Oral Answers to Questions

Mary Creagh Excerpts

Thursday 26th April 2012 Commons Chamber

[Mrs Spelman]

The Government made it clear in the water White Paper that we published last autumn that we want to see increased connectivity. Water companies are already joining up their sources of supply to help them to move water from areas of plenty to those of greatest need. For example, interconnection exists between United Utilities and the west-east link, and as my hon. Friend will have seen in the press, there is a bulk trading proposal between Severn Trent Water and Anglian Water. Local connectivity is the key, and Ofwat will bring forward proposals for the next price review that will encourage that.

[Mary Creagh (Wakefield) (Lab)]

I congratulate the Secretary of State on a shining and rare example of a successful Government policy. Since the drought was declared, it has been pouring with rain and she is in danger of doing a Denis Howell. Does she believe that people with boreholes should comply with any hosepipe ban in their area?

[Mrs Spelman]

In her kind remark at the beginning, the hon. Lady recalled the plight of one of my west midlands predecessors, Denis Howell, who will be forever remembered as the Minister for Rain who tried to make it rain in 1976. He is fondly remembered.

I encourage people who have borehole capacity on their property to follow the example of my hon. Friend the Under-Secretary of State and abide by the restrictions that apply to those who do not have a private supply of water. That is good practice.

[Mary Creagh]

There is some debate about the Under-Secretary of State’s hosepipe and whether it was left on. We know that the hosepipe ban has prompted—

[Daniel Kawczynski (Shrewsbury and Atcham) (Con)]

Misleading the House!

[Mr Speaker]

Order. The hon. Member for Shrewsbury and Atcham (Daniel Kawczynski) should not accuse another Member of misleading the House. That is improper. I say to him in all charity and kindness that, notwithstanding his great abilities and track record, in his capacity as Parliamentary Private Secretary to the Minister his role is to fetch and carry notes, and to nod as required; it is not to shout and heckle from a sedentary position. He will remain silent.

[Mary Creagh]

rose—

[Mr Speaker]

Order. I beg the hon. Lady’s pardon. Before we go any further, the hon. Gentleman should immediately withdraw the suggestion or allegation that anyone has misled the House.

[Daniel Kawczynski]

I withdraw it, Mr Speaker.

[Mary Creagh]

That is the first time that I have been accused of misleading the House when I have described something as a matter of debate.

The hosepipe ban has prompted a borehole boom. Taking from the groundwater supply affects everyone, because that is the water that fills the reservoirs, rivers and aquifers used by the public mains water supply. The Secretary of State’s water White Paper that was published in December—her definition of “autumn” is slightly unusual—astonished the water industry, because it proposed delaying the reform of water abstraction until 2027. What plans does she have in the meantime to tackle unsustainable water use by the few to preserve drinking water supplies for the many?

[Mrs Spelman]

The reform of the abstraction regime has, in effect, commenced. At the drought summit in May last year, the stakeholders in the industry agreed that we needed to take a more flexible approach to the present 30,000 abstractions a year to ensure that the water gets to everybody who needs it. The Environment Agency was praised publicly by the stakeholders at the third drought summit for the flexibility and transparency that have been achieved in the existing abstraction system. That does not mean that there is no scope for further improvement. As I said in the water White Paper, because of the challenge of climate change, we need to reform abstraction.

Water Industry (Financial Assistance) Bill

Mary Creagh Excerpts

Wednesday 14th March 2012 Commons Chamber

[Dan Rogerson]

My hon. Friend makes an excellent point. The water Bill will be a further opportunity for us to revisit these issues and I welcome the fact that hon. Members across the House are still considering this matter as one that needs further exploration.

[Mary Creagh (Wakefield) (Lab)]

I want to reply to the hon. Gentleman’s point about league tables. The idea came from Ofwat and is meant to ensure that there is transparent information for customers, shareholders and the Government so that they understand who is levelling the tariffs, where they are going and where the money is going. That was Ofwat’s idea and I cannot claim any credit for it, much as I would like to.

[Dan Rogerson]

The hon. Lady is very generous in ascribing the idea to Ofwat. I suspect that Ofwat could probably do that anyway and would not need legislation; if it wanted to publish a league table, it could get the information. Ofwat would have information from companies about where the money was coming from and where it was going and could publish it without that needing to be on the face of the Bill.

