Water Industry (Financial Assistance) Bill

Alison Seabeck Excerpts

Wednesday 14th March 2012 Commons Chamber

[Dan Rogerson]

It is a pleasure to serve under your chairmanship, Mr Hoyle. I follow the hon. Member for Thirsk and Malton (Miss McIntosh), whom I customarily refer to as “Madam Chairman” in the Select Committee. Obviously, it is a delight still to be considering this Bill. We are doing so rapidly, in order to make progress and get it on the statute book, so that it can start delivering fairness for my constituents and those of other Members across Devon and Cornwall, and so that we can start putting in place the framework for the necessary works here in our capital.

Although the amendment and the new clause proposed by the hon. Member for Luton South (Gavin Shuker) present a number of opportunities for discussion, they will not necessarily take us that much further forward. The amendment makes a reasonable point: if in future the Secretary of State or any other Secretary of State wishes to use the enabling powers of the Bill to make a difference to another part of the country that seems to have been disadvantaged, that should be explained to the House. I would have thought that it would be extraordinary, however, for such a thing to happen without a great deal of public debate or decades of campaigning, such as that which we have experienced in Devon and Cornwall. Perhaps other parts of the country might have such a keen hold on the Secretary of State or any future Secretary of State that they could get it all pushed through within a matter of weeks, but I suspect that that would not be the case. The Treasury would want to know very plainly and in great detail why the money was required and why it was felt to be a priority.

[Alison Seabeck (Plymouth, Moor View) (Lab)]

From a south-west perspective, the money we are getting is clearly welcome. As the hon. Gentleman has mentioned, other parts of the country might have demands, and given drought measures and so on, there might be reservoirs or other very large schemes in small areas that might impinge on us as our water bill payers could be asked to pay towards the costs. That would not be unreasonable, as we are expecting the payment to go the other way. Does the hon. Gentleman share my concern that, as the hon. Member for Thirsk and Malton (Miss McIntosh) mentioned, the money is not ring-fenced and how it is spent in future will be at the discretion of the Secretary of State?

[Dan Rogerson]

The hon. Lady is referring to the money identified for the south-west, and the worry that it might, to use a watery phrase, be diluted and spread out across the country. I suspect that that could potentially happen, but I know that the coalition Government are absolutely committed to seeing this provision through for the people of Devon and Cornwall. Who knows what might happen under a future Government? I hope that they would take the plight of our water bill payers equally seriously and continue that level of support. The hon. Lady makes an interesting point.

As I understand it, the amendment seeks to ensure that if a Government wished to offer such support to further areas, a statutory instrument would have to be tabled and debated. I find it hard to believe that any Government would consider doing such a thing without a debate not only in this place but out in the country at large and, I am sure, a debate in the Treasury too, which would have to be conducted publicly as well as privately. I know that that has been the case with the programme we now have for Devon and Cornwall. Although I accept the logic of what the hon. Member for Luton South said, I will wait to hear what the Minister has to say in reply before I decide what approach to take. Naturally, I want to support the Government—as I would on every occasion, but particularly as regards the provisions in this Bill.

The new clause concerns social tariffs and the next steps that we might want to take to help people who are under water stress, which, as the hon. Gentleman pointed out, will still be a significant problem for people in the south-west after the support set out in the Bill is delivered. Of course, water stress is also a worsening problem in other parts of the country.

I am delighted to see that the hon. Member for Wakefield (Mary Creagh) is in her place. On Second Reading, when we debated this subject, I intervened on her and made the point that any social tariff within a water company area presents problems as well as opportunities. If there is to be a social tariff at a significant level for those experiencing the worst problems in an area such as the south-west, despite the fact that many people will benefit we must be aware that within an area with a small population, a huge amount of the funding for the tariff will be provided by people just above the qualification threshold. I am very worried that in-region social tariffs will be unable to deal with the problem. When the hon. Lady set out where she would like the Bill to be improved, she said that she would do something about national water tariffs. It is a shame that we do not have such a provision and Devon and Cornwall MPs have put the matter before the Government. I understand that there are issues with the Treasury’s response, as that might be regarded as a tax, but we must consider how we can address that situation.

I do not see how a league table will help, however. Indeed, it might mean that water companies were under pressure to introduce the tables in such a way that it might disadvantage those people about whom I was talking—those just above the threshold who will not benefit from the tariff but whose water bills will increase to pay for their hard-pressed neighbours.

--- Later in debate ---

[Richard Benyon]

I am grateful to my hon. Friend for making that point. It shows when one prays in aid an organisation, one has to do so in the context of all the evidence that has been given by it to many organisations, not least a Select Committee of the House.

We want companies to be imaginative in the way they tackle affordability in their areas, not to force them into a straitjacket. Our guidance will not dictate eligibility criteria, the level of concession or the amount of cross-subsidy. It will give companies the freedom to make judgments, with their customers, on what can work in their areas. This addresses the point made by my hon. Friend the Member for Thirsk and Malton (Miss McIntosh). Social tariffs are a new tool in the tool-kit for companies, but they are not the only tool. Companies have many other effective tools—for example, win-win tariffs, which are self-funding from savings on bad debt and do not rely on cross-subsidies. They have trust funds, as has been mentioned, which are set up by the company to pay off the debts of those most in need, as well as payment plans and referrals to holistic debt agencies such as Citizens Advice, arrangements made locally that really work.

We must not see a social tariff as the only show in town. There are no state secrets here. The information from water companies about the social tariffs that they develop will be produced in negotiation with DEFRA, working on the guidance that we will publish in a few weeks. The proposals from the water companies and the decisions that DEFRA makes will be available for scrutiny.

[Alison Seabeck]

This is slightly tangential. The companies are working to tackle unaffordable water charges, but there is one thing that they probably cannot deal with, which was mentioned on Second Reading by one of the Minister’s colleagues and by me. Once the £50 payment comes through the system, which will help most people on low incomes, the companies will not be able to guarantee that it goes to the person who pays the bill. Instead of going to the vulnerable party, the money may be going to a park home owner who is not reputable, or a private landlord. What discussions has the Minister had, perhaps with the Ministry of Justice, about whether it would be a criminal offence—a fraud—if the park home owner did not pass the money on?

[Richard Benyon]

The hon. Lady could lead me down a long path of personal frustration on this subject, which I am happy to share with the Committee. I have a number of park homes in my constituency. Some are well run. It is a style of living that we across the House should encourage because it allows people at a certain age to release some capital and live in a smaller dwelling surrounded by people in similar circumstances, but there are too many park home owners who are appalling human beings. Various Governments, including this Government and the Government whom the hon. Lady supported, have sought to address this. I am working with my hon. Friends in the Department for Communities and Local Government to ensure that the alternative arrangements that the Government are making for park homes will be fit for purpose.

I thank the Committee for that bit of therapy. I can assure the hon. Lady that we intend the £50 to get to precisely the people whom she describes. I am happy to talk to anyone. In my Department we are keen to make sure that that money is not siphoned off by anybody and gets to the householder, even if that householder is a park home owner on a site owned by somebody else.