Plastic Pollution in the Ocean

Gareth Thomas Excerpts

Thursday 18th May 2023 Westminster Hall

[Gareth Thomas (Harrow West) (Lab/Co-op)]

I am grateful to the hon. Lady for initiating the debate. She may be aware that the World Wildlife Fund argues that some 8 million tonnes of plastic get dumped every year. While she rightly describes the progress made in this country in particular—but also in others—does she share my view that for the future, we actually need to see discussion of how we can toughen up product standards to increase the amount of plastic that can be recycled, and give consumers more information about which plastics used in products can be recycled and which cannot?

[Selaine Saxby]

Yes, in many ways I agree. I will certainly come on to speak far more about the global implications of the situation. While we are doing so much on our own island, we need to do so much more. In particular, the upcoming deposit return scheme, confirmed in the environment improvement plan, will bring the UK in line with similar nations, and recycle 90% or more of relevant containers.

Alongside reducing use and recycling as much as possible, we also need to look at the hierarchy of waste and reusing plastic products where possible. I ask the Minister to look at setting a target for the reuse of packaging, alongside our work on recycling. By setting a target, we would incentivise businesses to invest in reuse schemes that reduce the amount of resources required in our packaging supply chains. A recent UN report on reducing plastic pollution found that proper reuse systems could reduce plastic pollution by 30% by 2040, compared with 20% for recycling. Investing in and facilitating a reuse system would also reduce the cost of waste management and increase jobs in the sector. Unfortunately, despite UK efforts, plastic has been entering the ocean for decades and continues to do so.

Litter Action Groups

Gareth Thomas Excerpts

Wednesday 19th April 2023 Westminster Hall

[Mr Virendra Sharma (Ealing, Southall) (Lab)]

I beg to move,

That this House has considered the matter of support for litter action groups.

It is a great honour to speak under your chairmanship, Mr Paisley. I called this debate for two main reasons, the first of which is to recognise and thank those in my constituency who tirelessly volunteer to make it a better and safer place. They do not do that as a job; they do it because they see the great strain the council is under and the lack of awareness among too many people of the cost of littering and fly-tipping. In particular, therefore, I want to thank LAGER Can—Litter Action Group for Ealing Residents—and its leader and inspiration, Cathy Swift. Cathy is in the great tradition of British volunteers: she rolls up her sleeves, digs in and does not take no for an answer. National Rail, take note: that trackside still is not litter-free; you may not have granted her access to the trackside yet, but no is not the right answer. I hope you will forgive me, Mr Paisley, for gesturing to the Public Gallery and thanking everyone here today from LAGER Can, and the other volunteers, for their work.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

Will my hon. Friend also take this opportunity to join me in commending the huge effort by Harrow Litter Pickers, a group set up and co-ordinated by the remarkable Casey Dalton, which last year collected more than 11,500 bags of litter in the London Borough of Harrow? Does he agree that the Minister should be clear that local authorities should work with litter-picking groups to support their efforts and that some sort of nationally devised standard to help quantify those relationships might be helpful in holding local councils accountable for the support they give or, sadly, potentially do not give litter-picking groups?

[Mr Sharma]

I really appreciate and acknowledge the contribution made by my hon. Friend. The Harrow team work closely with LAGER Can in my constituency; we work together to improve conditions. I thank my hon. Friend for his intervention, and I am sure the Minister has also taken note of his suggestion.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Rebecca Pow)]

It is a pleasure to have you in the Chair, Mr Paisley. I congratulate the hon. Member for Ealing, Southall (Mr Sharma) on securing this debate about litter, an issue that is so important to so many of us. It is great to have the opportunity to talk about it and what we are doing about it, and to highlight and commend the many volunteers and groups doing so much commendable work to tackle this criminal activity, and this blight on our communities.

It was really interesting to hear about the hon. Gentleman’s local group, the Litter Action Group for Ealing Residents, otherwise known as LAGER Can—a nice, easy name to remember. It should not be confused with the all-party beer group, or anything to do with it. That sounds like a really good model, and Cathy, whom he mentioned, should be commended; I share in his comments. We also heard of excellent work done by others, including the Harrow Litter Pickers—I thank the hon. Member for Harrow West (Gareth Thomas) for mentioning them; these people all need a really big shout out—and all the volunteers and groups in Strangford.

I would like to give a shout out to a chap called Tim Walker in my constituency, whom I have been out with a number of times. He started a big litter collection off his own bat; it was, I think, just before covid. He got together a community group through Facebook, which joined him every week. More and more people started to turn out. He was so determined to tackle litter and other environmental concerns that he has set up a shop in Taunton called My Carbon Coach, and he is influencing people on even wider environmental issues. All these people need a big “thank you”.

It is usually just a careless minority who cause the issue. Councils have responsibility for keeping our public places clear, but we simply cannot underestimate the role and work of volunteers, who are very much driven by a sense of civic duty, and by pride in their community, which they want to be the best place possible in which to live. In 2019, the Government provided £9.75 million for a high street community clean-up fund, to empower local authorities across England to support communities in undertaking community-led high-street clean-ups. I have checked, and as far as I know, I do not believe that Ealing Council got any of that money, but it sounds as though it was doing a good job anyway. Councils were able to use that one-off funding to support volunteers. I think that the hon. Member for Ealing, Southall, asked for more support for volunteers; certainly, a lot of our recent funds have gone towards them. For example, funds have gone towards supplying people with litter-picking kit, and on training for residents in how to remove graffiti, which is another blight.

More recently, the Environment Agency removed barriers for litter action groups by publishing a regulatory position statement that enables volunteers to litter-pick without a waste carrier licence. That allows local tips to accept litter from pickers. There was an extraordinary incident that gave rise to a bit of concern about that, but that has all been ironed out. I hope that the hon. Gentleman is pleased about that; I think that he referred to it. I call on all councils to provide as much support as they can to volunteer litter-pickers. Residents going to a waste site in all good faith to deposit the bags of litter that they have worked so hard to collect should not be turned away. 

While we are talking about all those who have done such good work, I want to mention the Prime Minister’s Points of Light awards. Through those, we have recognised the outstanding work of individual volunteers who have tackled litter in their community. Recipients of the award include Lizzie Carr MBE. She launched the successful “plastic patrol” campaign, which inspired thousands of people to take to their local waterways to prevent plastic pollution. Another recipient was Dom Ferris, who founded Trash Free Trails, which brings together runners, riders and rovers in Britain’s national parks and wild places to tackle plastic pollution.

Let me deal with the issue of councils. We are going about tackling litter on many fronts. We have developed and shared best practice on the provision of litter bins, and have supported that with £1 million of grant funding for 40 councils to purchase new bins. The hon. Member for Ealing, Southall, suggested that good models should be copied and followed, and actually a lot has been learned from the practices of councils such as Ealing. It is interesting; even I have learned that there are good and bad places to put a bin. I suppose that makes sense; we want it to be where people have just finished their drink, or want to stub out their cigarette butt or whatever. It has to be convenient.

We have also committed £1.2 million to helping another 30 councils purchase equipment to tackle fly-tipping. That includes a range of projects that try to identify the offenders. That is harder than might be imagined, but there are some very creative ideas out there. As I said, councils need to play their role; that is why we have committed to putting enforcement guidance on a statutory footing. That guidance will give those to which it applies a clear and explicit duty, which they must have regard to when exercising their enforcement functions. Councils have a range of enforcement functions, but it is important that we ensure that they use them.

One of my bugbears is fast food outlets. I am sure that it is the same in other Members’ constituencies: often, an amount of litter accumulates around those sites. The Department for Levelling Up, Housing and Communities has recently updated planning guidance to clarify the powers available to councils to ensure that new hot food takeaways do not increase the impact of litter in their communities. Councils can also issue what are called community protection notices, which can be used to require the owners of premises such as fast food outlets to take certain actions to tackle the litter that is created by their activities. Those are all positive measures to tackle one of the types of location where we often find litter.