--- Later in debate ---

[Mary Creagh]

I agree that we have had a very good debate on the Bill. This week’s drought announcement illustrates the increase in weather volatility, however. If there are floods in Australia, it is likely that there will be droughts in other parts of the planet and we are going to have to plan for a lot more climate change disruptions.

As constituency MPs, we are all mindful of the fact that this April water bills will be rising by an average of 5.7%. At the same time as those bills drop on to customers’ doormats, 20 million people—about a third of our population—will be faced with a hosepipe ban across many parts of the country. The Bill puts in place assistance for the people in the south-west, however, and thereby corrects an historic injustice. It also gives powers to provide finance for infrastructure investment. We shall not oppose it on Third Reading, therefore.

I want to reflect on some of the Minister’s comments about our amendments. Amendments 1 and 2 would have introduced the principle of parliamentary scrutiny. He said Parliament does not examine spending decisions by Government, but, of course, Parliament does do that. Indeed, next week we will have the Budget and a lengthy Finance Bill that will examine Government decisions in detail.

The Water Industry Act 1991 stated that water companies could get money from the Government only if that was in the interests of national security, and that if they were ever to receive money from Government, that should be reported to Parliament. Under this Bill, that important principle of parliamentary oversight of the spending of considerable sums of taxpayers’ money is being broken.

We know that the assistance to the south-west will cost £400 million over the seven or eight years of the scheme. The Minister said it was “unimaginable” that any other water companies and customers would get public money. [Interruption.] I listened to the Minister’s remarks, and he used the word “unimaginable”. He said money would not be “sloshing” about and that the Government would not be “doling out” money to the water companies and their customers. However, in 1991 it was unimaginable to Ministers in the then Conservative Government that any water companies should ever receive money, which is why they stated that very important principle in the 1991 Act. We must not forget that the 22 water and sewerage companies are, of course, monopoly providers. At a time when bills are going up and hosepipe bans are being introduced in what is a monopoly industry, we now have to explain to our constituents why this money is being provided.

The right hon. Member for Bermondsey and Old Southwark (Simon Hughes) talked about the debt to equity ratio of Thames Water, as well as the structuring of the company and the packaging up of debt. Government infrastructure investment bonds might be useful in this regard. We heard this morning about the new 100-year bonds. They could be a prime candidate to be the long-term investment vehicles to finance large infrastructure projects such as the Thames Water tunnel.

This Bill’s title includes the phrase “Financial Assistance”, and we know that the groups that are most vulnerable to water poverty are single parents, pensioners and jobseekers. However, only a third of eligible households access the current WaterSure scheme. We want to see much more action from water companies to ensure that the most vulnerable access either national or company social tariffs. As my hon. Friend the Member for Bolton West (Julie Hilling) said, we should not expect water companies to be philanthropists, and so our new clause 1 was intended to be helpful. I am sorry that the Minister thought it an unacceptable regulatory burden on water companies.

When Labour was in government, we found league tables to be a very effective benchmarking tool in driving up performance in public services—schools and hospitals—allowing consumers, customers and taxpayers to understand where their money goes and where they are getting value for money. League tables provide transparency and equity, and in providing a public service—I cannot think of a more crucial infrastructure one than water—it is very important to end the postcode lottery on people’s eligibility for financial assistance.

Labour Members think that in future financing projects we need to be very careful about the burden we place on water customers, and we use the idea of league tables as a benchmarking tool. Many companies use benchmarking groups, which, on an anonymised basis, provide data to researchers, with the companies then getting the data back so that they can benchmark their performance. We do not see anything wrong, or any regulatory burden for the companies, if these companies are forced, by the regulator, to disclose what they are doing, so that we can bring the poor performers up to the level of the best and spur the best performers on to innovation on social tariffs.

We know that the Thames tunnel will add £70 to £80 to Londoners’ bills. Obviously, a number of questions have been raised about that, but I am concerned that the House may not have a large number of opportunities to debate this infrastructure project in the future, and so we need to make sure that proper consultation takes place. The House has debated the Crossrail Bill, which was a hybrid Bill—I made my comments clear on Second Reading as to why this was not a hybrid Bill. The Thames tunnel will create up to 4,000 direct jobs and our final amendment sought to ensure that the benefit of that £4 billion investment accrues to London and Londoners, as they will be paying for it.

