Food Banks
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Lord De Mauley
I think I have just answered that, my Lords. Britain has a great tradition of charitable giving, and it would be a great mistake to interfere with that.
Baroness Parminter (LD)
Can my noble friend say whether the Government have any plans to commission any of the research indentified in the conclusions of his own department’s recent review of food aid in order to inform and support the voluntary groups providing food aid?
Lord De Mauley
My Lords, we are not proposing to record the number of food banks or the potential number of people using them or other types of food aid. To do so would place unnecessary burdens on the wonderful volunteers trying to help their communities. The report is a useful summary of evidence from providers and charities. The provision of food aid ranges from small, local provision through to regional and national schemes. The landscape is mostly community-led provision responding to local needs. It is not the Government’s role to tell them how to run the services they provide.
Japan: Dolphins
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Baroness Parminter
To ask Her Majesty’s Government what discussions they have had with the government of Japan about the practice of capturing and slaughtering dolphins in Taiji.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley) (Con)
My Lords, my honourable friend George Eustice, the Minister responsible, wrote to the Japanese Fisheries Minister on 9 February to reiterate our opposition to hunting all cetaceans, except for limited activities by indigenous people for defined subsistence needs. Our ambassador had written to the Japanese Foreign Affairs Minister on 24 January to set out our position. The Japanese Government are in no doubt as to the strength of feeling here, nor about our policy against these hunts.
Baroness Parminter (LD)
I thank my noble friend for that Answer. Are the Government seeking to co-operate with other countries and civil society organisations to evaluate what measures can be taken using international conventions to which we are signatories, in order to end the unnecessary suffering of this trade?
Lord De Mauley
My Lords, I agree strongly with my noble friend that working within international agreements such as CMS and CITES, and with the IWC, is the way to achieve our conservation goals. We already work closely with other like-minded Governments and civil society organisations, including on whale and dolphin conservation, in these fora and we continue to press for enhanced co-ordination and communication between them to ensure that they co-operate to provide an effective and long-term framework for the protection of cetaceans globally.
Forestry: Independent Panel Report
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Baroness Parminter (LD)
I add my thanks to those of my noble friend to the noble Baroness, Lady Royall, for securing this debate today and for being such a formidable champion on behalf of our precious trees.
The noble Baroness said that there was strong support for the Government’s forestry and woodlands policy statement in January last year, which set out a clear vision for expanding England’s woodland cover while protecting our trees from the ever-increasing range and scale of threats, recognising that woodland assets would deliver benefits for society and the environment as well as contributing to economic growth. A commitment to legislate for a new forestry body was a central plank in the delivery of that vision.
The stakeholder consultation closed on the funding, governance and purposes of our new body. The presentation to the National Forestry Stakeholder Forum on 29 January outlined, as the noble Baroness, Lady Royall, said, the 10 core principles underpinning Defra’s plans. While they were broadly welcomed, they left much unsaid. Big questions remain about the contractual relationship of the body with Defra, and the body’s remit, scope and duties. I add my voice to hers in asking when the Government intend to bring forward a draft Bill to allow for necessary pre-legislative scrutiny.
It is clear that woodland and forests offer good opportunities to deliver manifold environmental and public goods, from carbon capture to providing habitats for wildlife and flora, and places that people want to share. They want to go out and explore our glorious countryside. At a time like this, we should not forget how afforestation can help to reduce the risk of flooding.
I want to pick up on one of those 10 principles outlined to stakeholders on 29 January—that the new public forestry body should be a pioneer in natural capital accounting and payment for ecosystem services. As the Woodland Trust said, this is an opportunity for the forestry sector to,
“demonstrate its value to society”.
One way to ensure that development does not lead to erosion of natural capital assets is a well designed biodiversity offsetting scheme. The Government’s Green Paper consultation on biodiversity offsetting is now concluded. Liberal Democrats are clear that the guiding principle for any offsetting scheme should be that there is a net environmental and biodiversity gain. Equally, and in contrast to the views of the Secretary of State, habitats such as ancient woodlands are irreplaceable, and as such should not be included in any scheme.
Decisions about biodiversity offsetting are important for the future of the public forest estate, given that it has huge potential to provide offset sites for any market-based scheme. It is ideally placed to deliver landscape-scale projects and the wider benefits that they can deliver. The Lawton report in 2010 made clear that nature areas that are linked together have a greater ecological value than similar areas of natural environment that are broken up and separated. This view was endorsed in the Government’s 2011 environment White Paper. Given its importance to the future of the public forest estate, can the Minister say when the Government will make clear their intentions about introducing a biodiversity offsetting scheme?
All three legislatures in England, Scotland and Wales are keen to see substantial levels of new woodland planting over a substantial period. It is important that non-market values are taken into account in decisions about the future locations of Britain’s new woodlands, thereby ensuring that we maximise the value for agriculture and timber outputs, climate change mitigation and recreational opportunities. This would make a reality of the threefold mandate, as outlined in the core principles for the new public forestry estate of enhancing the estate for the benefit of people, nature and the economy.
If we do not do that, we face the danger of locating new forests in areas that do not deliver all the benefits that society and the economy need. We could pick locations, for example, that maximise value of timber production but do not help tackle flooding in key catchments, or maximise greenhouse gas capture but do not help to increase recreational opportunities near our major urban conurbations. Such decisions need to be looked at using the right decision-making framework, and I therefore look forward this spring to the annual update from the Natural Capital Committee, set up by this Government, on its work in ensuring that natural capital accounting is embedded in decision-making. The successful completion of that work could be as important in delivering the future we all want for our British forests and woodland as the legislation necessary to put the public forest estate on a more sustainable footing.
Water Bill
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Baroness Parminter
Baroness Parminter (LD)
My Lords, in the face of the desperate flooding challenges that many in our country are now facing and look set to face in the future, I strongly welcome the proposals for Flood Re, which we are now coming on to debate and which will provide affordable flood cover for all households. My Amendments 154A, 154B, 156A and 156B give Flood Re, which will be a private company in receipt of public money, a duty to act in the public interest and extend its remit to help deliver a more resilient future in the face of flooding, working with other bodies to achieve that where appropriate.
The Flood Re scheme will benefit householders at risk of flooding. However, if flood risk management is not significantly improved over the lifetime of the scheme, we will be in no better a place after 25 years than we are now. The adaptation sub-committee of the Committee on Climate Change—and I am glad to see the noble Lord, Lord Krebs, in his place today—in its policy note to the Government last month makes it clear that significant increased investment in flood-risk management is required, as well as in flood defences, if the levels of risk are to be maintained, let alone reduced.