[Gareth Thomas]

I am grateful to the Minister for much of what she has said. I am sure that she will acknowledge what Harrow Litter Pickers has found, which is that on occasion, there are basically organised fly-tippers going around and causing problems for local councils, and litter pickers have to help the councils respond to those problems. To what extent is the Department willing to support intelligence-gathering efforts about those rogue fly-tippers, to help make councils’ enforcement a little more effective?

[Rebecca Pow]

The hon. Gentleman’s point is very much linked to the wider littering issue, and I will come on to it in a minute, because fly-tipping is an important part of this debate. Before I do so, I want to mention the Government’s new antisocial behaviour plan, which takes even tougher action against those who seek to degrade our public places. For example, it raises the upper limit on fixed penalty notices for fly-tipping to £1,000. That was a manifesto commitment, so I am really pleased that we brought that forward. The penalty for littering and graffiti has also been raised to £500. Those penalties can be issued wherever there is evidence linking someone to one of those crimes.

Alongside those increases, there are also new measures to help councils issue more penalties. Under the action plan, there will be a league table for local authorities on fly-tipping rates. In other words, we will ask: how much are they actually enforcing this? How often are they using the powers? I genuinely think that would be helpful; we would see which are the active councils, such as Ealing Council and potentially Harrow Council. It is almost naming and shaming. This problem really annoys people, and if they saw that their council was using these powers, that would be popular.

The Government have pledged a further £93 million of additional investment in what is called community payback, so that criminals sentenced to probation and supervised community sentences at court across England and Wales can complete up to 8 million hours of unpaid community payback per year in hi-vis jackets, under supervision. They will have to clean up graffiti, pick litter, clear wasteland, and redecorate public places and buildings. That will include offenders’ involvement in Keep Britain Tidy projects.

The Great British spring clean was mentioned. That saw 1,500 offenders spend almost 10,000 hours on 300 community clean-up projects. This year, we will build on that success, and will run a second clean-up week in the autumn. Under the action plan, a new approach called immediate justice will be introduced to make perpetrators repair the damage that they have done. They will be forced to pick up litter, wash police cars or clean up graffiti within 48 hours of being caught. That will start in 10 places across England and Wales next year. Local people will have their say on that scheme. The Probation Service is relaunching the community payback nominations website early next year. By law, it will be required to consult key community leaders and local authorities on how and where payback schemes should be used to improve the area, in terms of litter and other things that I have mentioned.

We have taken some major legislative reforms in trying to tackle fly-tipping, one of which is that last year we consulted on preventing charges for the disposal of DIY waste at household waste recycling centres. We will publish the results of that soon. That is potentially a lot of the stuff that gets fly-tipped, because people are trying to avoid paying to take it to the right place. We are also taking forward our commitment to develop proposals for the reform of the waste carrier, broker and dealer regime. That should make it easier for regulators to enforce against non-compliant operators, while making it much harder for those who are not registered properly to find work in the sector. We have consulted on that, and we will publish the response shortly. We are introducing mandatory waste tracking. All those things will make a difference to tackling the pernicious issue of fly-tipping.

We also have a range of other measures around reducing waste overall that will help to reduce litter, such as our extended producer responsibility scheme for packaging and the deposit return scheme for drinks containers. That is particularly aimed at in-scope containers, an awful lot of which are on-the-go products that are bought in a local shop, consumed in the street and then chucked away. The deposit return scheme is really designed to help tackle that.

Similarly, we have really cracked down on the issue of chewing gum on pavements. That is another absolute bugbear of mine. We have established a chewing gum taskforce, which has provided £1.25 million of funding to help more than 40 councils clean chewing gum off the pavements. It has had superb results: it has achieved reductions in gum littering of up to 80% in the first two months.

Behaviour change is really important in all this, as is education, which was mentioned comprehensively by the hon. Member for Ealing, Southall. I fully support him and all those schools that are doing such great work to teach their kids that it is not right to throw down litter.

I will end there. I thank the hon. Gentleman so much for bringing this debate to us. Huge congratulations and thanks to all those volunteers and community groups, including in Ealing, Southall, who have done such great work on cleaning up litter.

Question put and agreed to.

Water Companies: Sewage Discharge

Gareth Thomas Excerpts

Monday 15th November 2021 Westminster Hall

[Tonia Antoniazzi (Gower) (Lab)]

I beg to move,

That this House has considered e-petition 582336, relating to the discharge of sewage by water companies.

It is a pleasure to serve under your chairship, Mr Paisley, and it is an honour to be leading the debate on behalf of the Petitions Committee. The petition calls for an outright ban on water companies discharging raw sewage into watercourses. Personally, I think a lot of our constituents will be shocked to hear that it is currently legal for water companies to do this. How can it be okay for multimillion-pound businesses to absolve themselves of the responsibility for ensuring that our rivers and streams, and ultimately our seas, are free of harmful sewage?

I pay tribute to Ferry Harmer, who started the petition after seeing Feargal Sharkey raise some of the issues around the state of our rivers on the TV programme “Mortimer & Whitehouse: Gone Fishing” last year. I also thank the 111,434 people from around the UK who have taken the time to sign the petition, especially the 186 people from Gower who have signed it. I have had nearly 150 constituents get in touch with me about this issue in one way or another. That demonstrates the strength of feeling about this issue, which has featured recently in the news. When I spoke to Ferry, it was clear he is a man of real passion and determination. He spoke about the petition and told me that 41% of fish species are in decline in British waters. A third of species are in serious decline, including iconic fish such as salmon and trout.

Through my research, I have discovered astounding facts about the state of our rivers and waterways. Some 39 million tonnes of sewage were discharged into the River Thames alone in 2019—that is one river in one year. Last year, raw sewage was discharged into our waters more than 400,000 times, which is quite an incredible figure. This has now become an emergency for our waterways. Not a single river in England is in a healthy condition, not a single river meets a good chemical standard, and over 85% do not meet good ecological standards. Frankly, it is not good enough.

I am fortunate to represent arguably the best coastal community in the UK. The coast around Gower is popular all year round with families and tourists, and a growing number of local wild swimming groups took off during lockdown. It is the only contact that people have with the outside world, and it has been a saviour for so many people. The well-known Mermaids and other groups know that Gower has some of the best surfing in the UK. I will do anything I can to protect our vital ecosystem, seafood production economy and thriving tourist economy. I know that this is a devolved matter, but as I noted in a recent Environment, Food and Rural Affairs Question Time, this a UK-wide issue. What work is the Minister doing alongside the devolved Administrations, and what commitment can she give to do so, because these waterways, whether in England, Wales or Scotland, are all intertwined and all end up somewhere?

If sewage goes into our rivers and waterways, it will ultimately make its way to the sea, and even into our food chain through seafood and fish. I know we are all supposed to encourage recycling, but even I think that is going a little too far. The Government are failing in their duty of care here. The state of our waterways has not improved since 2016, despite ministerial claims that they are cleaning up their act. What is even worse, the unlawful discharge of sewage could be up to 10 times higher than the rate of prosecutions by the Environment Agency. The Environment Agency is responsible for monitoring and enforcement of water quality breaches, but it has fallen foul of the Government’s cuts; its funding has been slashed by 63% since 2010. Simple measures such as the number of points at which samples are collected have been cut by more than 40%. How can we continue to monitor the health of our rivers if less data is collected?

The Government’s response to the petition mentions that

“water companies have agreed to make available real-time data on sewage discharges from storm overflows at designated bathing waters all year round from this year. This data will be made available to help surfers, swimmers and other recreational water users to check the latest information and make informed choices on where to swim.”

