Water (Special Measures) Bill [HL]

Lord Whitty Excerpts

Committee stage
Monday 28th October 2024 Lords Chamber

[Baroness Pinnock (LD)]

My Lords, I broadly agree with the amendments in the name of the noble Baroness, Lady McIntosh. She raised some important issues, about, first of all, the way that surface water drainage is treated. As the Minister will know, surface water is combined with sewage water in the same pipes in many of our towns and cities, and increasing rainfall and development is putting pressure on that combined drainage system.

The other issue to consider, which the noble Baroness raised, is the pressure put on local authority planning services to agree to housing developments where the existing infrastructure is not appropriate to support them, with developers reluctant to fork out huge sums of money to pay for the additional drainage systems needed. The answer lies in empowering local authorities’ planning services to put conditions on planning consent which specifically require developers to build the appropriate infrastructure to support the development that they wish to build.

There is a related point. I am a local councillor; in my experience, where there is an issue of surface water, the planning services require underwater attenuation tanks to be built to hold that water until it can be released to the natural drainage systems, such as streams. However, the developers are very reluctant to do that, and are seeking to get around it in other ways. Surface water drainage issues and local authorities’ inability to enforce this is something that the Minister may wish to raise with her colleagues in local government when it comes to reforms of the planning system, as it will affect the Minister’s environment responsibilities. I agree with the amendments tabled by the noble Baroness, Lady McIntosh.

[Lord Whitty (Lab)]

My Lords, I was not planning to speak this evening, and indeed I have to go shortly, but this debate raises broader issues.

I agree with the noble Baroness, Lady McIntosh, that water companies should not be pursued by the authority for things which are not their fault and which they are unable to do anything about. However, this underlines the need to ensure that the new authority, whatever it is, is a very powerful authority.

As noble Lords may recall, the noble Duke, the Duke of Wellington, and I suggested that we should have a combined regulator. That has been rejected so far, but we need a regulator that can take steps against not only the water companies but other bodies which make the water companies’ tasks impossible or extremely difficult, and which are themselves primarily responsible for the pollution, flooding or other damage caused by the water.

That applies not only to developers, although I think that developers are probably explicitly the worst in this context, but, as the noble Baroness has just said, to highways authorities and to discharges from agriculture. If there is a water authority that has to deal with the far end of the effects of these discharges or the inadequacy of the piping, that authority should have the ability to take such steps. At the moment, it is either the local authority that does that in terms of planning permission, or it is the highways authority, which pays no attention whatever to water run-off, frankly, or it is the various bits of agriculture regulation. But if we are concerned about making sure that we have less sullied water and no threat of flooding, which may well be caused by people other than the water companies, I would argue that at some stage the Government will have to consider giving powers to the new authority that cover those companies, or particular actions by those companies, as well as the water companies.

Water (Special Measures) Bill [HL]

Lord Whitty Excerpts

2nd reading
Wednesday 9th October 2024 Lords Chamber

[Lord Whitty (Lab)]

My Lords, I do not wish to repeat the statements that have been made on various sides so far, so I will start again and review some of the history. I do so from a number of different perspectives. First, I was once an official of the trade union that organises most of the workers in the water industry, which would strongly prefer a return to public ownership. I have to tell my noble friend the Minister that we are in a strange week. We are reviewing the two most unpopular privatisations, rail and water—unpopular, that is, with their individual consumers. With one it is clear what the second stage will bring—a return to public ownership, in a form that still requires some determination and definition. However, here we are unclear about what the second stage will be.

Having said that, I strongly support what is in this Bill. To those who represent, directly or indirectly, the interests of the directors of water companies, I say that the more stringent measures to be taken against directors and boards of water companies will be triggered where they have broken the regulations, broken the law, and failed to run their company in line with the commitments given at the previous price review and the strategic plan agreed with Ofwat.

