couples with very low disposable incomes who are hit, in particular, by the council tax—simply cannot afford it.

What are we going to do about that? Will we say, ''No, logic must prevail; it must be down to the individual householder''? How do we get the owners of 60 or 70 houses in the middle of the countryside—some of them are retired, or live exclusively on benefits—to raise hundreds of thousands of pounds to put the sewers right?

It is in the public interest that there should be a responsibility on the sewerage authorities to spread the cost across their customers in the way described by the hon. Member for Sherwood. I simply see no alternative way out of the problem. I hope that the Minister will not just say no. We all have to grasp this issue; we all have similar problems in our constituency, and here is an opportunity to do something about it.

David Drew (Labour/Co-operative, Stroud)

I do not want to add much to what my hon. Friend the Member for Sherwood said in his inimitable way. I do not mean to prod the Minister, but we need some action on the back of the Atkins report; we need to clarify where we are going. The sad thing is that the problem will get worse before it gets better, because we know that until we lay down clear guidelines for new developments, some of those developments will involve substandard sewerage that will not be adopted.

Paddy Tipping (Labour, Sherwood)

I do not want to argue with my hon. Friend, because he has been supportive, but regulations introduced on 1 April mean that, from that date, all houses must have sewerage of an adoptable standard.

David Drew (Labour/Co-operative, Stroud)

I was just about to come to that. As is always the case when work is in progress, there is still some confusion locally about those regulations. I was about to say that we have reached a point at which the situation is at least static.

I shall raise a couple of points that I know my hon. Friend is aware of, but which confuse the situation considerably. In my area, until about five years ago, it was standard practice for the local authority to be the agent of the water company. What makes things worse at the moment is that I know of a number of cases—and I have to declare an interest, as this includes cases on my street—where there is total confusion in the event of a blocked sewer.

Householders ring the local authority, because many of them do not yet realise that the agency arrangement is no longer in place. The local authority then says, ''It's not our responsibility; ring Severn Trent.'' When the householders ring Severn Trent, it says, ''That's not an adopted sewer, so it's your problem.'' To be fair, between the authority and the water company, we usually muddle through, and

someone comes to deal with the problem. Sometimes there is a bill, and sometimes not.

There is total confusion out there about who does what, who pays for it, and what happens if no one picks up on the problem. I am assured by Severn Trent that the matter is purely one of a money, and I am sure that that is common to all the water companies. It has nothing to do with practicability or the company's ability to use the latest technology to improve sewers. Improvements can be made, but they have to be paid for.

The second issue that I should like to raise is quite complicated. I will not bore the Committee with the details, but an interesting issue has arisen in Summer street in Stroud about a sewer that has been tapped into by various new developments. Again, there is lack of clarity about the grounds on which that was done, and about who took responsibility—was it the planning authority, the water company, or those acting on behalf of the people in the newer property? That needs to be sorted out. I hope that the Atkins report, which I have looked at, considers the argument about who takes responsibility and therefore deals with the problem.

Finally, I come to the worst case of all. I agree with the hon. Member for Salisbury that we are talking about large sums of money. Like many Members, I have areas in my constituency where there is no clarity over ownership, particularly where sewers pass under common land, and it is a nightmare when there is a serious leak. Who is going to pay for it? I am not saying that we can resolve that through legislation; I am sure that many cases will end up not in the courts, but in an argument about who will pay the bill.

If the Atkins report is followed up and we consider secondary, if not primary, legislation, to clarify exactly how sewers are adopted and who will pay, that will only help those poor people at their wits' end who visit me and other hon. Members. It is not just a question of what people must pay, but of how they get to the stage of finding people to do the work. At the moment, everybody looks the other way, particularly in rural areas. The point was made that connection charges for new sewers are already high, so we need to consider the cost implications. Let us put forward a realistic and honest appraisal—we cannot carry on as we are.

Norman Baker (Liberal Democrat, Lewes)

I congratulate the hon. Member for Sherwood on tackling this important matter in a new clause. It is a convenient hook on which to hang something, and the fact that it is not prescriptive is also helpful—indeed, it is a bit like my amendment on the water savings trust.

The Government recognise that this is a serious issue. They are at last consulting—belatedly, but they have finally got round to it six years on, so we give credit where credit is due. We now have regulations to ensure that new sewers are adoptable. That is very important, and I congratulate the Government on achieving that; it could have been achieved a long time ago, but at least we have got there now. As the hon. Member for Stroud said, at least the situation will not get worse, and we can find a way to improve it. We must deal with it and, as the hon. Member for

Salisbury suggested, the only way is to have sewerage undertakers adopting private sewers. There is no other way around it. We can huff and puff and look for alternatives, but that is the only answer, and we must spread the bill, which in my cases will be large.

I wanted to speak today because of an incident in my constituency—I apologise in advance if I bore hon. Members, but the incident is important. A private sewer in my constituency has developed a blockage. The sewer serves 82 properties in Polgate, and the district council has decided for good environmental health reasons that the blockage must be cleared. It decided to seek agreement from the house owners to fund that, but agreement is not forthcoming, so it will serve a notice under the Building Act 1984 for the work to be done. The 82 properties are not on particularly rich estates, and in many cases the people who live there are struggling to make ends meet. A big bill will suddenly land on their doormats—it may be a four-figure sum—which must be paid to deal with a problem that they did not know was there and did not know was theirs. That is intolerable.

It is extraordinary that in this day and age responsibility is still so unclear and ownership unknown. People write to me saying that they had no idea that they became responsible for a private sewer when they bought their property, yet suddenly they have a big bill for rectifying a problem that may recur, unless the sewer meets adoptable standards, which will of course increase the bill.

There is a further complication to the case in my constituency: the private sewer is not terribly old—only about 20 or 30 years. The householders strongly believe that the reason that the sewer must be dealt with expensively now is that the material used for the piping 20 or 30 years ago was inadequate. Wealden district council argues that when, in its planning capacity, it gave permission for that material to be used all those years ago, it was acting on best advice and had no reason to think that it was inadequate—but it is.

It is rather rough justice for the district council to say, ''We did not know that the material was inadequate, but you can still have a bill anyway''. In the short term, Wealden district council, and other councils in similar situations, ought to pick up the bill—as they can. Under the 1984 Act, councils have permissive powers to pay to deal with such a blockage; they are not required to recharge individual householders. Until we sort things out properly it is far better in the short term to spread the cost around general council tax payers in the whole district, rather than to present 82 households with a huge bill that they probably cannot meet. How will they pay that bill? What will happen if they do not pay?

Bill Wiggin (Conservative, Leominster)

Does the hon. Gentleman feel that we are talking mainly about privately owned housing and that almost everybody who has bought a house recently has paid a large amount in stamp duty? Should not the person who has taken the money put things right? The money should come from the

Treasury, rather than from people who had nothing to do with the purchase of the houses.

Norman Baker (Liberal Democrat, Lewes)

I fully recognise the problems of local councils, whatever parties are involved, and the enormous burden of council tax—although that is taking us slightly beyond the scope of the clause. I would prefer it if such things could be funded through general, rather than local taxation. However, under the 1984 Act local authorities have the responsibility to deal with such matters and the power to pay out of their general pot or to recharge. Whatever the ideal situation is, we are dealing with what currently happens.

In the short term, local authorities must realise that it is neither fair nor practical for huge bills to land on the doormats of people who can ill afford to pay them. In the case that I mentioned, Wealden district council, which deals with Polgate, ought to pick up the bill.

That is the short-term scenario for getting us through the next year or two, but as the hon. Members for Sherwood, for Stroud and for Salisbury said, in the longer term this matter must be sorted out. There is cross-party agreement. This is not an easy problem to solve and I understand why the Government have hesitated. Nevertheless, the situation is becoming urgent. I hope that as a consequence of our discussions and the consultation process that the Government have embarked on, private sewers will become a thing of the past. In years to come people will, perhaps, look back on our discussion with incredulity.

Andy King (Labour, Rugby and Kenilworth)

I welcome the opportunity to debate this important issue. There is unanimity in the Committee about the necessity of taking action.

I want to be fair to the Minister. The review by W.S. Atkins is a fantastic piece of work. Sadly, however, many Opposition Members have not had sight of it. I assure them that it is a good read; it is enlightening and it will show them that there have been many missed opportunities to put things right. The situation was last reviewed in 1988. We must think about who was in power then.

We are trying to put right an anomalous situation. In Victorian times people had the sense, through the Public Health Acts 1848 and 1875, to require sewers to be adopted. Those Acts were unambiguous: they said, ''This is a public health matter. We must get this right.''

Our problems are due to bad legislation being made in 1936 under which the requirement rule was removed. We ended up with a mish-mash; some sewers were adopted, but adoption applications were not made for others. I assure Opposition Members that the problem does not affect just the odd 50 or 60 houses here and there. As my hon. Friend the Member for Sherwood said, there is a lack of clarity about the size of the problem—between 80 and 200,000 km of sewers are affected. Either way, more than 8.5 million households are affected. A lot of poor, old and vulnerable people are affected because of that earlier reckless decision.

The problem was further exacerbated in 1973 when the water companies came along. Of course, water companies want profit and do not see themselves as charities. Therefore, when problems arose, they asked, ''Where is the formal agreement?'' Local authorities scrambled around, but all that was necessary was a minute in a council meeting.

We now have a ridiculous situation in which sewers have to be in an immaculate condition and a perfect location if an agreement to adopt is to be reached, following a row with the regulator. That is just nonsense.

I apologise, Mr. O'Hara, for not declaring an interest at the beginning of my remarks. I was one of those people who lived in a house for 20 years without realising that my sewer had not been adopted. The interest has been registered with the House authorities, but I should have made it clear to members of the Committee.