Who does not want to check the amount of human waste, used sanitary products and anything else people have flushed into the water before they go for a swim? That is not a delightful thought. Let us not forget the words of the then Secretary of State for Environment, Food and Rural Affairs, the right hon. Member for Surrey Heath (Michael Gove), who back in 2018 told the Environmental Audit Committee that divergence from tough EU rules would be an opportunity for the UK Government to implement unquestionably tougher restrictions. He said that

“being different can sometimes mean being better”,

and that leavers did not automatically advocate for divergence out of a desire to lower standards. However, owing to Brexit, we have seen a shortage of heavy goods vehicle drivers and an increase in red tape, which has led to chemicals not being available to fully treat wastewater before it is discharged. What is more, the Government have granted permissions for the discharges to take place.

I am not here only to outline the increasing problems that the Government are exacerbating, because I have received suggestions of things that the Government could put into place to reverse some of the damage. To clean up our waterways, we need a fully funded and resourced action plan. We need targets for water companies and serious consequences when they break the rules. One way of doing that is to increase the environmental reporting requirement for water companies. I call on the Government to improve their plan to introduce annual reports, such as by making them quarterly reports. With more regular reporting and a system that allows for this, we can see where there are problem areas and react much more efficiently.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

Does my hon. Friend also think there should be a requirement on water companies to report that information to their consumers, perhaps in the form of formal consumer committees of each water company, so that that company is more likely to be held to account by the very consumers who suffer from this dumping of sewage?

[Tonia Antoniazzi]

That is key. Accountability is needed. If we are to move forward, those consumer committees that my hon. Friend speaks of are exactly what we need: a practical solution in order to move forward.

I welcome the Government’s commitment to introduce measures to reduce sewage discharge from storm overflows, but unfortunately this does not go far enough. The Government must eliminate sewage discharges. That is why Labour voted in favour of the Duke of Wellington’s amendment calling for exactly that. The Government’s aim of publishing a plan on this by September 2022 is just not good enough. Let us have that plan in place early next year. This has been dragging on for far too long, and there is no reason why we cannot have a strategy sooner.

If Ministers are serious about reaching the targets for cleaning our rivers, lakes, streams and seas, they must have a fully-resourced action plan for monitoring water quality and holding companies to account. However, there are also high-tech solutions that could be employed immediately. Ferry mentioned a system called HYBACS—hybrid activated sludge process—which does not sound absolutely delightful, but is cheaper and more effective than the system that companies are currently using. That sounds like a pretty obvious thing for the water companies to put in place. Where there are capital expenditure issues, it must fall to the Government to ultimately step in and protect the waterways. Natural mitigations can also provide solutions to this problem: reintroducing beavers, building more reservoirs and increasing tree and hedgerow planting.

The Minister has plenty to answer from my contribution, but I would also like to know how many water companies have been fined by the Environment Agency. How much have they been fined? When did the Minister last meet with the Environment Agency to discuss this?

I bring my contribution to a close by asking the Government to be bold in doing the right thing and getting our rivers and streams cleaned up. They should listen to the advice of experts: beef up the Environment Agency’s powers and keep pushing water companies to take responsibility, not just for those who signed the petition, but for everybody living in the United Kingdom.

--- Later in debate ---

[Gareth Thomas (Harrow West) (Lab/Co-op)]

I appreciate the opportunity to speak in this debate. I join others in congratulating my hon. Friend the Member for Gower (Tonia Antoniazzi) on opening the debate. I want to underline in particular the figure that she used: 39 million tonnes of raw sewage was dumped in the River Thames in 2019. As someone who loves walking by the Thames, occasionally swimming in it, and certainly canoeing on it, that figure gives even me pause for thought.

The contributions from my hon. Friends the Members for Salford and Eccles (Rebecca Long Bailey), for Weaver Vale (Mike Amesbury), for Dulwich and West Norwood (Helen Hayes) and for Bristol East (Kerry McCarthy) were very powerful in their critique of the ownership of water companies. Since privatisation, there has been a 40% real-terms hike in bills, almost £60 billion in payments to shareholders, and more than £50 billion in debt loaded on to water companies to make those payments to shareholders.

One of the problems with the argument made by the right hon. Members for Ludlow (Philip Dunne) and for North Thanet (Sir Roger Gale), and by the hon. Member for Keighley (Robbie Moore), is that it glosses over the issue of ownership and, in particular, the fact that annual investment in water supply infrastructure was lower in 2018 than in 1990. That rather suggests that there has been, for some time, a serious question mark about whether our privatisation is delivering.

[Philip Dunne]

I am very grateful to the hon. Gentleman for allowing me to defend my remarks. I made no remarks on the subject of privatisation. As he has raised it and accused me of having done so, I ask him whether he recognises that the amount of capital investment by the water companies in the 10 years prior to privatisation was half the amount invested in capital treatment works in the 10 years post-privatisation.

[Gareth Thomas]

The right hon. Gentleman will have to forgive me. I was concentrating on other things in the 10 years before privatisation—I am not quite that old. If he shares the Opposition’s concerns about the quality of performance of the privatised water companies, I welcome that.

I recognise that the Minister is not likely to give a commitment today to bring the water companies back into public ownership of one sort or another. I will therefore suggest a third way. We could maintain pressure on water companies to bring down the amount of sewage dumped in our streams long after the news cycle has moved on to other issues by giving the consumers of water companies more power, perhaps in the form of a requirement that any increase in bills—or if the Minister were willing to be radical, any increase in the salary of the chief executive and board—has to be approved by the consumers of that company. There should be a water users consumer committee for each water company, with real power to hold to account the board of that company. At the moment, only two committees, without any substantive powers, cover the whole operation of the English water companies. They are clearly not having much impact. I urge the Minister to take away the need to give consumers more direct power over and say in the operation of the water companies on which we all rely.

[Ian Paisley (in the Chair)]

I call Mr Grahame Morris. If it is more comfortable for you to remain seated for your speech, I am more than happy to facilitate that.

Environment Bill

Gareth Thomas Excerpts

Report stage & 3rd reading
Wednesday 26th May 2021 Commons Chamber

[Rebecca Pow]

I am pleased the hon. Lady made that intervention, because of course I would like to pay tribute to Surfers Against Sewage, which has played a key role in all this for such a long time. Coming from the south-west, as I do, I very much know about the good work done by Surfers Against Sewage.

Today we are debating the nature parts of the Bill, which provide a framework of measures to support nature’s recovery in line with the ambition set out in our 25-year environment plan.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

The Minister will know that England lags significantly behind the other countries of the UK on tree planting to help tackle climate change. She will also be aware that there is no ring-fenced component to the nature for climate fund for innovative, green-minded local authorities, such as my own in Harrow, to put in bids so that we, too, can play our part in increasing tree coverage.

[Rebecca Pow]

As the hon. Gentleman will know, or I hope he knows, we launched our tree action plan just last week. It sets out the raft of measures we will use to enable us to plant our commitments and target on tree planting, which is 30,000 hectares by the end of this Parliament. There are measures in the action plan, and we have allocated £500 million from the nature for climate fund, so I would say there is a huge commitment to tree planting in this country.

Agriculture Bill

Gareth Thomas Excerpts

Consideration of Lords amendments & Ping Pong & Ping Pong: House of Commons
Monday 12th October 2020 Commons Chamber

[Victoria Prentis]

I met the Trussell Trust and the Children’s Society last week to discuss how effective that local authority grant was. I know that my hon. Friend, who has done so much work in this space, has also taken evidence to that effect. I cannot give him the assurance that he seeks right now, but I assure him that I will make sure that those comments are fed through and, if the need is there, that that is seen as one of the options available and a very direct way of getting money to those who are in food poverty. The Trussell Trust is itself preparing a report on how effective that grant has been.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

All the indicators are that food poverty is on the rise, so I ask the Minister, as I asked the Prime Minister and the Education Secretary: why will Ministers not extend the food voucher holiday hunger scheme to the half-term and Christmas holidays?