Flood Re could raise awareness of flood risk, direct policy holders to advice and support and, crucially, if sufficient reserves are generated, it could support measures that individuals or groups can take to reduce flood risk. Surplus funds could, for example, pay for property-level measures, such as flood gates and air brick covers, which typically cost £5,000 per property. Government grants of between £2,000 and £4,500 are available, so Flood Re could, for example, meet the difference. It would be a sound investment, given that every £1 invested in property-level protection typically achieves a benefit of £5 or more; or it could contribute towards the cost of Environment Agency schemes that do not justify full government grants under the partnership funding approach. Funding from Flood Re could make the difference between a flood defence scheme going ahead or not, which would be worthwhile if it were to protect some of Flood Re’s highest-risk customers.
To determine what Flood Re could do, it is critical to know how any surplus funds will be defined and what will happen to them. The evidence of a Defra stakeholder presentation on Flood Re, in a slide entitled “Flood Re’s exposure to claims”, gives a median-loss scenario of £65 million in claims per year. That means that it could have at least £100 million in reserves at the end of the first year. Defra’s final impact assessment for Flood Re, in table 5 on page 20, states that, over the life of the scheme, it should on average make an annual surplus of £27 million. This calculation is based on Flood Re’s expected loss scenario which takes account of the low-probability/high-cost flooding that could take place during the 25 years for which the scheme is operational.
Either way, Flood Re is likely to hold significant sums of public money that could be used to help manage down flood risk. This would help save everyone money: high-risk households, other policyholders and Flood Re itself. This could be achieved without the main £180 million levy needing to be increased because it could just be pursued if Flood Re were in surplus. Over the 25-year lifetime, this would make a material difference to the number of homes at significant risk while helping those households secure affordable flood insurance on an ongoing basis once Flood Re is withdrawn. It is therefore important to know how the Government expect any surplus to be defined, in order that it might support such an approach. I look forward to hearing more from the Minister on that in his response.
We need legislation that expresses how Flood Re can help to deliver social objectives without claiming that Flood Re can or should solve all flood risk management issues. I hope that I have made clear what I am seeking for Flood Re to achieve, and the wording of these amendments is an attempt to do just that. I beg to move.
Lord De Mauley
My Lords, I am grateful to my noble friend Lady Parminter for her amendments regarding flood resilience and Flood Re’s role in that matter, and to all noble Lords who have spoken. Regarding Amendments 154A and 154B, I agree with my noble friend Lord Shipley that we need to tackle the root cause of the difficulties with the availability and affordability of flood insurance—the flood risk that households face. The coverage of the tragic events of the past couple of months, which my noble friend Lady Parminter mentioned, have brought the full impact of this home to us all. I thought that the letter read out by the noble Lord, Lord Campbell-Savours, set out the problem very well.
Households benefiting from Flood Re need to understand both their flood risk and the likely impact of the withdrawal, over time, of the subsidy on their future premiums. I hope that noble Lords will be reassured to hear that we have agreed with the Association of British Insurers the principle that insurers will be required to provide such information to customers when a property is ceded to Flood Re and at the point of a claim. I hope that the statutory requirement for the Flood Re scheme to manage, over the period of the operation of the scheme, the transition to risk-reflective pricing of flood insurance for household premises also offers some reassurance.
The ABI has now come forward with draft proposals for ensuring that the correct incentives are in place to drive uptake of resilient repairs after a flood, particularly for those properties subject to repeat flooding. We are still agreeing the detail of this approach and I hope to have more to say on Report. Encouraging households to become more resilient over the period of the scheme will help to reduce the impacts of subsequent flooding.
Turning to Amendment 156A, the subsection that my noble friends seek to amend has been drafted in such a way to provide firm pointers as to what the Flood Re scheme administrator would need to have regard but is also intended to allow for a degree of flexibility that may be needed as the scheme is finalised. I assure noble Lords, in the strongest terms, that the Government are absolutely committed to taking forward Flood Re, together with the insurance industry, and that both parties are working very hard to achieve this.
We expect the administrator to act responsibly in its management of the scheme throughout its life and we have every intention of ensuring that it discharges its functions in a proper manner, supported by the duties we will place in secondary legislation. The regulations made under Clause 54 will be subject to public consultation and we are currently considering carefully the Delegated Powers Committee’s recommendation that regulations made under this clause should be subject to the affirmative procedure. I trust that this assurance puts on the record our intentions in this regard.
As regards Amendment 156B, my noble friends are right that co-operation between Flood Re and flood risk management authorities will be important, in particular should Flood Re wish in the future to commit any of its resources to supporting flood risk mitigation measures. Clause 54 provides for Flood Re to share information held by it with the Environment Agency, its equivalents in devolved Administrations and any other bodies specified in regulations. It also provides for Flood Re to have a duty to act in the public interest, so where it is in the public interest for Flood Re to co-operate with other risk management authorities, it would be expected to do so.
Under the Flood and Water Management Act 2010, flood risk management authorities have a duty to co-operate with each other in the exercise of their flood and coastal erosion risk management functions. This is because the causes of flooding can cross organisational boundaries and responsibilities. For example, flood risk management schemes to protect one area may make the problem worse elsewhere if there is not a partnership approach to developing solutions. Flood Re will not have an operational role in designing or implementing flood risk management schemes. As I think the noble Lord, Lord Whitty, suggested, that would be beyond the scope of Flood Re and would require different skill sets. Flood Re will therefore not have the same degree of interaction with the risk management authorities that they will have with each other. I am not convinced that there is a need to extend the requirements based upon the Flood Re body.
Perhaps I may say to my noble friend Lord Cathcart that while directly managing flood risk is not the purpose of Flood Re, it is nevertheless vital that Flood Re does not just deliver affordable flood insurance. It should also contain the right incentives for householders and insurers to put in place the necessary measures to become more resilient, since otherwise the effective price limits in Flood Re may remove some of the financial incentive to take such action. He has suggested—the noble Earl, Lord Lytton, also asked about this—that Flood Re will need to build up its reserves, which is of course right, but it will have access to the proceeds of the levy and be able itself to take out reinsurance. Can I offer to meet noble Lords before Report, on which occasion I shall of course be happy to provide an update? Perhaps I could also address the point made by my noble friend Lord Crickhowell at this stage. I shall come back on Report to noble Lords with more details of how those who flood repeatedly might be treated. For the reasons I have outlined, I hope that I can persuade my noble friend to withdraw her amendment.
Baroness Parminter
I thank the Minister for that helpful response and I thank Members around the Committee who have contributed to this debate. It has helped to spell out in more detail what we are all hoping to achieve for Flood Re. We do not expect it to be able to answer all the social objectives in terms of flood risk management, but we should accept that it is not just a flood insurance vehicle, important and critical though that is. It will also need to provide the necessary incentives to transition to a stronger place in the future. The wording of the amendment may not be ideal, but at least it has facilitated this debate. I hope that noble Lords are not disappointed in my having brought it forward in that light.
