Reservoirs: Protection from Contamination

Lord Douglas-Miller Excerpts

Tuesday 3rd June 2025 Lords Chamber

[Baroness Hayman of Ullock (Lab)]

I refer my noble friend to a lot of the cross-government work that is taking place regarding security and state threats. Tackling the diverse range of state threats—not just drones but many other threats—requires a cross-government and cross-society response. We need to draw on the skills, the resources and the remits of different departments and operational partners. In Defra, we work closely to look at the threats and the appropriate levels of response, specifically drawing on expert advice from the National Protective Security Authority, the National Cyber Security Centre and the Home Office, as well as carrying out threat assessment with policing partners.

[Lord Douglas-Miller (Con)]

I apologise to the House and to the Minister that in my earlier question, I did not declare my farming interests as set out in the register, and I do so now.

[Baroness McIntosh of Pickering (Con)]

Will the Minister undertake an urgent review of the Reservoirs Act 1975, which is the relevant legislation for safety in the event of a possible breach of a reservoir? There is a lack of competent panel engineers, as they are called, to undertake this work. I think the noble Lord who asked the original Question would accept that we are too reliant on large reservoirs. Will the Minister also review the de minimis rule in the 1975 Act to see whether we could build smaller reservoirs in a greater number of places?

Farmers: Competitiveness

Lord Douglas-Miller Excerpts

Tuesday 3rd June 2025 Lords Chamber

[Baroness Hayman of Ullock (Lab)]

We have a number of plans to support food production, partly through the farming road map, which we are developing. We have appointed the noble Baroness, Lady Batters, to lead Defra’s farming profitability review, which will look at things like this. We are also looking at government procurement and buying British produce, which will support British farmers. There are a number of activities that we are currently doing.

[Lord Douglas-Miller (Con)]

My Lords, within the senior Defra team—and, sadly, I include all the Defra Ministers—we do not have a single farmer or land manager. If we did, they would explain that the last Budget and recent policy changes have created a lose-lose outcome for British farmers and the British public. Is Defra monitoring the number of farms going out of business, the increase in food prices the public are having to pay and the inevitable decline of our home-grown food security?

Farming and Rural Communities

Lord Douglas-Miller Excerpts

Thursday 3rd April 2025 Lords Chamber

[Lord Douglas-Miller (Con)]

My Lords, it is a great pleasure to follow my noble friend Lord Shrewsbury. I declare my farming interests as set out in the register.

In a few short months, this Government have achieved something rather remarkable—they have made those of us who farm in Scotland feel lucky. Sadly, they have done this by completely undermining the confidence and financial security of the farming community across England and Wales with a range of poorly thought-out policies. While I concur with the many points that my noble friend Lord Roborough made in his opening remarks, I will focus on three.

First, the reversal of the badger cull will leave many in the dairy and beef sector distraught at the prospect of heightened incidence of TB and the catastrophic impact this will have on many farm businesses. From my own experience, I believe that continuing the badger cull is a key part of the UK’s drive towards eradicating TB. Can the Minister tell us whether the Chief Veterinary Officer was party to and agreed with this decision?

Secondly, the Government’s policy of reducing APR and BPR has been well discussed and the devasting impact on family farms clearly spelled out, so I do not intend to repeat that, save to say that the alleged £500 million that this will bring in represents a rounding error in the scheme of the Chancellor’s self-inflicted economic woes. Is Defra now run as an offshoot of the Treasury or does it have a mind of its own? If it is the latter, could the Minister tell us whether she was party to the decision to reduce these IHT reliefs and whether she agrees with this policy?

Finally, we have the abrupt withdrawal of the SFI, hot on the heels of accelerating the reduction in the remaining delinked payments, creating a perfect financial storm for the farming community and leaving many farmers across the UK nursing heavy losses entirely as a result of the Government’s financial mismanagement. This feels manifestly unjust and must surely be either a deliberate outcome or an unintended consequence of not understanding the implications of their decisions.

I can appreciate that the budgeting process for the various ELMS modules is more complex than the previous CAP system. A demand-led system was always going to be more complex than simply allocating the budget on a per-acre basis. This complexity is not, however, an acceptable excuse for pulling the plug on a critical funding source that underpins the economic stability of the sector. It begs the question of who has budgeting oversight in Defra and why they have they failed at such a basic level.

I know the Minister understands that farmers need clarity on their finances, so I have three questions for her. First, was she involved in the decision summarily to close down the SFI against Defra’s own guidance? Secondly, has she any oversight of the budgeting process within Defra, and if not, why not? Thirdly, does she have any knowledge of when the SFI will reopen? My final point is that if farmers are to have any chance of navigating their way through the post-Brexit transition, they need clarity and certainty. At the moment, they have neither.