Those are egregious offences and they require those draconian powers—as some see them—to ensure that the behaviour of the management of the companies complies with the intention of the law both on the regulation of the industry and on the environmental regulations. When the regulatory restructuring was first established, it was assumed that water was like any other natural monopoly, which required strong regulation as there was no pressure of competition. Indeed, the only competition in this industry has been through takeovers and consolidation, and that has not benefited consumers of water.

I speak from various perspectives. I was a Minister in Defra at a time when water regulation did not seem too bad. Indeed, I acknowledge that, in the first 10 years or so of water privatisation, there was an increase in investment—certainly over and above what the state had done previously—and there were some major improvements. These were financed both by investment within the industry and the sell off by water companies of their non-water assets, including substantial amounts of land, which has made the environmental benefits of the previous water companies and the environmental regulations we have sought from them less easy to deliver. I was subsequently briefly a member of the board of Ofwat and, for quite a long time—mainly under the tutelage of the noble Baroness, Lady Young—a member of the board of the Environment Agency.

My experience in Ofwat was terrible. It was the weakest possible regulator. I remember one major company failed to meet its commitments on leakage, for example. The tariff would have enabled us to fine it £250,000 for its breach of its commitments, but we actually fined it £12,000. It has always been a weak operator.

I then moved across to the Environment Agency. At the time, I consulted with the Ministers of the then Labour Government on whether I could sit on two boards. I subsequently found that that would have been a good idea—naturally, I would have taken only one fee. That is why, if I cannot have the outcome for the longer term—as the noble Baroness, Lady Jones of Moulsecoomb, was advocating—my second choice would be that of the noble Duke, the Duke of Wellington. That is, to have a single regulator that covers a lot, or all, of the three major regulators—four if you include the Welsh board—in one place, with one strategic plan and one strategic outcome at the price review, whose timing and scope need to be reviewed as well. That would make it a much more powerful regulator than it currently is. That is my second choice, and I hope that the review the Minister promised us comes up with that solution fairly fast.

Another problem with the present situation is that Ofwat and the Environment Agency do not properly talk to one another. This has improved a bit, but the coincidence of their objectives, on both timescale and the way they deal with the companies, is not the best example of co-operation I have found in state bodies. Again, that is a reason I support the noble Duke, the Duke of Wellington.

When I stopped being a regulator, I became a consumer champion. I agree with the doubts people have expressed about putting consumers on the board—that may or may not suit a particular company—but the Consumer Council for Water, which has managed to sustain its lack of resources and still perform a useful role, needs to be seriously strengthened. I ask my noble friend the Minister whether, even in this short-term Bill, we could give extra powers and resources to the Consumer Council for Water. It can represent the interests of both household consumers and small companies, which are crucial users of the water industry’s output. Like farmers and others, they are affected by the environmental regulations that are required to clean up our waterways. The role of regulation of the water sector is not simply about the price and cleanliness of the water that comes through our taps—which has, for the first time in my lifetime, been questioned in one or two areas; it is about the environmental effects on our streams, rivers, seas and beaches. Consumers come in many forms, and the consumer role in this sector needs to be strengthened, not weakened.

I hope my noble friend the Minister can take that point on board and that all these considerations are taken into account in the second stage of this and the review. I also hope that that review is concluded fairly fast, because the companies, consumers and the environment need to know. The rivers, lakes and seas mentioned in this debate need a future different from the one that faces them at the moment.

Environment and Climate Change Committee Report: An Extraordinary Challenge: Restoring 30 per cent of our Land and Sea by 2030

Lord Whitty Excerpts

Wednesday 11th September 2024 Grand Committee

[Lord Whitty (Lab)]

My Lords, I appreciate that speech. I have to echo a lot of what has already been said by many noble Lords. The noble Baroness, Lady Miller, recalled that many years ago, when we were opposite numbers on the right to roam Bill, we were addressing the problems of squaring access with beautifying the countryside, but also starting to talk about reversing the decline in biodiversity—which, regrettably, has got significantly worse since then.

