Kew Gardens

Andy Slaughter Excerpts

Tuesday 16th December 2014 Westminster Hall

[Mr Andy Slaughter (Hammersmith) (Lab)]

My hon. Friend is absolutely right. Kew is important to the whole world and certainly to the whole of this country, but it has a special place of trust for those of us who have grown up and lived in west London. We want to see a sustainable future for Kew. While I acknowledge that the announcement today is welcome, there has to be a long-term future, and we have to preserve something that is unique in the world.

[John McDonnell]

I agree.

May I remark on the success of this campaign so far? It started way back in April, when concerns were being expressed by members of staff at Kew through their trade unions—PCS and Prospect, among others. As the hon. Member for Richmond Park said, we delivered a petition of more than 100,000 names. Unfortunately, we were unable to take the wheelbarrow containing the petition up to No.10, but we took the petition itself. The campaign built up a head of steam. We held a public meeting down at Kew; there were at least 200 people there, who were incredibly enthusiastic about the campaign. That effort secured £1.5 million, which the Deputy Prime Minister announced and which was very welcome, and we have received £2.3 million today. If we keep on talking, we will be up to the £5 million needed to cover the gap identified some months ago.

I am grateful for the new money but there is a long-term problem, mentioned by the hon. Member for Richmond Park: we need stability now. We cannot keep on going through these ups and downs of budgeting, in which one month a £5 million gap is found and then the Government come up with the occasional £1 million in the short term. What we are looking for is a long-term consistent plan.

The difficulty at the moment is about the funding of Kew itself. I have been looking through the figures, as set out in the House of Commons Library briefing. If we look at the funding in recent years, to be frank we see that the money has been ricocheting around, and up and down, in that time. There is the Department for Environment, Food and Rural Affairs operational budget. In 2007-08, it was £17.6 million; it went up to £19.85 million in 2008-09; then it went down in 2009-10 to £17.65 million; and it is now down to £14.4 million. Again, the message that comes across from managers, trustees and others is the inconsistency and unreliability of the funding, which means that they are unable to plan from one year to the next because many of the decisions about the funding of Kew are made quite late in the year. Consequently, the management find it almost impossible to plan.

The money I have mentioned is the core operational funding, which pays for staffing. In addition, if we look at the capital budget, which also comes from DEFRA, we see that in 2007-08 it was £7.6 million; it went up in 2012-13 to £17 million; and it is now back down to £13.6 million, but that includes some elements that take into account redundancy costs and other costs. Again, even on the basic infrastructure costs, let alone the staffing, the inability to plan for the long term is affecting the efficient management of the organisation itself.

Kew has done all it can to raise its own funds. We can see from the trust itself the operations that it has undertaken, including the charitable work that has taken place and the charitable donations that have been made. In addition, the hon. Member for Richmond Park and I met Marcus Agius, the chair of the trustees at Kew, who set out for us the discussions that had been taking place about the restructuring, which aims to secure additional funds. However, at the end of the day that was overridden—well, the backdrop to all this was the reduction in core income. So even though the restructuring is there to ensure that there is enhanced income, particularly with regard to the scientific work, it is still based on an overall cut in expenditure from DEFRA itself.

Again, part of the problem is that the income comes from DEFRA, whereas the work that Kew does actually spans a range of different Departments. Kew plays an important educational and scientific role. A range of aspects of its work could properly be funded by other Departments, particularly its work in the developing world. However, it relies on DEFRA; unfortunately, DEFRA’s budget has been cut in recent years, meaning that the cuts have followed through to Kew. There is volatility about the whole funding process, both in terms of DEFRA’s funding and Kew’s ability to secure funds from elsewhere. That means there is lack of clarity about the future of funding and an inability to plan and invest in Kew’s long-term future.

As the hon. Member for Richmond Park said, the tragedy is that this year there have been significant cuts: 125 posts have been cut, with 65 staff having already gone, and there is now a group of staff in 51 posts who, although there are 42 vacancies, are declared surplus. Although it is possible that they will able to compete for some of the 42 vacancies, not all the vacant posts are suitable alternatives for those staff.

Kew’s expertise is described as a mosaic of individuals with their own individual expertise in small teams. In recent years, that expertise has been whittled down. For example, the voluntary redundancy scheme has meant that, in certain areas of activity, the expertise has either been reduced significantly or lost altogether. I shall give some examples that have been provided to explain the situation to us.

Expertise in legumes, one of the world’s economically important plant families, has now almost entirely gone and expertise in pollen has almost gone, with implications for health, forensics, conservation and the study of pollen in the archaeological and geological contexts. Capacity in many other areas has also been reduced, meaning that potential skills shortages are being faced in a number of areas. Kew relies on some world-renowned experts in these particular fields. It is absolutely admirable that a large number of staff who have retired or gone from Kew as a result of voluntary redundancy have come back voluntarily and are now offering their expertise as volunteers. What greater commitment can be demonstrated than that?

In addition, there is concern that the gap in funding from DEFRA is having an impact as Kew desperately tries to seek funding from elsewhere.

The entrance fee for Kew is £15 and there is now a discussion about whether children should be charged. For my constituency, Kew has become an oasis of calm within west London—particularly for families, who visit and enjoy it. Any further increase in fees will, unfortunately, deter many people from visiting Kew and there will be a self-fulfilling prophecy of decline as a result. More importantly, at the moment Kew offers the opportunity for all families to be able to visit. Any increase in prices will deter those least able to afford it and possibly those who need it the most in terms of being able to break away from the duress of their everyday lives.

There are other concerns. Yes, of course fundraising activities have to take place at Kew, but there has to be a balance as well. We do not want Kew turning into a base for funfairs and other activities that crowd out the environmental enjoyment of the park itself.

I have listed the range of issues put to us in the various public meetings that we have had. There is real concern that unless we get some agreement on stable funding over the longer-term period—the next five to 10 years in particular—the additional money that came in September and the additional money today, which of course is welcome, will tide us over perhaps for another 18 months and then we will be back to square one. In the meantime, we will have lost expert staff and—pardon the pun—their expertise does not grow on trees. These people have been trained throughout their lives and have dedicated their lives to Kew. Their expertise must not be lost.

Although Kew got some investment from the significant funds that other institutions gained—particularly the museums, with free access and investment over a longer period—because of its link to DEFRA in particular it never gained the scale of funding needed to tackle its long-term issues of physical infrastructure and the long-term financing of its staffing and research, particularly its scientific research capacity. Many people feel that, as a result, Kew has been discriminated against and that now is the time to stand back and look at where we go from here.

The triennial review is coming up in the new year—the scientific review is coming back to us as well—and that will give us some opportunity to look at the long-term role of Kew, but that must be linked to a long-term financial and investment plan. If that means looking at DEFRA’s or other Departments’ budgets, that discussion needs to go on within the Government.

I have a specific request for the Minister to take away with him. Kew management are desperately keen to work closely with the Government. There has been some close liaison between Kew management, the trustees and the Government in trying to look at a long-term financial plan for Kew, but we are nowhere near securing a sufficient deal on that.

My request is that the Minister should go back to his Department and convene a meeting with all interested parties—all the stakeholders—including the Friends of Kew, the relevant local MPs, trustees, the management of Kew and the trade unions. In that way, we can get absolute clarity on the current financial position and the Government’s plans for the long-term future of Kew. We cannot have the budget ricocheting around as it has done in recent years. A long-term, stable funding plan for Kew needs to be agreed between the Government and all parties. I ask the Minister to get everyone around the table in the coming months.

The £2.3 million on top of the £1.5 million has given us the breathing space to consider long-term staffing needs and examine a long-term plan, based on the restructuring that has taken place so far, in respect of the ambitions of Kew.

When we met the chair of the trustees, he outlined the work that had gone on: the development of a scientific vision; the way in which work force activities, in individual silos at the moment, were being broken down; the co-operation across areas of expertise; and the introduction of a better career development plan for the staff. However, at the end that was all clouded by the reduction in the core income. Unfortunately, I think that the plans that Kew is putting forward will hit the financial rocks—perhaps not in the next 18 months, now that we have the additional money, but after those 18 months, unless we have a clear commitment from the Government.

We need to address the issue on a cross-party basis. Bearing in mind its international and global scientific role, Kew’s budget and long-term planning cannot be dependent on changes in Government. I would welcome the opportunity for all stakeholders to come together and for a cross-party agreement on the long-term financing of Kew, agreeing a base budget from which the fundraising activities could be developed as well as some of the scientific project work, to bring in additional funds. There should be solid agreement between parties and all stakeholders on a long-term financial plan for Kew.

I turn to the current staff difficulties. Following the £2.3 million announced today and the £1.5 million announced earlier, the message to the management now should be to hold off any further redundancies and cutbacks because there is real anxiety about the loss of expertise as a result of the cuts and the voluntary redundancies that have already taken place. It is important that the message to management is that they hold on to what staff and expertise they have until there is a much better and deeper discussion about Kew’s long-term future.

I hope tomorrow’s Select Committee visit will produce a report that gives us some indication of what the Committee sees as Kew’s long-term future. The evidence that has already been provided emphasises Kew’s scientific role and the importance of holding on to Kew’s solid bedrock of scientists. However, those presenting evidence tomorrow will present ideas about how to establish a long-term budget. There is a spirit of co-operation between all the stakeholders now, and the Government should seize that opportunity. As I say, I hope that is done on a cross-party basis.

As a friend of Kew, I know that many of us have enjoyed the gardens over the years. Kew is a world heritage site and a beautiful park. Underlying all that, however, is the magnificent role that Kew plays in scientific research. If we do not address Kew’s needs now and seize this opportunity to secure its long-term future, many of us will feel extremely guilty in years to come when it is degraded as a result of waves of cuts and the instability of its funding base.

I hope the Minister will agree to meet us all and to bring all stakeholders together. We can create a long-term plan for Kew. In that way, we will not need to have another Adjournment debate in a few months’ time. Indeed, every time we go for an early-day motion or an Adjournment debate, it produces an extra couple of million pounds, so, in the long run, it would be cheaper for the Minister to bring us all together.

Badger Cull

Andy Slaughter Excerpts

Wednesday 5th June 2013 Commons Chamber

[Mary Creagh]

I thank the hon. Lady for her intervention. I am coming on to that point in my speech. Her report certainly talks about the need for a proper strategy and a coherent policy, and I am not sure that that is what we have got from this Government.

[Mr Andy Slaughter (Hammersmith) (Lab)]

My hon. Friend has correctly identified an issue about which hundreds of my constituents have written to me, namely animal cruelty. Given the lack of evidence and the absence of consensus on the matter, and in the light of the huge public concern, the cull surely cannot go ahead. It is extraordinary that Government Members have not reflected the concern felt by their own constituents.

[Mary Creagh]

I know that there is a great deal of public concern. Any policy must be socially, environmentally and politically deliverable, and the Minister’s decision to pursue the cull will test the limits of those requirements.

In Gloucestershire, the police and crime commissioner is against the cull and the county council has said that culling will not take place on its land. Serious practical difficulties are posed by free shooting near footpaths and camp sites with bullets that can travel up to two miles. If the cull goes ahead, it will not end well. It will be bad for farmers, bad for taxpayers and bad for wildlife.

Bovine TB and Badger Control

Andy Slaughter Excerpts

Tuesday 23rd October 2012 Commons Chamber

[Mr Paterson]

We should be concerned about the cost of not doing the cull. The sums involved in our proposals are very modest compared with the cost of carting off 26,000 healthy cattle, and the number will grow every year. We would be heading to a bill of £1 billion—how many times have I said that, Mr Speaker? The hon. Gentleman shakes his head, but the problem is the result of the passive attitude of the Labour Government since 1997.

[Mr Andy Slaughter (Hammersmith) (Lab)]

The Secretary of State says he intends to press on with the cull regardless of strong scientific evidence and overwhelming public opinion against. Instead, will he take the advantage of the delay to meet the groups and scientists who are opposed? Without doing so, he looks arrogant as well as incompetent.

[Mr Paterson]

That was not a terribly accurate summary of what I have said. I have said that we will respect the science. Despite huge pressure from the NFU grass roots, which has been reflected by knowledgeable Government Members, the NFU has reluctantly written to me to say that it wants a postponement, because it cannot deliver 70%—I am respecting the science. I am more than happy to talk to anyone about the policy, including the hon. Gentleman and the shadow Secretary of State. If he knows scientists who want to talk to me, I will talk to them, but we are absolutely clear that we are following the scientific logic of the preceding trials in a methodical manner. We are respecting the science, which is why, with a heavy heart, we are accepting the NFU proposal and its request to delay.

National Policy Statement (Waste Water)

Andy Slaughter Excerpts

Monday 19th March 2012 Commons Chamber

[The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Richard Benyon)]

I beg to move,

That this House takes note of and approves the National Policy Statement for Waste Water, which was laid before this House on 9 February.

The waste water national policy statement sets out Government policy for the provision of waste water infrastructure of national significance in England. It will be used from this April by the Planning Inspectorate, as the examining body, and by the Secretary of State, as the decision maker, as the primary basis for making decisions on development consent for nationally significant infrastructure projects.

Consultation on the waste water national policy statement took place between November 2010 and February 2011. At the same time, it was subject to parliamentary scrutiny. The Select Committee on Environment, Food and Rural Affairs undertook scrutiny for the House by holding oral hearings and taking written evidence. It published a report of its findings in April 2011, with 19 recommendations and conclusions, to which the Government responded in February 2012.

I would like to take this opportunity to thank the Select Committee, nobly and expertly chaired by my hon. Friend the Member for Thirsk and Malton (Miss McIntosh), for its hard work and for its determination to get to grips with a subject area that was new to some Committee members and, at the time when I gave evidence, relatively new to me. I am grateful to the Committee for scrutinising the national policy statement in a relatively short period. I hope that it can see that its contribution has helped to refine and improve the document before the House.