I thank the Minister for agreeing to meet noble Lords between now and Report. That will be helpful because there are still questions about the surplus and how it will be defined. The comments made by my noble friend Lord Cathcart and others remind me that we are not guaranteed surpluses with Flood Re; this is only what we are saying if those surpluses are achieved. I am happy to learn that the Minister intends to say more on this issue at the next stage. On that basis, I beg leave to withdraw the amendment.
Baroness Parminter (LD)
My Lords, I put my name to my noble friend Lord Moynihan’s amendment and I shall speak briefly in support of it.
The Government’s impact assessment on managing the future financial risk of flooding states that there is insufficient evidence of a problem for businesses to get insurance and that there are other market mechanisms for them to get cover. However, the impact assessment focuses on the national impact, whereas flooding affects localities, so it is perhaps no surprise that it did not find that much evidence.
Further, the Government’s position is driven by their recent consultation on the issue, which asked for evidence of a need for a mechanism for small businesses and received a few responses from small businesses, which may well have had other priorities. The ABI has given the Government assurances that the broker community is doing,
“a good job working directly with business customers in getting a good deal for them”.
I contend that it is the Government’s job to insist that there be firm evidence of that, which is what the amendment is intended to deliver.
There are few studies of the impact of flooding incidents in general on business, apart from some by AXA, and they focus on the impact on individual businesses rather than the broader economic resilience of communities in the face of flooding. I could not find any research which looks at the significant impact of flooding on small businesses, which often make up the backbone of the rural economy. It is here that flooding has a huge impact not just on individual families and their businesses but on the complex web of supply and demand chains in the local economy. Ensuring adequate flood cover for small businesses, including farm businesses, is as important as supporting households if we are to protect the overall community resilience of rural areas.
As my noble friend Lord Moynihan said, small businesses were covered by the statement of principles and they were able to get flood risk insurance in the same way as households. Given that Flood Re does not guarantee them that insurance, we certainly need reassurance from the Government that they are mindful of the need for cover for businesses, particularly small businesses, and of their important role in rural communities.
Lord Ashton of Hyde (Con)
My Lords, I should declare an interest that I declared on Second Reading, which is that, until June, I was the chief executive of two insurance companies, and I still labour under some residual contract limitations.
There is an overriding need to put in place a workable solution that will, first, solve the most pressing need, which is to address the availability and cost of flood insurance and, secondly, do so in a way that is timely, affordable to the insurance industry, secured in co-operation with it and that does not allow government subsidy to create a huge deficit in the scheme over time.
Addressing the issue of small businesses raised by the amendment of the noble Lord, Lord Moynihan, we ought to remind ourselves that the statement of principles only covers the availability, not the affordability, of insurance for those small businesses. It covers only renewal policies, so the policyholder at risk of flooding cannot change insurer, and it does not cover the cost of the policy.
There is also the question of practicality. The introduction of businesses into Flood Re would dramatically complicate the pricing of the scheme, the availability of Flood Re as crucial reinsurance—on which the scheme depends—and, by no means least, the complexity of the internal model, which will have to be approved by the PRA. All the different coverage afforded by business policies, such as business interruption, contingent business interruption and loss of profits, will make the internal model much more complicated compared to what are fairly homogenous homeowners’ policies.
To address the most pressing need as soon as possible in a way that is acceptable to as many people as possible, we should concentrate on the most important issues and leave the Flood Re design as it is.
Baroness Parminter
My Lords, briefly, I support my noble friend Lord Shipley on this important amendment. We are rightly spending the majority of our time today discussing a financial vehicle to deliver affordable flood insurance, but the planning system has a vital role in making our country more resilient for the future. On the potential effects of cuts in local authority budgets on their ability to undertake their important planning functions, which my noble friend mentioned, I add that a review in 24 months’ time is sensible, given that in the intervening 24 months there will be further significant cuts to the Environment Agency’s budget, with an expected cut of more than 550 staff.
Given the scenes we have seen in recent days, it would be only too easy for people, rightly, to make the case that we must protect front-line staff in the Environment Agency. However, it is equally important to look appropriately at people in the back room who are working hard on the consultations on significant planning applications for developments of more than 10 houses or one hectare. Equally, it is important that the national flood management strategy, which the EA devised in 2011, is carried forward.
I add my support. The timeline that my noble friend Lord Shipley has suggested of 24 months is apposite given the need to review some of the resource constraints that both local authorities and the Environment Agency will face in the forthcoming months.
Lord Krebs
My Lords, I too support the amendment of the noble Lord, Lord Shipley. I have already declared an interest as the chairman of the adaptation sub-committee of the Committee on Climate Change. The sub-committee has a useful data set that could be brought to bear were this review to happen. It has developed a set of indicators, which are published, for the resilience of planning decisions in relation to present and future risks from flooding, particularly from future impacts of climate change. For example, it has looked at the implementation of SUDS, at the implementation of household measures that could provide protection at the individual property level and at planning decisions to develop in the flood plain. As has already been said by the noble Lord, development in the flood plain has been going ahead faster than development elsewhere, but this is not necessarily a bad thing. If the properties are appropriately protected, either by community-level measures or by individual household measures, the risks can be managed. The sub-committee has a data set and a set of indicators that could be useful were the Government minded to accept the amendment moved by the noble Lord, Lord Shipley.
Baroness Parminter
My Lords, I added my name to Amendment 156D of the noble Lord, Lord Krebs, and my related probing Amendment 156E has been grouped with it.
At present, the Bill states that the Secretary of State has the option to bring in a review process for Flood Re, but provides no detail. The first amendment, as the noble Lord pointed out, requires the scheme administrator to publish a plan to achieve a transition to risk-reflective pricing.
My second amendment would require Flood Re to publish the intended framework for reviews, outlining the decisions that needed to be made at each review point. Why is that important? The Government’s consultation document on Flood Re specified that reviews will be held in order that there should be a gradual transition to risk-reflective pricing. Discussions have centred on reviews every five years and the impact assessment for flood risk is based on that hypothesis, but there is nothing in the legislation to confirm that this will be so.
Getting a commitment to a five-yearly review is critical. Flood Re is designed by the Government to expire in 20 to 25 years’ time, with review points where decisions can be taken to reduce the benefit of the pool to claimants and the levy to all policyholders. If a linear approach is taken, this might result in a 20% drop in the levy, and the benefits, every five years. The potential problems are that the reviews could be more frequent, or never. The Treasury could require the transition period to be shortened, thus not allowing the necessary flood risk management investment to take place, or it could set the percentage drop in the levy to be higher in the earlier period. The reason why it might do so would be that under OECD rules the levy is considered to be a tax. Removing it early would reduce the percentage tax burden on the state.
