Flood and Water Management

Debate between Anne Marie Morris and Anne Main

Thursday 8th September 2011 Westminster Hall

[Anne Marie Morris (Newton Abbot) (Con)]

I add my voice to the voices of others who have commended the work of my hon. Friend the Member for Thirsk and Malton (Miss McIntosh) and her Select Committee. The Committee’s report is an excellent piece of work and it is thoroughly welcome.

As a Member who represents a constituency in the south-west, it will come as no surprise to people that I wish to speak today about water charging. The water charges in the south-west are the highest in the country, with an average bill of £517. I am afraid that that figure is rather higher than the one given in the Select Committee’s report, which puts the figure for the south-west at £490. At £517, the average bill in the south-west is 43% above the national average for water charges. Although I understand the points made by the hon. Member for Llanelli (Nia Griffith) on the challenges that she faces in Wales—I absolutely empathise with her—the south-west has 30% of the country’s coastline and 3% of the population, so the burden that we bear is exceptionally great.

Unfortunately, in addition we also have a large amount of sewage pipework inherited at privatisation without the adequate funding to get it into the state that is required. The problem was inevitably exacerbated by the bathing water directives, which were not foreseen and which have created all sorts of challenges for us in the south-west. The problem in the south-west is very significant.

Possible solutions have been considered by a number of different bodies. I commend the Walker report, which came out with a number of very good options. Equally, Ofwat came up with some good options. I will not go into the details of those, because they are well rehearsed in the Select Committee report. I am pleased to say that DEFRA has consulted on a solution. Of the four areas that were looked at, information on three of them was included in the DEFRA consultation. With the interests of the people of the south-west at heart, I will comment only on those options, which I hope will inform the Minister in his thinking when he comes to draft the water Bill, which I, like others, am keen to see sooner rather than later.

The first suggestion related to social tariffs. Whatever else we do, we certainly need to get a social tariff in place that works properly. The current tariff, WaterSure, is a good start, but unfortunately it does not protect some of the most vulnerable people in our society. Come what may, it needs to be reviewed. The suggestion that the social tariff be transferred to a central pot rather than continue to come out of the individual water companies’ pots is a good one. If that happened, I would want the water companies to take a sensible approach locally, to do what is right to meet the particular and peculiar needs in their own part of the world.

The second option considered was rebalancing who pays for what within the south-west itself. Given the overall unfairness of the settlement at privatisation—I am sure that that unfairness was not intended and that it was just one of those unfortunate consequences—rebalancing within the south-west itself is not something that any south-west MP would view with any comfort. Paying south-west Peter by robbing south-west Paul is not the solution, I think. Other suggestions include rebalancing sewerage charges and the business community paying a higher share, but tourism is crucial for us, so any rebalancing of that nature would certainly be most unwelcome—I am sure that the Minister recognises how unwelcome it would be.

I was interested that the third option put forward by Anna Walker in her report was not in the DEFRA consultation; in fact, I was very pleased that it was not in the DEFRA consultation. That option was to cross-subsidise the south-west from water-charge payers in other water company areas. The Minister, in ruling out that option, said that it would be quite inappropriate to take money from an individual in Newcastle who was on benefits to provide a subsidy for a water-charge payer in the south-west who may well be a millionaire. I say gently to him that perhaps he does not fully understand that the average income in Devon is actually £2,964 lower than the national average. Contrary to what too many people believe, the south-west is not a countryside of cream teas and beautiful cows, in which we all sit eating our strawberries and cream. The area is very rural, but we have a number of very deprived areas and the highest number of retirees and pensioners in the country. There is not a large number of millionaires sitting in the south-west, waiting to be bailed out by those in the north who are less well off.

The final option in the DEFRA consultation was one that I very warmly welcome. If I have one message for the Minister today, it is, “Yes, please, that is exactly what we want.” It is the suggestion that the Government put a £40 million subsidy behind South West Water bill-payers, which would effectively knock £50 off each bill-payer’s bill in the region. That would not only be welcome but, in the current circumstances and given the history, it would be the right and fair thing to do, because even though, if that subsidy were given, people paying water rates in the south-west would still have the highest water rates in the country, they would at least be less badly done by than they are now.

We need to look carefully therefore at what we do. It would be nice to see a “Benyon report” suggesting that the Bill include the adoption of the £40 million subsidy but, as the hon. Member for Llanelli pointed out, there is an ongoing challenge for those of us whose constituencies have long coastlines, and that is a challenge for the Government. If I might be so bold, given that two more directives on water quality will come from Brussels sooner rather than later, we should consider the matter urgently, rather than wait for the water Bill after the forthcoming one.

The Government have bravely already looked at the relationship between the taxpayer and the private sector in other areas. They have considered renegotiating some of the private finance initiative contracts that were biased against the taxpayer because the risk had not been properly assessed at the time they were entered into. Likewise, they have looked at the relationship between the taxpayer and the banks. Now might be an opportune moment to look at the relationship between the taxpayer and the water companies. I am sure that there would be all sorts of legal challenges and hurdles to overcome, but that does not mean that it should not be done. For water authorities that face particular challenges as a result of the water quality directive—for example, where the percentage increase would be very difficult for the local community to bear, a cap on above-inflation rises allowed by those companies might be considered in the annual review. That is something for the Minister to think about.

I shall turn very briefly to flooding. The Minister knows very well that it is a subject that is also close to my heart. I have to thank him for what he has done to ensure that I have flood defences in Shaldon and hopefully—subject to planning consent—in Teignmouth. Flood prevention is critical, and I pay tribute to my hon. Friend the Member for Thirsk and Malton for the careful and thorough analysis she set out at the beginning of the debate. She hit the nail absolutely on the head. If, as evidence seems to bear out, for every £1 we spend now we effectively save £8 in the future, flood prevention must be a key priority, and I am glad that it was presented as such in the national infrastructure plan.

I share some of the views that other hon. Members have expressed about the best solution. In planning policy, although the report makes it clear that it would be inappropriate to ban building on floodplains, developers have done very well from building on such land without having to contribute to the windfall, so there is an argument for reviewing the planning rules and regulations with a view to possible limits on building on flood plain. In insurance, which is the second key issue in the flooding debate, the renegotiation of the statement of principle that will lapse in 2013 needs to involve all parties, and not be seen as a matter for just the Government and the insurance industry. Developers and other beneficiaries of changes ought to play their part.

Those are the key points that I wanted to make today, and I am grateful for the opportunity to debate this crucial matter.

[Mrs Anne Main (in the Chair)]

Before I call the next speaker, I remind everyone that the winding up speeches start at five minutes to 5. I call Priti Patel.