Let me cite the example of what I found when I travelled to the Stade de France in Paris, in 1996, and met people from Bouygues, the big French construction company which was building the stadium. The French Government had taken the decision to build it in Paris Saint-Denis, a very poor suburb. This was about 16 years ago, a long time ago, but I was shown the number of apprenticeships at levels 4, 5 and 6—we are talking about master’s-level qualifications—that would accrue throughout that construction project. As my party perhaps did in government, this Government are potentially letting construction companies off the hook by saying that it is an unacceptable regulatory burden to ask them to do more on apprenticeships. Where does the 20% apprenticeships figure come from? Over a four-year project, why can we not get bright young undergraduates in, give them the on-the-job training and make sure that they then become the next generation of London’s civil engineers?

If I may, I shall leave the last word to my hon. Friend the Member for Hammersmith (Mr Slaughter). He talked about his young constituent rowing on the Thames, who said that we have a duty to protect our river in this great world city and that his generation is looking to our generation to build something amazing. We hope that that is what will result from today’s discussion, and that we will protect our great global capital city and one of the world’s great rivers for the next century.

Oral Answers to Questions

Mary Creagh Excerpts

Thursday 1st March 2012 Commons Chamber

[Mr Paice]

I am grateful to the hon. Lady for allowing me to address that issue, which also comes up later on the Order Paper. We do not believe that any regulation on the Schmallenberg virus is necessary. The important point to note is that all the evidence of it that we are now seeing—the deformed lambs and a few deformed calves—is from infection caused last autumn in the midge season. We are working closely with the other member states in northern Europe, where the disease was found earlier than in the UK, to develop the science. A year ago we had never heard of the virus, so we are having to develop all the basic science to move forward with tests and maybe vaccination.

[Mary Creagh (Wakefield) (Lab)]

I begin by wishing all Welsh colleagues dydd gwyl Dewi hapus, which my hon. Friend the Member for Ogmore (Huw Irranca-Davies) reliably informs me is “happy St David’s day”. I hope I have not offended anyone with my pronunciation.

We are grateful to the Minister for his speedy offer of a meeting with the chief vet on the Schmallenberg disease, which we hope to have early next week. As the Minister says, there is much that we do not yet know. Has the arrival of the virus in England led to any changes or pauses in the implementation of the Macdonald report?

[Mr Paice]

The short answer is no. At this stage, we do not see any need to change the decisions arising from the Macdonald report. I am grateful to the hon. Lady for her thanks for the briefing by the chief vet. It is important that all Members are properly informed about the disease. When her party was in government it kindly briefed me on such subjects, and it is only right to reciprocate. She will be aware that I wrote to all Members about a fortnight or three weeks ago with a very clear exposition of the situation.

[Mary Creagh]

I thank the Minister for those comments. May I suggest that it might be useful for the chief vet to meet all Members of Parliament to give those with badly affected constituencies the opportunity to question him?

The Minister argued against the disease being made notifiable in the EU. Will he explain why, when many farmers want it to be notifiable so that scientists can build up the full picture and help develop the effective vaccine that we all want? What steps has he taken to scale up the Animal Health and Veterinary Laboratories Agency so that it is not overwhelmed by testing as we enter the peak lambing season? How much will that extra resource cost and who will pay for it?

[Mr Paice]

On the last point, I assure the hon. Lady that, as this is—I will not say it is an emergency—obviously very urgent, we are finding the necessary resources. It is only right and proper that we do so. I cannot give a figure because it is all changing as we go. The chief executive of the AHVLA is addressing the issue of its resources. I am afraid that I have forgotten her first point.

[Mary Creagh]

Notifiability.

[Mr Paice]

I am grateful. The advice from the vets is that that is not necessary. We are receiving a tremendous amount of information from the private veterinary sector and, of course, samples from those in that sector and some directly from farmers, which all go into our labs for testing. As she implies, I urge all farmers to report any particular evidence. At the moment, we do not see any need for notifiability, but the matter is under review.

Water Industry (Financial Assistance) Bill

Mary Creagh Excerpts

Wednesday 29th February 2012 Commons Chamber

[Mary Creagh (Wakefield) (Lab)]

The Bill is welcome, if a little unexpected. It is welcome because it provides assistance to the people hit hardest by the botched Tory privatisation of the water industry, which created a water company in the south-west with too few people to pay for the £2 billion investment needed to create the south-west’s sewerage system over the following 20 years, with just 3% of the population clearing up 30% of the nation’s coastline. It left them with the highest unmetered water bills of any region and the Bill seeks to provide some relief, a fact that we welcome.