The issue, though, is not just when the reviews take place but what information they provide so that the Government and parliamentarians have the necessary information to make informed decisions. As such, it would seem important to define the critical parameters in the review in some detail at the outset, understanding exactly what areas beyond affordability and accessibility will be judged to see whether or not the scheme is effective. I hope therefore that the Minister will put on record the Government’s intentions in this regard so that we can have reassurances that the scheme will achieve the outcomes that we all want.
The Earl of Lytton
My Lords, I particularly welcome Amendment 156C, moved so eloquently by the noble Lord, Lord Krebs, as it enables me to raise a series of allied issues. The first is that, Flood Re or no Flood Re, we are all on notice that the cross-subsidy of flood risk needs to be replaced by individual risk assessments. The reason for that is our better geographical knowledge and the unsustainability of the continued mutualisation of risk in those circumstances. I have absolutely no argument with that.
One issue of concern is the data produced by the Environment Agency. Obviously, those data are very important for the industry and for consultants, but they are equally important for individuals because, if we are moving to individual assessment, we must have some means of identifying the individual impact on a per property basis. I referred earlier today to my discussions with Philip Wilbourn, a very eminent environmental surveyor and valuer from the north of England. He allowed me to circulate an e-mail to a number of noble Lords setting out his views, which I have done, but there is a particular bit that I would like to repeat. He refers to,
“the data published by the various agencies, including the Environment Agency”.
Bear in mind that this is someone who carries out evaluations and does assessments on individual properties or groups of properties for a variety of different purposes.
In his e-mail, Philip Wilbourn says that he cannot use the data for commercial purposes because he is prohibited from doing so. Then he says that there is no online ordering service to acquire data for reporting purposes, and he is forced to acquire it from GroundSure or Landmark, two of the authorised resellers, at what he describes as high cost. He says:
“The data reported by commercial companies often varies depending upon the royalty return”,
which seems to be quite the wrong trigger for objective data. He tells me that the costs cannot be absorbed by residential valuers and that the banks, for which these valuations are produced, will not allow such data as a disbursement for the reports that are sent to them. His e-mail continues:
“When data is ordered direct from the EA, it can take three weeks to be sent through depending on the region”,
and he says that he has tested that.
The scale of resolution on the Environment Agency website is 1:5,000, which does not enable a particularly accurate identification on a per property basis. The Scottish Environment Protection Agency’s website fares rather worse because the scale there is 1:25,000, so individual property analysis by the home owner is clearly going to be difficult. These are the data that are supplied to insurers to make decisions.
Of course, what happens? It gets boiled down to a postcode approach—the “postcode lottery” of which we constantly hear many examples. He says:
“The problem with postcodes is that many home owners/businesses may be paying more than they should”,
and he gives an example of a postcode—in I do not know what part of the country, but it is obviously an urban area—which is neatly bisected by a blue-ink line of flood risk.
There is a particular issue here as to whether the data that are produced by this public agency, for public consumption and for the benefit of society as a whole, will be available at reasonable cost—let us not say that it should be free—for the home owner and individual consumer. That is the question that I pose in the context of this amendment.
Water Bill
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Baroness Parminter (LD)
My Lords, I welcome the fact that the Water Bill places the Government’s strategic priorities and objectives on a clearer statutory footing and requires Ofwat to carry out its functions in accordance with it. New Section 2A(3) to be inserted by Clause 24 makes it clear that, “In formulating a statement” the Government “must have regard to” Ofwat’s duties, but only,
“may have regard to social and environmental matters”.
The government briefing note on sustainable development and the resilience duty that was issued last month confirms that the Government are strongly committed to sustainable development, balancing the equally important needs of society with those of economic growth and environmental protection. Before lunch we debated how this is articulated in the duties for Ofwat, but it is equally important that it is articulated clearly in the duties placed on future Governments. That is why I believe that the word “may” should be changed to “must”, so that Governments must take into account social and environmental matters when formulating future policy steers.
Statements of strategic priorities will replace the existing social and environmental guidance currently issued to Ofwat. In future, the Secretary of State will issue a single consolidated statement setting out social, environmental and economic policy priorities. My noble friend the Minister kindly confirmed in a letter to me on 17 January that the Government intend to continue to provide guidance on social and environmental matters within that single consolidated policy statement. Given that the Government have said that they will provide guidance on such matters, I feel that the use of the word “may” insufficiently reflects that commitment and the need for future Governments to take account of these matters when formulating the crucial strategic policy that will guide Ofwat. I beg to move.
Lord Whitty
My Lords, I support these amendments. New Section 2A(3) to be inserted by Clause 24 seems to differentiate between Ofwat’s duties regarding strategic priorities and social and environmental matters. We attach “must” to the former and “may” to the latter, but the Secretary of State ought to have regard to both. This is not the usual theological argument between “may” and “must”. Those of us who have been around the block on this legislation have come across that argument a number of times and have completely failed to understand parliamentary counsel’s advice. The provision clearly differentiates the status of the two duties. It does not differentiate and downgrade the social and environmental objectives for Ofwat, which some noble Lords might think would be sensible, as Ofwat is primarily an economic regulator. This is for the Secretary of State. It is the Secretary of State’s duty to balance all these issues out. He should therefore have regard to both duties and if it is “must” for the former it should be “must” for the latter. The provision does not say, “give priority to”; nor does it say, “If you have regard to these duties, you do not necessarily need to carry out exactly what they prescribe”. However, it is the duty of the Minister to balance all these things out. If the legislation gives less status to one than to the other, the outcome of the balancing seems to be predictive.
I do not think that is right. All parts of the policy need to be looked at. I think “must” is probably the appropriate modal verb but both duties need to be in the same form. They are both important and the Secretary of State, whoever that might be, needs to have regard to both. I therefore support the intention of the amendment.
Baroness Northover (LD)
My Lords, I thank my noble friend Lady Parminter for her amendment. She notes that Clause 24 on setting strategic priorities and objectives for Ofwat requires that the Secretary of State “must” have regard to Ofwat’s duties but “may” have regard to social and environmental matters. She would like to change “may” to “must”. I am also familiar with the debates to which the noble Lord, Lord Whitty refers, having delivered a “must” to the noble Lord, Lord Ramsbotham, yesterday at Third Reading of the Children and Families Bill.
