Environment Bill

Baroness Bloomfield of Hinton Waldrist Excerpts
Baroness Hayman of Ullock Portrait Baroness Hayman of Ullock (Lab)
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My Lords, I thank the noble Lord, Lord Carrington, for the introduction to his various amendments. As he said, Clause 84 removes the need, from 2028, to pay compensation to the holders of environmentally damaging abstraction licences when those damaging licences are amended or revoked. Although we have listened carefully to the concerns expressed by the noble Lord, we believe that we should put the needs of the environment first.

The requirement to pay compensation has been a barrier to action to protect waterways, including vulnerable chalk streams, which we considered earlier today and which in some cases have dried up completely, from the impacts of unsustainable abstraction. Over the years, a number of schemes have been introduced to identify and amend the most damaging and unsustainable licences, but the need to pay compensation to licence holders when those damaging licences are amended or revoked has been a significant barrier to progress.

The Water Act 2003 removed the requirement to pay compensation to the holders of licences causing “serious damage”, but this is an extremely high bar and is therefore rarely invoked, so in practice has provided little protection to our vulnerable waterways. The Water Act 2014 recognised this and removed the requirement to pay compensation for water company licence changes altogether. This has set a clear precedent for the removal of damaging licences without compensation. It is also important to recognise that 5% of surface water bodies and 15% of groundwater bodies are at future risk, where existing licence holders not currently using their licences in full could legitimately increase abstraction, thereby causing further damage to the environment.

The timescales proposed by the Government for this change provide ample time for catchment solutions to be identified and implemented wherever possible, with licence changes considered as a last resort. We must not curtail the ability of the Environment Agency to take action to protect and improve our rivers and wetlands, but instead should increase its ability to do so effectively.

In Committee, the noble Lord, Lord Cameron of Dillington, hit the nail on the head when he said,

“the days when you can be compensated for not causing environmental degradation have, in my view, long since gone”.—[Official Report, 7/7/21; col. 1313.]

We on these Benches could not agree more; we cannot support the noble Lord’s amendments, but instead believe that the Government have got it right in Clause 84.

Baroness Bloomfield of Hinton Waldrist Portrait Baroness Bloomfield of Hinton Waldrist (Con)
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I am grateful for both contributions and for the support of the noble Baroness opposite. I thank the noble Lord, Lord Carrington, for his amendments, and for not only meeting with my noble friend Lord Goldsmith and officials over the summer to discuss his concerns but for this constructive engagement.

The measures which we are introducing in Clause 84 are absolutely necessary to protect the environment from further damage and from over-abstraction. Members of this House have spoken of the necessity of protecting our water environment, including the fish and invertebrates which live within it, as well as of the need to protect our internationally important chalk streams, on which we have already heard from the noble Lord, Lord Chidgey, and others. Ending unsustainable abstraction is essential if we are to achieve this. But as I said in Committee, we also know that abstraction is vital for food production.

The Government recognise the impacts that these changes will have on permanent abstraction licence holders and are taking all steps possible to implement the changes fairly. The changes will not take effect until 1 January 2028. This will allow time for the full implementation of our 2017 water abstraction plan and for the Environment Agency’s catchment-based approach to become embedded, working with stakeholders, including permanent licence-holders potentially affected by these new powers, to voluntarily solve issues of access to water and unsustainable abstraction.

I reassure the noble Lord, Lord Carrington, that, by contrast, water companies can already have their extraction licences varied or revoked without the payment of compensation. I hope I can also reassure him when I say that this is not, as he termed it, an arbitrary or undefined process. Excess headroom will be assessed over each year of a 12-year period, to allow for weather variations and crop rotations, and to align with the abstraction licensing strategy timeframe. The Environment Agency will assess licences within scope on a case-by-case basis, considering all relevant factors including business needs and existing and future water resource needs, as the noble Lord mentions in his Amendment 73, before deciding what action is proportionate, as the noble Lord raises in Amendment 65.

We expect the Environment Agency to use this power as a last resort, once all other options have been exhausted. But if those options have been exhausted, it is simply not right that unsustainable abstraction and environmental damage should be allowed to continue. That is why this power is necessary. Should that decision be taken, the licence holder will have a right of appeal to the Secretary of State, as is currently the case. They can put forward expert evidence should they wish to do so, which was also a concern raised in Amendment 64.

The noble Lord, Lord Carrington, asked about timing. We are working with partners, including the National Farmers’ Union, on the guidance and will publish this guidance as soon as possible. The Government have worked, and will continue to work, extremely hard to ensure that these new powers are reasonable, proportionate and just. We will continue to work closely with a wide range of stakeholders to ensure that their implementation is a smooth and fair process.

I hope that the noble Lord recognises that the Government have endeavoured to put in place necessary safeguards. We can go no further without undermining the very purpose of this clause, which is to protect the environment. I acknowledge his comments about the long-term planning for the necessity of new reservoirs. I am afraid that I have no further details and can only acknowledge that this is a long-term solution. I hope that he agrees with the necessity of that purpose and will withdraw his amendment.

Lord Carrington Portrait Lord Carrington (CB)
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My Lords, I thank the Minister very much indeed for the very considered response. Although I do not totally agree on the compensation issue—but I was never going to—I accept all the assurances and the work that has been done by Defra to help ease our concerns. I have no hesitation in withdrawing my amendment, although I will continue on the compensation issue in future discussions. I beg leave to withdraw the amendment.