[Mr Andy Slaughter (Hammersmith) (Lab)]

The Minister is being his usual modest self in saying that he was not au fait with the subject. He is now up to his knees, if not his waist, in the subject, having dealt with the Water Industry (Financial Assistance) Bill last week and in introducing this debate. I believe that the Select Committee had some doubt about major projects being included in the NPS. For the avoidance of doubt, are the Government unshaken in their view that projects such as the Thames tunnel and Deephams sewage works should be included in the NPS? Whatever the final decision on the route and the detail, it is important to be clear—[Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I will make the judgments about the length of interventions, thank you. We want short interventions. I presume that the hon. Gentleman has got to the end of his.

--- Later in debate ---

[Gavin Shuker (Luton South) (Lab/Co-op)]

I note that debates in the House on waste water are rather like the No. 159 bus that serves the House—you wait for ever for one, then two come along at once. However, I welcome this debate on the national policy statement, as well as the statement itself.

Much of the interest in the debate will be generated by specific nationally significant infrastructure projects, such as Deephams, which is in the constituency of my hon. Friend the Member for Edmonton (Mr Love), and the Thames tunnel. Labour supports the Thames tunnel project. In government, we foresaw the need for the tunnel and established both the commission and the enabling legislation.

London’s sewers carry both raw sewage and rain water and were designed for 4 million inhabitants. There are now 8 million inhabitants, meaning that even small amounts of rain can cause massive amounts of untreated sewage to be discharged into the Thames. That happens once a week on average, and it kills wildlife, damages the health of river users and will in time trigger significant daily fines from the European Commission. We must comply with the urban waste water treatment directive. The project tackles that by collecting the overflow in a giant tunnel bored below London and processing the waste in Beckton sewage works. That should mean that discharges occur only a few times a year, and that they are much less harmful.

Projected costs have risen, however, and time scales have begun to stretch. The Government need to show leadership and make a clear commitment to the project to ensure that the right vehicle for managing and delivering it is put in place. We remain unconvinced by alternative solutions to the problems of London’s sewage discharge, many of which, sadly, are more about local politics than about long-term planning. The consultation process is vital to ensuring that sites are placed correctly and properly integrated into the environment. MPs will rightly want to represent the views of their local communities in that process.

There are several hurdles to clear, not least the Secretary of State for Communities and Local Government, who has an effective veto over the tunnel. The support of the Department for Environment, Food and Rural Affairs alone will be insufficient. Last week in the House, I questioned the Minister on the nature of the decision-making process. I expressed concern that the joint decision-making process was an administrative one and not a legal one, and asked for clarification. He replied:

“The Secretaries of State for Environment, Food and Rural Affairs and for Communities and Local Government will jointly take decisions on water and waste water applications. The Secretary of State for Communities and Local Government will take the lead on considering the Planning Inspectorate’s recommendations. My officials are due to meet his officials shortly to agree the process”.—[Official Report, 12 March 2012; Vol. 542, c. 318.]

Despite the Minister’s assurances, this evening’s debate is the last opportunity for Parliament to express its view of the appropriateness of the Thames tunnel project, so let me put it on the record that I am disappointed that the decision-making process giving the green light to the tunnel is yet to be decided, and that it will not be decided before Parliament has exhausted its scrutiny of whether the Government should be given the green light to go ahead. As we have seen recently in the internal divisions over planning reform and weekly bin collections, every time the Department for Environment, Food and Rural Affairs goes head to head with the Secretary of State for Communities and Local Government, it comes off worse.

In 2001, the independent Thames tideway strategic study was set up to consider the problem of London’s excessive sewage discharge and to come up with a solution. In 2005, the study concluded that improvements to existing treatment works and a tunnel to intercept the combined sewage overflows were the best solution. In 2007, we determined that it was appropriate for Thames Water to make provision for the design, construction and maintenance of such a scheme; and the Flood and Water Management Act 2010 provided for infrastructure regulation to create the framework for the tendering, designation and building of such a project.

In addition to the primary environmental benefits of the Thames tunnel, we saw it as an opportunity to create more than 4,000 direct jobs, expand apprenticeships and regenerate London. Tory-led Hammersmith and Fulham council has co-ordinated much of the opposition to the Thames tunnel plans. Most recently, it established a commission with four other councils to examine the project. Essentially, it proposed a combination of a much shorter tunnel, building more local sewage works, greater separation of foul sewage and rain water, and the installation of sustainable urban drainage.

Some of those would be welcome complementary projects, but we agree with the Government that pursuing the alternative route is a distraction that could cause far greater disruption and costs, and ultimately prove to be ineffectual. Supporters of the alternative approach would have preferred to fight the battle over whether the tunnel should be built at all, and with the commencement of the next-stage consultation, the passing of last week’s Water Industry (Financial Assistance) Bill and tonight’s national policy statement debate, attention should now be focused on getting the specifics right: route and site selection, the delivery vehicle and the finances.

I want to touch briefly on Deephams, in the constituency of my hon. Friend the Member for Edmonton. I have taken a particular interest in this project because treated effluent from Deephams discharges into Salmon’s brook, a tributary of the River Lee, whose source, as we all know, is the picturesque hamlet of Luton. Again, we accept the need for this upgrade work to go ahead. Deephams serves nearly 1 million residents and is already undergoing a £50 million programme of improvement works to deal with excess storm water inflows. Nevertheless, improving water quality and expanding capacity to meet the needs of a growing population will require further work.

The Government should express their view on whether it is better to rebuild the plant in the existing urban area, as congested as it is, than to rebuild on a new site. We know that if relocation is the preferred option, effluent will need to be moved from the existing site footprint for cleaning and then returned for discharge. I therefore welcome what I understand to be the Minister’s intention to designate Deephams as a nationally significant infrastructure project, as the Thames tunnel was late last year. That is what I understood him to say, but I am sure that he will be able to clarify when he sums up.

The process that we initiated in government of introducing national policy statements in draft form, with the intention that they be scrutinised by the relevant Select Committees and the public is, I believe, showing dividends. I pay tribute to the hon. Member for Thirsk and Malton (Miss McIntosh)—I note that we are increasingly in agreement on such matters—for her work chairing the Environment, Food and Rural Affairs Committee and for the recommendations of her Committee. I give the Government credit for incorporating many of those recommendations into the final document.

We completely agree with the Committee’s view that greater attention should be given to—SUDS—sustainable drainage systems as measures complementary to large infrastructure projects. In the case of the Thames tunnel, this can help to ensure that the effectiveness of the tunnel is not reduced with climate change and that we do not end up in 50 to 100 years’ time having to construct a second tunnel.

Measures to reduce the amount of water passing through drains and into the Thames can be implemented at neighbourhood or district level. We encourage councils across London not only to provide information and education on reducing water consumption through rain water harvesting and water recycling, but to lead by example. Education should focus on encouraging people to “wetrofit” their homes, with fittings such as low or dual-flush toilets, water-efficient shower heads and tap flow regulators. Introducing grey water recycling in new-build properties and renovations could allow bath and basin water to be cleaned and reused. External features for rain water harvesting should also play an essential role.

The Government have had much to say about their green deal programme at the Department of Energy and Climate Change, but little assistance is being extended to householders looking to purchase green roofs, water butts or downspouts to collect rain water that otherwise would go into our sewers, even though the advantages are obvious, with residents enjoying a notable reduction in their water bills and the sewerage system having to manage a lower volume of waste water. Over time, local authorities and the Highways Agency should replace hard, non-permeable surfaces with porous materials on pavements and public footpaths; home owners, too, should be encouraged to consider such measures. I do not underestimate the challenge that SUDS present to the status quo. Every year in London alone some 3,000 hectares of private domestic gardens are paved over—the equivalent of 2.5 Hyde parks. Such complementary measures should be part of a rolling programme, and we will return to them in the comprehensive water Bill, a draft of which the Minister promises in the forthcoming Session of Parliament.

On the wider objectives of the national policy statement, we welcome the commitment to sustainable development. Infrastructure should help us to live within strong environmental limits and to have due regard to environmental, social and economic considerations. However, may I press the Minister to clarify which definition of “sustainable development” he intends to use in this version of the national policy statement?

[Mr Slaughter]

I wonder whether I might put to my hon. Friend the question I put to the Minister, but did not get an answer to—although perhaps the Minister, who I think agrees with the position I described, might deal with it when summing up. This is something of a hybrid NPS, because although it deals with the general principles, as my hon. Friend says, it also deals with specific projects. Is it his view—as I think it is the Minister’s—that it is appropriate to have major projects such as the Thames tunnel in addition to general principles in the NPS?

[Gavin Shuker]

I completely agree with my hon. Friend that it is appropriate to recognise major, nationally significant infrastructure proposals in the draft of the document. It is important to note that the document will be revised over a cycle of every five or so years, and rightly so. It is also important to note that the Chair of the Select Committee on Environment, Food and Rural Affairs rightly proposed an additional appendix referring specifically to the two nationally significant infrastructure proposals in the document, for greater clarity and to ensure that that can be addressed appropriately by Ministers. I therefore agree with my hon. Friend’s point, and I am sure that the Minister will clarify the position in due course.

Returning to the broader themes of the policy statement, on public health and environmental improvement, we continue to support efforts to comply with the urban waste water treatment directive, and we appreciate how this is reflected in the policy statement. Improving water quality in the natural environment and meeting our international obligations are, of course, essential. In that vein, I am a little disappointed that there was not more in the water White Paper on the quality of water and waste water. We know that major projects will need to go ahead—not least the two that I have already mentioned—to achieve that objective, and I am assured that the objective in the NPS will be sufficient to ensure that those projects go ahead.

According to the waste water policy statement, reducing water consumption is another of the Government’s key objectives and a major part of their plan. We know about the benefits of reducing water consumption, and not just for water treatment. Much of England will be subject to water restrictions from 5 April, as drought conditions develop. Although we agree on the importance of the long-term reforms envisaged in the water White Paper—competition for non-household customers to drive water efficiency innovation—we are worried by the lack of deep thought on how to reduce per capita water usage.

In some parts of the advanced world, individual residents get by on just 75 litres per day, but in the UK, household water consumption has grown since the 1950s to around 150 litres per person per day. There is also still significant variation between different water companies. We therefore call for more action, including the publishing of the so-called missing chapter of the water White Paper, to ensure that water efficiency measures are taken seriously and that Government actions and programmes best reflect the guidance, so that not everyone is subject to restrictions on water use when there is enough water to go round in some regions.

On climate change mitigation and adaptation, we know that climate change will require some of our water treatment systems to take far greater volumes of waste and storm water, as well as require our water industry to reduce its emissions. By 2050, the industry—which already accounts for about 2% of our nation’s carbon footprint—will need to have contributed significantly to the 80% reduction in emissions required by the Climate Change Act 2008. At present, there is a tension between higher standards for waste water, often requiring higher levels of energy consumption, and the requirement to reduce the draw on our national grid. There is plenty of space for innovation, and a need for far more research on efficiency and devising new processes for raising standards of waste water. To help with this, we call on the Government to publish a road map, as they have with the motor industry, to sketch out a path to a low-carbon waste water industry.

The principle of the waste hierarchy should of course apply to any project under the national policy statement; the document refers to that directly. In that regard, more could be done to encourage new processes that harness the organic value of effluent. Will the Minister outline what discussions he has had with his counterparts at the Department of Energy and Climate Change and at Ofwat to ensure that the energy recovery process is maximised through the implementation of this document? We welcome this national policy statement, and we will not oppose the motion tonight.

Water Industry (Financial Assistance) Bill

Andy Slaughter Excerpts

Wednesday 14th March 2012 Commons Chamber

[The Chairman of Ways and Means (Mr Lindsay Hoyle)]

The good news is that I am not going to judge the speech or the ring main.

[Mr Andy Slaughter (Hammersmith) (Lab)]

I will, I hope, be a little briefer than the right hon. Member for Bermondsey and Old Southwark (Simon Hughes). I just want to make a few remarks arising from his comments and amendments.

I am absolutely with the right hon. Gentleman on the general principle that in going ahead with the Bill, which I believe has all-party support—I am not sure about him but he is not pressing his amendment—we must protect both public money and the money of the public. By public money, I mean, first, any underwriting of major capital schemes, such as the Thames tunnel. Secondly, this is a large private multinational company—I appreciate his research into its holdings and complex structure—and we must ensure that it pays taxes in the UK.

At the same time, however, we must also look after the money of the public and ensure that not a penny more is paid in increased water charges, particularly given that water charges are already rising above the rate of inflation for all water users across the UK, including Thames Water customers. I was somewhat reassured on Second Reading when the Minister said that the Government shared those concerns and that he was sceptical about the project—at least about whether its financing was what Thames Water said it was. There would be broad agreement on that.

I also agree with many of the comments of the right hon. Member for Bermondsey and Old Southwark about Thames Water, particularly under the ownership of RWE. During my first two or three years in the House, Thames Water was my bête noir, partly because of how it dealt with leaks—digging up roads all around London in a completely ad hoc, unconcerned way and leaving workings for months at a time—while still not getting to grips with the problem. Furthermore, the problem of sewer flooding, particularly in west London, has been a blight on people’s lives. Year on year, thousands of basement and ground-floor properties in my constituency are flooded by sewers, yet little attention is paid to it. And, indeed, there are Thames Water’s financial arrangements, which the right hon. Gentleman spoke about.

It is only right to balance that, however, by mentioning that Thames Water’s performance has improved markedly in the past few years in many of those areas, although we should continue to be concerned about its financial structures. A lot has been written in the papers in the past few days about the current drought and impending hosepipe ban and other possible measures, and the water companies are rightly under scrutiny. I note that in total—this is not just Thames Water—water companies are likely to report annual profits of £1.5 billion and that they are currently leaking about one quarter of the water they provide. They provide about 14.6 billion litres daily, and about one quarter of that is being leaked. It has been pointed out quite correctly that the hosepipe ban will save only 20% of the water being leaked daily.

The water companies, then, have a long way to go. Many of their problems were caused by the botched privatisation under the then Conservative Government and the fact that, as the right hon. Gentleman said, there has been an incentive for companies to beef up their profits to make themselves ripe for takeover, to sell on at a profit and not to worry during those years about their consumers and the cash cow that comes from having an effective local water monopoly.