One much-discussed remedy is the development of woodland, peatland and biodiversity credits, which should sit squarely within the wider environmental delivery plans. My noble friend Lord Roborough articulated that farmers and landowners need clear guidelines and positive encouragement, rather than the threat of a government arm’s-length body compulsorily purchasing their property if they do not follow Natural England’s mantra. I totally agree with my noble friend Lady Coffey’s assessment that to give CPO powers to Natural England—an organisation that is widely discredited, disliked and distrusted by the farming community—is both disproportionate and overarching. I strongly urge the Minister to look at this again before it causes serious conflict within the farming community.

Beaver: Reintroduction in England

Lord Douglas-Miller Excerpts

Thursday 27th February 2025 Lords Chamber

[Baroness Hayman of Ullock (Lab)]

As I have said, any introductions are being very carefully managed and licensed. We have a five-step management approach to beavers, which can also come in if there are illegal releases or releases that have spread into areas that are less appropriate. That five-step approach has a number of actions to cope with beaver numbers as we move forward with this programme.

[Lord Douglas-Miller (Con)]

My Lords, it is often the unplanned and unbudgeted aspects of species reintroduction that cause the conflict. In Scotland—where, like my noble friend Lord Forsyth, I live—the original beaver reintroduction study concluded that there was little impact on agriculture. Beavers were released, legally and illegally, and given full protection. The study, although technically correct, failed to mention that the reason for the small impact on agriculture was largely due to the fact that there was very little agriculture in the study area. The subsequent expansion of beaver numbers has caused conflict as they go into agricultural areas. Can the Minister ensure that any study or consultation prior to a reintroduction is comprehensive, includes a plan for problem areas and has a financial contingency?

[Baroness Hayman of Ullock (Lab)]

I reassure the noble Lord that there will be proper consultation and thorough consideration of any aspects of reports or information before any releases take place. I finish by stressing the fact that beavers bring huge benefits as well as potential risks.

Water (Special Measures) Bill [HL]

Lord Douglas-Miller Excerpts

2nd reading
Wednesday 9th October 2024 Lords Chamber

[Lord Douglas-Miller (Con)]

My Lords, it is a great pleasure to follow the noble Lord, Lord Whitty. I congratulate the Government and the Minister on making such a prompt start in addressing some of the long-standing issues associated with pollution emanating from the water sector. However, for a sector that is in dire need of significant long-term investment, strong management and increased financial stability, the overall impression the Bill gives is that the Government are anti-business, with far too much stick and not nearly enough carrot.

I completely agree that the water companies collectively need to improve both their performance and their financial resilience—areas in which they have let themselves down over the last years. The level of financial gymnastics that has so exercised the noble Lord, Lord Sikka, and the noble Baroness, Lady Jones, over the years has left the industry in a poor state to invest in the necessary infrastructure improvements and to reduce pollution incidents. Regrettably, the vast majority of those associated with this have long since departed the scene, and this Government’s desire to punish the sector through increased regulation and interference with market forces risks pushing the water companies further down the wrong road and making them less able to respond to the investment that is so desperately required.

It is not, as is often portrayed, a universally poor picture across all fronts in the water sector. In fact, on value, what customers get at the moment is really pretty good. Most get all the clean water that they can consume, and all their wastewater taken away, for little over £1 a day. What they do not get, and what they want to see, is their wastewater being managed responsibly and not illegally poured into our rivers and seas without due process. Crucially, customers do not want to see—although I fear the Bill will deliver it—increased costs and volatility in the sector.

One of the great challenges in this space is that the illegal dumping of sewage is often conflated with the legal process of sewage being released in high-rainfall events, which has been a feature of our system since it was designed by our Victorian forebears. Of course, both these outcomes are highly undesirable. Illegal dumping of sewage should rightly be penalised by strong measures, such as significant fines and bonus reductions, to prevent this happening. However, the reality is that the infrastructure requirements needed to reduce the legal release of sewage in high-rainfall events will take significant investment of time and resources.

Care should be taken by this Government to ensure that we do not create an environment where no good, top-quality executives want to go near this industry because of the draconian penalties and the random way in which government and its agencies run roughshod over the sector. Moving from where we are now to where we want to get to is a far from simple task. It will require capable and hard-working individuals to drive change through. In essence, I am saying: do not frighten the horses in a mad rush to punish an industry where those who have created the problems have long gone and those who are needed to sort it out are in short supply.