The Government are keen to hear and understand my noble friend’s concerns. However, we think that the new power to set strategic priorities and objectives for Ofwat will ensure that social and environmental matters will continue to be addressed. The purpose of Clause 24 is to strengthen and clarify the existing guidance-giving powers. It enables the Secretary of State to issue a single consolidated statement setting out social, environmental and economic policy priorities in the round to help Ofwat to balance all the relevant considerations appropriately when making regulatory decisions.
The Government’s principles of economic regulation require that Ofwat regulates within a clear framework of policies and duties set by the Government. Under the new power, Ofwat must carry out its relevant functions in accordance with the statement. The new powers stipulate that, in issuing the guidance to Ofwat, the Secretary of State must have regard to all Ofwat’s duties. These are set out in Section 2 of the Water Industry Act 1991 and include protecting the interests of consumers, promoting economy and efficiency by companies in their work and, as we have already discussed, contributing to the achievement of sustainable development. These duties encompass the regulator’s essential purposes and it is right that, in giving a steer on policies and objectives, the Government should be bound by them. We note that the duties clearly embrace both social and environmental matters. In addition, the new powers under Clause 24 stipulate that when formulating a statement the Secretary of State may have regard to social and environmental matters. We hope that this serves to provide additional reassurance that such matters will continue to be addressed through the strategic priorities and objectives. As a further check, Clause 24 also requires that we consult widely on the statement of strategic priorities and objectives. Following this, the statement will be subject to parliamentary scrutiny. When we consulted on the existing strategic policy statement last year, the social and environmental content received a warm welcome from both environmental NGOs and consumer groups. I thank my noble friend Lady Parminter for her own tribute to this.
We have great sympathy with my noble friend’s objectives but we are not persuaded that such a change to the Bill is required. I therefore ask her to withdraw her amendment.
Baroness Parminter
I thank my noble friend for her detailed comments on my amendment and for the fact that she noticed that I commented on the consultation last year. I take this issue very seriously. I also thank the Opposition Front Bench for supporting the amendment. It is not a matter of semantics. It might seem to be that, but it is more fundamental to the direction of travel—what we want for the water industry in the future and how we can assist future Governments to deliver the commitments that we all agree on. I will reflect on what the Minister has said, but we may return to this matter in the future. I beg leave to withdraw the amendment.
Baroness Parminter
I rise to support the intention of Amendment 120, if not the intention of Amendment 122, which is grouped with it. The issue of bad debt and the implications of what that means for the affordability of all our bills is an important one.
At Second Reading I asked the Minister why the Government, unlike the Welsh Government, are not implementing the bad debt provisions in the Flood and Water Management Act 2010, alluded to by the noble Lord, Lord Whitty. If they were to do so, it would help company debt recovery and bring down household bills. The response I received was that the Government were wedded to the idea of a voluntary scheme, with a database that the water companies were helping to fund, which would be brought in, probably via regulations, in the next month or so. I may be wrong, but I suspect that, with only an intervening 10 days between Second Reading and now, that is the answer that we will get again and that the Government will not wish to support these amendments.
Therefore I ask the Government, if they are determined to stick with the voluntary approach, whether they will set a reasonable review period to evaluate whether or not the voluntary scheme for landlords is effective. All the evidence to date, from the voluntary schemes of companies such as Northumbrian Water and others, shows that they do not work. It seems to be a reasonable request, if the Government are not prepared to move ahead with a mandatory scheme, for them to give an indication to the House of a reasonable review period, so that if the scheme is found to be ineffective—as most of your Lordships believe it will be—the regulations can be changed to make it compulsory.
The Earl of Selborne
My Lords, I have a lot of sympathy with the thrust behind the attempt of the noble Lord, Lord Whitty, to deal with those who will not pay as opposed to those who cannot pay. Some six or seven years ago I had the privilege of chairing a report of the Science and Technology Select Committee on water management. We were appalled by the number of affluent people in South East Water’s area who had worked out that they could never be deprived of their water supply as it is illegal to turn off the water, so they simply did not pay for it.
The cost of taking someone to a small claims court is a difficulty. Where there is a change in population, such as happens in some areas more than others, the cost of trying to trace defaulters can be more than the cost of the debt. The two amendments proposed by the noble Lord, Lord Whitty, seek to deal with this. I suspect that it would be better to deal with this in secondary rather than primary legislation, as was originally intended. Nevertheless, I believe that my noble friend on the Front Bench should encourage the thrust of these amendments, to make sure that those who can afford their water perfectly well should be induced to pay for it, and that the water companies should be assisted in this, particularly by those with information on who is responsible for paying the bill. Landlords are often in a position to provide that information. All assistance should be given in this case. It is galling to know that people who cannot manage their affairs but are living an affluent lifestyle are advised by debt managers, “Well, don’t bother about the water bill”.
Winter Floods
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Lord De Mauley
My Lords, it is a shame that the noble Lord was not here at Questions because we addressed that specific point. I said then that the agencies are working together to ensure that measures such as dredging can proceed. That is likely to be part of the outcome of the action plan which my right honourable friend the Secretary of State has demanded. We are looking for that to proceed as rapidly as possible. It is fair to say, however, that it should do so while meeting our environmental requirements, which are set by among others the EU.
Baroness Parminter (LD)
My Lords, perhaps I may pick up on the point about the Dawlish line being likely to be closed for six weeks. Further stretches are at risk from strong waves, meaning that other areas are likely to suffer—that is obviously not just local people but businesses. I thank my noble friend for the comments he has made today, but my understanding is that no research has ever been done on the significant impact of flooding on businesses, often small businesses, that make up the backbone of rural economies and the disproportionate effect of that on rural economies, particularly in places like Somerset. There is no research that shows how flooding affects the range of supply and demand chains in an area and identifies what impact this has on the overall community resilience of an area. After the devastation of this winter’s flooding and given that we are facing more in the next few years, do the Government have any plans to commission research into and to investigate the impact of flooding on the economic resilience of local communities in order to identify any further necessary policy interventions or resources?
Water Bill
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The Earl of Selborne (Con)
My Lords, I declare my interests, as I did at Second Reading, that, like the Minister, I am a farmer with an abstraction licence, although I have not been flooded—so to that extent, I do not claim the same interests.
The amendment would require Ministers to issue rules for the,
“designation of … procedures, responsibilities, status and governance”,
of a market operator. I cannot believe that such ministerial control would assist in the implementation of a successful market. In regulated utility industries, whether energy, communications or water and sewerage, the management and control of market operations is initially the responsibility of the regulator, working alongside the industry. Once the market is up and running, it becomes the responsibility of the industry, supported of course by the oversight of the regulator, which provides the framework. This approach helps to ensure that the regulator and the industry work together; the industry will need to adapt to innovation and new circumstances. We recognise that in this Bill we are promoting innovation and we have to ensure that the regulation adapts accordingly. The industry will need to adapt to innovation and these new circumstances, and it is for the regulator and industry to ensure that working practices are aligned in the regulatory framework that we are establishing in the Bill. I simply do not believe that it would be helpful to have a politician—the Minister of the day, of any party—fulfilling the role of controlling the market operator in this far-reaching way.