Everyone will be grateful for the research that the right hon. Gentleman has done into the financing structures. I am less sure, however, that his amendments would deal with that. I will not spend long on this because I suspect that the Front-Bench spokesman, my hon. Friend the Member for Luton South (Gavin Shuker), will explain, not as eloquently as me but forensically and analytically, how the Labour amendments would provide the necessary safeguards in a less prescriptive and detailed but more effective way to ensure that if any projects come forward for financial assistance, they are tested in the House first to ensure that the assistance is necessary.

I depart from the right hon. Gentleman in respect of the effect that his amendment might have on the clause. In the end, we need a project in London that will resolve the daily, sometimes weekly, regular flow of huge quantities of sewage into the Thames. On this, I am not sure where he is coming from. When we debated this matter last September in Westminster Hall, he said:

“I also put in a short response to the private commission that was set up by some interested local authorities and chaired by Lord Selborne.”—

in fact, it was set up by Hammersmith and Fulham council—

“The commission has argued that we must have a totally different direction. I am not persuaded by that. The Thames tunnel is the best direction. The previous Government came to that view and the present Government have held to it.”—[Official Report, 14 September 2011; Vol. 532, c. 316WH.]

That was in September. In February, he said:

“I am now clear that, since the end of the first round of consultations in 2011, the arguments for a review of the full tunnel proposal and possible alternatives have substantially increased.”—[Official Report, 29 February 2012; Vol. 541, c. 391.]

I am not sure what happened between September and February. This is important because we must find an effective solution. There is no point putting forward half measures.

[Jeremy Corbyn (Islington North) (Lab)]

I have met Thames Water and looked at the situation. Pollution of the Thames is totally unacceptable—as are the levels of sewage going into the Thames. There has to be a better drainage system to ensure that that does not continue. However, does my hon. Friend agree that after this process we need much tougher regulations to deal with the paving over of large areas of London and the Thames basin, which leads to excessive water run-off from rainfall, which then joins the sewage, becoming a sewage surge in the Thames? That water should be replenishing ground water, not being flushed away with the sewage and thus causing pollution in our river.

[Mr Slaughter]

My hon. Friend is absolutely right. The schemes that he describes, which are collectively known as SUDS—

[Heidi Alexander (Lewisham East) (Lab)]

Sustainable urban drainage systems.

[Mr Slaughter]

I am grateful to my hon. Friend for that prompt. Local authorities have woken up to the possibility of SUDS, albeit perhaps somewhat late in the day. Many are now insisting in planning applications that there should be no more paving over, while many are rightly taking enforcement action where those conditions are disobeyed. However, it is quite wrong to think that SUDS on their own will be a solution to the problem; rather, they offer additional assistance. The idea that we can suddenly convert road surfaces and pavements into permeable surfaces across London is highly impractical—look at the problems we had with simply replacing the water mains—and it would also cost four or five times more than the highest estimated cost for the tunnel. However, we must use SUDS, and indeed other measures

I am grateful to my hon. Friend the Member for Islington North (Jeremy Corbyn) for his intervention, because he brings me back to the point that I was making. I was pleased to receive an invitation from the right hon. Member for Bermondsey and Old Southwark to attend a meeting on 6 March in this place. This perhaps draws attention to the point that the hon. Member for Cities of London and Westminster (Mark Field) raised, because although probably 140 to 150 MPs would have been invited if the right hon. Gentleman had asked all those with an interest in Thames Water, I think only three turned up—me, the hon. Member for Hendon (Mr Offord), who is in his place, and my right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford), who was here a moment ago. That perhaps shows a certain lack of interest among some of our colleagues. I am sure that the hon. Member for Cities of London and Westminster would have been there, had he not had a more pressing engagement—I am sure that it was not the Campaign for Real Ale reception that was on at the same time, but there we go.

The invitation asked us to come and listen to Chris Binnie, the engineer who served as the independent chair of the Thames tideway strategic study steering group, which recommended the full tunnel solution. He was going to be present to explain

“why he now believes the costs have exceeded the benefits, and why there are quicker and cheaper solutions that should be considered urgently.”

I am familiar, as many Members are, with Mr Binnie’s proposal, which is what he has called the “Binnie Bubbler”, It is designed to aerate the Thames in a way that prevents the death of the fish and other livestock—if that is right phrase—in the Thames. I have read the arguments for and against the “Binnie Bubbler”, and I have always been rather sceptical about it, because I am not sure that it is suitable for the tidal Thames—it has apparently worked in Cardiff bay in a lagoon area—and also because I do not think it acceptable to allow raw sewage into the Thames at current levels and then simply to try to aerate it and possibly skim off the worst of it.

I therefore went along to the meeting—although I am sorry that I could not stay for the entire time—to see whether Mr Binnie had something more to say on that issue. It would be fair to say that he had something quite surprising to say. I appreciate that I am about to read from a note about the meeting that was written up by a supporter of the tunnel—I had left by this stage—but it says:

“Chris Binnie announced that he had changed his mind again and now supported Thames Water’s view that we should implement the single Thames Tunnel option. Wow! You could hear the gasps around the room and Simon Hughes’ chin nearly hit the floor.”

That might be slightly unfair: the right hon. Member for Bermondsey and Old Southwark is unfazed even by things greater than engineers changing their minds, for the second time. However, this issue draws attention to an important point in the argument about the Bill, and brings us back to the financing. I think everybody—certainly everybody present in the Chamber today and most other Members of the House, albeit with certain exceptions, my neighbouring Member of Parliament being one of them—supports the idea that something must be done to relieve sewer flooding of the Thames in a substantive way that will last us, we hope, as long as the Bazalgette solution did.

[Simon Hughes]

I do not want to prolong this unnecessarily, but would like to say clearly that my presumption has always been that something needed to be done. I started from the view that the Thames tunnel was the right solution. However, I want to be sure—not just for myself, but for my constituents, for the reasons that have been set out—that we are not about to embark on an expensive project if it is not entirely needed and has not been objectively assessed to be the right solution. Hence, I come to this issue with a “Let’s check and be certain before we press the button” approach. That was my view before I went to the Binnie meeting and when I came out of it, and it remains my view today.

[Mr Slaughter]

I am grateful for that clarification. I have never signed up to the concept of the tunnel uncritically or without reservations—or, indeed, at all—because I have always held open the option that there might be a better solution, and if that is what the right hon. Gentleman is saying, then we are on all fours with each other. That is why I have looked in some detail at proposals such as the “Binnie Bubbler”, SUDS and the idea of separate rainwater and sewerage networks, which would also create the problem of huge disruption and much additional cost. Some of those projects, including water conservation, can be done and should be effective, both environmentally and from a cost perspective; the difficult thing is to find an alternative that does what the Thames tunnel would do.

[Jeremy Corbyn]

My hon. Friend represents a riverside constituency, and therefore must have studied the issue in detail. I understand that the tunnel will not last for all time and will become overloaded within the next three or four decades. Therefore, we need to examine how we use water and how drainage systems operate, rather than hitting another crisis in three or four decades’ time.

[Mr Slaughter]

I agree, and something that is effectively a large sewer pipe stuck under the River Thames can sometimes look like old technology in some ways. There has to be a more organic and continuing process of developing solutions to avoid tunnelling, but it remains the case, first, that this solution has been preferred in many other capital cities around the world and, secondly, that at the end of the day, it is the simplest, clearest and most effective solution. Therefore, as well as considering other, additional measures, all our attention should be focused on how the Thames tunnel can be contained as a project, particularly financially, but also in terms of the disruption that it would cause.

However, I take my hon. Friend’s point entirely, and conclude by going back to basics and why we need this project. When I spoke on Second Reading last week, I invited my hon. Friend the Member for Luton South to join me last Saturday on the foreshore of the Thames by the CSOs—combined sewer overflows—in Hammersmith for the Thames21 clear-up. I was very disappointed to see that he obviously had pressing constituency business, because he would otherwise have joined me and about 100 of my constituents—although they might have been from Bermondsey and Old Southwark or Cities of London and Westminster. However, they were all hard-working people—they worked longer than I did. Together, they cleared up several skips of industrial, commercial and consumer waste—if I can put it that way.

[Jeremy Corbyn]

I rise to intervene on my hon. Friend for the last time and to thank him, because I visited the Hammersmith shoreline on Saturday evening, and it was absolutely brilliantly clean. I looked over that pristine area of mud and sand, and thought, “This is amazing! This is how the Thames can be. I wonder which guardian angel has been here and cleaned it up”—and now I know.

[Mr Slaughter]

Modesty forbids; all I would say, without going into too much graphic detail, is that when I left, I washed everything that I was wearing, yet it was still Monday morning before I got the smell out of my nostrils. Unfortunately, I did not go and wash everything I was wearing immediately, because I had to go canvassing for Mr Livingstone in between. I cannot think how many votes I must have lost in the condition I was in, following my outing on the foreshore.

It is a lot cleaner on the foreshore, and I appreciate absolutely what the Thames tunnel coalition, Thames21, has done, and all the fantastic consumer groups involved, in organising the clear-up. I pay tribute to them, although I wish that they did not have to do that work in those appalling conditions.

One of the people who was working hard there on that morning was a young man called Conor Newman-Walley, aged 15. He and his dad were there, working away. He goes to the same school in Hammersmith that I went to many years ago, and he is in the rowing team. It is a very good rowing team, as it was then. He is a founder member of Rowers Against Thames Sewage—RATS—and this is what he has said to the Thames tunnel organisation:

“In Victorian times, the people of London solved the first sewage crisis by implementing one of the most influential engineering projects of its time. As young people we learn and marvel about these feats in history at school. The challenge of sewage in the Thames today is too big for our generation. We look to those above us to put the projects in place that will solve this problem for generations to come. Our call to you is to build something amazing that our children will learn about in school.”

That attitude is one that we should adopt as we contemplate the Bill.

It is our duty to scrutinise the Bill and, more importantly, when it is passed, to scrutinise the project and any public money that might be committed to it and possibly put at risk. I hope that the amendments are not designed to stand in the way of ensuring that the clean-up of the Thames takes place. For Conor, a regular user of the Thames, this is not a lifestyle question, or a matter of the river looking pretty or smelling nice; it is a question of health, and of whether he can feel pride in his community when he goes to the river to take part in his sport. He needs to be able to take part in that sport without feeling personally inconvenienced or put at risk.

The Thames brings huge benefits to people, particularly my constituents who live alongside it and use it regularly. We have a duty to the public purse, as well as to ensuring that London has a river that is fit to look at, to use and to enjoy. I appreciate the attention paid by the right hon. Member for Bermondsey and Old Southwark’s to the financial detail, but I hope that he has not strayed so far from the path that he cannot also commit to those aims.

[Mark Field]

I do not necessarily regard the proposals as a scandal, as the right hon. Member for Bermondsey and Old Southwark (Simon Hughes) seemed to suggest when moving his amendment, but I share many of his general concerns about the financial engineering. I say that as the very proud Member for the Cities of London and Westminster. I do my bit to stand up for the banking fraternity and for large corporates, many of which are based in my constituency. Deep concerns have been raised by the amendments, however. The amendments will not be put to the vote; they are testing amendments that will enable us to have a useful debate on this matter.

I would not wish this debate to be seen as hostile to Thames Water. I have had fairly positive dealings with it over the significant amount of work that is being done in my constituency, in the City of London and in the City of Westminster. It is carrying out a huge amount of work there, and there is no doubt that it has been very disruptive, but I hope that central London will have a far better water system in the years to come as a result.

Deep concerns have been raised about how necessary it is to spend as much as £4.1 billion. It is quite respectable for the right hon. Gentleman to raise his concerns, although I suspect that he might have been less concerned if the huge amount of building work had been due to take place on the other side of the river, perhaps in Wapping rather than Rotherhithe. We all know that there has been a lot of disruptive work. I have seen it happening in my constituency with Crossrail. I have always been a firm supporter of Crossrail, although I have often said that there were no votes in taking that position. Indeed, votes have been lost through so doing.

We are proposing to spend a huge amount of money on the Thames tunnel, and I am not convinced that that is entirely justified. I do not disagree with what has been said by the hon. Members for Hammersmith (Mr Slaughter) and for Islington North (Jeremy Corbyn). Significant work clearly needs to be done to improve the quality of the water in the Thames, although, compared with early Victorian times, it is now wonderfully clean. That is no cause for complacency, however.

--- Later in debate ---

[Mr Slaughter]

Perhaps we should have more of these short Bills as they provoke such agreement between the two Front Benches. It is slightly surprising that there is such a degree of agreement, given that when the Bill is stripped down, it is about two specific initiatives. I have heard the argument about whether it should be a private or a hybrid Bill. It is a public Bill, but unless the Minister wishes to correct me, we are talking, first, about the subsidy to South West Water customers, and secondly, about the underwriting of the Thames tunnel scheme, both of which potentially commit large sums of public money. Given the rhetoric about public money that we have to hear all the time from the pattern book of this Government, and given the concerns expressed from the Opposition Front Bench, we can say that this must be an important measure or we would not be undertaking those commitments.

My first concern is about the Government’s reluctance to support the amendments tabled by the Opposition. I am at a loss to understand why that is the case. I hear what the Government say about the control of finance, as addressed in clause 2, but it seems to me, without going to the lengths to which the right hon. Member for Bermondsey and Old Southwark (Simon Hughes) went in pinning down the fine detail, it is important that the House continues to have a supervisory role and scrutiny of the finance of projects, particularly given what we have heard about Thames Water, in whatever guise or ownership. The same would apply to other water companies. I believe that the chief executive of Thames Water had a salary package of about £1.6 million last year. There is a lot of money sloshing around in the utilities companies.

Although I do not accept that the Thames tunnel is over-specified or is doing more than is needed for the job, we need to keep a close eye on the project. It is, as I said, an unfortunate outcome of the previous Conservative Government’s privatisation strategy that we have, potentially, people running our utilities who are more interested in their shareholders and their remuneration than in the welfare of their water customers. That gives us a particular responsibility, and I cannot understand why the Government will not accept what we propose.

Water bills are rising, and any project designed to relieve the problems of sewer flooding in London or flooding into the Thames will cost a lot of money and will inevitably add to bills. That is another reason for controlling costs and for protecting those who cannot afford to pay. That was the purpose of new clause 1. Again, I cannot see why that has been rejected by the Government at this stage. It is disappointing and shows a lack of concern on the Government’s part about the potential financial impacts of these measures.