It came as a great shock to the 800 or so residents of my own estate to find out that the sewers were not adopted when, after 30 years, serious problems started to develop. We held public meetings. I hired a local school hall and had to have two sittings when some 1,000 residents turned up and could not fit into the room. It was incredible. The fear of an enormous bill landing on their mat caused considerable concern to elderly people.

Brian Iddon (Labour, Bolton South East)

I find this discussion slightly incredible. Has my hon. Friend examined the reason that solicitors do not inform property buyers that they could find themselves in that situation?

Andy King (Labour, Rugby and Kenilworth)

That is a very good point. The Minister and the authorities have considered it on several occasions. The search asks only whether a property is connected to a public sewer, yes or no, but it should also allow the answer, ''yes, eventually.'' We are trying to remedy that, and we are putting matters right with new standards. We have drawn a line under the situation. Before 1936–37, we were okay, so the problem is just with the years since then.

Simon Thomas (Plaid Cymru, Ceredigion)

It is worth putting it on the record that solicitors have started doing environmental as well as legal searches in the past two or three years, and those facts and figures are now starting to emerge. People who now buy houses have knowledge of the problem, so the Committee's concern is with the historic problem to which the hon. Gentleman refers.

Andy King (Labour, Rugby and Kenilworth)

I thank the hon. Gentleman for that helpful intervention. Indeed, with buyer's packs, we are beginning to give people much better information so that they can make an informed decision.

We have a timely opportunity. In the early days, the water companies did not want to know about the problem, but they, too, have moved considerably. Only a year ago, the managing director of Severn Trent made it clear that adoption was the only way forward. Let us get it right and put in the money. Adoption could be phased in but, even if it were done

tomorrow, it would mean adding about £3 a year to household bills throughout the country.

Bill Wiggin (Conservative, Leominster)

I just wanted to clarify that point. The hon. Gentleman mentioned an addition of £3 to household bills across the country, but that is not quite right. There is a certain geographical distribution of the problem. For example, in my constituency, the majority of houses are in rural areas and have their own septic tanks, so they will not pick up the bill. Will not the cost hit some areas much harder than others?

Andy King (Labour, Rugby and Kenilworth)

That is a very important point. In my area, we are starting to put matters right. Flecknoe was the last village in my area in which the septic tank was causing problems and giving rise to worries about the environment through seepage and all the rest of it.

We have put in new sewers to villages, and I am delighted by the progress that has been made. We must treat the problem as a public health matter and share the burden properly across the whole country. The cost will work out at about £3 per household among those who pay water rates for being attached to a public sewer. Those who are not attached to a public sewer will not receive that part of the bill until their properties are connected.

My final point is that people in my estate are incensed because they pay exactly the same amount as the people across the road in a different estate whose sewers are adopted, and they say that they want a 30-year rebate.

We have an opportunity to put right a grave injustice. I thank my hon. Friend the Member for Sherwood, who says that this is a prodding amendment. We want the Minister to take it on board.

Elliot Morley (Labour, Scunthorpe)

I have listened carefully to the comments made by my hon. Friends the Members for Sherwood, for Stroud and for Rugby and Kenilworth and by the hon. Members for Salisbury and for Lewes. I have attended the all-party group on sewers on several occasions to discuss the particular problems in some detail. I understand that this is a major problem throughout the country. There will not be many constituency MPs who have not had the matter raised with them—people have certainly raised it in my constituency.

We are trying to address the situation. We commissioned a study by W.S. Atkins to ascertain the scale of the problem and to give us some options for tackling it. The results of that consultation are being analysed and will probably not be known until the beginning of next year. One problem with the parliamentary question tabled by my hon. Friend the Member for Sherwood is that the results are still coming in, but I can tell him that so far we have received 150 responses from individuals and organisations. He might also like to know that 86 per cent. of respondents are in favour of a change of ownership for private sewers. Of that 86 per cent., 92 per cent. consider that sewerage undertakers are best placed to take on that responsibility.

There are, however, financial implications, which hon. Members have touched on. We must consider what will happen to people's bills, and a lot of work

must be done to assess that major consideration. I understand the strength of feeling about this problem, and our work appears to indicate that it is much larger than people thought. The figures suggest that 50 per cent. of all domestic properties are connected to private sewers in one form or another.

The bad news is that costs may be very high. The good news is that if the problem affects a lot of people, there is a stronger justification for adopting a solution involving the sewage companies and, therefore, spreading the cost. We must consider those matters when we have had a chance fully to evaluate the representations received as part of the public consultation on the W.S. Atkins report.

I appreciate that this is a prodding amendment. It would add to the Bill permissive powers to take the

matter forward through the adoption of private sewers when all the analysis and work has been completed at the end of the consultation. However, it might take some time to phase in the adoption of private sewers because of the cost implications. I do not know about that, but we must do the work and be open and transparent.

My hon. Friend the Member for Sherwood has made a powerful case on permissive powers. I understand the case made by my hon. Friend the Member for Rugby and Kenilworth—the issue is important in his area—and other members of the Committee.

It being twenty-five minutes past Eleven o'clock, The Chairman adjourned the Committee without Question put, pursuant to the Standing Order.

Adjourned till this day at half-past Two o'clock.

Standing Committee D

Clause 98 - Adoption of lateral drains

Bill O'Brien (Labour, Normanton)

I remind the Committee that with this it will be convenient to discuss the following:

New clause 19—Power to require adoption of private sewers—

'After section 102 of the WIA there is inserted—

''102A Power to require adoption of private sewers

(1) The Secretary of State may be regulations establish a scheme to enable a sewerage undertaker to be required to adopt a sewer to which this section applies.

(2) A scheme under this section may apply to any sewer which is—

(a) situated within the area of a sewerage undertaker or which serves the whole or any part of that area; and

(b) not vested in a sewerage undertaker.

(3) Regulations under subsection (1) may amend section 105 so as to extend the appeals procedure to the scheme, provided that the appeal shall be heard by a person other than the person imposing the requirement to adopt.''.'

I understand that the Minister was responding to the debate when the Committee adjourned at 11.25 am.

Elliot Morley (Labour, Scunthorpe)

I had almost finished on the dot; the only problem was that I was a few seconds out. I was telling my hon. Friend the Member for Sherwood (Paddy Tipping) that he, together with others, has made a good case about the problems. There is still much work to do because we must respond properly to the consultation, which we cannot do until the beginning of next year, and evaluate the options, which will also take time. Nevertheless, it may be that an enabling power, such as the one that my hon. Friend argued for, could be useful. He will appreciate that we will have to consult parliamentary counsel, and so I ask him not to press his new clause and assure him that we will consider it on Third Reading.

Paddy Tipping (Labour, Sherwood)

Well, what can I say? Job done; enough said. I am grateful to my hon. Friend and look forward to discussing the issues with him again on Report. I appreciate how hard he has worked and how helpful he has been on the issue, and I understand that the enabling legislation will take time to work through.

Question put and agreed to.

Clause 98 ordered to stand part of the Bill.

Clause 99 - Requisitioning and adoption of lateral drains: supplementary

Bill Wiggin (Conservative, Leominster)

I beg to move amendment No. 212, in

clause 99, page 123, line 46, after 'building', insert

'and is outside the curtilage of that building'.

Welcome back to our chilly Committee Room, Mr. O'Brien. You will be amused to know that my wife has just rung to say that the boiler at my home has broken down, so this Room is home from home.

The amendment would ensure that the previous debate, which the Minister just summed up, does not extend to the gap between the curtilages of people's property and home. The definition of a ''lateral drain'' in the Bill could be interpreted as meaning the whole of the drain, from the building that it drains to the public sewer, and not from the boundary of the property of which the building forms a part.

The purpose of this enabling amendment is to clarify the exact meaning of ''curtilage of a building'' and the situation that people would face if the lateral drain between their house and the public drain were damaged. Obviously, if it is in their garden, it is their property and they must deal with it, but we are trying to tighten up the wording so that there is no misunderstanding.

If, as the hon. Member for Sherwood wants, all sewers are taken into the ownership of the water companies, a small section between the public sewer and the house will still be the responsibility of the homeowner. That is my understanding of the drafting, and I want to tighten up the wording so that there are no grey areas about who owns what.

Elliot Morley (Labour, Scunthorpe)

The hon. Gentleman is correct. The definition of a ''lateral drain'' in the Bill makes it clear that it is the part of the drain that runs from the curtilage of a building to the sewer, so it is outside the ownership of the property. The Bill deals with the fact that new drains will come under the responsibility of the sewerage undertakers. The definition already makes it clear that a lateral drain runs outside the curtilage of the building and from the curtilage to the sewer. I hope that that clarifies the matter.

Bill Wiggin (Conservative, Leominster)

The Minister has given way, but my intervention may be prolonged. Lateral drain means

''that part of a drain which runs from the curtilage of a building (or buildings or yards within the same curtilage) to the sewer with which the drain communicates or is to communicate''.

I understand that the wording attempts to define the garden—that which is outside the curtilage of the building but within the curtilage of the property.

Elliot Morley (Labour, Scunthorpe)

The curtilage is the boundary of the property, and is usually the edge of the garden. The drain will be the responsibility of the householder up to that boundary. Nothing will change on that. The lateral drain runs from beyond the boundary line of the property to the main sewer.

Bill Wiggin (Conservative, Leominster)

The matter has been properly examined. If there is ever a dispute in the future, the Minister's clarification is on record. We have a fair

amount of business to deal with, so I will not delay the Committee further. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 99 ordered to stand part of the Bill.

Clause 100 - Communication with public sewers

Bill Wiggin (Conservative, Leominster)

I beg to move amendment No. 136, in

clause 100, page 124, line 26, at end insert—

'(2A) Substitute for paragraph (b) of subsection (2)—

''(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''.'.