Baroness Parminter (LD)
My Amendment 95 is grouped with the amendment moved by the noble Viscount, Lord Hanworth. I wish to probe the issue to get a bit more information from the Minister on the shadowy role of the market operator. Before I do that, however, I take the opportunity on this first day in Committee to say that the truncated nature of the parliamentary process, with less than two weeks between Second Reading and going into Committee, has presented certain challenges to those of us who are trying to do our duty and give proper scrutiny to this complex Bill, as my noble friend Lord Crickhowell said. Like others, I thank my noble friend the Minister and the Bill team for the briefings and the clarity of the briefing papers, but that still leaves certain gaps in our knowledge. Noble Lords will be aware that the comments of the Delegated Powers and Regulatory Reform Committee on the Bill were published only on Friday, and we still await the Government’s response. Clearly, we have had to table our amendments before the Government have provided us with the response to important points that the Delegated Powers and Regulatory Reform Committee has made, and that is not particularly satisfactory or helpful.
Baroness Parminter
“( ) In relation to any agreement for the supply of water in bulk between a water undertaker and a qualifying person—
(a) the Authority and any party to an agreement shall at any time if so requested provide such information as the Environment Agency or NRBW may require in relation to the volume and source of any water to be abstracted or supplied and the timing of such abstraction or supply under the agreement; (b) the Environment Agency or NRBW may at any time certify to the Authority that it is necessary or expedient for the purpose of—to vary or terminate an agreement, the Authority must seek a variation or termination of that agreement;(i) conserving, redistributing or otherwise augmenting water resources in England and Wales;(ii) securing the proper use of water resources in England and Wales; and(iii) securing the conservation of flora and fauna which are dependent on an aquatic environment;to vary or terminate an agreement, the Authority must seek a variation or termination of that agreement;(c) if the Authority is satisfied that the variation or termination cannot be achieved by agreement between the parties within a reasonable time it must by order vary or terminate that agreement accordingly.”
Baroness Parminter
My Lords, I shall speak also to Amendment 76. The amendments seek to give the strongest safeguards to the bulk transfer of water in advance of—and, indeed, in the absence of—reform proposals for the water abstraction regime, which we will discuss in subsequent amendments.
The Bill incentivises existing licence holders to sell their water to water companies even when the catchment is over-abstracted. It is welcome that the Commons amended the Bill to require applicants for new water supply licences to consult with the Environment Agency as well as with Ofwat. It is on the existing licences being traded as a result of the reforms making it easier for bulk transfers that I wish to focus with these amendments.
Clearly water companies have responsibilities about deterioration outlined in the water framework directive but, as the head of water resources at the Environment Agency said in evidence to the House of Commons, Clause 12 could even force bulk transfers of water between existing participants that could affect the use of abstraction licences.
To protect the scarce resources, the Environment Agency and NRBW need the strongest role at the beginning of the trading process. At present the Environment Agency can only intervene once damage has occurred. That is too late, and especially so for the controls that we are proposing for a new market. In the Commons, the Government gave statutory consultee roles to both the Environment Agency and NRBW when Ofwat makes an order for bulk supplies. My amendment would give those bodies the right to compel Ofwat to intervene in or terminate a bulk supply agreement which it deems would cause unsustainable abstraction.
The issue is whether the statutory consultee role for the Environment Agency and NRBW when Ofwat makes an order regarding a bulk supply agreement means that Ofwat has to act on what these bodies say, or whether it is just advice or input on whether the supply is necessary or expedient which Ofwat can choose to ignore. Surely we need the Environment Agency and NRBW to be able to require Ofwat to intervene to vary or terminate a bulk supply agreement before unsustainable abstraction takes place. That is what both these amendments seek to achieve. I beg to move.
Baroness Northover
My Lords, I thank my noble friend Lady Parminter for tabling these amendments. Clause 8 plays an important role in achieving a more resilient water industry by encouraging the bulk transfers of water, or bulk supply agreements, between incumbent water companies and between incumbent water companies and inset appointees. We recognise my noble friend’s concern that an increase in bulk supply agreements might lead to unsustainable abstraction, particularly in advance of broader reform of the abstraction regime. We are therefore grateful for the opportunity to explore these issues in further detail today.
We would like to assure the Committee that we are serious about reforming the current abstraction system so that it is fit to face future challenges, and noble Lords are quite right to focus on this point. We are committed to putting in place an effective system that better reflects available water resources and we published our proposals for consultation in December. My noble friend Lord De Mauley will talk about our approach to abstraction reform in more detail shortly, as my noble friend Lady Parminter noted; as my noble friend Lord Crickhowell noted, Clause 12 may also appear to be relevant here.
I shall focus on Clause 8, which introduces new provisions to regulate more effectively bulk water supply agreements by introducing codes and charging rules that will govern these agreements. By enabling incumbent water companies to use water resources more flexibly and efficiently, increased water trading can both build resilience and increase the sustainable use of water resources. It can be particularly useful for water stressed areas and in times of drought. My noble friend Lady Parminter is right that we need to avoid any damage from unsustainable abstraction happening in the first place. Tackling damage after it has occurred can be a slow, difficult and expensive process. We therefore want to ensure that adequate safeguards are in place in introducing this reform to the bulk supply regime. We believe that these safeguards are already in place.
The Environment Agency and Natural Resources Wales are the regulators responsible for protecting and improving the environment and they will continue to control the impacts of abstraction through abstraction licensing. As my noble friend Lady Parminter noted, it has been agreed that Ofwat must consult the appropriate environmental body before ordering, varying or terminating a bulk supply agreement. However, I note her current disquiet at this. My noble friend Lord Crickhowell was more encouraged by the arrangement and is, as he put it, almost entirely satisfied by the correspondence from my noble friend Lord De Mauley, and I trust that my noble friend Lady Parminter has also seen this correspondence. If she has not, we will make sure that she receives it. I note also that the noble Lord, Lord Whitty, is less reassured, and I am sure that this issue will be considered further in the later group, as I have indicated. We all share the concern to ensure that we have a resilient system which does not cause damage.
