Thames Tideway Tunnel

Lord Stoddart of Swindon Excerpts

Thursday 24th October 2013 Grand Committee

[Lord Stoddart of Swindon (Ind Lab)]

My Lords, I support the noble Lord, Lord Berkeley, who has been one of the parliamentary leaders against this particular tideway scheme, and indeed the sole leader of the campaign in the House of Lords. He needs to be thanked for his efforts, so I have come along, not as an expert in any way and not as a Londoner, but to give him moral support. I represented Swindon in the House of Commons and I live in Reading. Although I have no interest as a Londoner, I have some interest as the former representative of the people of Swindon and as a resident in Reading who will be expected to pay an extra £80 to £90 in perpetuity for a scheme which will only benefit Londoners. That might sound parochial, and of course it is, but nevertheless people living outside London have an interest and really need to have their position considered.

I know a little about the water industry because I was elected to Reading Borough Council and served there for 18 years. One of the first committees I served on was the water committee. In those days the water industry was largely owned by the local authorities and they made a reasonable success of it. I was later the chairman of the land and works committee of the Thames Valley water board. We produced a very efficient and cheap water service for the people of the Thames Valley area and south Oxfordshire. My boast was always that we provided water at sixpence a ton. It is of course a lot more now but prices have gone up. Therefore I have a little knowledge of the water industry.

Talking about London, we had a quarrel with the Metropolitan Water Board. London is an important place and we understand that, but what they wanted to do, and what they did do through a parliamentary Bill, was to extract water from the Thames Valley area—our water, as we put it. It came along and stole it and put it into the Thames for the benefit of the people of London. It was not to the benefit of rivers in the Thames Valley area because a lot of them dried up. We have to careful about the needs and demands of London. However, that is just a little bit of history.

As has been explained, there are many aspects to this proposal. It involves people who live outside London having to pay for a project from which they will receive no benefit. All the benefits will go to London. They will be forced to pay the same increase in bills as Londoners, who will be the sole beneficiaries. The population of London is set to increase to more than 9 million over the next few years, so Thames Water will be receiving extra profitable revenue from all those people, part of which I believe should be used to finance this scheme. Also, when the shareholders bought the company, they knew that there was a problem of disposal in London. They knew exactly what the commitment might be and that it would be very expensive, yet they still bought the shares. Having acquired those shares, they should take responsibility for the proposals which, by buying the shares, they actually agreed to. I have said this before and I will repeat it now: this project should be largely paid for by the suspension of dividends for the shareholders. After all, a precedent has been set for this. Lloyds Bank shareholders, for example, have not received a dividend for three or four years because of the intervention by the Government in the bank’s management. I believe that the shareholders should pay.

The noble Lord, Lord Berkeley, has outlined some of the much cheaper and more effective alternatives. I believe that they should be examined more thoroughly than has been the case so far. He has also referred to the Government’s intervention into this privatised industry. It may be proposed that there is to be a government subsidy, but that would be intolerable. This is a privatised industry, and the Government have no business paying a subsidy. I have to tell the Committee that I disagreed profoundly with the privatisation of water, and I blame both parties for it. When the Labour Party had the opportunity to renationalise it and give it back to the local authorities where it properly belongs, it did not do so. It would therefore be outrageous if, having sold the water industry off in order to get rid of any debt and responsibility, they should now expect the public to subsidise a project which the shareholders knew about when they bought the shareholdings. I am completely at one with the noble Lord, Lord Berkeley, and I hope sincerely that the Government will not subsidise this project. It is not their business to do so. They should ensure that the cheaper alternatives are put in place and that if they are not put in place, the shareholders of Thames Water should pay the whole bill.