Water Industry

Debate between Dan Rogerson and Frank Dobson

Tuesday 5th November 2013 Commons Chamber

[Dan Rogerson]

The hon. Gentleman did not take interventions, so I shall follow his lead and try to respond to some of the issues raised in the debate. We will have plenty of opportunity to come back to his comments.

I congratulate the hon. Member for Dover (Charlie Elphicke) on leading the charge to secure the debate. He wanted to send a clear message to Ofwat and particularly to the water companies that consumers expect more now. They want a fairer deal to cope with the cost of living and to reflect the fact that the water companies have had some good years. They have had much lower borrowing costs in recent years than was predicted when those prices were set. The hon. Gentleman is looking for some flexibility during the current price review period for those issues to be taken on board.

Clearly, that is a matter for the regulator. Ofwat is being far more assertive in the message that it is sending to the water companies. It has the power to revisit the current price settlement, but in particular circumstances. Ofwat’s discussions with water companies are obviously focused on the coming price review period. It will want to see whether water companies come forward with any suggestions. As my right hon. Friend the Secretary of State pointed out in his letter to the water companies, they are in far better circumstances than were predicted at the beginning of the current period. As a Government, we are supporting Ofwat and providing political cover. If Ofwat is looking for a deal from water companies that more accurately reflects current circumstances, it has the political back-up to do that. I welcome the signs that Ofwat is indeed doing that.

The issues surrounding investment are crucial. The right hon. Member for Holborn and St Pancras spoke about the simple business of a couple of pipes in the ground catching the rain water and sending it on. That was the case once upon a time. There are also the issues of what happens—how can I put this delicately?—after the water has been consumed by the consumer. What used to happen is that a pipe would be installed, as I know all too well, representing a coastal constituency, and the waste would drift out into the Atlantic ocean. That is not acceptable now and we expect a far better standard of treatment for sewage and better solutions to deal with the problems. That is why we have much better bathing water quality than we used to have.

[Frank Dobson]

rose—

[Dan Rogerson]

I will not give way. I accept what the right hon. Gentleman says about what he considers simple problems. Yes, we want the water companies to do better on price, but we also want them to continue investing and improving. We have a responsibility to deliver better environmental quality. We have seen improvement in that but we want it to go much further, so we want the investment to continue. We will have the opportunity to consider some of these issues on Second Reading of the Bill, so perhaps we can come back to the more technical issues at that point. I know that hon. Members on both sides of the House will want to engage with me in the run-up to that and I look forward to some informal discussions, as well as the discussions on Second Reading.

I pay tribute to my ministerial predecessor, my hon. Friend the Member for Newbury (Richard Benyon)—he is not currently in his place—who did a huge amount of work to get us where we are. Some Opposition Members claimed that nothing has happened over the past three years, but nothing happened over the 13 years they were in office, other than reviews. Her Majesty’s Opposition seem to stake their reputation on a number of reviews, but they did nothing on the back of them. This Government will look at that work and the evidence provided and do something, such as dealing with the inequality in the south-west and the problems people there face, which Anna Walker looked at, and the issue raised by the Cave review, which looked at the water industry as a whole. This Government are taking action.

The Government are also looking at flood insurance, because the previous Government left the clock ticking on an agreement that was about to evaporate. We have negotiated something that will now be delivered in a Bill. I pay tribute to my hon. Friend the Member for Newbury for being at the forefront of delivering that settlement. We look forward to debating that as we take the Bill through the House.

The hon. Member for South Swindon (Mr Buckland) talked about leakages. He said that although water companies have improved, they could do much better and there is still a long way to go. I absolutely agree. The important point is that we still see companies investing in the infrastructure to put it right and get a better solution to the problems. That is why in all our discussions on price we must ensure that we get the balance right so that we can continue to see that investment.

We heard an interesting exchange between the hon. Member for South Swindon and the hon. Member for Dunfermline and West Fife on household disconnections. It was not clear to me whether the hon. Member for Dunfermline and West Fife was recommending that water companies should have that power. I hope that that was not the case, because it is certainly not something the Government want to reopen.