Bill O'Brien (Labour, Normanton)

With this it will be convenient to discuss the following:

Amendment No. 137, in

clause 100, page 124, leave out lines 27 to 32 and insert—

'(3) Substitute for subsection (4)—

(4) At any time within 21 days after a sewerage undertaker receives a notice under subsection (3) above, the undertaker may by notice to the person who gave the notice—

(a) refuse to permit the communication to be made, if it appears to the undertaker that the mode of construction or condition of the drain or sewer—

(i) does not satisfy the standards reasonably required by the undertaker; or

(ii) is such that the making of the communication would be prejudicial to the undertaker's sewerage system; or

(b) where the drain or sewer which it is sought to communicate with the public sewer is to be used for the draining of surface water, refuse permission for the communication to be made, or grant permission for the communication subject to such conditions as it thinks fit, subject to taking into account the considerations set out in subsection (4A) below.

(4A) Under subsection (4)(b) above, a sewerage undertaker may only refuse permission for a communication to be made, or grant permission for the communication subject to conditions, where it has reasonable grounds for considering that—

(a) it is feasible for an alternative method of drainage to be provided, utilised, maintained and kept in repair—

(i) which does not involve communication with the public sewer; but

(ii) which may include the provision of a lateral drain or sewer by any of the means provided for in this Chapter;

(b) this is justifiable taking into account the relative cost to the applicant of—

(i) providing the alternative method of drainage referred to in paragraph (a) above; or

(ii) requisitioning a lateral drain or sewer under sections 98 to 101B above for communication with the public sewer of the undertaker;

(c) where communication of the drains or sewer with the public sewer might contribute towards one or more of the following—

(i) the overloading of the public sewer or the sewerage system of which it forms part, and the consequential overflowing of its contents and the flooding of adjoining property or land;

(ii) the overloading of any sewage disposal works forming part of or connected with the system, so adversely affecting such work's capacity to treat or dispose of

sewage in compliance with any statutory requirement or consent applicable to it;

(iii) increased flows in and resulting overflows and discharges from combined foul and surface water sewers which may have adverse effects on the aquatic environment; or

(iv) the pollution of inland waters, the flooding of property or land, or the impairment of river or drainage systems, whether or not arising from the matters described in paragraphs (i), (ii) or (iii) above.''.'.

Amendment No. 139, in

clause 100, page 124, line 43, at end insert—

'(5A) Substitute for subsection (9)—

''(9) In this section—

(a) 'factory' has the same meaning as in the Factories Act 1961;

(b) 'inland waters' has the same meaning as in the Water Resources Act 1991;

(c) 'sewer provided for surface water' and 'sewer provided for foul water' excludes any sewer provided for the combined drainage of both surface and foul water.''.'.

Bill Wiggin (Conservative, Leominster)

Once again, we discuss sewerage. In this case, we are dealing with the difficulty that sewerage companies face in dealing with foul water—water that, perhaps, has come from a lavatory—as opposed to surface water, which may have run off the road. Those are very different types of water, and there is a different demand and supply for them. For example, if there is a thunderstorm, a huge amount of surface water is generated, but that will not necessarily correspond to the amount of foul water. The problem is that when water flows into the sewers, it can be of both types. That means that cloudbursts or sudden flash floods can cause the foul water in the sewerage to flood.

We need to ensure that surface water is kept separate in calculating the sewerage capacity required, and that is what we seek to do in amendment No. 136. That means that the sewers that are provided for foul water will be able to cope, because foul water is a regular flow, which is understood. Run-off water is a different kettle of fish, however, and we must ensure that not all the water is pushed into the same type of sewer. The question of allowing access to the public sewer from new developments must therefore be handled carefully, and the amendment seeks also to address that.

Norman Baker (Liberal Democrat, Lewes)

I have listened carefully to the hon. Gentleman's remarks. Is he suggesting a duplicate system for surface water, in parallel with the one for foul water?

Bill Wiggin (Conservative, Leominster)

No, I am not suggesting duplicate systems. I am attempting to ensure that when the calculation is made for foul water, it takes proper consideration of the surface water, particularly when a new sewer is installed and taps into an old sewer. If more houses are built, there will be less land to absorb water; areas such as roofs and concrete drives will contribute to a large amount of surface water suddenly running into the foul water drainage system. At present, that is not being calculated properly, and it is not included in the Bill in the way that I would like. I am therefore grateful to the hon. Gentleman for demonstrating that we should think separately about those two types of water, although they will still run

into the same holes and the same sewerage system. However, we must ensure that the calculation is done differently.

Elliot Morley (Labour, Scunthorpe)

The Bill already allows undertakers to refuse connections to the sewerage system if they think that that will cause flooding. They have that power now. If they think that there is a problem they can refuse to allow the connection, and the developers can appeal to Ofwat if they feel that the decision is unfair.

The crux of the problem was touched upon by the hon. Member for Lewes (Norman Baker). If the drains are not connected to the sewers where do they go? What does one do? A range of alternatives can be looked at. The Department takes this seriously. It is an important issue, particularly when one is dealing with surface run-off in times of exceptional rainfall. The Environment Agency is currently chairing a working group looking at the range of available options. It produced a consultation paper in May 2003 on design standards entitled ''Framework for Sustainable Drainage Systems in England and Wales''.

The working group recently discussed the responses and is considering how to take the issues forward. One of the key issues raised by respondents was the need to clarify responsibility for ownership and ongoing maintenance of sustainable drainage systems. My Department is currently undertaking work to address those issues and to prepare specific policy proposals for a further consultation document to be published by spring 2004.

All surface water disposal arrangements will have to be examined, including the issue of enforceable ownership and maintenance responsibilities. I am referring more to sustainable urban drainage systems than the drains themselves. The various options such as balancing ponds, wetlands and reed beds will be considered. I have seen one or two innovative examples of sustainable urban drainage systems. However, there are arguments about who takes over the maintenance, the management and the responsibility. That has not been resolved yet.

Ian Liddell-Grainger (Conservative, Bridgwater)

If one has a right of access in the deeds of one's house which is legally binding and allows one to get to the drains, would that be affected if the sewers were adopted?

Elliot Morley (Labour, Scunthorpe)

We are going back in time—that question relates to an earlier clause, but I think that I can answer it. If a person has a right of access to drains, it will not be changed because it is a right of access within the deeds of the property. Such a right generally relates to the curtilage. If the responsibility of maintenance outside the curtilage goes to the undertakers, it should not be a problem for the owner-occupier. But there will be no change in relation to the right of access to manholes and for rodding and so on.

We are looking at the wider issues of sustainable urban drainage and sewer flooding. The undertakers now have the power to refuse connection if they think that there is a problem. There are some quite complex issues, but they can be resolved. That is what we are in the process of doing. The hon. Member for Leominster

(Mr. Wiggin) raised some important points, which we accept and are trying to address.

Bill Wiggin (Conservative, Leominster)

I am grateful to the Minister for that reply. He will see that that is largely what we attempt to do in amendment No. 137. The wording in the Bill was not as clear as it might have been. The Minister addressed much of that. A problem that will have to be dealt with at some stage is whether undertakers have the right to refuse the connection on the basis that the standards are below their acceptable standards or because it would be prejudicial to their sewerage system.

It will be difficult for the Minister to deal with everything that we discussed in the previous debate. There is a problem with substandard and home-made lateral drains and sewerage connections. We have tried to ensure that the industry is not burdened with costs that it cannot expect reasonably to offset.

Elliot Morley (Labour, Scunthorpe)

The problem again relates to the retrospective situation. The hon. Gentleman might like to know that the building regulations have been changed under H5, which now has a requirement for separate systems of drainage for new build. That means that a separate system has to be put in place to ensure that rain water is diverted from the sewer systems. In some ways, the problem has been resolved for the future; the inheritance is the difficulty.

Bill Wiggin (Conservative, Leominster)

I recognise that and I am grateful to the Minister for that intervention.

Andrew Lansley (Conservative, South Cambridgeshire)

As I understand it—I am stretching to recall the circumstances—even on some recent occasions since the introduction of the building regulations to which the Minister refers, the issue has been enforcement. Some small developments, even individual properties, have made unauthorised connections into the sewer system, rather than go to the expense of putting in separate drainage for surface water. That can contribute to some sewer flooding where there is exceptional run-off.

Bill Wiggin (Conservative, Leominster)

My hon. Friend is absolutely right; our amendment would prevent all water going down the same hole and would ensure that the hole was of an adequate size. He put that point well, and I am grateful to him. Will the Minister also confirm that, in amendment No. 139, the definitions of ''factory'', ''inland waters'',

''sewer provided for surface water''

and

''sewer provided for foul water''

are as the amendment would suggest? I am sure that they are, but can he confirm that? We have a problem with cowboy builders—for want of a better expression—and that is particularly worrying, considering that consultation is taking place about adopting some of the more historical privately owned sewerage systems. There is a danger that new build will take advantage of the Government's good intentions and builders will construct it to a substandard level, on the basis that they know that they will soon hand it over to a water company. I urge the Government to be

mindful of that and to be extremely alert to what may take place in future.

Elliot Morley (Labour, Scunthorpe)

On amendment No. 139, I was not clear whether the hon. Gentleman was asking whether the definitions in his amendments were consistent. Is he asking that?

Bill Wiggin (Conservative, Leominster)

The amendment would confirm the definitions. That may not be necessary, and I am hoping that the Minister will confirm that.

Elliot Morley (Labour, Scunthorpe)

It is difficult to speak on the hon. Gentleman's amendments. On the definition of ''inland waters'', I assume that he is referring to the Water Resources Act 1991. I have a feeling that the definition was slightly different as applied to the Bill. The term ''factory'' in his amendment is the same as in the Factories Act 1961; ''inland waters'' has the same meaning as in the Water Resources Act 1991; the other points concerning sewers for surface water are not required in those definitions.