[Miss McIntosh]

I am delighted that the hon. Lady had the opportunity to visit my constituency and I look forward to hearing from her how that went. Does she not appreciate the fact that, as the Secretary of State has just mentioned, £90 billion has been invested since privatisation that probably would not otherwise have been invested? There was also a debate among the hon. Lady’s hon. Friends in the past about privatising the railways, but there is general agreement in the country that water privatisation has been a success bar the unfortunate circumstances that pertain in the south-west in the context of its having the longest coastline and the application of the EU bathing directive in that regard.

[Mary Creagh]

I am happy to report that the pigs I met in the farmer’s field in the hon. Lady’s constituency were extremely well. There was a very strong smell of bacon coming off them, even while they were alive, which was very nice, and I was very happy to see them.

On privatisation, we accept the consensus that privatisation is here to stay and that it has delivered the investment in the infrastructure at no direct cost to the taxpayer. It is clear that that cost has been paid indirectly by customers through their bills, however, with particular damage to customers in the south-west. That is why the Bill is with us today.

[Stephen Gilbert (St Austell and Newquay) (LD)]

This seems to be a particularly smelly debate. Can the hon. Lady explain why over 13 years, despite recognising the problems of privatisation in Cornwall and the south-west, Labour did nothing to help address the concerns that the Bill addresses?

[Mary Creagh]

I have in my hand a graph from Ofwat’s website about the annual average bill. The hon. Gentleman will see—I am not sure whether he can see this far, but I would be happy to pass it on to him—that when we passed the relevant water legislation in 2000 water bills dropped from an average of £325 a year to £285 a year. During that water review period, water bills were much lower. We took action across the country and that will also have affected the hon. Gentleman’s constituents in the south-west. He is also ignoring the fact that we asked Anna Walker to consider the issue of affordability. We have had the Walker report and only one aspect of its many recommendations is being debated today. The rest are being left, I am afraid, on the long finger.

[Sheryll Murray (South East Cornwall) (Con)]

I paid water bills in the south-west for 13 years under the hon. Lady’s Government and I cannot remember my bills ever being stable or not increasing considerably. I do not know where she has got her figures from—perhaps she is looking at a national figure—but I can assure her that my bills have not reduced.

[Mary Creagh]

Does the hon. Lady think that the £50 a year for which the Bill provides until the end of the spending review period is adequate compensation for her constituents? It will undoubtedly be eaten up by the next two years-worth of price increases in cash terms.

[Neil Parish (Tiverton and Honiton) (Con)]

Does the hon. Lady accept that this coalition Government have done more in 13 months than the Labour Government did in 13 years? We have 3% of the population in the south-west and 30% of the beaches, and that is why we have got these extreme costs. This Government have faced up to their responsibilities and delivered real cash to water bill payers, rather than just talking about it like the previous Government.

[Mary Creagh]

I am disappointed at the hon. Gentleman’s tone, because he is ignoring the fact that we commissioned the Walker report when we were in government. He is also ignoring the action we took, not least to prevent customers from being disconnected. I am sure that many of his constituents were affected in the early days of water privatisation when hundreds of thousands of customers were cut off—disconnected—from their water supply for non-payment of bills. We changed that. We changed the law and effectively instigated a right to water, which we think is a basic human right and is required for basic dignity and decency. I am sure that affected many people in the south-west.

The Bill is welcome because it lays down powers exercised by the Secretary of State to provide finance for the huge infrastructure investment that is needed to clean up the Thames, which has had very little investment since the great sewer drilled by Bazalgette 150 years ago. However, there are a number of questions that the Secretary of State must answer. First, why is the Bill so short? We are in a time of drought not seen in this country since 1976, so why is she focusing on the little picture rather than the big picture? Why was the water White Paper that was due in spring 2011 not published until December 2011? Her colleague the Minister with responsibility for water is now promising a draft water Bill this spring, so can she confirm that there will not be a full water Bill to take forward the other measures in Anna Walker’s report in the Queen’s Speech this May—yes or no?