Another concern I have—I shall be brief, as I spoke about this on Second Reading—is about those who would muddy the waters, so to speak, on the Thames tunnel project. If anybody can come up with a cheaper project that will have the same or better effect, I am sure it would be extremely welcome and we would all like to hear about it.

I shall say something nice about Mr Binnie, who has had a bit of a rough ride in the debate. He is, after all, speaking as a professional and, given his previous association with the Thames study, as someone who cares genuinely about the quality of water in the Thames. Even at his most sceptical, before his second road to Damascus conversion, he said:

“The full tunnel would be the best thing for the river…Are there cheaper alternatives for producing similar results?”

The same question was posed by the right hon. Member for Bermondsey and Old Southwark. Mr Binnie’s answer, on mature and professional reflection, is no, there are not.

I do not think that that means we should stop looking for ways of bringing down the cost. Indeed, the cost has already been reduced by adapting the route of the tunnel that was previously envisaged. I hope that the Government will take that on board and not simply accept that the current route, the current combined sewer outflow linkages and such matters are a done deal and a fait accompli. That is important not only with regard to cost, but in relation to the disruption that will be caused where the CSOs are linked to the river—I declare an interest, as one of those CSOs will be in my constituency and two are close by. Substantial progress has been made, because originally many more riverside sites were going to see that level of disruption. We are working on that all the time. Let us not stop working on that and trying to find solutions that will be less disruptive for local communities in London.

As I have said, there are some loud naysayers. I am afraid that the Selborne commission lacked all coherence. Its report did not even contain the proposal for the half tunnel that was in its press release. Anyone who has looked at that proposal will realise that it is simply a non-starter, and for those who live in west London, as my constituents and I do, it would be a complete nightmare. Not only would it cause greater disruption, because there would have to be more storage points—clearly, there is nowhere for the sewage to go once the tunnel fills up—but the sewage would stay in the tunnel and fester for days or weeks before being taken away by the existing sewerage system. I can see why it might have had a superficial attraction for the right hon. Member for Bermondsey and Old Southwark, because it would not have caused disruption in his constituency, but sooner or later we would have had to face up to the fact that we must have something that works.

When I hear the leader of my local council saying that we cannot afford to make the river clean enough for fish, or my neighbouring MP saying that rowers and sailors are seeking a personal benefit by not having the river flooded with sewage every week, I have to ask that they grow up a bit and be a little more sensible. As the shadow Secretary of State, my hon. Friend the Member for Wakefield (Mary Creagh) said when quoting my constituent, Conor, a 15-year-old can put us right and tell us that we ought to have the courage and enthusiasm that our forefathers had when they designed the great civil engineering projects of the 19th century, and indeed the enthusiasm we have in supporting schemes such as Crossrail and High Speed 2, which are much bigger than the Thames tunnel. We must bear in mind two slightly contradictory facts as we go forward. First, cost control is not just important as a matter of probity, but absolutely vital, particularly for those on low incomes who will be paying the bills. Secondly, whatever version of the tunnel is finally approved, it has to be fit for purpose not only now, but for the next 100 years.

Water Industry (Financial Assistance) Bill

Andy Slaughter Excerpts

Tuesday 6th March 2012 Commons Chamber

[Mr Andy Slaughter (Hammersmith) (Lab)]

In London, there is a real need for improvement to the sewerage system. The present network of major sewers was designed for a 19th century city. London’s population is now 7.6 million, but it is projected to rise to 8.3 million by 2021 and to 8.8 million by 2031. It will then have doubled since the major sewers were built. It is remarkable that the system has managed so well for so long, and is a tribute to Bazalgette and the others who designed and built it. It is, however, clearly inadequate, and has been so for some time.

The present system consists of combined sewers, which convey foul sewage and rainwater run-off to the sewage treatment works before they are discharged. When the combined sewers reach capacity, the combined sewer overflows—CSOs—are designed to discharge excess untreated waste water into the River Thames. This avoids overflows and back-ups through manholes and into individual properties, but it means that as soon as the hydraulic capacity of the sewage treatment works is exceeded, sewage is pumped directly into the Thames. In fact, some parts of London, including my constituency, also have a problem with sewage back-up, and the Counters Creek relief scheme that Thames Water is seeking to implement will bring an end to that appalling problem, which has affected thousands of my constituents over the past few years. It happened three times in four years during the latter part of the last decade. I welcome the implementation of the Counters Creek relief scheme—a major scheme across west London—but the result will be even more sewage going into the Thames. The river will continue to bear the brunt.

Discharges can occur following as little as 2 mm of rain; they happen approximately 60 times a year. The Thames is tidal between Hammersmith and Beckton, and when CSOs discharge, the resulting sewage and litter flows up and down the river with the tide. In winter, it takes about a month for non-biodegradable waste to get from the head of the estuary at Teddington to the sea. In summer, when water levels are lower, it can take up to three months. It is in summer that we get the worst response and the worst smells.

In future, sewage might flow into the Thames even on dry days unless the situation is managed. In any typical year, 39 million cubic metres of untreated waste water—a mixture of sewage and rainwater—are discharged. The frequency and volume of untreated waste water entering the tidal reaches of the Thames have increased, and will only increase further. This level of waste entering the environment is not tolerated anywhere else in the UK, and it should not be flowing into the main river of our capital city. Something clearly needs to be done.

The discharges affect the river in several ways. First, polluted water increases health risks to recreational users of the Thames, whose numbers I am pleased to say are increasing year on year. Secondly, the aesthetic impact of CSO discharges is offensive. Materials such as faeces, toilet paper, wipes, sanitary products and other “flushable” items, including hypodermic needles, regularly end up in the Thames at Hammersmith. All of this causes slicks of pollution to float on the river before being washed up on the foreshore. Thirdly, sewage discharges harm the ecology of the river by reducing dissolved oxygen levels in the water. In extreme events, this can result in the death of fish and other wildlife, often in large numbers. There are therefore strong environmental, health and economic cases for the Thames tunnel.

The Thames tunnel will work with the existing system of sewers, with improved sewage treatment works and with the Lee tunnel to reduce the frequency of CSO discharges. This Government and the previous one have conducted serious studies of the issues behind the tunnel. Investigations have been carried out by the Department for Environment, Food and Rural Affairs and by independent bodies, resulting in the 2007 regulatory impact assessment, the Thames tunnel needs report, and DEFRA’s 2011 strategic and economic case for the Thames tunnel. They all conclude that the tunnel is the most comprehensive solution available at the most proportionate cost.

A number of alternatives have been suggested. The first is that we have a system to mitigate and reduce the dissolved oxygen levels in the Thames. This involves using the so-called Thames Bubbler oxygenation craft, as well as hydrogen peroxide dosing. This has helped with fish mortality in some places, but it is not sustainable; neither is it a complete solution and neither will it work in a tidal river.

[Mr Matthew Offord (Hendon) (Con)]

The hon. Gentleman is making an eloquent speech. Does he agree that the Bubbler and the sustainable drainage system will not remove things like heavy metals, pesticides and all the other contaminants that go into the river through the CSO system he describes?

[Mr Slaughter]

That is absolutely right; it is a sticking plaster approach. I have reservations about the tunnel, which I shall come on to, but I am making the case that the tunnel is the only sensible solution thought of so far because many alternatives have been put forward but they are simply not sustainable.

SUDS—sustainable drainage systems—are one alternative. There is nothing wrong with them. They reduce the amount of surface run-off blowing into the sewerage system and complement other measures. However, the Government policy statement makes it clear that to prevent rain water and run-off entering sewerage systems completely will require either a new system designed to meet the principles of SUDS and source control or a completely new conventional separate water system, which would be disproportionately expensive. Although it can be installed effectively in new developments, trying to retrofit all London’s properties to the required level is simply impractical. It is impractical, too, to create extra capacity in the existing sewerage system. Existing sewers cannot be enlarged or duplicated because the system is so large and complex and has so many cross-connections that most of the network would need to be enlarged to prevent CSOs from discharging.

The Government’s report says that substantial duplication and enlargement to most of the sewers would entail massive construction work throughout inner London, enormous disruption and extremely high costs. Converting a combined drainage system into a separate drainage system would involve the provision of a completely new network of sewers approximately 12,000 km in length. Every existing property would require connecting to the new system and the cost and disruption would be high and might lead to a large number of misconnections, which could create a legacy of problems.

Any of those alternatives, if they were sustainable, would cost many times the cost of the tunnel—whether it be a SUD system or a separate rain water and sewerage system. What the opponents of the tunnel have been left with—I am sorry to see that the right hon. Member for Bermondsey and Old Southwark (Simon Hughes) appears to have joined them—is the idea of a shorter tunnel. This is a tunnel that would cover just west London—the so-called Selborne tunnel, named after the author of the report sponsored by Hammersmith and Fulham council.

The shorter tunnel has none of the advantages of the longer tunnel and brings many more problems. It would effectively mean sewage stuck in the shorter tunnel for up to two weeks at a time while it became septic and could go nowhere—clearly it can flow only through the existing network of sewers in east London as capacity becomes available there. It would also require far more storage on land in west London. Thames Water’s response to the Selborne report—I have no brief for Thames Water—was quite devastating, pointing out its follies and fallacies. Indeed, if we read the Selborne report, we find that it does not talk about the shorter tunnel because it was realised that it was not a workable proposition. It would cover only half of the CSOs in London—that is, it would do only half the job. East of Battersea, sewage would continue to go into the Thames; west of Battersea, including in my constituency, the tunnel would regularly be full of sewage, with all the attendant problems of smell and disease that that can cause.

[Mr Offord]

Does the hon. Gentleman agree that our aim is to address some of the environmental problems of the river apart from the death of the fish on which so many people seem to focus, and that because the shorter tunnel would not comply with the urban waste water directive, the whole exercise would be pointless?

[Mr Slaughter]

The whole exercise has been a PR exercise, a sham and a spoiler. Those who have supported, or are supporting, the shorter tunnel have no credibility when it comes to resolving environmental and other problems. By all means let people criticise the Thames tunnel on its merits, but let them not propose this chimera as an alternative.

As a Hammersmith Member of Parliament, I have had to deal with all the propaganda and misleading statements that have appeared over the past five years under the auspices of Hammersmith and Fulham council. In fact, there is a huge amount of consensus about what needs to be done, and, to a large extent, about the solution, at least in principle. It is agreed that we must resolve the problems of sewers flooding the Thames, and that a tunnel is the best way to do that. We can argue about the route and about the cost, but both this and the last Government, mayoral candidates, most local authorities and most London Members of Parliament of all parties are of one mind, and it is not helpful to suggest otherwise.

Let me summarise the recent history of the campaign against the tunnel in Hammersmith. It began because this was an EU scheme: it began as an anti-EU campaign. Then it was claimed that it would despoil all the local parks—such as Ravenscourt park, which is about half a mile from the Thames—or that Furnival gardens would be dug up, which was never the intention. There were also false claims that housing estates would be demolished to make way for the tunnel portals. None of that has helped to identify the reasons for what is being done.

I sympathise with individual residents’ groups who are concerned about what is happening in their immediate areas. My constituency contains at least two of the sites involved. The Acton sewage tanks are on the very border of my constituency, and I hope that the fact that the tunnel will begin at that point will mean an improvement, because tanks that often cause problems of smell and are unsightly will no longer be needed. The other site is the Hammersmith pumping station. I have had the pleasure of going down into it—as have the hon. Member for Hendon (Mr Offord) and many others—to see the appalling conditions that exist when raw sewage is pumped into the Thames. At that site, the necessary building work will be contained within the parameters of Thames Water’s own development area. Of course we should be concerned about the disruption caused by building work, and should encourage Thames Water to use the river wherever possible to take spoil away, but, as far as I can see, Thames Water is working quite closely with local authorities and others, when that is allowed, to ensure that that disruption is minimised. It will clearly be necessary to keep an eye on the situation.

The one issue that is of concern in Hammersmith and Fulham is what is going to be the main drive shaft of the tunnel, which was to have been at Barn Elms in the constituency of the hon. Member for Richmond Park (Zac Goldsmith) but will now be in south Fulham, in the constituency of the hon. Member for Chelsea and Fulham (Greg Hands). I feel for the residents of Fulham if disruptive work is to take place there, but much of the blame for that must lie with the local authority, which, by running an extraordinarily outrageous campaign against the tunnel on principle and on entirely false premises, has failed to engage with Thames Water other than to try to take it to court to prevent it from proceeding with the project at all. By contrast, the hon. Member for Richmond Park and other London local authorities have played a blinder in negotiating with Thames Water, pointing out the problems involved in development in one area or another. It seems that the people in Hammersmith and Fulham will have to put up with the main drive shaft because of the incompetence of their own local authority.

I find it strange that the main defence put up by Hammersmith is that 95% of what is going into the river at present is water, and only 5% is sewage. Raw sewage is, by definition, a mixture of water and other products. I am not sure that that quite answers the question of how we are to have a sustainable River Thames in the future. I was fascinated by the following statement by the hon. Member for Chelsea and Fulham in his explanation of why he is opposed to the tunnel:

“Anglers, rowers and sailors will experience personal benefits from the tunnel”.

Never before have I heard not having to swallow human excrement proposed as a personal benefit. There is a complete lack of reality about what is actually happening. At present, people who walk along the Thames towpath see raw sewage floating in the river on a regular, weekly basis. That is a disgrace to London, our capital city, and something must be done about it.

We must keep a careful eye on both where Thames Water is intending to build and the cost of this project. It is true that costs have escalated over time. Both Front-Bench teams have made the point that Thames Water’s bills are the lowest in the country, and even after the anticipated additional cost of the tunnel, its bills will be near or below the national average water bill. Although that is true, it is no great comfort to those of my constituents on low incomes who will have to pay the additional cost. Because there is a clear and overwhelming need for the alleviation of sewer flooding, the attitude to this issue of both Thames Water and the Government has been somewhat blasé.