Bill Wiggin (Conservative, Leominster)

I am grateful to the Minister for replying to amendment No. 139. I have no problem with withdrawing all my amendments, but I am grateful to the Minister for those clarifications and the comments of my hon. Friends the Members for Bridgwater (Mr. Liddell-Grainger) and for South Cambridgeshire (Mr. Lansley). We have touched a nerve, and the Government will have to take that into consideration if they are to do what the hon. Member for Sherwood (Paddy Tipping) wanted, when they take all the previously privately owned sewers into the ownership of the water companies. There will clearly be another water Bill when that happens. We shall revisit this issue, perhaps on Report, but certainly under that Bill. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Bill Wiggin (Conservative, Leominster)

I beg to move amendment No. 138, in

clause 100, page 124, leave out lines 39 to 43 and insert—

'(5) Substitute for subsection (6)—

''(6) Any question arising under subsections (3) to (5A) above between a sewerage undertaker and a person proposing to make a communication as to—

(a) the reasonableness of the undertaker's refusal to permit a connection to be made, or the reasonableness of the conditions on which the undertaker is prepared to permit a communication to be made; or

(b) as to the reasonableness of any requirement under subsections (5) or (5A) above,

may, on the application of that person, be determined by the Authority under section 30A above (and accordingly section 105 above shall not apply to any requirement under subsection (5A) above).

(6A) In making a determination under subsection (6)(a) above, the Director shall consult and take into account the views of the Environment Agency and any affected riparian owners.''.'.

The amendment is similar to the previous amendments and we are seeking again to ensure that the definitions are consistent, concise and fair. Judging from the way in which the debate has flowed today, that question is still up in the air. I hope that the Government will include this type of issue in their consultation, certainly that with the professionals who

they hope will take over the privately owned sewers. There is an implicit compliment in that people feel that they are the best equipped to run sewers. I agree with that, but we must be mindful of how we work out how it is paid for. I would prefer stamp duty, as I said earlier, but that is because there will be area charges which will be difficult unless we find a way of smoothing things out.

Elliot Morley (Labour, Scunthorpe)

This proposal, too, deals with sewer flooding, who should be consulted and what should be taken into account in relation to connection.

I take the opportunity to correct the hon. Gentleman about the previous debate on the new clause tabled by my hon. Friend the Member for Sherwood. The Government have not conceded that private sewers are to be taken over by the sewerage companies. What we said is that we are willing to consider an enabling measure in the Bill if after the consultation, discussion and consideration it is thought to be the best way forward. That is what we were discussing earlier. I make it absolutely clear that no decision has been taken.

An authority may wish to refuse connection for a variety of reasons and the amendment would put the matter into the category on which there would have to be an automatic consultation on every connection, which is unnecessary. For example, the debate might be about the suitability of a particular type of fitting. We would not expect Ofwat to have a formal consultation with the Environment Agency or riparian owners on such a minor change.

The amendment also does not list other important potential consultees such as local authorities or the Consumer Council for Water. It could not be justified to single out the Environment Agency and riparian owners, because there are other interested people. There is no need to prescribe as rigidly as the amendment; there will be wide consultation, which is the reason for the working parties. All interested stakeholders will have the opportunity to make their case and to have it taken into account.

Bill Wiggin (Conservative, Leominster)

The water companies, who have every reason to want the matter clarified, will have heard what the Minister said. The wording in my proposal may be too prescriptive. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 100 ordered to stand part of the Bill.

Clause 101 - Devolution: Wales

Bill Wiggin (Conservative, Leominster)

I beg to move amendment No. 117, in

clause 101, page 125, line 42, leave out 'or mainly'.

Bill O'Brien (Labour, Normanton)

With this we may take amendment No. 118, in

clause 101, page 126, line 26, leave out 'or mainly'.

Bill Wiggin (Conservative, Leominster)

The amendment is very similar to an earlier amendment. It would deal with water or sewerage undertakers whose area is wholly or mainly in Wales. I intended the measure to deal with undertakers who are wholly, rather than mainly, in

Wales but in a previous reply the Minister explained that because of the way in which the areas are divided up there are few that are wholly in Wales. Nearly all the companies on the borders have a small area that goes over the border and thus would be precluded. Unless the hon. Member for Ceredigion (Mr. Thomas) wants to dive in, we do not need to pursue the matter. I hope that the Minister will confirm that I am right.

Simon Thomas (Plaid Cymru, Ceredigion)

As the hon. Gentleman has conceded his ground, I will not discuss the amendment, which is as ill conceived this time as it was the first time around. However, I take the opportunity to question the Minister. My reading of the clause, whether it is amended or not, as the hon. Gentleman half suggested, is that it will enable the National Assembly for Wales to decide on the construction of new reservoirs in Wales, whether the reservoirs provide water wholly or mainly for Wales or for England. Can the Minister confirm that my interpretation is correct? I hope that it is, because it is important that the construction of reservoirs in Wales, which directly affects the Welsh communities, landscape and environment, is decided as a planning matter by the National Assembly and not a Westminster Department.

Elliot Morley (Labour, Scunthorpe)

As I mentioned earlier, the construction of reservoirs in Wales is primarily a planning issue and would come under the power of the National Assembly for Wales.

Amendments Nos. 117 and 118 would restrict some of the National Assembly's water regulation functions to undertakers that operate entirely in Wales. We have already debated amendment No. 78 under clause 43, and we established that no undertaker serves an area wholly in Wales. The amendments would therefore exclude the Assembly, and the Secretary of State would have to exercise his powers throughout England and Wales. That is not the Bill's intention. We have dealt with areas that fall wholly in England, and those points were properly examined and the provisions are there. However, we would not want to undermine the Welsh Assembly's powers, as the amendments would.

Bill Wiggin (Conservative, Leominster)

Oh yes we would.

Elliot Morley (Labour, Scunthorpe)

I thought that that was not the hon. Gentleman's intention, but apparently it is.

Bill Wiggin (Conservative, Leominster)

The Minister is absolutely right that it is not my intention to undermine the powers of the Assembly. Offa's dyke is in my constituency and I am nervous that it might soon be Offa's dam.

We have had a clear debate, so I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 101 ordered to stand part of the Bill.

Clause 102 - Minor and consequential amendments and repeals

Schedule 7 - Minor and consequential amendments

Bill Wiggin (Conservative, Leominster)

I beg to move amendment No. 130, in

schedule 7, page 185, line 35, leave out paragraph 4.

On my notes is written, ''Why not convert?'' and that is the question that I seek to raise with the amendment.

Elliot Morley (Labour, Scunthorpe)

I thought that might be political.

Bill Wiggin (Conservative, Leominster)

No, we are certainly having none of that—I had enough of that from my predecessor.

Schedule 7(4) concerns changing licences from one type to another. I ask the question, ''Why not convert?'' because why should someone not be able to convert one type of abstraction licence to another? It is not a contentious question. I understand that three types of licence are included in the Bill, and if someone should want to convert or prolong a licence, I do not see why that should not be possible.

Elliot Morley (Labour, Scunthorpe)

Section 51 of the Water Resources Act 1991 allows a licence holder to apply to vary the terms of an existing licence. Paragraph (4) of schedule 7 expressly prevents the use of section 51 to change the type of licence, so, for example, a full licence cannot be converted to a transfer licence. The holder would need to apply to the agency to surrender the old licence and be issued with a new one to go through the proper procedures.

Amendment No. 130 would remove that restriction and allow a change in licence type to be a variation on an existing licence. However, changing the type of licence is not a change in terms. A new licence would then be required. I am talking about a transfer licence, a time-limited licence or the existing unlimited one. If a holder wants to change his type of licence, he can do so as I have indicated, but he must go through that process, rather than a variation.

Bill Wiggin (Conservative, Leominster)

Is there not a real danger that people will be tempted to take up abstraction licences, to go through the process and then use them on a one-off basis, simply to continue their ownership of them as a safeguard, perhaps in case of a water shortage in the near future? Because they cannot move from, say, a transfer licence to a full licence or vice versa, there is a possibility that a water company that needed to be able to abstract and had a licence to do so, but did not really need it, would simply hog the licence to prevent anyone else from having it. Otherwise, when there was a water shortage, it would have to go through the whole process again, and it would very likely be turned down. That is why we need a certain flexibility in the Bill and why I seek to clarify the point.

Elliot Morley (Labour, Scunthorpe)

The Bill deals with that. Let us say that someone applies to obtain a licence. One of the conditions for getting a licence is that the applicant has to show a requirement for a licence. If someone is surrendering an old licence and applying for a new one, the same conditions would apply. They would

have to demonstrate a need for the licence. In addition, if they did not use it for four years, it could be withdrawn.

Bill Wiggin (Conservative, Leominster)

I am grateful to the Minister for that reply—well, in fact I am not that grateful because the Minister has not addressed the problem. Yes, every four years someone would have to use their licence, but a company could do that. The shame of this is that people will apply for licences unnecessarily, on the basis that they may need them at some unknown future date. They will take action to continue to roll over those licences.

That means that many people who would like a licence will not be able to get one, because they will not be able to justify it environmentally. Because this part of the Bill rules out flexibility, that is more, rather than less, likely to happen. I am prepared to concede that it is not guaranteed to happen, but I imagine that a bit of flexibility would be constructive. [Interruption.] I see that the Minister has received a little note; perhaps there will be something interesting in it for me.

Elliot Morley (Labour, Scunthorpe)

The situation is not very different from the one that I described to the hon. Gentleman. The licences as they are issued now can be very different. They will have conditions attached to them. Some will have protected rights conditions; some will specify volumes. There are abstraction licences and transfer licences, which can be very different things. If a licence holder wants to change a licence to which conditions apply, the best way will be to surrender it and make a fresh application, rather than a variation, so that it can be evaluated properly, whatever the new licence is; otherwise, control over the management of licences will be lost. That is why I argue strongly against the amendment.