I remind noble Lords that water companies have statutory environmental duties as well, including a duty under Regulation 17 of the Water Environment (Water Framework Directive) (England and Wales) Regulations 2003 to have regard to river basin management plans when deciding whether to enter into bulk supply arrangements. River basin management plans set out the environmental objectives for the water bodies within a river basin district and how they will be achieved. Each water company also has a duty under Section 37A of the Water Industry Act 1991 to produce a water resource management plan every five years that sets out how it aims to balance demand and supply over the next 25 years.
As I say, my noble friend Lord De Mauley will be addressing abstraction in greater detail in the next group, and in the mean time, I hope that my noble friend will be content to withdraw her amendment.
Baroness Parminter
I thank the Minister for her comments and I thank my noble friend Lord Crickhowell and the noble Lord, Lord Whitty, for their contributions in exploring this debate. It has become clear that the focus is not the new licences, which are covered by effective safeguards, but the issue of bulk trading where the licences have already been issued. It is about whether the new safeguards that have been put in, which give statutory consultee status to the environmental bodies, are sufficient. Ofwat has to consult those bodies, but it is not obliged to act in accordance with what they say. In the absence of the aligned timetables for the abstraction reform proposals and the proposals for the upstream composition, I remain concerned that we need the strongest safeguards. If we are not given satisfactory responses to the issue that we will be discussing imminently, I reserve my right to come back to it. On that basis, I beg leave to withdraw the amendment.
Baroness Parminter
“( ) Before laying a draft of an instrument in accordance with subsection (1), the Minister must publish and present to Parliament draft legislation for reforming the law in respect of water abstraction.”
Baroness Parminter
My Lords, we now touch on the issue of the absence in the Bill of any abstraction reform proposals. Amendment 96 seeks to address the issue of the non-alignment of the proposals for upstream competition, which are within the Bill, and those for abstraction reform, which are not. Without the proposals for abstraction reform running in parallel with those that create a market for trading water, there is a significant risk to our scarce water resources. I will not repeat what I said at Second Reading, but suffice it to say that the House of Lords EU Sub-Committee on Agriculture, Fisheries, Environment and Energy and the Environment Agency both concur with the Government’s own view that at present,
“significant volumes of water are licensed but unused”.
If this water is used as the result, for example, of increased trading in a reformed system, that could cause environmental deterioration.
The upstream competition briefing paper which the Government have helpfully provided for us states that they are aiming to legislate for abstraction reform early in the next Parliament. My amendment would merely give statutory backing to that commitment by this Government and would tie future Governments to abide by it. Requiring the Minister to draft public legislation to reform water abstraction will give clarity to parliamentarians about the shape of the abstraction reform proposals prior to their scrutiny of the regulations that will govern the new market in upstream competition, which the Government say could come into force by 2019. I hope that the Minister will agree that this amendment is one way—I accept that it is only one way—of reflecting the Government’s stated commitment to delivering reform in a timely and coherent way. That can be secured only by aligning the proposals for upstream reform, which are in the Bill, with those for reform of the abstraction regime, which are not. I beg to move.
Baroness Parminter
I thank my noble friend the Minister for his detailed comments and the numerous colleagues around the House who joined in this debate. We face an inadequate abstraction regime that will be reformed at some point in the future and a Bill here and now that will introduce upstream competition proposals that could exacerbate the problems of abstraction. While I thank the Minister for his comments, I do not feel he adequately answered why the Government are not prepared to put wording in the Bill reflecting our concern that there is insufficient clarity at the moment about the timetabling of this issue. My noble friend Lord Crickhowell was kind enough to say he had great sympathy with that point.
I accept that the wording I proposed might not be right. We certainly do not wish to put any barriers on the proposal for reforming the retail market. I am sure everyone in this House agrees that we want to press ahead with that now. However, in the relationship between the abstraction reform proposals and the upstream competition there needs to be clearer timetabling within the Bill. I say to the Minister that we will return to this issue on Report, and in the absence of a sequencing being put in the Bill we will look again at further safeguards that will be required to prevent more deterioration to the environment. Those safeguards will be along the lines mentioned in my previous proposed amendments, which my noble friend Lord Cathcart was kind enough to say that we should look at more seriously, particularly paragraph (c) in Amendment 74. As I said, we will come back to this matter but on that basis I beg leave to withdraw the amendment.
Water Bill
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Baroness Parminter (LD)
My Lords, I have neither the interests that the Minister had to declare nor the form of the Opposition Front Bench. Indeed, this is the first Bill that I will be taking through this House on behalf of the Liberal Democrat group. I may not have the interests or the form but I certainly have the passion to ensure that the Bill delivers to meet the challenges that our water resources currently face.
Only one in four of our rivers and lakes is a fully functioning ecosystem. Equally troubling, many of our water supplies are under pressure from unsustainable levels of abstraction and the combined effect of climate change and a growing population. Liberal Democrats accept that each generation is responsible for the fate of our planet so it is no surprise that we want to protect natural resources, on which future generations and economic prosperity depend. We therefore support the Bill, which sets the framework to improve the health of our precious lakes and rivers while keeping water available and affordable.
We are members of a coalition Government so of course there are areas where we would like to see the Bill go further. Opening up the upstream water market should go hand in hand with the reform of the abstraction licensing regime, rising demand for water should be tackled by greater metering and affordable flood insurance should equally help to build up our resilience to future flooding. These are areas that I will be seeking to strengthen in the Bill through clarification and amendment.
I credit Ministers who have gone a long way to meet the widely held aspirations for a stronger commitment to sustainable resource management in the remit of the water regulator, Ofwat. The introduction of a primary duty to secure the long-term resilience of water supply and sewerage systems is significant, and made all the stronger by the new Minister, Dan Rogerson, during the Bill’s passage in the Commons. To make crystal clear the Government’s intention to protect our natural resources, I would hope that Clause 24 could be amended to oblige rather than invite future Governments to take into account social and environmental matters when drawing up future strategic priorities and objectives for Ofwat. I invite Ministers to reflect further on that.
It is a disappointment that the Government are not legislating now to reform the water abstraction regime. The current system, in place for more than 40 years, has left ecosystems damaged. As the House of Lords EU Sub-Committee D’s 2012 report into EU freshwater policy said, and I must declare an interest as a member of that committee,
“delaying this reform for at least 15 years fails to respond to the urgency of the situation”.
Like the Opposition, we on these Benches think that without the proposals for abstraction reform running in parallel with those that create a market for trading water, there is significant risk to our scarce water resources. The Government’s consultation document on abstraction reform confirms as much, saying:
“Significant volumes of water are licensed but unused. If this water is used, for example, as a result of increased trading in a reformed system, this could cause environmental deterioration”.
Equally, the Environment Agency has identified a large number of catchments where increased trading could leave less water in river or groundwater than is needed to maintain required environmental standards.