This begs the question: how was it allowed to get into this state? The answer, I am afraid, comes back to the inadequacies of the regulators. This is a serious cause for concern, as the Bill gives a whole range of new powers to the regulators, which have not shown a high level of competence to date. I ask the Minister to reflect on whether it is appropriate to give the regulators additional powers that interfere with the running of a large-scale business that they clearly do not understand.

In conclusion—to avoid repetition and in the interests of time—I support the comments made by my noble friends Lord Blencathra and Lord Remnant. In particular, I question the fit-and-proper-person test and the need to have consumer representation on water company boards. This, in my experience, will lead to conflict and paralysis in the boardroom, the inevitable slowing-down of decision-making, increased volatility and, worst of all, increased costs for the consumer.

Wild Atlantic Salmon

Lord Douglas-Miller Excerpts

Thursday 12th September 2024 Grand Committee

[Lord Douglas-Miller (Con)]

My Lords, I start by putting on record my congratulations to the Minister on her appointment. I wish her all the best in navigating her way through an interesting, diverse and sometimes thorny portfolio. I declare my interests, as set out in the register, as the owner of two salmon rivers in Scotland and as a past chairman of the Atlantic Salmon Trust.

I am most grateful to my noble friend Lord Forsyth of Drumlean for raising this important issue. It is regrettable that we have so little time, both individually and collectively, to explore it. To add a little context to this debate, I will offer a few statistics to help noble Lords visualise the extent of the demise of wild Atlantic salmon. In 1800, the population of wild Atlantic salmon was estimated at 100 million. By 1950, this number had dropped to approximately 10 million—a reduction of 90%. Today, the population sits at around 2.5 million, so, in statistical terms, we have lost 97.5% of the population in a little over 200 years. For a species that has been swimming in our rivers and oceans for more than 6 million years, that is a truly terrible result. They are now classified as endangered, and it would not be an exaggeration to say that they are on the brink of extinction.

Depressingly, the cause of this disaster is almost entirely man-made. There are, however, many ways in which the fortunes of this incredible pioneer, traveller and survivor could be reversed. Today, we will hear from many noble Lords about some of the key ways to improve salmon numbers. Essentially, as my noble friend Lord Forsyth mentioned, there are only two things that salmon need: cold water and clean water. I totally endorse my noble friend’s comments on salmon farming. I encourage all Members of this House to refrain from eating the smoked salmon on the menus here and instead to look at smoked trout, which is a much healthier and kinder alternative to smoked salmon.

Official Controls (Location of Border Control Posts) (England) Regulations 2024

Lord Douglas-Miller Excerpts

Wednesday 22nd May 2024 Lords Chamber

[Baroness Hayman of Ullock (Lab)]

My Lords, I thank my noble friend Lord Berkeley for bringing his regret Motion for debate this evening.

Speakers have raised concerns about how operating the inland BCPs will potentially make it more difficult to manage biosecurity and food safety risks. The noble Baroness, Lady Bennett of Manor Castle, went into some detail around specific concerns. The Secondary Legislation Scrutiny Committee discussed these risks with Defra, and in its response Defra acknowledged that there was a small risk because of this approach. In its report, the SLSC said:

“We agree that the use of inland BCPs does not make it more likely that harmful goods are not detected. It is a concern, however, that transporting goods and live animals from a port to be checked at an inland BCP, especially where this is located at some distance away, makes it more difficult to contain potential biosecurity risks than carrying out these checks within the compounds of a port”.


As other noble Lords have said, I would like to press the Minister on how the Government plan to manage these risks effectively, as Defra has acknowledged that there is a small risk.

As my noble friend’s regret Motion is mainly around drivers, I will concentrate on that. We know that lorries must drive 22 miles from Dover to the border control post at Sevington. Anyone found to be carrying unsafe or contaminated food could then be asked to turn around and drive back again. As we have heard, there is not enough information or instruction on what drivers are supposed to do. The Government have not explained how lorries will be monitored between the port and the control post or how they will ensure that goods which have been identified as unsafe leave the country.

I was interested in the comments from Nan Jones, the policy technical manager at the British Meat Processors Association. She has asked how we will ensure that those products get back on the ferry. With that gap, how do we know that they have not unloaded a load of products when they have been rejected? Returning a large consignment of high-value product such as meat would constitute a big loss for a business. Relabelling a product and finding an alternative market such as a wholesaler or restaurant could be tempting. She added that, once it is in the country, if you are that way inclined there are many ways in which you can disguise it.