[Victoria Prentis]

I know that the hon. Gentleman has campaigned on this matter for some time. He has heard what the Department for Education has to say about that. The scheme that I am discussing is the £63 million scheme, which of course did not go just to families with children, although they were heavily represented among the recipients of that scheme. We will pass on those comments and those of the Trussell Trust and, of course, the EFRA Committee when considering how we tackle food poverty directly over the course of this winter. We all know that this is going to be a difficult time for many.

Returning to the Bill, we already have powers in what was originally clause 17, which commits the Government to

“lay before Parliament a report containing an analysis of statistical data relating to food security”

in the UK. We listened to the concerns raised regarding the frequency of the food security report and, through Lords amendments 5 to 8, reduced the minimum frequency of reporting from five years to three years. Of course, we can still report more often than that, and in times of strain on food supply that might well be appropriate.

Turning to Lords amendment 11, I recognise the positive intentions behind the amendment, but I am afraid I take issue with the drafting. The Government are committed to reducing the risks from pesticide use. We have already tightened the standards for authorisation and withdrawn many pesticides from the organophosphate and carbamate classes. Integrated pest management will be a critical part of future farming policy. Under our existing legislation, the use of pesticides is allowed only where a scientific assessment shows that it will have no effect on human health, including that of vulnerable groups.

The amendment, although undoubtedly well intentioned, is far too broad. It extends to any pesticide and any building, and would include pesticides that are important for productivity but pose no danger whatsoever to health. Even worse, it also extends to any open space used for work, which on my reading would prohibit the use of pesticides in fields entirely. I encourage hon. Members to read the amendment carefully before supporting it.

Environment Bill

Gareth Thomas Excerpts

2nd reading & 2nd reading: House of Commons
Wednesday 26th February 2020 Commons Chamber

[The Secretary of State for Environment, Food and Rural Affairs (George Eustice)]

I beg to move, That the Bill be now read a Second time.

It is a pleasure to open this Second Reading debate on the Environment Bill. In recent decades, our natural world has faced multiple pressures. As a consequence, we face two great global challenges: climate change and biodiversity loss. A million species face extinction, and climate change is piling the pressure on nature, doubling the number of species under threat in the past 15 years. If global temperatures rise by even 1.5°, we will lose even more of our precious life on Earth. As an island nation, we are acutely aware of the devastating effects of plastic pollution on marine life. We need to act now to turn things around. This Government were elected on the strongest-ever manifesto for the environment, and this Bill is critical to implementing that commitment.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

The Secretary of State is clearly right about the two big global challenges that we face, but does he also recognise that, as a country in our own right, we face a specific challenge with air pollution? Will he explain why he will not commit to the World Health Organisation-recommended legally binding limits on air pollution, to be set and met by 2030?

[George Eustice]

The hon. Gentleman will be aware that the Bill provides for us to do precisely that by setting targets for PM 2.5. We will want to consult and engage people on exactly what that target should be. It is worth noting that the World Health Organisation has commended this Government’s air quality strategy, saying that it is an example for the rest of the world to follow.

The Climate Emergency

Gareth Thomas Excerpts

Thursday 17th October 2019 Commons Chamber

[Gareth Thomas (Harrow West) (Lab/Co-op)]

Will the Secretary of State give way?

[Theresa Villiers]

I am going to make a little more progress.

Only six years ago, 40% of our electricity came from coal; now that figure is less than 5%. In 2018, more than a third of our electricity was generated by renewables, and earlier this year the UK went a whole fortnight without using electricity generated from coal, the first time this has happened since the industrial revolution. We have the largest installed offshore wind capacity in the world, and annual support for renewables will be over £10 billion by 2021.

--- Later in debate ---

[Theresa Villiers]

We will certainly look at all the options to create low-carbon jobs, including the ideas that the hon. Gentleman speaks about.

Just as the Climate Change Act set a path to reducing carbon emissions, so our Environment Bill will embed environmental principles at the heart of Government decision making. It will mandate the Government to set ambitious, legally binding targets on the pressing environmental concerns that we face as a nation, including air quality, water, resource efficiency, waste reduction and safeguarding nature and habitats.

[Gareth Thomas]

On waste reduction, the Secretary of State will know that plastic is one of the big sources of pollution in our natural environment—particularly in our seas, but also on land. What pressure is she therefore applying to the manufacturers of soft drinks to move away from plastic, particularly single-use plastic?

[Theresa Villiers]

The hon. Gentleman is right to highlight the pressing concerns about single-use plastic. The Bill contains a number of provisions designed to cut down on avoidable plastic waste, which I will address in more detail in a moment. It includes the potential for the charges that apply to plastic bags to be extended to other plastics; it also includes better labelling to ensure that people are clear about whether the products that they buy are reusable or recyclable. It will help people to understand the best way to recycle by introducing a consistent approach to kerbside recycling, to increase the proportion of plastic that is recycled rather than ending up in landfill. We fully recognise the enthusiasm across our nation for tackling avoidable plastic waste, and our Environment Bill sets out a range of measures to help us to meet that challenge.

Water Industry

Gareth Thomas Excerpts

Tuesday 22nd January 2019 Westminster Hall

[Gareth Thomas (Harrow West) (Lab/Co-op)]

I beg to move,

That this House has considered the future of the water industry in England and Wales.

Customers and employees should be helped to take back control of the companies providing our water and taking away our sewage. The people of England should once again be front and centre of their water industry. Democratic, publicly owned businesses operating in the private sector, regulated with vigour by a more effective Ofwat is the Co-operative party’s vision of the future of the water industry. I am proud to chair that political party. I am grateful to the Backbench Business Committee for the opportunity to explore that agenda through this debate.

Nationwide, John Lewis, the Co-operative Group, the Royal London insurance company and NFU Mutual are just five successful examples of people-run businesses—mutuals—where profit is sought not to line the pockets of wealthy investors, but to reward customers and employees, and to invest in local communities. Such businesses are inspiration for reform of the water industry.

Margaret Thatcher’s decision 30 years ago to privatise our water industry has created an expensive, unaccountable and unfair system. No other country has a fully privatised system of water and sewage services with so little competition. The resulting monopoly businesses are overseen by a woefully weak water regulator. Unsurprisingly, the consumer voice in England carries little weight against the interests of distant investors, whose decisions have seen water bills rise by 40% above inflation since privatisation.

[Daniel Zeichner (Cambridge) (Lab)]

Does my hon. Friend agree that the rather poor practices of some water companies have led to widespread public disillusionment? When I worked for Unison a few years ago, an excellent report was published showing some remarkably creative accounting, which seemed to suggest that money was being diverted not to investment, but to shareholders.

[Gareth Thomas]

My hon. Friend and the trade union movement in general have pointed that out on a number of occasions. I will come on to one of the trade union movement’s particular campaign issues.

Water companies have become a desirable global financial commodity, bought and sold by big banks, international infrastructure investors, pensions and sovereign wealth funds. Since privatisation, as my hon. Friend just pointed out, dividend payments have been very high, at an average of £200 million a year per company, and £2 billion a year in total. Over the past 30 years, at least £48 billion has gone directly to shareholders.

Analysis by Greenwich University suggests that the more than 40% increase in household bills in that time was driven mainly by the need to finance growing interest payments on debt—a point that the trade union movement in particular has highlighted. That analysis shows that accelerating debt levels are the result of the high dividend payments paid by water companies to their shareholders, which exceeded the privatised companies’ cash balances in every year bar one since 1989. Indeed, it is striking that total payments to shareholders are very similar to the total outstanding debt burden of privatised water companies, with at least £48 billion in payments in the past 30 years and at least £51 billion in total debt.