Bill Wiggin (Conservative, Leominster)

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendments made: No. 303, in

schedule 7, page 186, line 16, after 'access;', insert 'or'.

No. 304, in

schedule 7, page 190, line 14, at end insert—

'( ) The Environment Act 1995 is amended as follows.'.

No. 305, in

schedule 7, page 190, line 15, leave out

'of the Environment Act 1995'

and insert

'(general provisions with respect to water)'.

No. 306, in

schedule 7, page 190, line 22, at end insert—

'( ) In Schedule 22 (amendment of enactments), paragraph 181 is omitted.'.

No. 307, in

schedule 7, page 192, line 43, at end insert—

'( ) In Schedule 3 (Director General of Water Services), paragraphs 6 and 7 are omitted.

( ) In Schedule 4 (customer service committees), paragraph 6 is omitted.

( ) In Schedule 25 (amendment of enactments), paragraphs 68(2)(a) and 76(a) are omitted.'.—[Mr. Morley.]

Bill Wiggin (Conservative, Leominster)

I beg to move amendment No. 101, in

schedule 7, page 193, line 9, at end insert—

'(3A) In section 144B (restriction on undertakers' power to require fixing of charges by reference to volume)—

(a) at the end of paragraph (a) of subsection (1) there is inserted—

''that is 'household premises' as defined in subsection (5) below,'';

(b) at the end of the section there is inserted—

''(5) In paragraph (a) of subsection (1) above, ''household premises'' shall have the same meaning as in section 17C of this Act.''.'.

Bill O'Brien (Labour, Normanton)

With this it will be convenient to discuss the following:

New clause 26—Metering—

'(1) In section 142 of the Water Industry Act 1991 (powers of undertakers to charge), in subsection (2), ''(2A),'' is omitted.

(2) In section 142 of the Water Industry Act (charges schemes) subsections 2A and 2B are omitted.

(3) In section 143 of the Water Industry Act 1991 (charges schemes), in subsection (5)(a), ''in a case not falling within section 142(2A) above'' is omitted.

(4) In section 144A of the Water Industry Act 1991 (right of consumer to elect for charging by reference to volume), subsections (5), (6), (7), (8) and (10) are omitted.

(5) After subsection 144A of the Water Industry Act 1991 (Right of consumer to elect for charging by reference to volume), there is inserted—

''144AA Arrangements for introduction of metering

(1) Where—

(a) water is supplied by a water undertaker to premises in which, or in any part of which, a person has his home;

(b) charges in respect of those premises are fixed by virtue of any charges scheme under section 143 above without reference to the volume of water supplied; and

(c) such other conditions as may be prescribed by the Secretary of State through regulation are also satisfied in relation to the premises, and to the occupants of those premises,

the undertaker may at any time give the consumer a notice (in this section referred to as a ''company measured charges notice'') allowing the undertaker to fix charges in respect of the supply by reference to the volume of water supplied.

(2) Before making such regulations as are permitted by subsection (1) above the Secretary of State shall—

(a) consult—

(i) the Authority,

(ii) the Council,

(iii) the Assembly,

(iv) relevant undertakers,

(v) the Environment Agency; and

such other persons as the Secretary of State considers it appropriate to consult; and

(b) publish the draft regulations for public consultation.

(3) In making regulations under subsection (1) above, the Secretary of State must have regard to—

(a) the interests of—

(i) households with an occupant or occupants with low incomes;

(ii) households with an occupant or occupants of pensionable age;

(iii) households with an occupant or occupants who have a medical condition which causes significant levels of water use;

(b) the furtherance of water conservation;

(c) the particular circumstances in areas of water scarcity; and

(d) the promotion of economy and efficiency on the part of companies holding an appointment under Chapter 1 of Part 2 of this Act in carrying out the duties of a relevant undertaker.

(4) A water undertaker may not give effect to a company measured charges notice before the end of a period determined in accordance with the undertaker's charges scheme.

(5) If and so long as a water undertaker is entitled under subsection (4) above to fix charges for the supply of water in respect of any premises by reference to the volume of water supplied, a sewerage undertaker is under a corresponding obligation to fix charges in respect of foul water drainage provided by the sewerage undertaker in respect of those premises by reference to that volume.

(6) Any charges scheme under section 143 above—

(a) must contain provision for determining the period mentioned in subsection (4) above, and

(b) shall have effect subject to the preceding provisions of this section.

(7) In this section ''household premises'' has the meaning as defined in section 17C above.''.

(6) In section 144B of the Water Industry Act 1991 (restriction on change in basis of charging), for subsection (2) there is substituted—

''(2) Where this subsection applies, a relevant undertaker may not by virtue of any charges scheme under section 143 above begin to fix the charges in respect of those premises by reference to volume unless either—

(a) the consumer—

(i) has given the undertaker a measured charges notice under section 144A above, or

(ii) has consented to the charges in respect of the premises being so fixed, or

(b) the undertaker has given the consumer a company measured charges notice under section 144A above, or

(c) the fixing of charges in respect of those premises by reference to volume is required under section 148A below, or

(d) there has been a change in the occupation of the premises and no charges have yet been demanded from the person who has become the consumer.''

(7) After section 144B of the Water Industry Act 1991, there is inserted—

''144C Metering charges

Charges and other amounts to which this section applies shall not, by virtue of anything contained—

(a) in this Chapter;

(b) in any local statutory provision;

(c) in any charges scheme under section 143 above; or

(d) in any agreement entered into on or after 1st September 1989, be recoverable by a relevant undertaker from any person if they have been fixed wholly or partly by reference to a rating valuation list or are otherwise determined, whether directly or indirectly, by reference to any value or other amount specified at any time in such a list.

(2) This section applies to—

(a) charges in respect of any services provided at any time after the end of 31st March 2018 by a relevant undertaker in the course of carrying out its functions; and

(b) amounts of any other description which such an undertaker, in exercise of any power conferred by or under any enactment, requires any person to pay in respect of any period ending after that date or in respect of anything done after that date.

(3) In this section ''rating valuation list'' means a list which is or has at any time been maintained, for the purposes of rating, under section 41 or 52 of the Local Government Finance Act 1988 (c.41),

section 67 of the General Rate Act 1967 (c.9) or any other enactment.''

(8) After section 148 of the Water Industry Act 1991 there is inserted—

''148A Charges by volume, etc

(1) Subject to subsection (2) below, the Secretary of State shall, not later than the end of 31st March 2018, by regulations require all water undertakers to fix charges in respect of the supply by reference to the volume of water supplied for all household premises and to instal any meter in household premises to be used in determining the amount of any such charges.

(2) The requirements of subsection (1) above do not apply—

(a) to household premises—

(i) that share a supply pipe with one or more other premises;

(ii) where it is not reasonably practicable to instal any meter to be used in determining the amount of any charges; and

(b) to other household premises as may be prescribed by regulations.

(3) The Secretary of State may be regulations require all water undertakers to ensure that all customers in household premises, such as are excluded from the provisions of subsection (1) above by subsection (2) above, are charged by reference to the volume of water supplied and that meters are installed in household premises to be used in determining the amount of any such charges; and that this is achieved by such times as may be prescribed.

(4) Before making such regulations as are required by subsections (1) to (3) above the Secretary of State shall—

(a) consult—

(i) the Authority,

(ii) the Council,

(iii) the Assembly,

(iv) relevant undertakers,

(v) the Environment Agency; and

(vi) such other persons as the Secretary of State considers it appropriate to consult; and

(b) publish the draft regulations for public consultation.

(5) In making regulations under subsection (1) above, the Secretary of State must have regard to—

(a) the interests of—

(i) households with an occupant or occupants with low incomes;

(ii) households with an occupant or occupants of pensionable age;

(iii) households with an occupant or occupants who have a medical condition which causes significant levels of water use;

(b) the furtherance of water conservation;

(c) the particular circumstances in areas of water scarcity; and

(d) the promotion of economy and efficiency on the part of companies holding an appointment under Chapter 1 of Part 2 of this Act in carrying out the duties of a relevant undertaker.

(6) The Secretary of State may by regulations make provision for transferring to the Authority powers and functions for the purposes of subsections (1) to (3) above, including—

(a) modification of appointment conditions to meet the requirements of subsections (1) to (3) above, and

(b) imposition of penalties under section 22A above following the failure of a water undertaker to meet the requirements of sections (1) to (3) above.

(7) In this section ''household premises'' has the meaning as defined in section 17C above.''.'.

Bill Wiggin (Conservative, Leominster)

I shall speak only to amendment No. 101. This fairly straightforward little amendment would be tacked on to the end of paragraph 27(3) of

schedule 7, which deals with regional committees—that term is enough to send a shiver up anyone's spine. The amendment refers to

''undertakers' power to require fixing of charges by reference to volume''.

We have had a long debate on issues of volume, and the amendment is designed to qualify them. I hope that it finds favour with the Government, but I suspect that it will not.

Norman Baker (Liberal Democrat, Lewes)

I shall address my remarks to new clause 26, in my name and that of my hon. Friend the Member for Guildford (Sue Doughty). Members will know that I have referred to metering on Second Reading and during this Committee, and I want to explain in some detail why it is the correct way forward. I draw the Minister's attention to the fact that the new clause is detailed, so he will not be able to use the standard response that there is no detail. He will have to use his other response and tell us what is wrong with the detail. I look forward to it.

The new clause is what Sir Humphrey might have called courageous, as it is not without political risk, but we have proposed it because we think that it is right. Unlike gas or electricity, bills for which are based on consumption, water has historically been charged on the notional 1973 rateable value of the property—in other words, the amount for which someone could theoretically have rented out their house in 1973. That is an odd way of charging for water, especially as that value, if it had any meaning to start with, is 30 years old.