We know that drivers need a lot of support through the changes because the impact of new border controls on drivers can be pretty significant. We know that there is increased documentation and checks, a lot of additional paperwork, that safety and security declarations, customs forms and other documentation will be required. While you need documentation to ensure compliance with regulations to prevent illegal activities, it is a lot of extra work for drivers to ensure that they are compliant with.

We also know that you could end up with longer waiting times at border crossings. All of this we have discussed at length. However, it does put a lot of extra pressure on drivers. Efficient planning and understanding of any new requirements will be crucial for drivers to deliver on time and in a manner that they should be doing. We also know that fuel costs could rise because of longer waiting times at border check points. Various businesses have raised concerns about that with us.

Drivers need to understand what is happening. These relations are evolving. How do they ensure that they adapt their processes in a way that is compliant with all the biosecurity and safety measures that are coming in? If they are not careful, quite accidentally they could end up with penalties. It is important that proper information is available for drivers.

I want to mention a letter that the Cold Chain Federation trade group wrote to Steve Barclay, the Environment Secretary. The group was concerned that volumes of illegal meat seized at Dover were a demonstration of the determination of criminals to bring in and trade in illicit goods and that

“the 22-mile corridor now open to them (or indeed, other criminals to intercept high value goods) adds further risk to the UK food chain in that it provides numerous routes to exit from the inspection process”.

The noble Baroness, Lady Randerson, went into some detail about concerns about illegal behaviour. She also mentioned the short straits routes. I will not go into that, as we discussed it at length in the last debate, but these are real concerns for industry.

There have also been concerns that the Government’s plans to manage the risks effectively and enforce the arrangements in practice are not necessarily laid out and that there is not enough understanding about how that will work. That includes whether the authorities will be able to monitor properly whether the lorries are carrying out the checks that they are being instructed to do. How is that all being managed?

What plans are there to ensure that drivers who do not speak English properly understand the information and what they are supposed to be doing? I am sure that the Government will have something in place, but it would be good to have confirmation of that.

I would like to raise one final thing. Another potential problem is that UK government computer systems used to identify potentially risky consignments are prone to errors, which could send thousands of trucks for physical inspection. According to the Financial Times, people who attended a meeting on border management with Defra said that officials admitted the error rate was currently 33%. I am not sure if the Minister was at that meeting, but it would be interesting to know if that is correct.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Douglas-Miller) (Con)]

It is absolutely a delight to be here this evening and to get such a warm and thoroughly lovely reception from everybody. I start by thanking the noble Lord, Lord Berkeley, for the privilege of standing at the Dispatch Box in this important debate, and all of those who have spoken for their thoughtful and constructive comments.

The legislation that is the subject of this debate has been instrumental in implementing the second phase of the border target operating model. New controls under the model began on 30 April, and I am pleased to report that, contrary to some of the press speculation and some of the comments made this evening quoting the press, checks have been introduced successfully at border control posts throughout the country. Defra will continue to monitor the controls and the impacts, and their effectiveness.

The noble Lord, Lord Berkeley, and the noble Baroness, Lady Hayman, asked how the Government intend to ensure that drivers of vehicles subject to controls attend the inland border control posts. Drivers will be instructed, if their goods have been called for an inspection at a border control post, by a port official at the point of entry or at the short straits through a digital system. That system comes up on their telephone, and their telephone number has to be inserted into the system for the electronic IPAFFS to actually pass; they cannot get in without that information being on the system. It cannot fail and so far has not failed.

Where a physical check is required, goods cannot be legally placed on the UK market until the load has been taken to a border control post, inspected and cleared. An instruction to attend a border control post for an inspection constitutes a legal requirement. Should a vehicle fail to attend a border control post, officials can require the return or destruction of the goods for the relevant local authority to carry out controls, such as identity or physical check. There is no evidence so far of traders taking advantage of Sevington’s inland location to circumvent checks.

The noble Lord, Lord Berkeley, also asked what a consignment is. It is a range of goods covered by the same certificate, which is pre-filled to enter the country through any of the border control posts.

The noble Baroness, Lady Bennett, took some delight in telling me that that we were failing on pretty much every single front in the system that we have implemented. She gave me a few examples, which I did not recognise. I am sure she would understand that this is a very significant change to what has gone on before. We have not ever done checks at our borders, or at least not for a very long time. The imposition on businesses importing into this country is significant, and the Government are well aware of the cost and the time and trouble this will cause. At the same time, I think that she would agree with me that it is extremely important that we do this for our own biosecurity. There are multiple reasons, which I think we would collectively agree on, for why we are doing this.