[Mrs Spelman]

The Under-Secretary of State for Environment, Food and Rural Affairs, my hon. Friend the Member for Newbury (Richard Benyon), will be happy to answer this point in detail, but we do not need new measures to do some of the important things we need to do right now to tackle this drought. I mentioned the drought summit. As we saw last year, flexibility in terms of abstraction licences helped our farmers and we did not need hosepipe bans.

The extra time we took for the water White Paper improved it, putting resilience at its heart, and the climate change risk assessment vindicated that decision. I am sure that hon. Members would like the time to debate, through proper pre-legislative scrutiny, the measures set out in the water Bill. The Prime Minister gave an undertaking to the Chairman of the Select Committee on Environment, Food and Rural Affairs that a draft bill would come forward within months and I have repeated that commitment today.

[Mary Creagh]

I take it from that answer that there will not be a full water Bill in the Queen’s Speech this May. On the issue of abstraction, the proposals so far in the water White Paper talk about reforming the abstraction licence with an end date of 2027. The Secretary of State has had three drought summits—

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

Much can be done now.

--- Later in debate ---

[Mary Creagh]

That is fantastic; so we can look forward to a reform of the abstraction regime that will not take until 2027.

[Frank Dobson]

In considering any water shortages that may or may not occur this year, will my hon. Friend and the Secretary of State bear in mind that in the 22 years since privatisation there has been no net increase in reservoir capacity in England?

[Mary Creagh]

I am sure that the Secretary of State will have digested that point from my right hon. Friend.

This is an orphan Bill, which is decoupled from the long-term reforms required to tackle climate change and keep water affordable. Why does the Bill, which affects two areas—the south-west and London—not mention those two areas? Is it because that would make it a hybrid Bill, which would require full and proper scrutiny in the other place? Is it because by not mentioning those two areas and drawing the Bill widely, the Secretary of State is able to define it as a money Bill, which means that it receives only a cursory one day’s scrutiny in the other place? What possible reason could she have to fear their lordships’ scrutiny of this worthy and timely Bill? We can surmise that she is keen to get her short Bill through Parliament—an endeavour that does not seem to have been properly communicated by the Whips to her own Back Benchers, if today’s sudden change of business is anything to go by.

[Andrew George]

I note that the hon. Lady described the Bill as worthy and timely. I am curious about her line. She says that £50 per household in the south-west is insufficient; I would like to know whether she and her party propose offering more to the south-west, and how that would be funded. Secondly, in view of the line that she is taking, is she suggesting that she and her party will vote against the Bill today?

[Mary Creagh]

I am happy to say that we will not vote against the Bill. If the hon. Gentleman waits, I will come on to some of the wider affordability issues and will, I hope, answer some of his questions on the wider issues.

The next unanswered question is: why are we debating the Bill now? We know that the Government ran out of meaningful new legislative business about two months ago, and the House has been surviving on thin rations—a meagre diet of one-line-Whip business and Back-Bench business debates, valuable though they are. There was no new Government legislation, but suddenly—boom!—out of the Department for Environment, Food and Rural Affairs, a Department whose Ministers are the embodiment of clout, grip and competence, spurted a sudden, short water Bill, born of the realisation that if the Department has lost its slot in May’s Queen’s Speech, it had better deliver on the Chancellor’s promises to the south-west and his coalition partners. That happened just six short weeks before the end of one of the longest parliamentary Sessions ever held. Clearly, such a masterstroke of parliamentary planning and timing could have been confected only by the Department that brought us the forest sell-off.

Labour in government corrected many of the injustices of water privatisation. As I said, in 2000 we banned water companies from cutting off the water supply of homes, schools and hospitals for non-payment. It is extraordinary to think that legislators would allow provisions that let hospitals—care givers and providers of sanitation—be cut off for non-payment of bills. We allowed for compulsory metering in areas of scarcity, and a more muscular Ofwat, holding the water companies to account, has emerged in recent years.

[Dan Rogerson (North Cornwall) (LD)]

Will the hon. Lady give way?

[Mary Creagh]

I will make some progress, and then I will give way. Where specific issues required careful consideration, we brought in experts to advise us. We commissioned the Pitt report after the 2007 floods, the Cave report to look at competition and innovation, and the Walker report, which analysed water charging and looked explicitly at the problem of high bills in the south-west. My hon. Friend the Member for Ogmore (Huw Irranca-Davies) legislated for water companies to introduce social tariffs in the Flood and Water Management Act 2010. I shall now examine each of those issues in turn.