The 1991 Act conceded that water companies should no longer use rateable value and provided that its use would no longer be permitted beyond 31 March 2000. That decision was subsequently overturned. We now have an odd no-man's land in which companies use both rateable value and metering, which gives us the worst of all possible worlds. We are moving by stealth towards universal metering, but the Government do not want to champion it overtly. They are waiting for people to make their individual choices and for water companies to push the idea in the hope that we get universal metering without the Government doing anything.

That is a fundamentally dishonest policy, which has its own dangers. The current hybrid situation represents a worse solution than basing everything on rateable value, because there is a cross-subsidy from unmetered to metered properties. That is not something that people want to see in terms of social justice.

The new clause would prevent water companies from using rateable values as a basis for water charging, effective from 31 March 2018. We have built in the long lead-in period in recognition of the fact that such changes cannot be achieved overnight. We must consider the infrastructure and how quickly we can introduce universal metering throughout the country, and having talked to water companies, we believe that 15 years is a reasonably generous period. I

hope that that deals with the practicality of whether we could achieve the change in that period.

Andrew Lansley (Conservative, South Cambridgeshire)

Before we go too far into the discussion of the hon. Gentleman's metering proposals, will he clarify whether he intends the metering to be strictly based on the volume of water supplied or whether he wants the charges to be levied in relation to the variable costs of water supply in which fixed costs are attributed to each customer on the basis on which those costs arise? Does he intend that the fixed costs should still be varied according to the volume of water consumed?

Norman Baker (Liberal Democrat, Lewes)

My preference would be for the system to operate in the same way as electricity and gas. There would be a minimal standing charge, together with costs according to volume. I would also want to see rising tariffs providing a disincentive to use a greater amount of water.

Andrew Lansley (Conservative, South Cambridgeshire)

The hon. Gentleman's reply is interesting and not what I expected. It is interesting because the structure of costs in the water industry is different from gas and electricity, and the variable cost of water is a far smaller proportion of the total cost than the variable costs of either gas or electricity. I see no reason to suppose that, if one were charging only on the basis of the variable cost of water supply, there would be any incentive to water conservation, because the variation in charge would be very limited. The application of a standing charge, if it were unrelated to the rateable value, would mean that cross-subsidisation from expensive properties to cheaper ones would be removed.

Norman Baker (Liberal Democrat, Lewes)

I hope that the hon. Gentleman will let me develop my arguments, because he has intervened at an early point in the case that I am making. I have indicated that if there were a standing charge, it should be low. I am ambivalent about whether there should be such a charge—on balance, perhaps, I think that there should. However, I believe that there should be an increase in tariffs on the amount of water consumed, to give an incentive to reduce water consumption.

Simon Thomas (Plaid Cymru, Ceredigion)

Will the hon. Gentleman give way?

Norman Baker (Liberal Democrat, Lewes)

Yes. I am trying to make a case, but I will give way.

Simon Thomas (Plaid Cymru, Ceredigion)

I appreciate what the hon. Gentleman is trying to do, but I should like him to clarify a point. Does he intend the standing charge to include a certain amount of water that can be consumed under that standing charge before the extra charges for variable amounts of consumption are incurred? Will the standing charge allow for an average household's consumption, with more to be paid on top, or will the standing charge apply whether one uses no water at all or a little water?

Norman Baker (Liberal Democrat, Lewes)

The answer is that the new clause allows either solution to be introduced; it is not prescriptive. However, I would want there to be rising tariffs at a key point. It could be that a given amount of water could be taken under the standing charge arrangement, and then a rising tariff applied according to consumption, to act as a disincentive to use of water

beyond the point at which increased consumption might become environmentally disadvantageous.

The new clause would require the Secretary of State to put in place a strategy for attainment of comprehensive water metering by 31 March 2018 and, in the interim, it would enable water companies to introduce compulsory metering, when the Secretary of State allowed it. In that way, metering would be implemented gradually, with the expectation that it would occur first in areas where there is currently a water shortage, such as the south-east, and that the areas where water supply is less of a problem would be left until later.

The new clause would implement comprehensive metering to a set timetable. The Government are currently allowing metering to be introduced by stealth, and should make up their mind whether they regard metering as a good idea. The 1991 Act initially suggested that it should be phased out. New consumers may choose to switch from rateable value to metering, but there is no choice for those who come into a property that is already metered—they have to inherit it.

The water companies have made it plain to us that it is not possible to carry on indefinitely with the current legislation, which is based on that hybrid solution. They say that there is a cross-subsidy from unmetered to metered customers that will be unsustainable as the number of metered customers continues to grow. Those who are opposed to metering must face that fundamental point.

Kevin Brennan (Labour, Cardiff West)

Can the hon. Gentleman tell the Committee, from the discussions that he had with the water companies, how many of those companies are in favour of compelling people to transfer to water meters, as he suggests, and how many are not?

Norman Baker (Liberal Democrat, Lewes)

I cannot give the hon. Gentleman an absolute figure. I have spoken to the water bodies collectively—to Water UK—and to individual companies in my patch, and to several others throughout the UK. None of them wants compulsory metering, but all recognise that the current situation cannot be allowed to continue indefinitely.

Kevin Brennan (Labour, Cardiff West)

If the hon. Gentleman cannot do that—I realise that it might be a bit much—can he tell us one company that is in favour and one that is not?

Norman Baker (Liberal Democrat, Lewes)

I can tell the hon. Gentleman that South East Water recognises the need for compulsory metering, and it has been helpful in drafting the new clause under discussion. No doubt other companies are opposed to it, and I am sure that hon. Members will draw attention to them in their own contributions to the debate.

I do not want to lose the last point that I made—one which hon. Members must address in the interests of equity and fairness to consumers who are not well off. At present, creeping metering happens where people perceive that switching to metering is of direct economic interest to their own situation. The figures to which I referred earlier are in a parliamentary answer

provided to me by the Minister earlier this year. They indicate that the average metered bill is significantly lower than the average unmetered bill in every company area except Portsmouth. That means that those who are unmetered are providing a cross-subsidy to those who are metered. It is often the poorest who are unmetered. That should not be allowed to continue. We must address that in some way. My preferred solution is to have universal metering. In a sense the alternative solution is rateable value. The present hybrid arrangements are unsustainable.

Nick Palmer (Labour, Broxtowe)

Does not the hon. Gentleman think that one of the reasons for that difference may be that metered customers use less water?

Norman Baker (Liberal Democrat, Lewes)

Of course metered customers use less water. The very fact that they are metered acts as in incentive to use less water. But there is an overall cost to the water supply as they are paying less than they would have done under rateable value. The income that the water company would have received has to be obtained somewhere else and is a cost to other householders.

Kevin Brennan (Labour, Cardiff West)

Is the hon. Gentleman aware that one company that is against water metering is Glas Cymru, which, to my knowledge, is the only water company in the UK that has been set up as a public interest company not to make a profit but to serve the interests of its consumers?

Norman Baker (Liberal Democrat, Lewes)

I was not aware of that. I am grateful for the information, which is doubtless a fact to be considered. I do not pretend that these situations are black and white. But I am sure that the metering by stealth, which has been going on for 13 or 14 years, cannot be allowed to continue. We need a clear statement of Government policy, which my new clause is designed to elicit. There are arguments for and against.

We support metering despite the fact that it has downsides. I do not pretend that everything is rosy. There is a short-term transitional cost. There are infrastructure costs in implementing the system and installing meters but we believe that in the long term the effect of stemming the forecast growth in demand will benefit the consumer by keeping bills lower and benefit the environment by limiting the growth in abstraction. If water consumption can be capped, the need to invest in longer-term infrastructure such as new reservoirs is obviated.

Metering trials took place in the early 1990s. The final summary report from the national metering trials working group states:

''The Water Industry Act 1991 requires that water companies can no longer use rateable values as a basis for charging after 31st March 2000.''

That has been overtaken by events.

''The metering trials have shown that customers, by and large, accept the idea of paying by volume and that there can be a significant effect on demand.''

It is a given from the studies that took place that demand can be reduced by metering. Indeed, the study

in the Isle of Wight, which was the most comprehensive of all the studies, showed a 21 per cent. reduction in demand for water. I am happy to accept that that may be to some extent an unreliable figure. For example, an attempt was made at the same time to introduce leakage controls. Nevertheless I am in doubt that water can be saved by metering.

Simon Thomas (Plaid Cymru, Ceredigion)

The hon. Gentleman has just mentioned the very point that I wanted him to address. Although his attempt to achieve greater water conservation is undoubtedly the right approach, about 18 per cent. of our water is still lost through leakage before it even gets to the customer. I wonder whether his new clause addresses the real problem in the industry, which is downstream from the customer.

Norman Baker (Liberal Democrat, Lewes)

There are a number of problems with water. One is the failure of the public authorities to conserve it properly. We tried to deal with that this morning and only partly succeeded. There is the problem of technology and how one can design toilets that do not waste water. There is the problem of leakage in pipes and how one deals with householders' pipes, particularly the section from the tap to the main connection which is privately owned and where most of the leakage now takes place.

There is a whole range of problems relating to the loss of water. We are trying to address one of them. I have never pretended that it is the only issue, but it is one of them. If electricity were based on rateable value people might decide to keep the lights on, but as they pay for it people are more careful about how they use electricity. I want the same philosophy to apply to how people use water.

Richard Burden (Labour, Birmingham, Northfield)

The national water metering trials in the early 1990s, which considered the impact of metering, came in for a lot of criticism on the grounds that the areas chosen were far from typical. One argument advanced then was that the Isle of Wight does not have many high-rise blocks of flats, which cause technical problems when introducing water metering. Has the hon. Gentleman thought about how reliable those metering trials were?