The Leader of the Opposition and, in particular, the shadow Chancellor deserve considerable credit for highlighting the lower cost of water bills in Scotland, where Scottish Water is publicly owned. While bills in Scotland are 2% less in real terms than they were 18 years ago, English water bills increased by some 13% in real terms over the same period.

Privatisation has not meant more investment. Indeed, annual investment in water supply infrastructure was lower in 2018 than it was in 1990 and has fallen by about 10% in the past 10 years. All of the capital investment made since privatisation could have been covered using only the money generated by customer bills. Instead, much of the income generated by water bills appears to have been used to pay the interest on debt built up by the privately owned water companies, in turn to fund dividend payouts.

Despite similar levels of capital investment, we are now in a situation in which, according to research by the University of Greenwich, consumers in England are paying £2.3 billion a year more for their water and sewerage bills under the current privatised system than if the utility companies had remained in state ownership.

[Darren Jones (Bristol North West) (Lab)]

Does my hon. Friend agree that this is an excellent opportunity to bring consumers into the conversation with businesses, in a way that mutualisation allows, so that we can learn from customers as well as talk about the ownership of utilities?

[Gareth Thomas]

My hon. Friend makes a good point. I will come on to how mutuals would allow customers to have a lot more say over—indeed, they would give them ownership of—the water services on which we all depend.

Turning to one specific company, Thames Water was owned for 11 years by a complicated string of holding companies and offshore businesses, all ultimately owned by Macquarie bank, receiving returns of between 15.5% and 19%. Research by the Financial Times suggests that between 2006 and 2016, Macquarie and its fellow investors paid themselves £1.6 billion in dividends, while Thames Water was loaded with £10.6 billion of debt and ran up a pension deficit of some £260 million.

Dividend, debt and pension deficit were not the only things to increase under Macquarie’s control of Thames Water; customer bills and complaints also soared. The only thing that went down during this period was customer satisfaction, which is now ranked 22nd out of 23 in the Consumer Council for Water league table.

[Jim Shannon (Strangford) (DUP)]

I thank the hon. Gentleman for bringing this debate. Ofwat imposes no penalties on managers who break their commitments. Does he agree that legislation must be put in place to ensure that—after loading Thames Water with debt and flooding the Thames valley with excrement—the water body faces more than just a fine that is less than the amount it would take to dispose of the water in the appropriate way? In other words, the fines do not match the crime.

[Gareth Thomas]

The hon. Gentleman makes an extremely good point. Given that we are in the middle of the latest pricing review, if Ministers had the gumption they could put pressure on Ofwat to use its existing powers to bear down on those exact issues. I agree with the hon. Gentleman’s general point that we need a full review of the powers available to Ofwat. I am sure that they need to be increased.

Thames Water’s credit rating is the worst in the industry, according to Standard & Poor’s. Thames Water’s tax bill also declined during the period in question, as it regularly paid no corporation tax on its £1.8 billion turnover. Thames Water is, by its own admission, failing to meet targets to reduce the number of properties experiencing chronic low water pressure; failing to reduce the number of complaints; and wasting almost 700 million litres of water annually through leakage. It is failing to meet basic standards in 17 out of 41 key areas. That dismal record also includes record fines for poor performance.

In comparison, Scottish Water, which is publicly owned, has debt levels 5% lower than 17 years ago; its interest payments have remained consistent; and, with no dividends having been paid out, all the profit has been reinvested. It is worth pointing out that, adjusted for leakage per kilometre of pipes, Scottish Water performs just as well as an average English company, with 10.2k litres of leakage per kilometre as opposed to 22.1k for Thames Water, 10.8k for United Utilities and 9.5k for Yorkshire Water.

Thames Water is not alone in poor performance. In truth, more than 20% of all water is currently lost through leakages from water pipes. In total, it is estimated that some 7.5 trillion litres of water has been lost through leakage, which is equivalent to the total volume of water currently in Loch Ness.

[Rebecca Pow (Taunton Deane) (Con)]

The hon. Gentleman is making a powerful case against the water companies. The issue of leakage seriously needs to be addressed. Something like 1,273 Olympic-size swimming pools-worth of water is leaked daily because water pipes have not been addressed. The Secretary of State for Environment, Food and Rural Affairs has rattled the cages of the water companies, to improve their performance, and they have set out in a new plan that they will reduce leakage by 16%. Does the hon. Gentleman agree that that should not be done voluntarily and that there should potentially be stronger regulation?

[Gareth Thomas]

I find myself in the slightly unusual position of agreeing almost completely with the hon. Lady. Leakage is a huge problem. Much tougher regulation by Ofwat in particular, and ultimately an increase in the regulator’s powers, are required to bear down on the shocking levels of leakage, not least because the Environment Agency has said publicly that England and Wales could suffer major water shortages by 2030. The agency also noted that enough water to meet the needs of 20 million people is lost every day through leakage, which surely further supports her significant point.

To be frank, in the past Ofwat has not demanded enough investment from water companies, given the scale of the rise in customer bills. It appears to have been asleep at the wheel under various leadership teams. The Public Accounts Committee, which looked at regulation of the water industry as far back as 2015, criticised Ofwat for overestimating costs and poor benchmarking of efficiency, resulting in higher bills for customers.

The hon. Lady also made the point that even the Secretary of State for Environment, Food and Rural Affairs suggested in March last year that water companies have not been acting in the public interest. Granted, the Secretary of State’s criticism came a month after a detailed critique of the water industry by the shadow Chancellor; nevertheless, the Secretary of State’s criticism is welcome.

As I indicated earlier, the latest price review is under way and already the Consumer Council for Water is concerned that Ofwat’s grand promises are unlikely to be met, with

“companies bidding for significant rewards for performance levels that aren’t particularly stretching”.

In part, prices are decided by the cost of equity and the cost of debt, plus investors’ expected UK tax burden. In my view, Ofwat should reduce the cost of equity in its calculations while maintaining fair treatment on debt finance for genuine capital investment. In short, Ofwat should drive down the profit that the owners of water companies make. It should also scrutinise the tax behaviour of those owners, to crack down on tax avoidance, and demand that owners do not use tax havens to receive the profits from our water companies. Lastly, every English water customer should see their bills reduced after 30 years of being used as cash cows by the owners of water companies. It is time that consumers and their pockets were treated better.

In October last year, the Select Committee on Environment, Food and Rural Affairs suggested that an independent review to determine whether the water industry was fit for purpose was required. The Chartered Institution of Water and Environmental Management went further, suggesting that such a review needed to examine the ownership of water companies. The Select Committee also raised concerns about the powers available to Ministers and Ofwat to improve governance and prevent pollution. With climate change approaching and a creaking infrastructure, the Committee argued that the need for change was urgent.

For some of the reasons that I have set out, there is growing concern about the ownership model in the water industry, and there are alternatives to the current privatised system. Long-term alternatives that the Government should consider include, in particular, a mutual approach, with democratic public ownership by consumers and employees, modelled on the success of Welsh Water and inspired by other similar success stories. Welsh Water, or Glas Cymru, does not pay dividends to shareholders, and yet it operates in the private sector. It has an ownership model that forces it always to operate in the interest of its customers and it has changed the way in which it raises finance, in order to reduce the cost of credit.

Welsh Water now has the strongest credit ratings in the water industry, which reduces its financing costs and allows for even more future investment in its infrastructure and services. Customer bills have been reduced steadily in real terms and so far it has returned about £180 million to customers in the form of customer dividends. In addition, it has provided some £10 million of support for vulnerable and low-income customers, through social tariffs and an assistance fund.