Ironically, the Bill contains provisions for both the construction of the tunnel and subsidies in respect of excessive water bills. I am not suggesting that that may be required in the London area at present, but we must be aware that there are many very poor people in my constituency and across London who find it difficult to pay their water bills in addition to everything else. I would like either the Government or Ofwat to conduct a more critical analysis of Thames Water’s plans and the costs. We did that in respect of Crossrail, which is another major civil engineering project in London, to try to keep down, or drive down, costs, and I believe we should do the same for the Thames tunnel. It is not good enough simply to say that there are social tariffs and that the bills will be no higher than the national average. People are being asked to pay substantially extra on top of bills they may already be struggling to pay.

I am grateful for the House finding additional time to debate this issue, which is vital for London. There are only a handful of opponents, including those representing Hammersmith and Fulham. It is extraordinary that they do not have a response to what is a national embarrassment and a health hazard, and something that we can no longer sustain in London—a river that is getting back to the state it was in in the 19th century, when the Bazalgette scheme was necessary. Whenever we discuss projects such as HS2, Crossrail and the Thames tunnel, I am always ashamed that there seems to be a reluctance to undertake great civil engineering projects, in which this country led the world in the 19th century.

I hope that there is a solution, and I suspect that it is the Thames tunnel project. In going forward with it, the Government must consider the sensitivities of the various local areas and the cost.

--- Later in debate ---

[Gavin Shuker (Luton South) (Lab/Co-op)]

Allow me, Madam Deputy Speaker, to convey the apologies of the shadow Secretary of State, who has been unable to attend owing to the split sitting of this Second Reading. I am sure that that is true of many other Members across the House.

We have had a robust discussion of a variety of issues, and I am heartened by the contributions of different Members. I shall start with last Wednesday’s contributions. The hon. Member for Thirsk and Malton (Miss McIntosh) pressed the Minister for an amendable motion on the debate on the waste water national policy statement, asked about the lack of an impact statement, raised concerns about the Government’s actions in the negotiations on flood insurance, and asked where the comprehensive water Bill was. We share all those concerns.

My hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) raised understandable concerns about the King Edward memorial park in his constituency and educated us on the importance of fire sprinklers. I hope that the Government will work with him and us to ensure that the comprehensive water Bill responds to this aspect of fire safety. The hon. Member for St Ives (Andrew George) made a typically insightful speech that recognised the actions of Members on both sides of the House to reduce bills in the south-west. He also made a compelling point about the national treasure status of Devon and Cornwall’s beaches, which is a point that we accept.

My right hon. Friend the Member for Lewisham, Deptford (Dame Joan Ruddock) spoke powerfully about the Deptford high street Thames tunnel site, demonstrating once again that she is a powerful advocate on behalf of her constituency, and the hon. Member for Hendon (Mr Offord) confirmed his view, which we share, that the Thames tunnel is both essential and desirable for the ongoing health of the river and Londoners.

My right hon. Friend the Member for Exeter (Mr Bradshaw) asked where the comprehensive water Bill was—a theme that many Members picked up on—and established that the welcome £50 reduction would be quickly wiped out by a lack of action more broadly on affordability.

The hon. Member for Newton Abbot (Anne Marie Morris) asked a number of technical questions—in particular, about park homes—to which, given the six-day hiatus in this Second Reading debate, I would expect the Minister to have a comprehensive and erudite response.

My hon. Friend the Member for Plymouth, Moor View (Alison Seabeck) was generous and forward-looking in thinking not just of her constituency—for which she has helped to secure water affordability payments—but about affordability more broadly. She reiterated our question: where is the Government action to quell rises in water bills beyond the direct subsidy to the south-west?

The right hon. Member for Bermondsey and Old Southwark (Simon Hughes) asked his own questions about the Thames tunnel. To be clear, we do not necessarily agree with the alternative proposals to deal with the problem, many of which have more to do with short-term political interests than the long-term benefits of being good custodians of the natural environment.

The hon. Member for Plymouth, Sutton and Devonport (Oliver Colvile), in what was originally a very short contribution, paid tribute to his predecessor, Linda Gilroy. When it comes to water, I am sure he will represent his constituents’ interests in the same way. He was less generous, however, when he talked about three Labour MPs as perhaps being one reason why more action was not taken. I would say that those three Labour MPs more than punched above their weight in bringing the issue to the fore.

My hon. Friend the Member for Bolton West (Julie Hilling) talked about debt in her constituency and gave us real stories of customers struggling to pay their bills. The hon. Member for Camborne and Redruth (George Eustice)—another Devon and Cornwall Member—talked about the nature of the scheme to award £50.

My hon. Friend the Member for Hammersmith (Mr Slaughter) talked about the need for the Thames tunnel, in his typically forthright style. He did not hold back from saying what he really thought, including about his local council. He also slew the myths of the Selborne commission—a sensible thing to do in a debate such as this.

[Mr Slaughter]

If my hon. Friend has any lingering doubts about the need to alleviate the sewage going into the Thames, he is welcome to join me and my constituents at 10 o’clock this Saturday when Thames21 will be doing a deep clean just by the sewage outlet at Hammersmith bridge. I am sure he will find ample evidence there of why we need such alleviation.

[Gavin Shuker]

I believe that is what is known as a helpful intervention from my hon. Friend.

The hon. Member for North Cornwall (Dan Rogerson) talked about the nature of the privatised settlement, and raised the possibility of the Bill being used to extend payments to other areas. I hope he will look carefully at our amendments to ensure that the issue has proper parliamentary scrutiny as the legislation goes through.

My hon. Friend the Member for Stretford and Urmston (Kate Green) talked about affordability, social tariffs and data sharing, all of which are essential if we want to reach a broader affordability settlement.

The hon. Member for Tiverton and Honiton (Neil Parish) talked about bill payers in Devon and Cornwall, and returned to the theme of competition, which we obviously look forward to hearing more about in our comprehensive debates on the Bill.

Last but not least, my hon. Friend the Member for Edmonton (Mr Love) talked about the consequences of the 50 discharges each year on average, and about Deephams, the site in his constituency.

This Bill deserves proper scrutiny, because the issue of water affordability is not going to go away. Across the country, families are under real pressure. We therefore welcome the help extended to the south-west, and we praise the many Members, in all parts of the House, who have raised that point, both in this Second Reading debate and in the run-up to it. However, the problem of water affordability does not stop at the River Exe. In a moment, the Minister will stand up and talk about financial assistance—indeed it is in the very title of the Bill—but today, across this country, a fifth of all households are spending more than 3% of their income on water. What assistance does this Bill extend to the 400,000 households in Wales, the 460,000 households in Yorkshire, the 780,000 households in the Severn Trent region or the 1.1 million households here in the Thames region that fall into that category? Sadly, the legacy of this legislation will be what it does not do, as it offers no help for millions of hard-pressed households.

We know that the pressure on budgets will only increase—the White Paper makes that much clear. Populations will increase, as will scarcity of water in large parts of the country. We in this House must therefore take action to keep water affordable. The Government promised us a proper water Bill—significant legislation, far-reaching market reform and action for customers. However, their own water White Paper—their blueprint for water—was delayed by six months. Our Cave, Pitt and Walker reviews gave the Department a clear direction of travel. Everyone across the House accepts that what is needed is a comprehensive package, tackling water issues, introducing changes and then letting the industry settle down and deliver. What we need is a proper water Bill, but Ministers have lost their slot in the Queen’s Speech. Indeed, just last week I asked the Minister across the Dispatch Box:

“If tackling drought, conserving water and reforming abstraction are so important, why has the Secretary of State delayed her own Bill?”—[Official Report, 1 March 2012; Vol. 541, c. 410.]

His response was that he was not privy to the contents of the Government’s legislative programme for the next Session of Parliament. That is a shame. I would have hoped that someone had pointed out to the Minister that he had lost his slot. Everyone in the House seemed to know that, apart from him.

This mini-Bill proves that the pilot light is on at DEFRA, but that there is little legislation coming through any time soon. Customers, investors and water companies will rightly ask: where is the beef? This delay is serious: we are to see no action to curb the unsustainable abstraction of our rivers and streams, no time scales to increase competition in this highly regulated monopoly market, no changes to ease water scarcity—exacerbating the extreme drought conditions that we are already experiencing—and no action to keep water affordable across the UK.

This legislation is for the future, but the cost increases are for now. This April, water bills are set to rise by an average of 5.7%, which will add £20 to the average bill. We will seek to amend the Bill to ensure that those who are struggling to pay will have access to a social tariff. It is unfair to extend the situation in which a postcode lottery determines whether people can afford to pay their water bill. We know that the Government have ruled out extending national social tariffs beyond the WaterSure scheme, even though that scheme reaches only a third of eligible households. They have walked away from making further social tariffs mandatory. Under their plans, the design of social tariffs is to be left to private companies. In fact, in the DEFRA draft guidance, companies are even given the choice of whether to provide one at all.

In the short term, we know that tackling the bad debt that raises all our bills, pooling cross-subsidy to make it more effective, requiring landlords to share the names of their tenants, as they do in the energy sector, and setting minimum standards for social tariffs can all make a serious dent in the cost of water. We know what works, and we are willing to work with the Government to introduce comprehensive reforms to achieve that. So which of those measures will DEFRA commit to? None of them. That is not good enough.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Richard Benyon)]

I thank hon. Members on both sides of the House for their participation in this debate. It is good to hear that the issues tackled by the Bill are at the forefront not only of my mind but of those of other hon. Members. Also, it is a pleasure to be lobbied by my hon. Friend the Member for Camborne and Redruth (George Eustice). He should not worry about collaring me in the Lobby, and neither should any other hon. Member. If I give the impression of putting my head down and trying to get through it as quickly as possible, I regret that. I congratulate him and Members from the south-west from all parties on the pressure that they have brought to bear to achieve a measure to alleviate what we accept is an unfairness that dates right back to privatisation 20 years ago. I congratulate them on the success that they have achieved thus far in getting this legislation introduced.

Water seems to have been in the news on a daily basis recently, which reflects how precious the resource is to each and every one of us. Despite the confidence of the right hon. Member for Exeter (Mr Bradshaw) that we live in a rainy country, parts of the United Kingdom have been affected by drought for many months now, and that is likely to continue into the summer.

We must act now: it is imperative that we have a system in place that provides a secure water supply now and for the future, while continuing to protect the environment. That is why we are dealing with the situation we face at the moment. We brought together experts and key players in the water industry at a drought summit. We do not need legislation to get on and tackle some of the drought-related problems; we are doing that right now.

I often find myself making speeches about the particular river of concern in my constituency—the River Kennett—and I am also lobbied by Members across the country about the water that flows, or does not flow, through rivers in their constituencies. Of most concern to this Bill is the river into which the Kennett flows—the Thames. Today, the proposed Thames tunnel offers the most timely, comprehensive and cost-effective solution to the combined sewer overflow problems and the dumping of raw sewage into our river.

My right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes) asked for the case on the tunnel to be compared once again with other proposals put forward. I have to say, however, that none of the alternatives identified during the extensive studies carried out over the past decade has been found swiftly or adequately to address the environmental and health objectives for the Thames tideway while simultaneously complying with our statutory obligations.

[Mr Slaughter]

rose—

[Richard Benyon]

I shall give way just once to the hon. Gentleman.

[Mr Slaughter]

I compliment the Minister on his clarity and consistency on this issue. Does he share my frustration, however, that when I go back to my constituency I find the hon. Member for Chelsea and Fulham (Greg Hands)—as a Government Whip, he should be helping this Bill through the Commons—running a vitriolic campaign against the tunnel and a local authority that not only spends tens of thousands of pounds on a misleading campaign, but as of last night is threatening to sue the Secretary of State for Communities and Local Government to prevent him from safeguarding sites in the borough? Can the Conservative party get its act together on this issue?

[Richard Benyon]

I thought that the hon. Gentleman was going to make a helpful intervention, but he made his point eloquently once again.

The alternative proposal for a shorter western tunnel would allow large volumes of raw sewage to continue to flow into sections of the Thames—exactly what the Thames tunnel is designed to avoid. It is clear that the public do not want raw sewage going into this iconic river through one of the most important cities in the world.

In what I must say was a great speech, we heard from my hon. Friend the Member for Hendon (Mr Offord) about how serious is the issue of combined sewer overflows—not just in London, but around the country. He added his own perspective on other elements of the Bill. I can assure him that combined sewer overflows are monitored robustly and that action is taken where permits are breached or problems with the environment are identified. Beyond the Thames tunnel, some £1 billion is being invested further to reduce the impact of combined sewer overflows across the country.

We are ever mindful of the costs involved in the Thames tunnel project. We remain convinced that there is an economic case for it. Part of it is Thames Water’s estimate that the project would directly employ about 4,250 people in the construction and related sectors, as well as providing further secondary employment. The Thames tunnel team actively support the Crossrail Tunnelling and Underground Construction Academy, which is currently training and gaining employment for 70 apprentices a year. Following the Crossrail model, the Thames tunnel project will specify in its contracts the level of apprentices that will be employed by the contractors.

Let me say that I remain sceptical on cost, which is where I believe Ministers should be on a project of this size. We are receiving the best possible advice, and the work will be ongoing. I cannot possibly stand here and say now that costs will definitely be pegged at the current estimated level, but we will try to deliver this project within budget and effectively for the people of London and the country as a whole.

Water Industry (Financial Assistance) Bill

Andy Slaughter Excerpts

Wednesday 29th February 2012 Commons Chamber

[Mrs Spelman]

Naturally, Thames Water will be one of the water companies looking at a company social tariff. That provides a means, as with Severn Trent Water and every other water company, of really helping the most vulnerable customers. It is important, too, to put in context what Thames Water customers, probably including some hon. Members, pay now. Unlike South West Water, Thames Water currently has significantly below average water bills. The average combined water and sewerage bill is £356 a year. South West Water ratepayers pay £517 a year, whereas Thames Water’s ratepayers have a combined bill of £319 a year. We are starting with Thames Water’s ratepayers who have a significantly below average bill.

[Mr Andy Slaughter (Hammersmith) (Lab)]

rose—

[Mrs Spelman]

Let me make a little progress, if I may.

