Water Companies: Fines

Baroness McIntosh of Pickering Excerpts

Thursday 6th February 2025 Lords Chamber

[Baroness McIntosh of Pickering (Con)]

My Lords, I congratulate the noble Baroness, Lady Grender, on securing this debate, and I am delighted to follow the noble Lord, Lord Browne. I welcome the Minister as ever to her position. I am delighted that the noble Baroness, Lady Grender, has given such a warm welcome to the outgoing Conservative Government’s Plan for Water and the water restoration fund. I declare my interest as on the register: I am an honorary vice-president of the Association of Drainage Authorities; and I co-chair the All-Party Parliamentary Group for Water.

We were fortunate enough to hear this week from Sir Jon Cunliffe, who has been charged by the Government to produce a report for the water commission by the end of June this year, and I very much look forward to his conclusions. In the meeting of the All-Party Parliamentary Group for Water, he told us that the model that was introduced by the then Conservative Government for water privatisation factored in a level of debt, and I think that is something to which he will refer. He has not been asked to review the water privatisation model in that sense of nationalising the water sector, and I think we should recognise that in the debate today.

I repeat my request to the Minister: when does she imagine that Schedule 3 of the Flood and Water Management Act 2010 will be introduced, so that there will be an obligation for all major new developments to have sustainable drains? That will help the situation and reduce flooding.

Some of the project bids invited by the previous Government are still on the table. For example, farmers were invited to make environmental improvements to prevent flooding downstream by slowing the flow, as we saw in Pickering in North Yorkshire, by creating dams, including by planting and felling trees. Can she confirm that such projects will benefit?

As I had long called for them, noble Lords can imagine my welcome for the Plan for Water and the subsequent launch of the water restoration fund as precisely the types of measure that would benefit farmers and local communities under ELMS and other schemes such as the SFI. A number of groups applied for these schemes to bolster their capacity and capabilities to deliver such on-the-ground projects, and they were invited to put forward bids by June 2024.

They were applied for by farmers and landowners—I imagine in Yorkshire, Northumbria and other parts of the country—but they never heard any more. Can the Minister say what has happened to those projects? As the noble Baroness, Lady Grender, asked, what has happened to the water restoration fund? Farmers, landowners and the environmental organisations working with them were led to believe that these were just the types of projects that the water restoration fund was meant to help.

I have read only the one report in the Guardian to which the noble Baroness, Lady Grender, referred, but if these reports are to be believed, it would be entirely inappropriate for the Treasury to hijack these funds and allocate them to other—I am sure very worthwhile—causes. The fact is that, as the Minister will know, it takes time, resources and money to put a bid in for such schemes as the projects invited through the water restoration fund did. They were invited in good faith to put in these bids in April 2024. I understand that the bids closed in June 2024. They were very exciting bids; they ticked a number of boxes for wildlife and the environment, and they were also appropriate to be conducted by farmers and landowners.

I have long believed that, if the ELM and SFI schemes and the water restoration fund are to work successfully, they should benefit local communities and reward farmers for the work they are already doing. The noble Baroness will be aware of the work of drainage boards in low-lying areas such as Lincolnshire, North Yorkshire, possibly Cumbria and other parts of the country.

It sends out a very bad message from Parliament if one Government invite people to apply for these schemes and the next Government then do not allocate the money. I hope the Minister might be able to share the Government’s thinking in this regard and can confirm that these schemes are still viable and may still go ahead in short order this year.