The first step on that path for the water industry in England, so that it can match and then go further than Welsh Water, would be the formation of consumer and employee trusts. These trusts would have the power to appoint non-executive directors to water company boards, and they would have access to independent advice from management, so that they can make well-informed and independent decisions.

Ofwat should discourage investment in the water industry that requires a fast return to the owners of expensive equity. Instead, it should steer water companies towards the lower-cost debt market, with responsible investors such as public sector pension funds, whose interests are aligned with those of the water sector and whose investment could help to ensure that there is a modern, resilient water infrastructure.

Over the longer term, as equity investors seek to sell up because they recognise that they can no longer make a fast buck, consumer and employee trusts could use bond issues to buy those equity investors’ stakes in the business. These trusts would need to be underwritten by a buffer, or internal equity reserves, to borrow against. That could be achieved through a Government guarantee on loans or debt, to ensure that any large unexpected investment needs will be met, and to ensure that if anything should go awry, lenders are in a first loss position. Similar initiatives already take place in other areas of Government policy. Government guarantees could be replaced over time through the accumulation of non-distributed reserves, or of retained profit, by the trusts.

As the ownership of water companies changes, legislation should be passed to embed the not-for-profit principle. The new not-for-profit water companies would also require protection, with an asset lock to prevent demutualisation in the future. Consumer and employee trusts—like those at Nationwide, John Lewis and other mutuals—would enable customers and the workforce to have an active role in the key decisions taken by their organisation. The board would include employee and customer directors, and the trust membership would enable members—including consumers—to vote for board members, and to agree audit, remuneration and company governance decisions, as well as how profits are invested or distributed.

Ofwat should be given new powers to ensure that water companies encourage employee and customer participation in the democratic process. The new employee and consumer trusts should also have a role in the scrutiny and decision making of Ofwat, with a scrutiny panel that reviews the operations of the regulator, led by consumers, and also playing a role in Ofwat’s appointments to its board.

In conclusion, comparisons of public ownership and private ownership of the water industry do not come out favourably for England’s privatised water companies. They do not look like they are committed to environmental investment and the other challenges facing the water industry. The latest price review should herald the beginning of the transformation to new not-for-profit owners—the very consumers and employees who depend on the services of the water industry. Public ownership works in Scotland and the model for mutual transformation of the rest of the water industry works in Wales. It is time that there was new ownership of the water companies in England, and I commend the mutual model to the House.

[Richard Benyon (Newbury) (Con)]

If hon. Members check my entry in the Register of Members’ Financial Interests, they will see that I chair an organisation called the UK Water Partnership. As the Leader of the Opposition claimed that I was some sort of stooge for the water companies, I put on the record that the UK Water Partnership is a public-private partnership, and that I was asked to chair it by the Department for Environment, Food and Rural Affairs. It brings together industry, policy makers and the research community to try to provide the key to unlocking a $500 billion global marketplace, as well as tackling water security issues through a strategic approach to research innovation and global clients. It effectively works right across the water sector, helping British companies to do better in a global marketplace. I very much do not speak for water companies.

As the water Minister who introduced more competition, changed Ofwat’s prioritisation of environmental protection, introduced the catchment approach to upstream water management and oversaw the Thames Tideway tunnel in its initial phase, I have a fair degree of insight into how private water companies work and what they deliver for customers.

I appreciate the hon. Member for Harrow West (Gareth Thomas) bringing this matter to the House. I suppose it all depends on which end of the telescope we look down. It is easy to pray in aid companies and organisations that fail, and so give a malign picture of the whole operation of our water sector. I will try to give a more balanced view, but I totally accept some of the points made, as there are good players and bad players in every sector.

As in any field that involves a number of organisations, we will of course come across ones that are good and others that are bad, but I am absolutely certain that we have benefited from privatisation. It is wrong to turn the clock back and pretend that there was some halcyon era of cheap water, exemplary customer service, massive investment and great environmental activity by companies in the days when they were publicly owned. To those who say, “Ah, but we would do it better this time,” I say that that is the Venezuela defence. Socialists say that Venezuela has not done socialism right and that they would do it differently here, that nationalisation would be different from in the past. Those years of bad service, under-investment and environmental degradation must not happen again.

[Gareth Thomas]

I am enjoying the trip to Venezuela that the right hon. Gentleman is taking us on. May I draw him back to my remarks about the mutual model of democratic public ownership, which would see the water companies remaining in the private sector, albeit run by their customers and employees, a bit like at John Lewis and Nationwide?

[Richard Benyon]

I can come on to talk about suggestions that I think have some virtue, particularly employee share ownership schemes. As with everything, there is no perfect right or absolute wrong; there is a massive area of grey, and I will explore some of the nuances, on which I think we can perhaps find some agreement.

On the model of nationalisation I have heard certain individuals speak about at Momentum rallies, I think about the head of a nationalised utility company going to see the Chancellor to plead for more infrastructure investment funds, only to be told, “Get in the queue behind the NHS, welfare, policing and schools”—the long list of public spending priorities that come before something that is now funded privately and by institutional investors. Let us consider some facts. Since privatisation, water companies in England and Wales have spent about £150 billion on improvements to the water service. That is infrastructure that had been absolutely ignored by public expenditure before it was put into the private sector. The companies now spend about £8 billion a year continuing with those improvements.

When I was water Minister, I met institutional investors and saw that the regulated utility sector is an extremely popular place for people to invest, including for pension funds—the people who pay the pensions of people in the public sector. I welcome the fact that sovereign wealth funds and overseas investors want to invest in the United Kingdom. They do so because it is a stable and relatively low-yielding but relatively secure investment.

--- Later in debate ---

[Richard Benyon]

There has absolutely been bad practice. I have had my concerns about Thames Water in the past, but today the company has capped its dividend payments, is investing more in resilience and is doing a whole new range of different activities, and my concern is that we risk cutting off an enormous amount of infrastructure investment if we do not get this right. I think there is a way forward, and I will touch on it in a moment.

Compared with 30 years ago, customers are now five times less likely to suffer from supply interruptions, eight times less likely to suffer from sewer flooding and 100 times less likely to have low water pressure. The hon. Member for Harrow West talked about Welsh Water; he is right that people sometimes suggest that it is a mutualised organisation, when it is a private company. Welsh Water loses 121 litres per property in leakage, which is more than nearly every other water company. Its average combined water and sewage bill is £439, which is 8% higher than the average English and Welsh bill, at £405. It is higher than the bill in six English companies, and that is in a country where there is no shortage of water. I come from the Thames Water region and we are short of water there, but in Wales they are not so I cannot understand why the bills are so high. In Welsh Water, the average number of minutes lost due to supply interruptions is 43 minutes, which is about 400% higher than in most other companies, where fewer than 10 minutes are lost.

The picture is not universally wonderful, and there occasionally needs to be a bit of balance in the subject. Water companies have reduced leakage by a third since the 1990s. We are about to see an incredible increase in innovative methods of detecting leakage, and it is right that in the current price review round there is an enormous driver on those companies to crack down on it further.

On the environment, standards have dramatically risen, with the welcome return of wildlife to rivers that had been biologically dead since the industrial revolution. Otters rely on healthy rivers and were thought to be on the verge of being wiped out 30 years ago, yet they are now seen in every county in England.

The average domestic water bill is just over £1 a day—that is £1 a day to get all the water we need into the household, and all the sewage and waste water out. Although bills went up immediately after privatisation to help deal with decades of under-investment when the industry was owned and run by the Government, bills have stayed pretty much the same in real terms since 1994 after inflation, and are set to fall in real terms over the next few years. By 2025, bills will have fallen in real terms for a decade. The industry’s independent regulator Ofwat—which has just come in for some stick—has calculated that bills are £120 lower than they would have been if the combination of privatisation and tough independent regulation had not happened. Bills would have been £120 more per household if the industry had remained in public ownership.