We need a solution that prevents sewage from entering the Thames in the first place. Today, the proposed Thames tunnel offers the most timely, comprehensive and cost-effective solution to the combined sewer outflow problems. We are very aware, though, of the impact its construction would have on local communities. Thames Water has just finished its second public consultation on its proposals, and will consider the responses it has received. It plans to publish its response in the latter half of May. Thames Water will continue to work hard with those potentially affected to minimise the impact where practicable.

We recognise that the large and complex Thames tunnel project comes at a cost, which will impact on Thames Water sewerage bills, but we are confident that the bills would still remain below the current national average and below the average bills of Southern, Anglian, Wessex and Severn Trent Water customers—and well below those of South West Water customers.

[Mr Slaughter]

Does the Secretary of State agree that

“the cost of the tunnel is too large to justify the environmental benefits”,

and that the

“Projected costs ... outweigh the advantages of a cleaner river”?

[Mrs Spelman]

Is the hon. Gentleman saying that his party is not in favour of trying to clean up the sewage out of the Thames? He will know that the initial study on the Thames tideway was launched when his party was in power—in 2001—and that a significant amount of time was spent looking at alternatives and carefully assessing with the greatest rigour what the costs of such a complex project might be. Just to put this in context, the proposed cost for the Thames tunnel is comparable to the amount having to be spent in Paris to do almost exactly the same thing, and on what the German Government are having to do to deal with an outdated system on the Rhine-Ruhr. So I do not accept his argument that the expenditure on cleaning the sewage out of the Thames is not justified.

The objective of our approach is to help relieve the extent to which households in London are being asked to contribute. As I said in my written ministerial statement on 3 November 2011, the Government believe that the private sector can and should finance this project, but we accept that there are some risks that are not likely to be borne by the private sector at an acceptable cost. We are willing, in principle, to provide contingent financial support for exceptional project risks where this offers best value for money for Thames Water’s customers and taxpayers. However, I will want to be assured that, when we offer this contingent support, taxpayers’ interests remain a top priority. We are working with Ofwat, Infrastructure UK and Thames Water to ensure that the financial structure for the proposed Thames tunnel includes safeguards, so that the likelihood of Government support being called on is minimal.

--- Later in debate ---

[Mrs Spelman]

I wish to make a little more progress.

We believe that simply having this power available will help us to maximise private sector investment in the tunnel and keep the cost of financing down. The Bill in 1858 that provided the money to construct a new sewer scheme for London, and to build the Embankment in order to improve the flow of water and of traffic, was rushed through Parliament and became law in a mere 18 days. Although we do not anticipate such swift progress, we need to ensure that assistance is provided promptly to South West Water customers and, similarly, that Londoners can be assured that the power to provide contingent financial support is in place while we work with Thames Water and other stakeholders to plan for the financing and structuring of the tunnel.

[Mr Slaughter]

rose—

[Mrs Spelman]

I have already taken one intervention from the hon. Gentleman.

As the Bill contains just two simple spending powers to implement intentions that the Chancellor set out in the autumn statement, our intention is that the Speaker be able to certify it as a money Bill. I am, however, mindful of the limitations that would place on discussions in the other place and of the desire to debate the need for the Thames tunnel, in particular. The need for the proposed Thames tunnel will no doubt be discussed in detail if, as I expect, the waste water national policy statement is debated before the end of March. We will also shortly be laying a draft order before Parliament to amend section 14 of the Planning Act 2008. This section 14 order would enable a major sewer such as the Thames tunnel to be included as a nationally significant infrastructure project, and we look forward to hearing any concerns that hon. Members may have.

--- Later in debate ---

[Mary Creagh]

We believe that the allocation of sums, guarantees, indemnities, or whatever form the financial assistance takes, should be done with full parliamentary oversight, and I will address that when I move on to clause 2.

We believe that the tariffs should be paid for by cracking down on bad debt, which the Secretary of State mentioned in her speech. Ofwat’s website states:

“More than five million households currently owe money on their water bills and over the last five years the amount owed has increased by more than 50%.”

In 2010, £1.6 billion was outstanding, three times the amount of bad debt for gas and electricity bills, despite the fact that water bills are much lower. As she said, the people who cannot or will not pay add an average of £15 a year to the bills of consumers who play by the rules. Bad debt arises in part because landlords are under no legal obligation to provide their tenants’ details to water companies. Rather than a voluntary approach, the Government should compel landlords to share their tenants’ details with water companies, and I know that the consultation is ongoing and is due to close fairly soon. If we reduce bad debt, we can reduce everyone’s bills and fund social tariffs that help those struggling to pay.

Clause 2 creates financial mechanisms and guarantees to support the construction of the Thames tunnel. Why do the Government avoid using the words “Thames tunnel”? Are they trying to avoid a proper discussion of the merits? Labour supports the project. Our Flood and Water Management Act 2010 introduced a “provision of infrastructure” regulation, creating the framework for the tendering, designation and building of such projects. However, costs have risen and time scales have stretched. The Government need to show leadership and make a clear commitment to the project and ensure that the right vehicle for managing and delivering it is put in place. The consultation process for the tunnel is vital for ensuring that sites are placed correctly and the environmental impact of the work on residents is minimised.

[Mr Slaughter]

I agree with what my hon. Friend says about the Thames tunnel, and to that extent I agree with the Secretary of State. However, had the Secretary of State not chuntered through her speech in such a cursory manner on an issue that is very important to London Members, I could have told her that the virulently anti-tunnel comments that I quoted were not mine, but those of my neighbouring Tory MP, the hon. Member for Chelsea and Fulham (Greg Hands), who happens to be a Government Whip. This is just another example of members of the Government saying one thing in the House before going back to their constituencies and saying the exact opposite.

[Mary Creagh]

That used to be the province of the Liberal Democrats, but perhaps saying two different things, depending on whether one is at the top or the bottom of the hill, in the House or in one’s constituency, is contagious. We should all take the necessary precautions, but such indiscipline would never have been allowed when I was a Government assistant Whip.

There remain, however, a number of hurdles to clear, not least that of the Communities and Local Government Secretary, who has an effective veto over the tunnel, so DEFRA support alone will be insufficient. We see the tunnel, in addition to its environmental benefit, as an opportunity to create up to 4,000 direct jobs for Londoners, to expand apprenticeships and to regenerate London. With the provision of financial assistance, we expect not just those apprenticeships but higher-level training to be a non-negotiable part of the deal.

In an infrastructure project of this scale, complexity and duration, we should be setting targets not just for apprentices but for the number of young people who will achieve masters-level civil engineering qualifications over the project’s lifetime, as well as encouraging local and national procurement to secure growth and the economic recovery in London.

No impact assessment has been produced alongside the Bill. The rather short explanatory memorandum states that this is because the Bill is associated with public expenditure, but clearly there will be burdens on water companies when administering any schemes under clauses 1 and 2, so what conditions will South West Water have to fulfil? Presumably, there will be an audit process, so what will the company’s administrative costs be, or has it agreed to waive them?

Of more concern, however, is the fact that there is no provision anywhere in the Bill to require potentially large sums of taxpayers’ money to be spent transparently and accountably. Clauses 1 and 2 state that undefined “terms and conditions” can be attached to the use of public money, but that falls well short of making clear exactly what will happen, and we believe that certain safeguards should be specified in the Bill.

I had a little look at the Water Industry Act 1991 this morning, and section 152 states that the Government can pay out money to water firms only

“in the interests of national security.”

So it is clear that infrastructure projects of the scale and cost of the one before us were simply not envisaged at the time of privatisation.

Today’s Bill shows those limitations, and section 154 of the 1991 Act also states very clearly that if any financial assistance or guarantee is given,

“the Secretary of State shall lay a statement of the guarantee before each House of Parliament”

and

“as soon as possible after the end of each financial year…lay before each House of Parliament a statement relating to that sum.”

The right hon. Lady says that the subsidy to South West Water will continue until the end of the next comprehensive spending review period, but that again is not in the Bill or in the explanatory memorandum, and we want to see those things guaranteed.

--- Later in debate ---

[Jim Fitzpatrick]

My right hon. Friend makes an important point that will be a matter for scrutiny in Committee. I expect it to be raised in Committee in due course.

East London assembly member John Biggs and I are seeking Thames Water’s latest considerations, and obviously the Bill would affect the building of the Thames tideway tunnel. The local community is resolute on this issue. My only concern about the choice between the Heckford street site and the Thames foreshore site is that building the interceptor to the sewer on the foreshore would mean much more traffic by water, on the Thames. If Heckford street is chosen, there will be several thousand heavy goods vehicles on the streets of Tower Hamlets and further east for several years. That would not be a welcome dimension, but these things are in the balance, and obviously we are pressing for the best possible outcome for the local community.

The second issue that I want briefly to mention is fire sprinklers. I pay tribute to the Minister, who is always courteous and efficient. I am grateful for the meeting that he afforded me and the officers of the all-party group on fire safety and rescue to discuss the matter only four to five weeks ago. There is a myth perpetrated by the media—mostly in adverts on TV and in the cinema—that when a fire in a building activates the sprinkler system, every sprinkler right across the building is activated and the whole place is doused in water and damaged. The reality, of course, is that the only sprinkler activated is the sprinkler head immediately above the seat of the fire, as the heat generated by the fire melts the soldered link, causing the blockage to fall away and allowing the water to act as an extinguishing agent. The problem with the myth is that people are frightened of sprinklers, because they think that if they install them in their building and they are inadvertently activated—we know that smoke detectors can go off because of burning toast—their home would be damaged. However, that is not the case, and the cost to society of not installing sprinkler systems in buildings includes the hundreds of millions of pounds lost to schools damaged by fire every year—a cost that is often passed on to local council tax payers, as most local authorities self-insure.

[Mr Slaughter]

My hon. Friend is making a good point about a matter that was brought home to me recently. Hon. Members will remember the serious fire that closed Wood lane, opposite the BBC in Shepherd’s Bush—perhaps that is why it got so much publicity. The consequence of such events in major buildings with no sprinkler systems is not just the risk of loss of life, but often the permanent loss of jobs where buildings cannot reopen and the huge damage to industrial and public buildings.

[Jim Fitzpatrick]

My hon. Friend anticipates the point that I am coming to, immediately after I make the point that when a school burns down, the problem is not just the damaged building, but the disruption to the education of the students at that educational establishment and the impact on parents, who have to take their kids to schools further away, with disruption to friendships and the rest of it. As for the point that he correctly makes, when there is damage to an industrial or commercial premises, there is not only the damage to the building, but the cost of insurance for the company, a loss of production and, more often than not, unemployment costs to the individuals who work on those premises, because it takes months and sometimes longer to rebuild or replace, if at all possible.

Most critical of all is the loss of life. Fire deaths affect the most vulnerable in society. The majority of people who die in fires are the most vulnerable—the old, the sick, the young, people with social difficulties or people with addiction problems. The most vulnerable are the ones who predominantly die in fires. Tragically, we have recently seen a number of major multiple fatalities across the country, most recently in London—in what was formerly Brent East—where a mother and five children died in a fire. However, the experience of local authorities where fire sprinklers are the norm is entirely different. There is a district in Arizona called Scottsdale—one of Phoenix’s five districts—that is the fire sprinkler capital of the world, as I am sure the House will be pleased to learn. Scottsdale has had a city ordinance for 30 years that says that if someone builds something, they have to install a sprinkler system. One person has died in a fire in Scottsdale in 30 years. Scottsdale has 250,000 people. They smoke, they cook, they burn candles and they probably have heating too, despite the desert climate. Sprinklers save lives. That is now becoming the UK experience. More local authorities, more registered social landlords and more developers are recognising the benefits of sprinkler systems.

There has been extensive correspondence between the all-party group and DEFRA on the Water Industry Act 1991. If I may, I shall quote from a letter from former chief fire officer Ronnie King, who is a highly regarded officer in the fire service, as well as being the active administrative secretary of the all-party parliamentary group on fire safety and rescue and the chair of the water liaison group. In reference to the Act, which the Bill amends, he says:

“To this end I outline in this letter a proposed change to section 57 on the provision of water for firefighting. Section 57 covers the duty to provide water for firefighting and currently this duty is limited solely to providing water from designated fire hydrants. Increasingly householders are seeing the benefit of installing sprinkler systems, which will lead to significant reductions in fire deaths and injuries if they could be more widely used. Under the current legislation such supplies are classified as non-domestic supplies and are subject to agreement of terms and conditions on a case by case basis. An amendment of section 57 to include as firefighting water that taken from service pipes connected to a sprinkler system will clarify the status of connections to the water system for automatic fire sprinkler purposes. The current ambiguity is a barrier to the proliferation of sprinkler systems.”

I acknowledge that the Minister has asked his officials to examine that matter and to report on it. If nothing can be done in this Bill, we would be grateful if it could be considered for the water Bill that is coming along not far behind it. I also want to acknowledge that the vast majority of the water companies already do the right thing in co-operating, without the legislative clarity that the proposed amendment would provide. An amendment to the Water Industry Act 1991 in the Bill would be welcomed by the fire service and the fire industry as another major step towards a safer society, but I recognise that that might not be possible yet. School fires are increasing, and I am told that 10% of schools are affected by vandalism involving fires each year. More fires are occurring during school hours, and it is only a matter of time before there is a major tragedy. Most fire legislation is reactive and retrospective, drafted on the back of a major loss of life. The amendment that I have suggested could take us forward significantly, and protect our children in the future.

In conclusion—and as a complete aside—we really need to hold a fire evacuation drill in this place at some point, because we need to give leadership to the rest of the country on these issues. I am grateful for your indulgence, Mr Deputy Speaker.

--- Later in debate ---

[Mr Matthew Offord (Hendon) (Con)]

I rise to support the Bill, as I have much experience of both South West Water and Thames Water, However, I must say that my perceptions of the two companies differ widely. They appear to operate at different ends of the spectrum: South West Water levies one of the highest surcharges in the UK and has the lowest number of consumers, while Thames Water levies one of the lowest surcharges and has the highest number of consumers.