For many years, we have done nothing. We are now starting to build up our new border controls and biosecurity controls. To go from nothing to everything in one go would undoubtedly have created the scenarios the noble Baronesses, Lady Randerson, Lady Bennett, and others keep telling are happening at the moment. They simply are not, and I gave a clear instruction at the beginning of the process that we want a pragmatic approach. We are not in the business of closing down UK business, but we have an imperative to check and to build up those checks over a period of time, taking a risk-based approach. It is not helpful to be told that we are not doing everything we should be doing. Of course we are not: we are in week two. We may be doing everything in a few months’ time, and perhaps somebody else will be standing here at the Dispatch Box answering questions on that. I think and hope that they will see the benefit of taking a pragmatic approach, because we do not want to stop trade in this country.

The noble Baroness, Lady Bennett, said that she felt that there were not adequate staff at Sevington—it is not “Severington”, just for information. I am not sure whether the noble Baroness has been there, but I have. I have spoken to the staff and seen them operating there, and I can tell her that it is working very well and is fully staffed, so I do not recognise the comments that were made.

There were comments too about getting from Dover to Sevington, which is 21.7 miles away, and the risk that might constitute. Of the goods coming in to Sevington, 99.9% are from organisations we trust and know; it is a formality to check that there has not been a mistake, and that we are not inadvertently bringing in some pest or disease. The people coming to Sevington are not looking to import things illegally into the UK; they are following our rules. They have export health certificates, have followed the whole system all the way through and have loaded everything up on to the system; we are simply checking that all those formalities have been done correctly.

We should not conflate that with the illegal importation of meat that comes in primarily, but not exclusively, through Dover, which is brought in by a van and a driver from Poland, Romania or somewhere else. Those people will never go to Sevington: they are not on our system and we do not even know they are coming. It is really important to avoid conflating those two things. If you do, you get very confused about what Sevington and every other border control post in the UK is trying to do. Stopping illegal imports is the job of Border Force at the border. Checking goods that are coming in through our prearranged system is the job of our border control posts. They are fully manned and fully operational across the entire country.

The noble Baroness, Lady Hayman, asked me about an error rate of 33%. That number is not familiar to me—I have never heard of it—so I will go away and check. If the rate is anywhere near that, I will certainly write to the noble Baroness.

With that, I will conclude. Once again, I thank all those who have spoken this evening for their thoughtful and valuable comments.

[Lord Berkeley (Lab)]

My Lords, I am very grateful to all noble Lords who have spoken in this short debate. It has been very interesting; so many examples from different parts of the importing world and cargoes have been cited. I am grateful to the Minister for his response, because he clearly disagrees with many of the issues that have been raised. He may be right that it is short-term.

I will make a couple of points. First, I think he said it in the previous debate, but the Minister mentioned again drivers in white vans from Romania. I used to live in Romania, about 50 years ago; I was working there. It is a member of the European Union, like so many other member states, and has just as much right to being treated with dignity and respect, and speed, as people from other member states. A lot of people criticise meat from Poland—

[Lord Douglas-Miller (Con)]

I wonder if I might comment. I absolutely agree that anybody from Romania or Poland, or indeed any other country in the world, has the right to be treated in a dignified way. But the fact of the matter is that, in Romania, African swine fever is running riot. It might be in Europe, but it could be any other part of the world. The point is that we do not want African swine fever. If you import illegal pork into this country, you will bring African swine fever with you at some point.

[Lord Berkeley (Lab)]

I am grateful to the Minister. We will have to see. Where I live in Cornwall, there is a boatyard next to me that builds fishing boats, and it has about 15 Romanian welders—legally, I should say —and they are bloody good welders. The fact remains that we are importing most of these goods from the European Union, and I am sure the Minister agrees that everybody will be treated equally.

My main concern, which several noble Lords have raised, is when things go wrong. Whether or not there are enough staff we can go on debating until the cows come home, but government IT systems have a habit of not always being 100% successful. This is probably something for the next Government, but the Minister can keep on thinking about this for the next few days: what is the fallback situation when it goes wrong? In other words, is there a manual system that will keep the goods moving while somebody sorts out the computers?

We will have several months when there will be a lot of press about this, and there will be no Ministers to answer questions, so we will all watch it with interest. Somebody or other in this Chamber will be on the other side of the fence at that stage, and will be able to answer criticism. If it is the present Minister, then in Opposition, I am sure he will enjoy that.

It has been a very useful debate. I am grateful to all noble Lords who have spoken and to the Minister for his very comprehensive reply. I beg leave to withdraw the Motion.