Norman Baker (Liberal Democrat, Lewes)

Yes, I have. I discussed the matter at length with Southern Water, which is a local company. The Isle of Wight was the biggest area in which tests were carried out and probably produced the most reliable figures. I agree with the hon. Gentleman that it may be dangerous to extrapolate too widely from the results in the smaller areas. The Isle of Wight was a large test area and it is reasonable to draw conclusions from it.

The new clause addresses the issue of high-rise blocks. It recognises that there must be different arrangements for areas and premises in which individual households could not be metered, such as metering a block of flats and subdividing the bill, but that is not specified in the proposal. However, the new clause recognises that there is a problem in high-rise

blocks and other buildings and contains a measure to deal with it.

The National Consumer Council report, ''Towards a Sustainable Water Charging Policy'', published in 2002, states that in New York 600,000 were converted to charging by volume between 1988 and 1998. As a consequence, the water company was able to postpone indefinitely a huge investment programme to develop further water supply resources. It is clear, first, that the installation of meters suppresses demand and, secondly, by doing so it obviates the need for long-term infrastructure investment, which means lower consumer bills in the longer term.

Diana Organ (Labour, Forest of Dean)

I go along with the philosophy that we should be considering efficient ways of using water in the infrastructure. Is the hon. Gentleman aware that the most successful boys' urinals in new primary schools, such as Hopebrook in my constituency, are completely dry? As a Member of Parliament, the hon. Gentleman, like me, will have to visit many boys' urinals in primary schools. A new design is being used that does not need water, so it does not smell and is extremely efficient. We should consider every measure by which to cut down on the unnecessary use of water in new infrastructure.

Norman Baker (Liberal Democrat, Lewes)

I am grateful for the hon. Lady's intervention. It shows another means of saving and conserving water. I am not over-familiar with boys' urinals but I take her point. [Interruption.] Not for a long time, anyway. I will bear in mind what she said the next time I am near a boys' urinal.

I return to my response to an intervention from the hon. Member for Ceredigion. A lot can be done generally to save water and the hon. Lady mentioned one means of doing so, but it is important, because it has got people who use water to consider how much they use, and whether they need to use it. I am in no doubt that water metering will suppress demand, obviate infrastructure investment and keep bills down. It is also fairer, by and large, that people pay for what they use rather than pay some notional amount based on 1973 rateable values, which is indefensible. I want someone to defend that position in a moment.

The arguments about water metering are not all for or against. The real issue is to ensure that any system that is introduced does not adversely affect the poorest people. That concern is probably why successive Governments have not pushed ahead with the proposal, and perhaps why, in 1997, the new Labour Government pulled back from the 1991 Act, which would have required universal metering.

The changes in subsections (5) and (6) of the new clause give water companies the power to require customers to install a meter and to be charged volumetrically, but they give the Secretary of State power to have regard to important factors such as the needs of low-income consumers and areas of water scarcity. The Secretary of State is given room for manoeuvre to deal with those groups and to take extensive consultation. The new clause provides that he must give particular consideration to vulnerable customers such as the poorest families and those with

medical conditions requiring high usage. Those conditions must be satisfied and the matter sorted out before water metering can be introduced.

The Government recognise the need for vulnerable groups to be protected in respect of water metering in the regulations, but water companies and Water Voice have told us that those regulations do not work at present. There is little take-up, they are not understood, the forms are hugely complex and they do not help the target audience for which they were designed. Irrespective of anything else in the new clause, the Government need to review the regulations to ensure that they work.

Our overall intent is to balance the interests of the environment, consumers and water companies to provide a timetable for universal metering by 2018, to ensure that particular consideration is given to vulnerable customers in drafting the necessary regulations, and to charge substantially by volume. There should be rising tariffs which mean that the first use of water will be cheaper than later uses, although it is important not to penalise the essential use of water. We want to ensure that water companies are fully involved in the consultation process and to provide the Secretary of State with sufficient room to manoeuvre on the issue of vulnerable groups, taking into account the difficulty of metering properties. The concerns expressed in the amendment and the new clause are linked to our earlier amendment on water poverty. The Minister agreed that the regulations on vulnerable groups needed to be improved.

It is not practical or honest to proceed with the hybrid system of water metering by stealth. Some time in the future there will be universal metering. It will happen because water will become more scarce, especially in the south-east, for example; because as people move around, consumers who had water meters will choose that system for their new premises; and because there will be pressure from the water companies. If there is to be universal metering, it is better to manage the process properly. The Government should be open about it, have proper consultations with the affected groups and introduce a system that deals with the issue I have raised, ensuring that the vulnerable are properly protected. A system that is brought in by stealth would not do those things.

Robert Key (Conservative, Salisbury)

My water system is metered in my constituency home and in my London home. Is the hon. Gentleman's water metered at both ends?

Norman Baker (Liberal Democrat, Lewes)

It is certainly metered in my house in Lewes; I made sure that it was. I live in a block of flats in the Westminster city council area, and I do not know whether it is metered or not. I have only just moved in and I have not yet had a bill.

Kevin Brennan (Labour, Cardiff West)

May I check a further point with the hon. Gentleman? As I understand it, he proposes that the charges should rise according to the volume of water used. Why should a bath for the fourth child in a family of four cost more than a bath for an only child in a family?

Norman Baker (Liberal Democrat, Lewes)

I understand that important point; I referred to the vulnerable groups regulations, which

should protect such people. I do not want a system that discourages the essential use of water in any way. Any system that introduces metering must deal with that problem, as the present regulations do not protect people. We discussed in earlier sittings the percentage of household income that is spent on water bills, which is way above the 3 per cent. guideline given by the Department for Environment, Food and Rural Affairs.

The vulnerable groups regulations, if they are properly drafted, in conjunction with the rising tariffs, should protect people who may question whether the fourth child can have a bath. If they can afford it, they may wish to use water to bathe the fourth child, while someone else may wish to water their garden or to wash their car using a hosepipe.

It is important to charge by volume, but also to have protection for essential use in the circumstances that I have described. That is what the new clause tries to achieve.

I hope that the Minister will respond positively to the new clause, although he will probably not accept it. However, the Government must be honest about water metering; it is not sufficient to leave it to metering by stealth, which does not provide the safeguards that the new clause would introduce.

Elliot Morley (Labour, Scunthorpe)

I will deal with stealth metering in a moment, but I must first deal with the amendment tabled by the hon. Member for Leominster. This is more technical and he is asking to use the term ''household premises'' as defined by the competition provisions in schedule 4. There is a problem with that, because that definition, which can be elaborated on in regulations, was created for use under the proposed competition regulations. It is not a definition that we wish automatically to apply to metering, and if any changes made to the definition of household premises automatically affected metering, it would restrict the ability to fine tune the competition provisions.

There are fundamental differences between metering and competition and we would not wish to replicate some areas here. That is why I do not think that the hon. Gentleman's definition is suitable. I am not aware of any problem with the current definitions; they were introduced in the Water Industry Act 1999 and have been in operation for three years without any great difficulty. I do not see the case for the amendment.

I do not agree with the new clause tabled by the hon. Member for Lewes. My disagreement is more with the philosophy of it, than with the new clause itself. I shall explain why. The Government are clear about our objectives: we believe that, in the long term, the most appropriate way of charging for water is metering. We have said that on a number of occasions. We have a difference with the hon. Gentleman because he accuses the Government of metering by stealth.

We are metering by choice; we are giving people the choice of moving on to a water meter. It is true that, over time, more and more people have done that. All new houses must have water meters; once one is put in,

the regulations say that it has to stay in. The hon. Gentleman misunderstands the situation. There is already provision for companies to apply for compulsory metering if they so choose. That is in water-stressed areas, and if the company wants to make the case that there is a problem with water resources in its area, it can come to DEFRA and make an application for compulsory metering. So far, none has done so. We would expect any company to address the points made about matters such as leakages, before it asks for compulsory metering, but the provision is there.

Norman Baker (Liberal Democrat, Lewes)

I assure the Minister that I know that the provision is there. I have had discussions with the water companies about it. Their view—I am obviously putting their case, which they wish to have communicated, rather than the Minister's interpretation of it—is that the hurdles that they would have to overcome to qualify for that are so high that it is difficult, and not sensible, for them to invest a huge amount of time in overcoming them. That is their argument; the Minister may not accept it, but that is what they told me.

Elliot Morley (Labour, Scunthorpe)

I am not entirely convinced by that argument. If the water companies think that the hurdles are too high, they are welcome to address that through Ofwat and directly to DEFRA, as they do in our discussions. The provision is there, should it be necessary, and should there be an issue of real water shortages. Water metering is a complicated issue; that emerged from our discussion, and I am glad that we have had it. It is quite an important issue and there is no harm in addressing the pros and cons of it.

I can claim to have experience of both sides of the argument because I live in the Anglian region. I think that Anglian was the only company that started with compulsory water metering. I remember the horrendous difficulties that it ran into with that programme. It was paying for the meters that were being installed; it is worth bearing it in mind, when we talk about giving people choice, that meter installation is free. That is quite a powerful inducement for people to move over to it. There were enormous problems with Anglian and that is why I would be reluctant to accept the date that the hon. Gentleman cites in his new clause. There are terrific technical problems in many parts of the country in installing meters. We have heard about difficulties with blocks of flats. In my constituency, older blocks of terraced houses use one water supply, and attaching a meter to that is horrendously problematic.

My own home in north Lincolnshire—I must quickly say that I am metered in London—is an 18th-century manor house that has been socially divided into two houses. I live, in a socially responsible way, in one half of that building. There is only one water supply for the whole building, and it runs through my side of the house. Trying to install two meters is incredibly difficult. I know that because Anglian Water came round to fit my compulsory meter and, despite spending half a day under the sink in my kitchen, could not work out how to do it for the two

separate houses without enormous costs and problems. We have to be careful when setting dates for overcoming technical problems.