The Bill is about a decade overdue. The shadow Secretary of State said that many of the problems are the result of privatisation, but that is an erroneous assertion. If we look at the value of the water companies before privatisation, we will see that Anglian Water was worth £357 million, North West Water £458 million, Severn Trent £476 million and Thames Water £558 million, but South West Water was worth a lowly £106 million. In general terms, at the time of privatisation South West Water had the lowest amount of assets per property, and since privatisation the company has invested about £2 billion, in 2007 prices, to bring its infrastructure to the same level as that elsewhere in England and Wales.

At privatisation, South West Water’s bills were about £50 higher than the national average. This disparity was exacerbated by the impact of the bathing water directive and, of course, the urban waste water treatment directive. As the Public Accounts Committee and the National Audit Office recognised in 1992, privatisation of the water industry was an unprecedented task, with 10 utility monopolies floated on the stock market at the same time after years of restricted investment and an obligation then to spend more than £24 billion in a decade in order to catch up. Any perception of failure now can be attributed only to the lack of governmental interest in the industry 10 years after privatisation and, in the case of South West Water, in the 19 years its consumers have had to wait for the Walker review.

If greater interest had been shown, one industry practice that is causing problems across the country would have been identified: the use of combined sewer overflows. CSOs are intended to act as release valves at times of higher operational use. When Sir Joseph Bazalgette first planned the sewers for London, he gave every person a sewage production allowance and decided the diameter of pipe needed to remove it. He then doubled that diameter. We should all be grateful that he did so; had he not, the smaller size of the sewers would have ensured that they overflowed in the 1960s.

However, the Metropolitan Board of Works said that the cost of Bazalgette’s plans was too high, so he proposed and installed the combined sewer overflow system. This ensured that when it rained the accumulation of rain water that enters the sewerage system can be released through the CSOs, taking the sewage with it. London’s current population is estimated to be about 8 million and rising. In a typical year, 39 million tonnes of untreated sewage is discharged into the River Thames with as little as 2 mm of rainfall. To put that in perspective, that is enough to fill the Royal Albert hall 450 times, and the discharges occur about once a week on average.

The emerging effluent contains not only sewage and storm water, but biochemical oxygen demand material, pathogens, nutrients, heavy metals, pesticides, oils and suspended solids. In short, London’s Victorian sewers can no longer cope, which is why London desperately needs the super-sewer, or Thames tunnel. The CSOs discharge into the river not only chemical and biological contaminants, but nearly 10,000 tonnes of litter every year, including toilet paper, wipes, sanitary towels, condoms, cotton buds and other flushable items. I know that the hon. Member for Hammersmith (Mr Slaughter) accompanied Thames Water on a trip, as I did, where he saw for himself the problems at the pumping station at Fulham. The hidden dangers of the effluent that goes into the river include pathogens, viruses and bacteria, such as E. coli, hepatitis A and faecal streptococci.

Due to the ebb and flow of the tide, it can take up to three months for sewage that has entered the uppermost reaches of the Thames to reach the sea. That is a problem in itself, but the persistence of infection is a real problem. Around 50% of typhoid bacteria are destroyed in an aquatic environment in one to three days, and 90% is destroyed in three to 13 days, but the most resistant can remain for weeks and retain their power of infection, which has an impact on not only the people who use the river, but those who live around it.

[Mr Slaughter]

The hon. Gentleman is making a powerful case, and he is right to say that I visited a pumping station, although it was the Hammersmith one. When most people think about pumping stations, they think that some form of treatment is going on there. On the contrary: a structure that is probably half the size of this Chamber fills up with raw sewage, which is then pumped straight into the Thames, and that happens on at least a weekly basis. Does he agree that it is highly irresponsible to say that we should clean up the Thames so that it is so clean that salmon can thrive and prosper in it? We need to clean it up because it is an essential health matter.

[Mr Offord]

I thank the hon. Gentleman for his intervention. I am probably aware who he is citing, and, having had conversations with the former leader of Hammersmith and Fulham council, I can assure the hon. Gentleman that we do not agree on this subject, though we may agree on many others.

The super-sewer in London is essential to ensure that the UK complies with European environmental standards and, most particularly, the urban waste water treatment directive. All British taxpayers are at risk of having to fund hefty EU fines if the UK is confirmed to be in breach of that directive.

It is not just London and Thames Water that need to take action, however. All water companies have a contract with their consumers not only to provide them with clean water, but to remove their sewage and to treat it responsibly, but that is not happening. The water quality of Britain’s beaches is being jeopardised by thousands of unregulated overflow pipes that dump raw sewage into coastal waters and rivers. It has been estimated that 3,500 pipes operated by water companies pump unlimited amounts of raw sewage into more than 80 rivers and along sections of our coastline. That comprises more than 60 operated by South West Water, including pipes on the River Torridge, which flows to a popular Devon beach; more than 250 outlets operated by Yorkshire Water, including sewage flowing into the North sea; sewage overflows on the River Don, where thousands of fish were killed by sewage pollution in 2006; and an overflow, operated by United Utilities near Manchester, which was blamed for polluting a fishery in 2005.

--- Later in debate ---

[Simon Hughes]

I absolutely accept that. I was not disputing the cross-party nature of the campaign. I was trying to support my hon. Friend and colleagues across the House by saying that those of us who do not come from the south-west have supported them too.

A pledge made by the Liberal Democrats bas been honoured, and a pledge made by the coalition Government has also been honoured—generally, then, this is a good proposal.

The second part of the Bill is the one that preoccupies those of us with London constituencies and constituencies served by Thames Water. It is the largest water company in the country and covers a significant number of colleagues with constituencies in the Thames valley as well as in the capital. That relates to clause 2. I support the general proposal that the Government should be able to assist major infrastructure projects, and I am aware that last year and the year before, the Chancellor rightly identified a set of infrastructure projects around the country to get people back into work. Good, long-term, viable infrastructure projects are a good thing, and we should support them.

There is always a danger, however, that infrastructure projects start with one price tag but end up with another. When the Thames tunnel scheme to deal with sewage in the Thames—the system built in the Victorian era by Bazalgette is no longer fit for purpose—was first proposed, the general cost was said to be between £1 billion and £2 billion, but everybody now accepts that, at 2011 prices, the Thames tunnel would cost £4.1 billion or more. That excludes financing costs, as the notes to the Bill explain, but includes £900 million for risk and optimism bias. So this is a big project that will cost a lot of money.

In 2006, the water regulator warned potential buyers of Thames Water that it would not allow them to saddle the company with high debt levels and pass financial risk on to the customers. I want to concentrate my remarks on the financing, and the financing structure, but I also want to place on the record my position on the project. I have supported the general position that we need to deal with the infractions on air quality and water quality in London that have brought us before the European authorities. That is what we are facing in relation to water and air quality; therefore, we need to act.

I have started from the proposition that the Thames tunnel, as proposed by Thames Water, is the right answer. When it was endorsed by the last Government it had my support, but I am increasingly troubled that it looks as if it may not be the answer that everybody once thought it was. Therefore, when I recently made a full submission as part of the consultation process, I asked—I am also about to write to the Secretary of State to ask this question, after this debate and after a meeting on Monday—whether, at least between now and the point in the normal timetable when Thames Water might be in a position to make an application, there could be a final independent review of the viability of the current project.

Those driving the project have an interest—Thames Water has an interest, and there are others with an interest. It is important not just to have a battle between those with an interest in favour and local authorities such as mine—[Interruption]—and that of the hon. Member for Hammersmith (Mr Slaughter), who is about to intervene on me—which, because of the effect on their constituents, have become opposed. At the moment we have a dialogue of two different interested groups, and I think we need to get some people involved who do not have a vested interest. There are people in the European Commission who do not have a vested interest, there are people in international environment agencies who do not have a vested interest, and there are also people who do not have a price interest. Before they commit their support to a project that is rapidly increasing in cost—I will say why that is a danger for the Government, as well as for everybody else—I think the Government would be wise to commit themselves to one last review. I hope I can persuade colleagues over the next few weeks that this can be done in a way that is compatible with the timetable in general terms.

[Mr Slaughter]

The right hon. Gentleman took part in a Westminster Hall debate last September—less than six months ago—at which I think I was also present, when he said:

“The Thames tunnel is the best direction.”—[Official Report, 14 September 2011; Vol. 532, c. 316WH.]

Is he saying that he has changed his mind since then? If he is saying that he has reservations about cost or individual sites, I would say that I probably share them—if I get a chance to speak, I will probably address them. Is he, however, saying that he has now changed his mind about the project as a whole?

[Simon Hughes]

The answer is that there is a proposal on the table for what is called “the full tunnel”. I am not as certain now that what is called the full tunnel is the right solution. There is already the tunnel being built in the east—that is well under way—and there is an argument for a smaller tunnel and other measures. I just think we need to satisfy ourselves before we go for the full tunnel that that is the right solution. There are also site issues, of course, but I regard those as secondary, although in my constituency, as in the hon. Gentleman’s, they are hugely important to our constituents, not least with a major site being planned in the middle of my constituency affecting thousands of people, thousands of homes and two or three major schools.

[Mr Slaughter]

rose—

[Simon Hughes]

I will give way one last time.

[Mr Slaughter]

The right hon. Gentleman is being very generous. When he says “not the full tunnel”, I should point out that the context of his remarks last September was his objection to the wholly inadequate Selborne report, which proposes a partial tunnel—a disastrous tunnel—in west London. I hope he is not saying that he supports that.

[Simon Hughes]

Rather than have a long dialogue, I will let the hon. Gentleman have a copy of my submission to Thames Water later, so he can read my full views. However, let me summarise, as I did in my submission:

“I am now clear that, since the end of the first round of consultations in 2011, the arguments for a review of the full tunnel proposal and possible alternatives have substantially increased. There has been a growing amount of opposition against the full tunnel from my constituents and other constituents in greater London.”

I go on to say that we should therefore give that argument greater weight.

Let me turn to the substance of the financial issues, which are dealt with in this part of the Bill. Back in 2007, a memorandum was submitted to the Treasury Committee by a Mr Martin Blaiklock—consultant, infrastructure and energy project finance—on the subject of Thames Water specifically, but also on equity-type investment generally. He said:

“Over the last 12 months I have be keeping a particularly close watch on the activities of Thames Water, not least because I am a Thames Water customer, but also because it is one example,—and a good example,—of Private Equity involvement with public services. The case of Thames is significant as it is the UK’s largest privatised water utility, serving the Capital and 13 million customers, and also a monopoly service provider...Thames Water Utilities Limited…is the utility licensed by OFWAT. However, Thames Water Utilities Limited is 5 or 6 times removed from the controlling investor group…of whom a number are based offshore in Luxemburg…Is this the ‘transparent’ corporate structure expected of a UK monopoly public service provider?”

I cannot put this on the record, but there is a helpful graph in that memorandum to the Treasury Committee showing Thames Water Utilities Ltd at the bottom. Above it are lots of holding companies, including Thames Water plc, Thames Water Holdings plc, Kemble Water Ltd and Kemble Water Holdings Ltd, and intermediate holding companies. The list goes right up to non-Macquarie investors and then to Macquarie, and shows the purchase of part of the company by the Chinese state finance organisation and others. That shows an organisation that does not do transparent finance. We therefore need certain safeguards to be put in place to protect any taxpayer investment and Government support.

The company also has considerable activity in the Cayman Islands. I am not sure whether that is the most appropriate way for a major utility company to spend its money. The tax arrangements of Thames Water, having been bought by Kemble, have involved setting up a subsidiary financing branch in the Cayman Islands, based at Ugland House, which has 18,856 other businesses registered at it. There is a real question of transparency for Thames Water, and the Government need to have a public debate on it. We need to look at this matter in Committee and on Report to determine exactly how the financing arrangements are arrived at. There is at the moment no proposal from Thames Water as to how it will raise the £4.1 billion to finance the project, and I am concerned that the cost might ultimately be borne by the Thames Water ratepayer, which might not provide the best value for money for our constituents who pay their bills.

Mr Blaiklock concluded:

“There is no doubt that the introduction of Private Equity-type investment into the privatised UK public services has sharpened up the financial management of such enterprises. However, such Private Equity investment has also

(a) introduced a lack of transparency in the control, governance and, therefore, the accounts of such utilities. Some utilities, such as Thames Water, are effectively owned and controlled offshore, possibly by companies with limited liability and domiciled in tax havens. Corporate information is, not surprisingly, hard to come by for such Private Equity investments! Hence, in the event of operational failure by such utilities…it is quite possible that the controlling company and its directors cannot be called to account, notwithstanding OFWAT’s Conditions P and F licensing requirements…

(b) increased the leverage and, thereby, decreased the financial strength of such utilities, at the expense of customers and the security of service; and

(c) introduced corporate uncertainty. The investment horizon for Private Equity is traditionally three to five years, which is short for public service utilities, which require long-term capital and financial stability. The only balancing feature has been the increased intervention, as direct investors, by pension funds and life insurance companies—as principals, not clients—albeit some are offshore owned and controlled. Such investors have longer time horizons and are ideal investors for such public service utilities.”

The other activity that is certainly questionable is the way in which Thames Water has managed its affairs in recent years. Extremely high dividend payments have been made over the past years, representing a direct transfer of income and capital out of Thames Water to private investors. At the financial year end in 2011, Thames Water made £225.2 million in profits, but it distributed £271.4 million in dividends. This high dividend policy is a recent development, but it is not limited to last year. In 2010, the unadjusted common dividend payout ratio, in percentage terms, was 141.5%—that is, nearly half as much again, on top of profits, was paid out. The figure for 2009 was 126.7%—a quarter as much paid out again as was made in profits, and in 2008, 61.3% was paid out. That contrasts with Anglian Water’s dividend ratio of 81.%, Southern Water’s 58.7% and South East Water’s 48.4%. The policy of paying higher returns to investors started immediately after the company was purchased by the consortium behind Kemble Holdings in 2007. The company paid out £535 million in dividends in 2007, and £233 million in 2008.

All this has happened while the company has vastly increased its debt position. In the financial report of 2008, the change in the amount of debt held by Thames Water was more than £1.5 billion. Ofwat warned the bidding companies to keep a good debt ratio, advising that 45% would be appropriate. The ratio is now at 80%. We—Parliament—and the Government need to ask why Thames Water has increased its debt holding by so much when it is known that it has an extremely large capital project coming up, which will need a substantial amount of borrowing.