South West Water: Brixham Contamination

Lord Douglas-Miller Excerpts

Wednesday 22nd May 2024 Lords Chamber

[Baroness Hayman of Ullock (Lab)]

My Lords, recent events in the Brixham area have once again highlighted the sorry state of the water sector, yet just this week water companies in England and Wales have asked the regulator for permission to increase bills by up to 91%. They say that this is necessary to improve the water network, something that Professor Chris Whitty says is a public health priority as well as an environmental one. This pressing need has not prevented United Utilities increasing its dividend payments by nearly 10% while at the same time polluting Lake Windermere. Other firms are increasing payouts to investors despite their poor performance. Is it not time for the Government to call time on the current system by putting water companies into special measures and ensuring that law-breaking bosses face criminal charges rather than receiving bumper pay packets?

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Douglas-Miller) (Con)]

I thank the noble Baroness for her question. We have debated a number of times the issue of special measures, and I think I have been clear in the House every time I have stood at the Dispatch Box that the Government will use special measures when the criteria for them are met. I accept that that is quite a high bar, but there are a number of other options for all those water companies that they should fully explore before the Government will consider putting them into special measures.

[Baroness Bakewell of Hardington Mandeville (LD)]

My Lords, the first television news on the Brixham infection indicated that contamination was contained to those already infected. The next day’s bulletin retracted that statement, telling viewers that the area of contamination had widened. Bottled water was available to some, but not all, living in that area. As the source was known to be a reservoir contaminated by animal faeces, why was action not taken sooner to alert people to the dangers of drinking their tap water and to provide everyone with bottled water?

[Lord Douglas-Miller (Con)]

I am always nervous of taking as fact what I read in the papers or listen to on the news. I have spent the morning speaking to the chief inspector of the Drinking Water Inspectorate and he is not able to tell me what the noble Baroness has told me. I am just guessing that he might have slightly better access to that information. It is dangerous to say with that level of assertion that that is what has happened, because it is not what I am hearing. It is a live investigation and I cannot go into the details of what I have been told. I can say that South West Water has been handing out bottled water and in many cases over the last week it has been prioritising priority service customers and vulnerable sites. It has opened three bottled water stations, at Broadsands car park, Freshwater Quarry car park and Churston car boot field. It is supporting both vulnerable areas and local residents with bottled water.

[Lord Deben (Con)]

My Lords, I remind the House of my previous interests—no longer—as chairman of a small water company; therefore, I know a bit about it. I hope that my noble friend will insist that the water companies behave properly, of course, but will he please remind the Opposition that when it was run by the state and municipalities, we had no investment at all? That was why it was privatised, and not for any other reason. In the years after privatisation, a great deal of investment has taken place. The problem was that both Governments—Tory and Labour—told the control, which started off with Mr Byatt, that he was to keep prices down instead of allowing the kind of investment that we need. You do not get water free, and we have to have proper investment.

[Lord Douglas-Miller (Con)]

My noble friend must have the same pack as I have in front of me because he has virtually said word for word what is in mine. We have discussed the issue of privatisation many times both in this House and in other debates and that is not a route that this Government are going to go down. I completely concur with what my noble friend has said.

[Lord Boateng (Lab)]

My Lords, in Scotland, real bills are still the same as they were 17 years ago, while English bills have increased by over 16% in real terms over the same period. The publicly owned Scottish Water invests over one-third more per capita in its water industry and supplies than any private English company. That is £282 per household over the last 17 years compared to only £210 per household in England. Does not one conclude from that that publicly owned companies are doing better than privately owned ones? If that is not the Minister’s conclusion, how does he explain the differential?

[Lord Douglas-Miller (Con)]

The noble Lord has some very impressive statistics on Scottish Water. I happen to be the beneficiary of Scottish Water because I live up there. It is not quite as rosy as he tells us, because one area on which we have made great progress in England has been storm overflows and monitoring and understanding exactly what is going into our river systems. If the noble Lord was to look at that area in Scotland, he would find it very deficient.

[Baroness McIntosh of Pickering (Con)]

My Lords, does my noble friend agree that the water companies play an important role as owners of agricultural land? It is extremely important that we get to the bottom of what caused this incident to ensure that tenant farmers know exactly what their position is concerning South West Water and the Brixham contamination, as well as other landowners.