Although I believe that metering is the way forward—I make it clear that the Government believe that metering is the long-term future—I point out to the hon. Gentleman that the effect on demand is more complex than he thinks. There have been several studies on that, and the water companies and Ofwat currently assume that metering would bring a 5 per cent. saving in water use; not bad, but not huge either. However, in some areas this summer, metered customers used more water proportionally than unmetered customers. The reasons for that are not clear and more analysis is needed, but it is not necessarily the case, as the hon. Gentleman believes, that metering is the new nirvana and will solve all the problems. Meters may be part of the solution for water management, and we would not rule them out.

I also want to clarify that there is no cross-subsidy between metered and unmetered supply. Ofwat is responsible for setting prices and tries to ensure that there is no subsidy. If there were any implications, they would be for the unmetered supply because the biggest water users would move on to meters. It is also more likely that those who pay the highest rateable value would move over to meters so, as the overall income changes, there are implications for the charges of those with an unmeasured supply. Ofwat is responsible for examining that, and it sets prices, taking those factors into account. However, I do not want to give the impression that metered customers are subsidising unmetered customers, because that is not true; we would have strong words to say if it were.

Norman Baker (Liberal Democrat, Lewes)

The Minister said that there is no cross-subsidy, but does he accept that if somebody on an unmeasured supply changes to a metered supply in the belief, usually correct, that they will save money, the overall income stream to the water company will diminish? That affects the resources available to the water company for future investment and, if Ofwat is approached and told, ''We want an increase of X per cent,'' the figures on its balance sheet will probably justify that. There is an implication for unmeasured customers from the reduction in income from measured customers.

Elliot Morley (Labour, Scunthorpe)

That is basically what I was saying, but the implication is for the unmeasured customers. If the base declines, Ofwat will have to decide on the charging regime to be applied to unmeasured as opposed to metered customers. However, I want to make it clear that there is no subsidy from unmetered to metered customers.

Kevin Brennan (Labour, Cardiff West)

Is not the implication of the suggestion of the hon. Member for Lewes that the introduction of compulsory metering will lead to a massive and sudden fall in income to water companies? That will lead to much lower investment and bigger problems with leakages.

Elliot Morley (Labour, Scunthorpe)

That again would be an implication of a fast move to metering, which would affect water companies, consumers and vulnerable groups. We would prefer an orderly and phased move towards the

changes, to minimise dramatic impact on consumers and people. I do not believe that the new clause would achieve that.

I want to say a word about vulnerable groups. Some of my hon. Friends were concerned, and I can tell them that vulnerable group regulations are under review. They are designed to assist metered customers who need to use large volumes of water for essential purposes. The results of the review and consultation will be issued by the end of this year. That is an aside to say that we are sensitive to the needs of vulnerable groups in relation to water meters and we are trying to address them.

It would be to many people's advantage to move to metering at the moment. As prices and regimes change, I suspect that more and more people will find it in their interests to do that and we will see continued progress as more people make the move. We are moving towards maximising the number of people on water meters, bearing in mind the technical problems, which will not be easy to resolve. That is part of an overall approach to water management, which also includes tackling leaks, considering building regulations and the design of new houses, and minimising water use. We must consider a range of issues in ensuring that we have good water management, and leakages is just one of them.

I return to the point that if there are shortages in a water-stressed area, companies can apply for compulsory metering. They can also already insist on compulsory metering for large water users. In my area, for example, it is compulsory for people with swimming pools and, I think, sprinklers to have a meter. Such measures can be applied, which shows that far from introducing meters by stealth, we are giving people the choice. We are working in a way that allows transitions without huge distortions for either the companies or consumers. We recognise that there are sensitivities in terms of what people want to do and that effective measures are needed for vulnerable groups. We already have some measures in place and are trying to improve them further.

The Government approach is the right one. We are aiming for the same end point as the hon. Member for Lewes, but it is a question of being practical and proportionate and of recognising the difficulties in applying large-scale metering throughout the country. We have recognised those problems, and our balance is just about right. We are open for discussions about different charging mechanisms and other approaches. As I have mentioned several times, we are receptive to new ideas and approaches. The hon. Gentleman has the best intentions and motivations, but his new clause would not work in the interests of either water companies or consumers.

Sue Doughty (Liberal Democrat, Guildford)

Before we leave the new clause, I should like to make a few points. Much of the Bill is about reducing the amount of water that we abstract, using water wisely and putting in place measures to do that in increasingly difficult climatic times. The Minister rightly pointed out that several measures in the Bill are designed to do that, and we know that some water companies have been effective in reducing their leakages to the level of diminishing

returns. Other companies such as Thames Water, which was mentioned this morning, still have a way to go, and we want to see improvement from them. However, water companies in many parts of the country have responded to the challenge.

The Minister says that people can opt for a meter, but many people will not do so if, for example, they are unsure about the state of the pipes in their garden, for which they are responsible. The problem is that if there is a break in the pipe before it gets to the meter, where it is that person's responsibility, they may get a high bill. Constituents who have not been able to reach a proper accommodation with the water company come to me worrying about what might happen in such circumstances.

I appreciate that there is no great demand for metering in Wales. There is an awful lot of water there, so they would say that. I know of one other part of the country where metering would not be popular, for the same reason—there is no water shortage in that part of the country. The water companies in such areas would understandably not want to go for it.

One wonders whether the Welsh would be so keen for water not to be metered if there was a water shortage in another part of the country—perhaps in England—to which water was being shipped from a new reservoir in Wales.

Simon Thomas (Plaid Cymru, Ceredigion)

Perhaps I might suggest that we put one big meter on it.

Sue Doughty (Liberal Democrat, Guildford)

Well, effectively, that happens in practice. We look at the amount of water that is going through.

It is understandable that the Minister dwelled at length on the problems on shared supply pipes and where it is practical to install a meter. The new clause deals with that by excluding such provisions under proposed new subsection (2A) of the relevant section of the 1991 Act and allowing for separate arrangements.

It is well known and understood that there are some groups of properties where it is impossible to divide fairly the amount of water going through each component part. However, one could aggregate all those properties and divide the amount of water going into them proportionately and fairly. That would be a matter for consultation. We do not dictate how that should happen. The proposal allows for consultation before the Bill is enacted. It does not have to go down to the level of detail, because we recognise that such a thing would not just be included as a finished measure before due consultation of the implications was carried out.

There are questions about whether if everybody were metered, there would be less investment. However, if there were less investment, that would presumably be because there had been a reduction in the amount of water used. I hope that we would, for example, avoid a new reservoir in south Oxfordshire in the Thames Water region. That is always on the cards, despite what was said about leakage. We are using more water; we wash and shower more often and we

wash our clothes more often. There are all sorts of considerations to bear in mind, but eventually the water must be paid for. We are still keen on taking a closer look at metering.

Hon. Members have said that there are high hurdles to be overcome before we decide on compulsory metering. However, we need to consider the matter, not only in the interests of social justice, with the provisos that we have discussed, but because many of the measures that we are considering may not be enough to guarantee the supply of water in an increasing number of households, which we need to supply, and given the climatic stress that we are facing.

Bill Wiggin (Conservative, Leominster)

What an enjoyable afternoon I have had listening to the debate, thinking of the Minister reclining in his 18th-century manor house, particularly with the water authority burrowing under his kitchen sink.

I remember asking the hon. Member for Lewes earlier if it was official Liberal Democrat policy for there to be compulsory metering. If that is so—and I hope that it is—he has demonstrated in the new clause that he really believes in it. I do not mind if he distributes a ''Focus'' leaflet on such an issue around my constituency. I believe that the public deserve the choice of whether to have a free meter, should they want one, or to maintain the status quo by continuing with the rateable value. That is probably the right and reasonable way to proceed. Of course, we will end up with a higher proportion of metered houses in the long run.

I was grateful to the Minister for dealing with my rather technical amendment, the purpose of which is to define property and household premises, because in the next amendment we will come on to the difficulty with blocks of flats. However, I do not want to move on to that debate at this early stage. We shall later have a debate on fluoridation when we will talk about compulsory mass medication. I suspect that the more liberal-minded among us will be against that. And how could we possibly be in favour of compulsory water meters?

Norman Baker (Liberal Democrat, Lewes)

I shall be quick, as there are many new clauses to debate.

First, I want to pick up three of four points that the Minister made. He mentioned the word ''choice''. There is choice in some respects, but not in others. There is choice if a person happens to be in a unmetered premises and wants to change to a meter, but there the choice ends. There is no choice if a person is in a metered property and wants to go back to being unmetered. There is no choice if a person buys a new house and it has a meter. The choice is therefore illusory, or at least there is a choice for some but not others. That contributes to the hotchpotch that I referred to during in my introduction.

Secondly, the Minister does not like the date 2018. As I said, I talked to the water companies; they said that a minimum of 10 years was required, and we have given them 15, so that is not an unreasonable period.

Thirdly, as the Minister said, the new clause is not nirvana. It could be one measure among many. I fully accept that, and I am prepared to sign up to Ofwat's 5 per cent. figure that the Minister quoted. The figure of 5 per cent. is significant and should not be thrown away; it is worth having. I have offered part of, but not the whole solution.

I shall turn to the idea that it is bad to save water because bills will go up. As the hon. Member for Salisbury (Mr. Key) said from a sedentary position, the argument seems to be for subsidising inefficiency, which we should not be doing. We would obviate the need for further infrastructure improvements, thereby keeping the cost of the water industry down—my hon. Friend the Member for Guildford made that point.

We have had a useful discussion. The Liberal Democrats reserve the right to press new clauses to the vote later in the process. I do not pretend that metering is without problems—it is not. I hope that it appears in the introduction to the report accurately rather than mischievously. It is not honest of the Government to duck the issue and wait for sources outside the Government to sort it out over a long period. Labour Members generally want to protect vulnerable groups, but those people will suffer more unless the Government use a big bang approach.

The rest of the debate is in Hansard.