Some have questioned why the Tory and Lib Dem Government wanted to extend £40 million a year in financial assistance to a region dominated by Tories and Lib Dems. I will leave others to speculate about the politics, but it is clear that customers in the south-west face bills that are, on average, 43% higher than in other areas. That is why we examined the issue in government and did the groundwork on helping those 700,000 households. I pay tribute to colleagues in all parts of the House, and to our former colleague, Linda Gilroy, for their work on the issue.

[Mr Matthew Offord (Hendon) (Con)]

Perhaps the hon. Lady could tell the House the average cost of a water bill in the south-west pre-privatisation, and say how that compared with bills in other parts of the country.

[Mary Creagh]

I do not know what the costs were, but I can say that all water bills were considerably lower pre-privatisation. If the hon. Gentleman looks at graphs of what happened to bills post-privatisation, he will see that they went up exponentially, particularly in the early 1990s. They were kept down in ’91 and ’92, and then they went up exponentially across the board. From memory, they were around £250; that has gone up massively.

[Mr Offord]

How much was it in the south-west?

[Mary Creagh]

I do not have those figures. Does the hon. Gentleman have them? Perhaps he will share them with the House in the debate.

We accept the argument that the south-west requires additional help to keep water affordable, but stopping there misses the point. Ofwat, the independent regulator, estimates that a fifth of households are already spending more than 3% of their income on their water bills, yet Ministers have failed to bring forward any plans to tackle high bills, apart from in the south-west, which has the highest bills in the country. There, around 200,000 people spend more than 3% of their disposable income on water bills, but in the Thames region there are a staggering 1 million people in the same predicament, so surely we should be working towards extending help through a national affordability solution. Without one, the effect of the Government’s £50-a-year payment in the south-west will soon be wiped out by price rises; prices will rise by more than inflation in each of the next three years. The assistance is welcome, but decoupled from wider reform, it will provide little lasting help on water affordability. I hope that answers the point raised by the hon. Member for St Ives (Andrew George).

We know from Ofwat that the groups most vulnerable to water poverty are single parents, pensioners and jobseekers. When we were in government, we introduced WaterSure, a national affordability scheme paid for by a cross-subsidy from water customers, and paid only to metered households with three or more children or to people with certain medical conditions, but the limitations of the scheme are apparent, because not everyone in water poverty has three or more children, and many pensioners and jobseekers will not be eligible for the scheme.

There is a further problem of penetration of WaterSure. Only a third of eligible households access the scheme, so there is big issue relating to the role of the water companies in educating their customers about WaterSure and the role of places such as jobcentres in making sure that people have access and understand their entitlement.

[Mrs Spelman]

When the hon. Lady’s party was in power, what did it plan to do about the fact that two thirds of people eligible under WaterSure were not taking it up? Will she acknowledge, therefore, that with the baton being passed to the present Government, who continue to run the WaterSure policy but with more determination to enable more eligible households to take it up, we have supported that with the introduction of guidance on social tariffs to all companies?

[Mary Creagh]

The right hon. Lady might want to answer her own question. We commissioned the Walker report, which said that Ofwat should do a six-monthly league table of water companies showing the best and worst performers. She has had 18 months. Has she implemented the recommendations of the Walker report? She has made her own guidance to water companies on social tariffs voluntary, not mandatory, and I fail to see how allowing them to choose whether to implement them will help customers.

[Alison Seabeck]

Perhaps I can shed some light on what was going on under the previous Government. In the Plymouth south-west area, a detailed pilot was undertaken to identify people for whom water was unaffordable. That was to feed through into forward policy development. Anna Walker used that as part of the basis for some of the work that she did, so it is not true that we were not considering how to reach the people who needed help.

[Mary Creagh]

I thank my hon. Friend for that clarification. It is clear that much work was done in the south-west because it has the highest penetration of WaterSure customers and the highest rate of metered households, despite the fact that water is plentiful in the south-west, so it has nothing to do with scarcity. It has to do with people making a rational economic choice and understanding that if they move to metered bills, their costs will go down.

The Government should be using existing data about benefits to ensure that everyone who is eligible is on the WaterSure tariff. I hope we have described the heavy lifting that we did on that tariff. Last year the Government consulted on taking on the costs of WaterSure and absorbing them at a cost to the Exchequer of £10 million a year, as opposed to continuing the cross-subsidy. This idea was dropped from the water White Paper. What has happened to that notional £10 million? Why is it not being used to part-fund company social tariffs or a wider tariff to help the wider population?