The Government so far have committed that the timetables for both reforms are “likely to be broadly similar”. We need assurances that proposals for upstream reform, which are in the Bill and which could come into force by 2019, will be fully aligned with reform of the abstraction regime, which is not legislated for. In the absence of the Minister being able to give such assurances, there must be further environmental safeguards put in place prior to the introduction of upstream competition.
Liberal Democrats support the proposals to open up retail competition in the business market which has worked so well in Scotland, saving money for businesses, charities and public authorities with multiple sites and enhancing water resource management. However, in Committee we will seek clarification over the proposals to open up the upstream wholesale market to competition. While this may make trading between water companies easier, this theoretical market model seems to include the potential for the de-averaging of prices and currently lacks parliamentary scrutiny of central elements, such as the setting up of the market operator.
Managing water resources for the long term has to take account of affordability for consumers now, with more than 2 million households currently spending more than 4% of their income on water bills. This coalition Government are to be applauded in getting more families on low incomes out of paying tax to boost the money they have to meet household expenses. The water companies could do far more to bring those household expenses down by more firmly tackling bad debt which adds £14 to all our water bills. Recognising that finding non-payees is critical and that 80% of them are in rented households, a voluntary database for landlords to register tenant details will soon be introduced. In Committee in the other place, Water UK expressed the view that a voluntary approach simply does not work, a view echoed by the EFRA Select Committee. The evidence of Northumbrian Water which has had such a website for two and half years shows that only 7% of landlords have registered, and they were the landlords who were already committed to tackling the issue.
Why are the Government, unlike the Welsh Government, not implementing the bad debt provisions in the Flood and Water Management Act 2010 which would make compliance with the database mandatory when such a move could help company debt recovery and bring household bills down? Do the Government support the fixing of the date for implementation of those proposals, should the voluntary database fail to work?
The Bill rightly seeks to build up our national water resources, but unlike the water White Paper, there is insufficient focus on the equally important issue of demand management. The Government argue that this can be pursued outside legislation, and of course it can. Indeed, it is good to see the recent changes Ofwat has made to its calculation of a total expenditure approach which should incentivise water companies to use demand management and green solutions such as water catchment management as opposed to capital investment, but we need leadership on metering to help tackle the demand for water, and such leadership should be reflected in this Bill.
In the UK, every person uses about 150 litres of water a day, which is one of the highest levels in Europe. Anglian Water confirms that households which are metered use 10% to 15% less water, yet less than half of the country is presently on a water meter, and current water company plans aim to reduce water usage by just 5 litres a day per person by 2020. Metering gives consumers greater control over their water consumption and the chance of improved affordability. It also helps water companies target households using large amounts of water, provide water efficiency support and tackle leaks. The case for smart water metering, combined with advice on how to reduce water usage and social tariffs which minimise affordability issues for disadvantaged heavy-use households, is strong. The independent Walker review in 2009 recommended a widespread switchover to metered charging. This conclusion was supported by the EFRA committee and more recently, at Second Reading in the other place by the former Defra Minister, the honourable Member for Newbury, who called for a possible legislative stimulus for metering, adding,
“knowledge is power for households”.—[Official Report, Commons, 23/11/13; col. 79.]
The Government’s response in the other place was that companies might invest a lot of money in meters that,
“could be spent on other infrastructure”.—[Official Report, Commons, Water Bill Committee 10/12/13; col. 164.]
Surely this Government believe it is for companies to decide their own business priorities within the framework set by government and the regulator. At present, if a company wants to consult its customers about introducing compulsory meters, it cannot unless the Secretary of State determines that either the whole or part of the area of that company is one of serious water stress. Location should not be a bar to action, and so I will table an amendment to the Bill to remove this restriction on business and send a strong signal to water companies about moving towards universal metering.
Like many in the House, I feel deep sympathy for those who, as a result of recent flooding, face the worry, upheaval and stress of rebuilding their lives. I am sure that we will hear more about the impact of flooding in Somerset from my noble friend Lady Bakewell of Hardington Mandeville later. The fact that the Bill guarantees affordable flood risk insurance to all householders is therefore extremely welcome and Ministers are to be congratulated on negotiations with the insurance industry which could deliver this.
Flood Re will be a private sector body handling public money and, as such, its aims should clearly reflect the need to act in the public interest and to incentivise householders to reduce their flood risk over time. By amending Clause 51 in this way, we can transition to a stronger place at the end of the scheme’s 25 years. By doing so, it will reflect the Liberal Democrat view that to successfully manage flood risk we need a greater people and community focus, not just a focus on institutional responses, with their infrastructure plans for flood defences and installing huge pipes. Moreover, given that a number of new clauses were added in Committee in the Commons and therefore lacked pre-legislative scrutiny, I and my noble friend Lord Shipley, who sadly cannot be here today, look forward in Committee to teasing out a number of questions about Flood Re’s operation and the ability of key agencies and local communities to respond to the flooding challenges which the adaptation sub-committee of the Committee on Climate Change recently set out so clearly.
In conclusion, Liberal Democrats strongly welcome the Bill. It will help to meet the Government’s stated goal of securing the most efficient use of scarce water resources. I have, however, highlighted a number of areas which I hope will be addressed in Committee, and look forward to participating enthusiastically as the Bill passes through this House.
Flooding
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Lord De Mauley
Yes, my Lords. The NPPF contains tough requirements, so we can build in high-risk areas if there is nowhere else at lower risk; the needs and benefits outweigh the assessed flood risk, taking account of mitigation measures; buildings are safe and less susceptible to flood damage; and flood risk is not increased overall and, indeed, where possible, is reduced. So, yes, I am.
Baroness Parminter (LD)
The Secretary of State has received assurances from the ABI that households will receive every possible support from the insurance industry. Can my noble friend the Minister say what evidence there is to show that that is happening?
Lord De Mauley
Yes, my Lords. Indeed, some examples of how the insurance industry has responded are that it has drafted in extra staff, including cancelling Christmas leave, to ensure that capacity is sufficient to deal with the increased volume of claims; it has deployed emergency response vehicles to flooded areas to give advice to affected communities; it has called customers in flooded areas to offer assistance; it has deployed loss adjusters to visit affected areas as quickly as possible to assess damage, begin the drying out of properties and arrange for repair work to begin; and, importantly, it has prioritised vulnerable and elderly customers.
Peatlands
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Baroness Parminter (LD)
My Lords, the poor condition of upland blanket peat bogs causes nearly 300,000 tonnes of CO2 to be released into the atmosphere every year. Can the Minister say at what date the Government intend to increase peatland restoration in the national greenhouse gas emissions reporting?