I then spent four years at Defra, largely dealing with the common agricultural policy and various livestock pandemics. I do not remember much attention being paid to the greening of the countryside, nor do I remember addressing the designation of protected areas until very late in my role, when I received a question from a noble Lord about SSSIs. The noble Baroness, Lady Young, referred to the favourable status of SSSIs declining dramatically; it was already declining when I received this question, and it has not been reversed.

Monitoring the areas we have already designated has been ineffective. The main purpose of the other protected areas is not greening, increasing biodiversity or whatever; it is the beauty of and access to the landscape, and ensuring that fairly large areas have a degree of protection from industrialisation or residential development.

This is a complex problem, because people assume that the label of protection, which includes AONBs and national parks, actually means something to do with nature. In reality, it means relatively little. The whole thing has to be reversed. The public do not fully understand them, normal maps used for walking or visiting the countryside do not mark them, there is little effective status to these designations and there are too many of them.

I hope that part of the future programme will look at the current designations and see if we can go further, using them as a tool in the context of the broader land use strategy we are supposed to be developing. We can then begin to meet the targets that were—I think the word is “boldly”—designated by the Government and adopted internationally. I praise the noble Lord, Lord Goldsmith, and others who committed to and are pushing that, but the fact is that the whole structure of designation, of regulation and of the resources available to regulators such as the Environment Agency, Natural England and local government has reduced in this area in recent years. I hope that we are about to turn a corner and that new Ministers recognise the need for that.

This is broader than that, because the biggest environmental and land use policy, the principles of which we all approved in the last Parliament, in the Environment Act and the Agriculture Act, envisages improvement in what is usually referred to as carbon reduction and greening but is agricultural practice more broadly. That needs driving in a new direction. Unfortunately, most of the schemes that have come out, particularly in the Agriculture Bill, make the mistake of emphasising hiving off from farming bits of land that are to be regarded as green and as contributing to biodiversity targets.

Some of that has to happen, but we will not achieve our targets if we do not also address the problem of making sure that food production, which should continue at a high level, also becomes greener, less carbon intensive and less biodiversity destroying. If we hive off bits of agricultural land, grazing land and upland land in particular, from the requirement to help meet biodiversity targets, we will be making a serious mistake. There is no need for there to be such diverse problems.

One of the issues for the ELMS strategy is that we deliver an outcome that is consistent and points in the same direction, instead of dividing up land into different parcels with substantially different biodiversity approval rates. That strategy has to be abandoned.

We have not tackled the problem of marine areas. We have designated some as higher marine areas, but we have not taken steps to reduce fishing and dredging in our inshore and beach areas. Unless we do that, we will not fulfil the target on the marine side. There is a great possibility of managing to do so on the land, but there is a lot more to do on the marine side, starting, as someone suggested earlier, with banning bottom dredging.

Water Companies: Financial Resilience

Lord Whitty Excerpts

Tuesday 23rd July 2024 Lords Chamber

[Baroness Hayman of Ullock (Lab)]

At the moment we are working closely with the regulators, including Ofwat, to ensure that they are fit for purpose and can deliver what is needed in the sector.

[Lord Whitty (Lab)]

My Lords, further to the question of the noble Earl, Lord Attlee, I speak as a former non-executive director of Ofwat for a few months, and as a former non-executive director of the Environment Agency for a few years. Ofwat was always feeble. The Environment Agency has been rendered feeble by a cut in resources and asking the companies to report on their own homework. What is needed is a new and powerful single regulator for the water sector. Do the Government have plans, at least in the medium term, to move to that?

[Baroness Hayman of Ullock (Lab)]

My Lords, we are working with Ofwat and the water companies to deliver change as quickly as possible. As I mentioned, the first thing we are doing is bringing in the water special measures Bill to try to change the culture within the water companies. We will work on another water Bill that will come forward, and I look forward to working with all noble Lords, including my noble friends, on what that could contain in order to make the biggest difference to the current situation.