[Lord Douglas-Miller (Con)]

I completely concur with my noble friend that it is critical that we get to the bottom of what has happened to have generated this outbreak of cryptosporidium. It is currently far too early to know the exact cause of the outbreak. South West Water is continuing its investigations to confirm the source of the contamination. The Drinking Water Inspectorate has initiated its investigation into the cause, extent and actions of the company and begun collecting evidence on site. I should point out that it is the Drinking Water Inspectorate which is taking the lead on this investigation.

[Lord Whitty (Lab)]

My Lords, is not this instance a failure of the central role of the water companies to deliver clean and healthy water to every household? In the days before privatisation, we used to pride ourselves on our water and decry foreign water. Whether that was true or not, this is a central failure of regulation. There are three regulators of the water industry. We need to have a new start on regulation of water, with a single regulator for it, if we are not to have renationalisation. On the point of renationalisation, I know that my Front Bench, as well as the Government, are not in favour of it, but I note that the largest shareholder in Thames Water wrote down its shareholding to nil. If the rest of the shareholders, which are very guilty in this, did the same then the cost of nationalisation would be pretty small.

[Lord Douglas-Miller (Con)]

The noble Lord is quite right that the Canadian pension fund’s owners wrote down the value of its shareholding in Thames Water to zero, but that of course does not mean that it is zero. I am not sure that would help him in terms of its privatisation.

[Lord Redesdale (LD)]

My Lords, there is quite justifiable anger at the way that some companies, including Macquarie, have dealt with taking money away from water companies. The problem highlighted in the south-west is that there is an enormous amount of anger in the country towards water companies. However, this has led to an increase in the amount of abuse and actual physical assault that workers in the water companies are facing at the moment, as has been highlighted by some of the work of the GMB. Could the Minister make sure that, when MPs or others discuss this issue, they should commend the work of those people on the ground rather than the higher issues that are causing problems?

--- Later in debate ---

[Lord Douglas-Miller (Con)]

I completely concur with those statements, because it is absolutely unacceptable that those who are sent out to sort a problem end up being abused and given a tough time for something which cannot conceivably be their fault. I totally accept that and will ensure that we take that message back.

Agriculture (Delinked Payments) (Reductions) (England) Regulations 2024

Lord Douglas-Miller Excerpts

Tuesday 21st May 2024 Lords Chamber

Moved by

[Lord Douglas-Miller]

That the draft Regulations laid before the House on 16 April be approved.

Relevant document: 23rd Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 20 May.

Motions agreed.

Water Companies: Failure

Lord Douglas-Miller Excerpts

Tuesday 21st May 2024 Lords Chamber

[Baroness Jones of Moulsecoomb]

To ask His Majesty’s Government whether they have a plan for Thames Water and other water companies if they fail.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Douglas-Miller) (Con)]

My Lords, I declare my interests as in the register. As set out in statute, if a water company became insolvent or were in serious breach of its principal statutory duties or an enforcement order, it would enter special administration. The statutory purpose of special administration is to ensure that the company continues to operate and that customers continue to receive their water and wastewater services.

[Baroness Jones of Moulsecoomb (GP)]

I thank the Minister for his Answer, but it does not sound like much of a plan—there is not much detail there. I declare an interest as a member of the advisory board of River Action. I will put a plan forward; I am happy to share it with the Government because it is better than that one. The plan is that, as soon as any water company fails—and several are looking as if they are on that path now—we take it back into public ownership. We do not make taxpayers and bill payers pay extortionate amounts—we would keep it very cheap; I can explain how—and we stop the pollution as soon as possible, because we have all had enough.

[Lord Douglas-Miller (Con)]

I thank the noble Baroness for her very comprehensive plan and look forward to talking to her in detail. In the meantime, I assure her that the Government and Ofwat, the financial regulator of the water sector, carefully monitor the situation. Ofwat continues to engage with Thames Water to support it in improving its resilience within the context of its licence and broader statutory obligations. Fundamentally, it is the companies’ responsibility to continue to raise capital, and they should continue to explore this while fulfilling their statutory obligations of providing water and wastewater services to their customers.

[Baroness Bakewell of Hardington Mandeville (LD)]

My Lords, the noble Lord referred to the statutory instrument that sets out the action to be taken when water companies are teetering on the verge of bankruptcy, which was debated on 19 February and subsequently passed in the Chamber. The mechanisms are there, so why are the Government havering over implementation and allowing inadequate management of this vital asset to degenerate on a daily basis?

[Lord Douglas-Miller (Con)]

My Lords, there is a high bar for the imposition of a special administration regime. A variety of options remain available to Thames Water in securing additional finance and it is vital that all of them are fully explored. The Government are prepared for a range of scenarios across our regulated sectors. If it becomes clear that any company will become insolvent or can no longer fulfil its statutory duties, we will not hesitate to use our powers to request the court to place it into special administration.