On the subject of customer satisfaction, the hon. Member for Harrow West has said that people are terribly dissatisfied with their water companies. I went on the internet last night to look at what Ofwat, the Consumer Council for Water and individual water companies are saying, and customer satisfaction levels for water and sewerage services are around 90%. As politicians, would we not love to have a bit of that, particularly at the moment?

[Gareth Thomas]

I wonder whether the right hon. Gentleman would comment on two things. The first is the National Audit Office’s calculations, which suggest that there has been a 43% increase in real terms in water bills since privatisation, and the second is the significant difference in water prices between publicly owned Scottish Water and the privatised water companies in England, which I mentioned.

[Richard Benyon]

I do not know the circumstances in Scotland, so I can only speculate, but that is another country that is not short of water, as many parts of this country are. I just think that we need to look at what the customers are saying, and my impression is that customers are not shrinking violets. When I came into this House in 2005, my inbox was overflowing with complaints about Thames Water’s customer service, which made me realise that water is an absolute necessity of life. It is the first thing that people will complain about; it is something that we perhaps rely on too much, and use too much of, in the area of the country in which I live. However, the idea that customers are somehow not involved in and concerned with raising these issues is wrong. When they are asked about them, they give quite interesting responses.

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[John Grogan (Keighley) (Lab)]

It is a great pleasure to follow the right hon. Member for Newbury (Richard Benyon), who has displayed his knowledge of not just the water industry but Momentum rallies, Venezuela and so on. His remarks put our party and our Front Benchers on notice that we have to get the detail of this policy right. It is a very radical policy, and I support changes in the water industry, but we will hear many mentions of Venezuela and Momentum rallies in any election campaign in which this is an issue. It is also a great pleasure to follow my hon. Friend the Member for Harrow West (Gareth Thomas), who opened the debate in a typically urbane and knowledgeable way. He is a great loss to our Front Bench, and I hope that one day he will be a Minister again in a future Labour Government.

[Gareth Thomas]

A £5 note is on its way.

[John Grogan]

I do not know whether that is a “thank you” or a bet.

I will speak briefly, but perhaps a little explicitly. I think that part of my hon. Friend’s speech was directed at our party’s own Front Benchers. At the moment, we are consulting on our plans for the water industry, and I hope nothing is set in stone. In developing our policy, we need to learn as much from Scotland, Wales and—if I may say so—Northern Ireland as we do from experts who reside in the north of London. My hon. Friend referred to the Secretary of State for Environment, Food and Rural Affairs and the shadow Chancellor competing, about a year ago. It was last spring—spring was in the air—and one of those gentlemen said:

“Far too often, there is evidence that water companies—your water companies—have not been acting sufficiently in the public interest.”

It could have been either of them; in this instance, it was the Secretary of State. On that occasion, he was as cruel and as vehement in his speech about the water industry as he was about the Opposition last week, so this is an open goal for the Opposition.

I will not repeat the statistics that my hon. Friend referred to when opening the debate, except for the basic statistic that the privatised water industry has taken out about as much in dividends as it has put in as investment, so the idea that the privatised water industry has brought new investment into the industry that would not have been made otherwise is wrong. However, what should be a Labour Opposition’s policy on changing ownership? I hope that the shadow Minister, my hon. Friend the Member for Plymouth, Sutton and Devonport (Luke Pollard), can confirm that the submissions that my hon. Friend the Member for Harrow West has made will be considered very carefully in our current review of policy in this area.

I share with the right hon. Member for Newbury a love of employee share ownership schemes, particularly if they involve the whole of the company. I chaired such a scheme, which ran Hatfield, one of the last two deep mines in our industry. It has a different feel from any other form of capitalism. I hope we will consider that. I hope we will also consider the role of regulation, because any reference to external regulators seems to have gone from our paper. I do not want civil servants making all the decisions on the regulation of the water industry. It is a specialist role.

In Scotland, there is a publicly owned industry, but there is also an independent regulator. Incidentally, there is also competition in the business retail market in Scotland, which exists alongside public ownership of the industry. We have had some debate already about the precise form of ownership, but as I understand it, in Wales it is not employee-owned, but a not-for-profit model. I understand that the cost of debt for the Welsh industry is less than for any other industry in the public or private sector in the whole United Kingdom. I hope we learn from Wales, too.

If we are to take some of the water industry at least into the nationalised sector, why not let a thousand flowers bloom? I hope our Front Benchers will consider that. Why not have some on the model that my hon. Friend the Member for Harrow West mentioned and some where there is demand in the public sector? That would be one way of doing it, but it will be more costly to have all the water industry in the nationalised sector, as compared with my hon. Friend’s suggestion. We have to face up to the question of compensation. It is not good enough for an academic in north London to refer to how the banks were taken in distress into the public sector. Certainly they were, but they had virtually no value in their assets, and that would not be the case with the water industry.

Some of the water industry shares are owned by the workers of the water industry, and some are owned by the pensioners. I have had an interesting dialogue with an organisation called We Own It, which is contributing to the field. When I asked it about this question, it said—I paraphrase—that it did not really believe in compensation, but that it recognised that workers and pensioners somehow have to be looked after. We have to do better than that if we are to stand up with a general election campaign.

--- Later in debate ---

[Deidre Brock]

It is interesting. We are, of course, spending considerable amounts of money on addressing that. As I understand it, and I will speak about this later, our service performance is now comparable to the leading UK water companies; on some measures, we outperform them. As we continue to invest, water loss will be driven down. English water companies are having to resort to debt; that is what their investment in infrastructure is largely based on.

[Gareth Thomas]

Far be it from me to help the Scottish National party out, but as I understand it, from analysis done by Greenwich University, the levels of leakage per kilometre in Scotland are better than for many English water companies, and are certainly in line with the average at worst.

[Deidre Brock]

I was quite surprised by the contribution made by the right hon. Member for Newbury, as that is not my understanding. Perhaps I should quote the Scottish Water Commission, which noted in 2013:

“It is now more than a decade since Scottish Water was established. In that time the company has transformed itself as an organisation. It has caught up with the top performing companies in England and Wales on cost efficiency and levels of service and has regularly reached—and outperformed—its targets.”

I expect more of that in the future.

As Greenwich University research found,

“the public-owned sector in Scotland delivers the service just as efficiently, albeit at a lower cost to consumers.”

In Scotland, bills are 2% lower in real terms than they were 18 years ago, while over the equivalent period in England they increased by 13%. Drinking water continues to be at record levels of compliance, and there were no failing waste water treatment works in 2017, compared with more than 70 in 2002.

Scottish Water has reduced energy consumption and increased renewable power generation. It has cut carbon emissions by more than 30% since it first reported in 2006-07. Driven by the Scottish Government’s ambitious renewable heat and carbon reduction targets, the amount of renewable energy the company generates is now more than double its electricity consumption. Ageing facilities are being replaced through major investment in projects such as Glencorse water treatment works outside Edinburgh. That energy-efficient plant was delivered on schedule and under budget, and now supplies cleaner, safer water to around half a million people in the capital, while having sustainability at the core of its operations. A hydro-turbine provides almost half the facility’s own energy needs, helping to keep water charges low for customers.

Scottish Water’s service performance, as I mentioned, is now comparable with that of the leading UK water companies; on some measures, it outperforms them, while still keeping the bills down. Even where it can be said that the leading English companies perform better, at the current pace of investment by Scottish Water, and without the spend on dividends, that position is set to change over the next decade.