Londoners will see their bills rise by £70 to £80 a year when the Thames tunnel is finished in, we hope, 2020. London has some of the poorest people in the country and a significant number living in water poverty. WaterSure will not help most of them. It is imperative that company social tariffs are introduced well before the Thames tunnel is completed to minimise the financial impact on Londoners, yet the Government’s draft guidance on company social tariffs shows that they are adopting a minimalist approach.

The Government have ruled out data sharing, which is key to helping water companies identify customers in water poverty and enabling them automatically to reduce their bill, which is obviously the least painful way, rather than allowing people to get into water debt and then taking action through the courts to pursue the money. They have ruled out an affordability scheme administered nationally, and they have ruled out an extension of WaterSure, which is the only national social tariff. Under DEFRA’s draft guidance, the design of social tariff schemes is left entirely to the water companies. Indeed, it is their choice whether to implement a scheme at all. This is the big society in action: a postcode lottery for millions of customers facing water poverty. We believe that it is untenable for the Government to pass a water financial assistance Bill without providing any assistance to the rest of the country. We will pursue amendments that would oblige water companies to deliver a social tariff scheme that meets clear and uniform criteria.

[Dan Rogerson]

On the question of how WaterSure will be funded and placing obligations on companies, if we have a funded social tariff in the south-west, it will have a disproportionate effect on the other bill payers who are paying into the pot. More work needs to be done before we start pushing regions down the route of having generous social tariffs, because we need to know what costs are being loaded on to other bill payers in the region.

[Mary Creagh]

That is an excellent point. That is why we were interested in the Government’s consultation, which talked about a national affordability scheme and offered the potential to absorb the costs of WaterSure. I hope that the Minister will offer some clarity on that in his closing speech, and I am sure that we can work together on that.

[Simon Hughes]

I do not mean to pre-empt what the hon. Lady might say on the other aspects of bills for water rate payers, but are she and her colleagues concerned—I put this point to the Secretary of State—that the value to water rate payers in London of the Thames tunnel, which is now priced a £4.1 billion, might not be what it was when the previous Government thought it was a good idea? There are big questions about whether it represents value for money for water rate payers and is the best solution in the light of the evidence.

[Mary Creagh]

We believe that the allocation of sums, guarantees, indemnities, or whatever form the financial assistance takes, should be done with full parliamentary oversight, and I will address that when I move on to clause 2.

We believe that the tariffs should be paid for by cracking down on bad debt, which the Secretary of State mentioned in her speech. Ofwat’s website states:

“More than five million households currently owe money on their water bills and over the last five years the amount owed has increased by more than 50%.”

In 2010, £1.6 billion was outstanding, three times the amount of bad debt for gas and electricity bills, despite the fact that water bills are much lower. As she said, the people who cannot or will not pay add an average of £15 a year to the bills of consumers who play by the rules. Bad debt arises in part because landlords are under no legal obligation to provide their tenants’ details to water companies. Rather than a voluntary approach, the Government should compel landlords to share their tenants’ details with water companies, and I know that the consultation is ongoing and is due to close fairly soon. If we reduce bad debt, we can reduce everyone’s bills and fund social tariffs that help those struggling to pay.

Clause 2 creates financial mechanisms and guarantees to support the construction of the Thames tunnel. Why do the Government avoid using the words “Thames tunnel”? Are they trying to avoid a proper discussion of the merits? Labour supports the project. Our Flood and Water Management Act 2010 introduced a “provision of infrastructure” regulation, creating the framework for the tendering, designation and building of such projects. However, costs have risen and time scales have stretched. The Government need to show leadership and make a clear commitment to the project and ensure that the right vehicle for managing and delivering it is put in place. The consultation process for the tunnel is vital for ensuring that sites are placed correctly and the environmental impact of the work on residents is minimised.

[Mr Slaughter]

I agree with what my hon. Friend says about the Thames tunnel, and to that extent I agree with the Secretary of State. However, had the Secretary of State not chuntered through her speech in such a cursory manner on an issue that is very important to London Members, I could have told her that the virulently anti-tunnel comments that I quoted were not mine, but those of my neighbouring Tory MP, the hon. Member for Chelsea and Fulham (Greg Hands), who happens to be a Government Whip. This is just another example of members of the Government saying one thing in the House before going back to their constituencies and saying the exact opposite.