[Lord Dubs (Lab)]

My Lords, the wording of the Question is “if they fail”. Does the Minister agree that on seeing on our television sets the excrement coming into our streams and rivers so frequently, most people in the country would say that the water companies had already failed?

[Lord Douglas-Miller (Con)]

I do not actually agree with the noble Lord fully. I accept that a number of the water companies are not performing to the right standard. The Government have been very clear that what is going on is unacceptable, but there is a huge legacy issue here. Simply renationalising water companies or stopping their chief executives from getting their pay, bonuses and all the other things—as is now in place—is not going to solve that problem straightaway. It is a long-term legacy issue which the Government have a fully funded plan to address.

[Lord Sikka (Lab)]

My Lords, in 1990, Thames Water had net assets of £1,329 million. By 2023, they had increased to £1,435 million, which is a paltry increase of 8%, or a total of £106 million, mostly due to accounting abuses. This means that, over 33 years, Thames Water shareholders have provided little or no new equity at all, which is a major reason for its financial instability. Everyone knows that Ofwat is negligent and incompetent; what is the Government’s excuse?

[Lord Douglas-Miller (Con)]

The noble Lord cited a number of very detailed figures, which I know he is prone to doing, so forgive me if I do not know the detail on that. Since privatisation, the private water sector model has unlocked about £215 billion of investment. This is the equivalent of around £6 billion annually in investment—almost double the pre-privatisation level. This has delivered a range of benefits. Our bathing waters continue to improve—in 2023, almost 90% were classified as good or excellent. Water companies have invested £25 billion to reduce pollution from sewage and water company investment in environmental improvements has been scaled up to over £7 billion since 2020.

[The Lord Bishop of St Albans]

My Lords, could the Minister reassure the House that should any of the water companies fail, the ongoing monitoring of, for example, run-off from agricultural land—which is devastating many of our rivers, including the important chalk streams in Hertfordshire in my diocese—will continue, that we will continue to seek to find improvements, and that no momentum will be lost?

[Lord Douglas-Miller (Con)]

I absolutely assure the right reverend Prelate that this would be the case. If a water company were to go into administration, the special administrator would take control of the company and it would be regulated in exactly the same way as any other water company and subject to all the same environmental rules and regulations.

[Lord Grade of Yarmouth (Non-Afl)]

My Lords, we have reached the end of a long period of very low interest rates, during which the regulated utilities have taken on a great deal of debt. That was not a problem when interest rates were so low but, now that interest rates have risen, does the Minister think it time that the regulators of those industries took a keener interest in the balance sheets of the regulated utilities?

[Lord Douglas-Miller (Con)]

The noble Lord raises a very good point. Undoubtedly, mistakes were made in how water companies reacted over the past 10 or so years, when interest rates were very low. Now that interest rates have risen, so have the costs of the borrowings, which have created a number of difficult financial implications for them. However, we all hope that interest rates are falling.

[Baroness Hayman of Ullock (Lab)]

My Lords, my noble friend Lord Dubs mentioned contaminated water, and there is now evidence that faeces-contaminated water has been detected in 10 areas of England and Wales. Is the Minister absolutely certain that nobody here today has drunk contaminated water?

[Lord Douglas-Miller (Con)]

I will just drink this glass of water—bottled water. I assure the noble Baroness that it is very good.

[Noble Lords]

Oh!

[Lord Douglas-Miller (Con)]

The noble Baroness raises a very serious point, despite all the laughter. One recent example of contaminated water has been extremely challenging, but the water company has responded pretty well. The Defra team went down there, and we have been in constant contact with South West Water. As noble Lords might expect, we have launched an investigation into the cause, and I hope that we will have the answers soon.

[Lord Fox (LD)]

My Lords, the Minister cited a number of figures, but one he did not cite is that, since privatisation, the shareholders of 10 water companies have withdrawn £85 billion that could and should have been invested in the water industry. Whatever happens, can he undertake that those shareholders will not benefit further from the catastrophe happening to our waterways across the country?

--- Later in debate ---

[Lord Douglas-Miller (Con)]

The noble Lord makes a very good point, which was touched on by the noble Lord, Lord Grade, on the behaviour of some of the previous shareholders and owners of water companies. I apologise for their behaviour—as do the Government—because I wholly agree with the noble Lord, Lord Fox, that it was not well done. I very much hope that the controls put in place since then, and the lessons learned, will satisfy him going forward.