My question to my right hon. Friend the Secretary of State is whether the Government have investigated whether Thames Water would have been able to make a greater contribution to any scheme from its own funds if it had not spent the last few years borrowing money in order to pay itself. Both the financial policy and the tax arrangements of Thames Water seem to me to be appropriate for us to debate.

My conclusion is that we might need to insert conditions into the Bill regarding any financial arrangements whereby the Government underwrite the borrowing by Thames Water, making it clear that they should be transparent, ethical and accountable so that Thames Water users, those of us who represent people in the Thames Water area and everybody else in the country can understand that there has been some pretty strange organisational finance going on in the last five years. We must make sure that the objectives do not feather the nests of the equity investors rather than benefit Thames Water users, so we must ensure that we have the right financial vehicles if we are to go ahead with infrastructure projects like this one. We will have plenty of opportunity to debate the project itself on other occasions, but I hope that the Secretary of State will be sensitive, as I know the Treasury is sensitive, to these real concerns about how Thames Water runs its financial affairs.

Public Bodies Bill [Lords]

Andy Slaughter Excerpts

Tuesday 25th October 2011 Commons Chamber

[Robert Flello (Stoke-on-Trent South) (Lab)]

The Youth Justice Board has played a central role in reducing the number of criminal offences committed by young people since its creation, but the Government’s proposal to transfer its functions to the Ministry of Justice threatens to roll back the progress of the past decade. As we have heard, the YJB has pioneered the creation of a distinct youth justice system, separate from the adult estate, recognising that the factors that lead young people to commit crime are complex, and can be addressed only through specifically targeted crime prevention and rehabilitation strategies.

As we have heard, during the last Parliament the Youth Justice Broad oversaw a 43% reduction in the number of first-time youth offenders by working with youth offending teams to focus on the causes of crime. We have also heard, but it is worth repeating, that there has been a 34% reduction in offences committed by young people and a 15% reduction in the number of young people in custody, down from 2,830 per annum to 2,418 per annum by May 2010.

[Mr Andy Slaughter (Hammersmith) (Lab)]

I am sorry that time will not allow me to make a speech about this matter. I had the privilege of holding the youth justice portfolio for the Opposition for the past year before handing it over to my hon. Friend. That allowed me to see, while going round the country, the best practice in youth offending institutions, foundation training companies and youth offending teams. Without exception, they all praised the Youth Justice Board as the organisation that gives coherence, example and structure to what is happening. They cannot understand why the Government are abolishing a body that is proving to be such a success.

[Robert Flello]

I am grateful to my hon. Friend, who makes his point extremely well. If we had had a proper amount of time for this debate, I am sure that he would have made his contribution.

Waste Water (Thames and Greater London)

Andy Slaughter Excerpts

Wednesday 14th September 2011 Westminster Hall

[Simon Hughes (Bermondsey and Old Southwark) (LD)]

We are moving to slightly calmer waters as we change from a debate on European Union fiscal union to one on waste water in the Thames and Greater London. I am grateful to the Minister for his and his Department’s regular interest in these matters.

On Monday this week, David Walliams—he is probably more famous than many of those elected to Parliament—ended his swim from Gloucestershire to Westminster bridge. On the same day, Boris Johnson, the Mayor of London, wrote an article in The Daily Telegraph entitled “David Walliams’s Thames swim: it will take a super-sewer to get London out of this mess”. He was referring to the fact that London has a looming waste water crisis.

We have a fantastic piece of engineering in this great city of ours. Our sewer system was designed by Sir Joseph Bazalgette in the wake of what was known as the great stink of 1858. The purpose was to stop the sewage backing up into homes and streets whenever the system overflowed. It was connected to the Thames, so that excesses of waste water and sewage emptied into the river. That system was designed for a city of 4 million people. The city’s population is now approaching 8 million, and before too long it will be a conglomeration of nearer 9 million people. It is obvious to everyone that, with the best will in the world, the present system will not be sustainable. Thames Water is responsible for the system, the company is overseen by Ofwat, and the regulator is accountable to the Department for Environment, Food and Rural Affairs.

For some years a proposal has been on the table to build a Thames tunnel. It was the subject of consideration by the previous Government, and the scheme has been handed on to the present Government. In principle, Labour Ministers gave their blessing to a tunnel scheme; the alternative was a softer environmental mix of things, including a hope that rain water could be collected, and that there would be a more personalised collection with less sewage and so on.

The amount of sewage currently discharged into the Thames is one of many dramatic figures. That is not sewage taken to the waste disposal plants but the excess of sewage that ends up in the river. It is 39 million cubic metres a year. That may not mean much to most people, engineers apart, but it is equivalent to filling the Royal Albert hall 450 times. That is a lot of sewage. It is clearly something that nobody would wish to be in our capital city’s river.

Last weekend, I had the privilege of chairing the hugely successful Thames festival for the 10th time. The Mayor of London’s Thames festival is a reincarnation of the GLC festival, which started 15 years ago. It is held to celebrate the river, and getting on for 1 million people were there this weekend. We want the river to continue to be celebrated. We want it to be clean. We want it to be accessible, and we want people to be able to use its beaches. We want it to be used for commerce and tourism and related activities. We want to see more natural life in the river, including fish such as porpoises and dolphins. We also want to see David Walliams or the Mayor of London swimming in it—or even the hon. Member for Poplar and Limehouse (Jim Fitzpatrick), whose constituency is opposite mine on the north bank of the river, and me. I was once thrown in; it was not a pleasant experience, but that was soon after I was first elected 28 years ago.

I bring the matter to the House today because, in part, it is already on the Minister’s desk. Indeed, the Minister will be aware that in November last year, perfectly properly, the Government published the national policy statement for waste water. On 30 March 2011, the Select Committee on Environment, Food and Rural Affairs published its report. It makes 19 recommendations. In essence, the Committee would like to see the draft national policy statement amended. As the Minister knows, some of the Committee’s recommendations relate specifically to Thames matters. I shall put recommendations 9 and 14 on the record, but I shall leave colleagues and others to read the other conclusions later.

Recommendation 9 states:

“Approval of the costs which can be passed on to water and sewerage company customers is rightfully a core Ofwat function under its current regulatory remit and it is hard to see the benefits to be gained from duplicating this activity within the spatial planning process. In view of the alarming increases in estimated costs, Ofwat must fully utilise its regulatory powers to scrutinise the economic case for the Thames Tunnel project and be rigorous in determining which costs should be passed on to Thames Water’s customers.”

Amen to that. Water bills are high enough and the project will not be cheap, so people will want to ensure the best cost benefit.

Recommendation 14 states:

“We recommend that the draft NPS be revised to produce a purely generic document by removing Chapters 3 and 4 on the replacement of the Deephams Sewage Treatment Works and the Thames Tunnel. Defra may wish to provide material in an annex exemplifying points made in the NPS by reference to specific schemes, but it should be made clear that it does not constitute information to which decision makers must have regard when considering project applications.”

Those are the only two Thames-specific recommendations. The others are about the process.

I shall briefly put things into context and then pose my questions. I apologise that I gave the Minister notice of my questions only recently, but they are all matters for his Department. However, I shall understand if he needs to come back on some matters. The European Union agreed in 1991 that there should be one system across Europe. Again, following the previous debate, one of the good things that has come out of the EU is that it is setting standards on such things as air and water quality. Bluntly, London has failed on both water and air. On water, the UK is on the way to being taken to court by the Commission. We are also at risk of being liable for poor air quality in London. The EU is the right place to chase such things and to ensure better quality. The Thames tunnel project was intended to ensure that we comply with statutory EU requirements. However, we have been held to be in breach of the directive, which is why the matter is going to the European Court of Justice. Judgment is expected next year.

Secondly, the Government have been consulting on secondary legislation to be made under the Planning Act 2008 that would classify proposed major sewer projects such as the Thames tunnel as nationally significant infrastructure projects. The consultation closes on 5 October. The project would go to the independent Infrastructure Planning Commission. My colleagues and I and Conservative Members did not want that body to be independent, but when the Localism Bill becomes law it will become accountable to the Government, and the Secretary of State will be accountable to Parliament, which I welcome.

The last bit of the jigsaw is that Ministers are considering the draft national policy statement in light of the consultation responses generally, and the Select Committee’s responses in particular. We will have a final statement before too long. A waste water policy statement is coming down the track, and there will be changes to the planning law. There is also Thames Water’s plan; the company has received responses to its consultation and it will almost certainly published a revised plan in November.

Like every riverside MP, but more than most, my constituency is very much on Thames Water’s map. When the company announced its plans at the turn of the year, it featured two sites in Bermondsey. It considered Druid street, which would connect the local combined sewer overflow, known as Shad Thames pumping station, to the main tunnel. It also considered the foreshore near Butler’s wharf and the car park at the flats in Tower Bridge road. It decided that Druid street was the preferred site. However, there was concern about that as it was the site of a children’s playground on a council estate and not the greatest of sites. I hope that Thames Water will respond positively to those views and go ahead using the Shad Thames pumping station and not the Druid street site.

By far the most controversial plan is to use the King’s Stairs gardens as the main drilling site for south London. Some 5,274 people have signed a petition against it, and a considerable number of other people, including me, have said that it is not a good plan because it is a greenfield site and on the Thames Path.

Thames Water has responded positively to such views. It has always engaged well with the community. I pay tribute to the Save the King’s Stairs Gardens action group and to its chair Donna Spedding. The group made a substantive case about the use of greenfield sites as opposed to brownfield sites and put forward good technical arguments.

As a result, Thames Water has now co-purchased Chambers wharf, a brownfield site slightly further upstream. As of this moment, there are two sites in the frame. Obviously, the Rotherhithe community hopes that the King’s Stairs gardens site will come off the list as it is inappropriate. We do not know where the other sites will now be—whether it is in Southwark, Deptford or further downstream.

[Mr Andy Slaughter (Hammersmith) (Lab)]

The hon. Gentleman correctly identified two problems with the scheme. One is the choice of site and the other, as with all infrastructure projects, is the cost. As constituency Members, we will all have issues and will have to negotiate with Thames Water. Like the hon. Gentleman, I have found Thames Water to be a reasonable organisation with which to negotiate. Can we try to disaggregate this matter from the project as a whole? My local authority, which is implacably opposed to the scheme, is using those legitimate objections to object to the whole scheme. I hope that we can have a three-party endorsement today of the fact that we have to clear up the Thames. David Walliams has focused our attention on that. Every single week, my constituents see huge amounts of raw sewage going into the Thames, near to where they live. Let us try to identify and solve the problems so that we can support a scheme that really has to be carried through.

[Simon Hughes]

The current estimate for the Thames tunnel scheme is pretty enormous. It is £3.6 billion and is likely to go up rather than down. Thames Water says that the alternative would cost £13 billion and take 30 years. When I responded to the consultation, I said that the evidence seemed to be in favour of the Thames Water plan, subject to getting the sites right, but I wanted final reassurance. I made my response formally at the turn of the year.

I also put in a short response to the private commission that was set up by some interested local authorities and chaired by Lord Selborne. The commission has argued that we must have a totally different direction. I am not persuaded by that. The Thames tunnel is the best direction. The previous Government came to that view and the present Government have held to it. Unless something comes up in the latest process, we need to go ahead with the Thames tunnel scheme, but the site must be right. My experience is that engineers are reasonable people who will look at a better option if it is put to them. They are also quite flexible. The private commission is having its hearings and it is about to produce its report. I hope, therefore, that we can arrive at a common position.

My questions to the Minister are partly procedural as well as substantive. Will the Government respond specifically to all the recommendations in the Select Committee report? If they cannot do it now, when will they do it? If the concerns that have been expressed by colleagues across the House and in the Select Committee are taken into account, will the Minister accept that that will lead to a change in the draft policy statement?

Will the Department delay bringing the debate on the policy to the House until the Localism Bill has been enacted and implemented and the Infrastructure Planning Commission has been set up? I want to ensure that if the Thames tunnel is subject to an overarching planning approval, the decision is a democratically accountable one. Will the Minister give us the earliest date when Parliament might be able to have the national policy statement back? When the policy comes back, can he assure us that there will be a debate on the Floor of each House so that colleagues in London and the whole of the Thames estuary can make a contribution to the debate? This is a big debate and we want to ensure that it is given adequate time and that it is not something that is pushed through on the nod or in half an hour.

It is clearly logical to have one overarching planning approval for the scheme, but if there are any sites on which there is a significant building there should be extra planning processes to ensure that everything is done in the right way. For example, if the King’s Stairs gardens site or the wharf site in Bermondsey are chosen, people will want to know that the new building will not be too tall, too big, too wide or too ugly and they will also want to have their say. The subsidiary buildings should not be rubber-stamped through either. Will the Minister pass on that concern to his colleagues in the Department for Communities and Local Government? We want an extra consultation process about the detail or extra planning requirement.

Whatever our views about the Selborne commission, will the Minister tell us that the Department will consider the report and respond to it before the final draft of the national policy statement is published? Will he give us the Government’s final assessment of the cost of the project and will he give us an assurance that council tax payers, local councils and the Government will not have to pick up the tab? Obviously, people understand that this is a Thames Water project and that it will not be cheap. People will want to know not just what the cost is overall but that their bills will not go up in other places as well. It would be helpful if the Minister could show us the departmental cost-benefit analysis.

Will the Minister tell us whether there is any compensation available to people whose land, properties or amenities are affected? If they suddenly have a great treatment works or a shaft put in front of their window for seven years, what compensation will they receive? If Thames Water identifies new sites, people in my constituency and elsewhere would be grateful if the sites that are no longer in the firing line or are no longer being considered are dropped off the list so that they know they are no longer under threat.

I end by paying tribute not just to the Save the King’s Stairs Gardens group but the Save Your Riverside group. All these people are highly intelligent and reasonable in what they are asking for and I hope that I have reflected that here. This is a huge issue for many of our constituencies in London and we would be grateful for as much information about the scheme as the Minister can share with us.