The myth that private profiteers are required to deliver things better has been dispelled. Indeed, the We Own It campaign points to the move towards public ownership internationally, with 235 cities in 37 countries taking water into public ownership in the last 15 years. Public ownership of public water supplies is already working in Scotland. That may seem clear, but it is worth reminding the Labour party of that fact, given that the Scottish leader, Richard Leonard, argued recently that they should be taken back into public hands. There was a wee bit of confusion there, but I will certainly draw his attention to helpful comments made by his colleagues down here today.

Scotland is rightly famous for its water. It is a reliable natural asset that serves our health, our wellbeing, our environment and our economy well. It is right that public supplies of domestic water have remained a public asset, delivered in the public interest. It should be so in England too.

--- Later in debate ---

[Dr Coffey]

My right hon. Friend is correct, and that has been considered. The balance is very important. However, we need to continue to challenge South West Water to make sure its investment is effective. The hon. Member for Keighley (John Grogan) talked about the challenges on sewage, and there are particular challenges in the south-west on aspects of combined overflows. We continue to press the company to make sure that it is maximising the investment on improvements.

[Gareth Thomas]

Will the Minister comment on two points? I mentioned in an earlier intervention that, since Scottish Water was set up in its current form, the price of water is 2% lower in real terms, while water bills in England have gone up by an average of 13% in real terms. Secondly, in the current price review, does the Minister intend to require Ofwat to significantly lower the cost of capital, which is included in the amount that Ofwat allows water companies to charge?

[Dr Coffey]

I am not aware that I have the power to direct Ofwat on exactly how it comes up with its cost of capital. My understanding is that it has reduced what it assumes to be appropriate for the weighted average cost of capital, but I expect the price review to be published shortly. I am due a briefing from Ofwat within the next week on that particular issue.

On prices, Severn Trent’s average bill is still lower than that of Scottish Water. I want to bring some facts into the debate. The need for ongoing investment in the water industry will vary around the country, as will what water companies put forward as necessary for the changes we require.

Ofwat has highlighted the benefit of modernising licence modification powers, after the Secretary of State asked it to look into what further powers it felt it needed. We are currently consulting publicly on that proposal and will make a final decision after the consultation. If we decide to proceed, we hope to bring that forward in a legislative vehicle in the next Session.

The Government’s strategic policy statement in 2017 set out the need to improve protections for vulnerable customers. To help water companies achieve that, the Government introduced data-sharing provisions in the Digital Economy Act 2017 to better identify those who may need help with their bills. Companies have responded positively to that challenge in their draft business plans. Between 2020 and 2025, they have pledged to reduce dividends and bills, increase investment to £50 billion, improve transparency on executive pay and increase the uptake of social tariffs by nearly 90%. Welsh Water’s level of investment is nowhere near as high as that of the average water company in England.

I am pleased that many water companies have set out how they will share profits with customers either directly or through community benefit schemes. They have set challenging targets to extend their support to vulnerable customers, including a commitment from Northumbrian Water and South West Water to eradicate water poverty in their regions.

The industry plans to reduce leakage by 16% by 2025 and has set the ambitious target of a 50% reduction by 2050. Companies also plan to reduce individual water use by 2045, targeting 83% metering penetration and a per capita consumption of 123 litres, which would be a significant improvement on today’s average of 141 litres in England. We will hold them to account on those plans and we will take action ourselves. In our water conservation report, which was published just before Christmas, I said that we would carry out a call for evidence and a consultation on the measures we can take to reduce demand.

Even though we expect that leakage will fall and demand will drop, water supply still needs to be increased. To ensure key infrastructure can be delivered on time, we are consulting on a draft national policy statement for water resources infrastructure, which will streamline the planning process for new large water infrastructure projects, such as reservoirs, desalination plants and water transfers. We expect companies to collaborate with one another on regional water resource plans that transcend company boundaries, to identify the most cost-effective solutions for each region and for the nation. That includes water companies considering other water users in their plans and working together where appropriate. The Environment Agency’s national framework for water resources will support that work.

It is important to recognise the regulators of the water industry, namely the Drinking Water Inspectorate, the Environment Agency and DEFRA, which itself continues to regulate on a small number of matters. They all have good powers to protect consumers and the environment.

The work of the Consumer Council for Water has been referred to. As the consumer body, its role is to hold the water companies to account on behalf of customers. It acts for both residential and business customers. We want to see a water industry that puts customers at the heart of the business, contributes to society and protects our precious natural environment. We will continue to push the sector and to hold it to account, to ensure that it achieves those objectives.

[Gareth Thomas]

I am grateful to the Backbench Business Committee, to you, Mr Gray, for chairing the debate, and to my hon. Friends and other hon. Members for taking the time to take part. I think the mutual route to democratic public ownership offers significant advantages over the current privatised system. Customers and employees would be in charge of the very services they depend on. There would be no cost to the taxpayer involved in the change of ownership. Profits would be reinvested in the business and continued borrowing for investment would be feasible. On that basis, this has been a very useful debate.

Question put and agreed to.

Resolved,

That this House has considered the future of the water industry in England and Wales.

Fisheries Bill

Gareth Thomas Excerpts

2nd reading: House of Commons & Money resolution: House of Commons & Ways and Means resolution: House of Commons
Wednesday 21st November 2018 Commons Chamber

[Gareth Thomas (Harrow West) (Lab/Co-op)]

There are at least 65 co-operatives in the fishing industry, which are worth more than £48 million at the moment. Would not one of the best ways to help boost the fishing co-operatives sector, which keeps profits in hard-pressed coastal communities, be to ensure a radical reform of the quota system, two thirds of which is held by just three opaque companies?

[Michael Gove]

The hon. Gentleman makes an important point. As we leave the CFP, there is an opportunity to reallocate quota. We have already seen a reallocation, with a 13% uplift for the under-10 metre fleet under this Government. There is a crucial point to make: some of the quota that is necessarily allocated is allocated for the types of stocks—pelagic stocks—of which the under- 10 metre fleet, simply because of the nature of where those fish are found, would be poorly placed to take advantage. So he is absolutely right to say there is a case for reform, but a significant amount of quota could not, at this stage, be allocated in the way that he might suggest.

--- Later in debate ---

[Sue Hayman]

We are looking for the Government to address the historic imbalance and inequality in the fishing industry that these quotas show. The companies that we have looked at have benefited from a system that has led to a long-term consolidation of quota into the hands of a very few operators. We are very keen to look at ways in which that can be changed.

[Gareth Thomas]

May I take my hon. Friend back to the point that she was making about the impact of austerity on coastal communities? Does she not accept that, given the success of co-operatives, there might be an opportunity, through this Bill, to promote the co-operative sector in the fishing industry a little bit more, not least because one of the great things about co-operatives is that the surplus they generate stays within the local community?

[Sue Hayman]

My hon. Friend makes a very important point. We would certainly support increasing co-operatives. I understand that there is an opportunity to double the number of co-operatives if we go about it in the right way. That was an incredibly important point.

Fisheries Council

Gareth Thomas Excerpts

Monday 19th December 2011 Commons Chamber

[Richard Benyon]

I am grateful to my hon. Friend for his help and advice as I have progressed in this job. It is useful to have Members of the House who know what it is like to go through this charade—I use the word carefully—of a process, which requires decisions to be made after two or three days of heavy negotiations that run right through the night. We must have meaningful reform and it must have regionalisation at its heart. We need to be able to define in the new year exactly what we expect when working with partners in the sea basins around the UK. I pledge to keep the House informed of our progress.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

Given the considerable disquiet among British fishermen about the deal, particularly the breaching of the Minister’s own red lines, is the deal not further proof of the catastrophic loss of influence in Europe since the Government parties came to power?

[Richard Benyon]

No, the hon. Gentleman probably was not listening when I said that we have been working extremely closely with our European partners. I think that he would really benefit from seeing just how well we worked and how we joined forces to defeat a proposal that, had it been implemented, would have been utterly devastating for our fishing industry.