[Mary Creagh]

That used to be the province of the Liberal Democrats, but perhaps saying two different things, depending on whether one is at the top or the bottom of the hill, in the House or in one’s constituency, is contagious. We should all take the necessary precautions, but such indiscipline would never have been allowed when I was a Government assistant Whip.

There remain, however, a number of hurdles to clear, not least that of the Communities and Local Government Secretary, who has an effective veto over the tunnel, so DEFRA support alone will be insufficient. We see the tunnel, in addition to its environmental benefit, as an opportunity to create up to 4,000 direct jobs for Londoners, to expand apprenticeships and to regenerate London. With the provision of financial assistance, we expect not just those apprenticeships but higher-level training to be a non-negotiable part of the deal.

In an infrastructure project of this scale, complexity and duration, we should be setting targets not just for apprentices but for the number of young people who will achieve masters-level civil engineering qualifications over the project’s lifetime, as well as encouraging local and national procurement to secure growth and the economic recovery in London.

No impact assessment has been produced alongside the Bill. The rather short explanatory memorandum states that this is because the Bill is associated with public expenditure, but clearly there will be burdens on water companies when administering any schemes under clauses 1 and 2, so what conditions will South West Water have to fulfil? Presumably, there will be an audit process, so what will the company’s administrative costs be, or has it agreed to waive them?

Of more concern, however, is the fact that there is no provision anywhere in the Bill to require potentially large sums of taxpayers’ money to be spent transparently and accountably. Clauses 1 and 2 state that undefined “terms and conditions” can be attached to the use of public money, but that falls well short of making clear exactly what will happen, and we believe that certain safeguards should be specified in the Bill.

I had a little look at the Water Industry Act 1991 this morning, and section 152 states that the Government can pay out money to water firms only

“in the interests of national security.”

So it is clear that infrastructure projects of the scale and cost of the one before us were simply not envisaged at the time of privatisation.

Today’s Bill shows those limitations, and section 154 of the 1991 Act also states very clearly that if any financial assistance or guarantee is given,

“the Secretary of State shall lay a statement of the guarantee before each House of Parliament”

and

“as soon as possible after the end of each financial year…lay before each House of Parliament a statement relating to that sum.”

The right hon. Lady says that the subsidy to South West Water will continue until the end of the next comprehensive spending review period, but that again is not in the Bill or in the explanatory memorandum, and we want to see those things guaranteed.

[Mr Adrian Sanders (Torbay) (LD)]

Will the hon. Lady commit her party, should it ever return to power, to continue the £50 discount each year?

[Mary Creagh]

We have to look at the cost of water bills in the round—the average, unmetered cost of water bills. We want to bring them down throughout the country, but we are not sure what sort of economy we will inherit, so I shall not make any election promises today.

We will seek to amend the Bill in Committee so that the Government are required to seek further parliamentary approval for such payments through the laying of a statutory instrument. That power should be triggered after a sober assessment of the facts, and after the Secretary of State has made her case to the House.

The explanatory memorandum is silent on state aid. Is the Bill compatible with EU state aid rules? Has the Environment Secretary discussed the matter with the European Commission? [Interruption.] Okay. So water customers do not run any risk of having to repay the assistance at a later date. That is a relief.

In conclusion, despite the right hon. Lady’s warm words, this “financial assistance” Bill is poorly named. It extends no financial assistance to anyone except those living in the south-west. It is an orphan Bill, conceived in haste, which is silent on the wider affordability issues, and it ignores the cost-of-living crisis for households hit by this Government’s assault on the squeezed middle.

We recognise that privatised water has brought benefits, with £90 billion invested in our infrastructure at no direct cost to the taxpayer, and we believe that water should remain a properly regulated private industry. Today, however, is a day for thinking about the water customer. Since privatisation, customers’ bills have increased year on year, wherever they live. Many have found themselves adjusting to metered water, and by 2015 there will for the first time be more metered customers than unmetered ones. Climate change will mean more regions being under greater water stress, with consequences for customers’ water use. That is why it is down to us to hammer out a new consensus on water affordability. I ask Ministers to work with us to amend the Bill and help hard-pressed families.

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[Miss McIntosh]

Given what the hon. Member for Edmonton (Mr Love) said as well, I do not think that the House is in any doubt about the need for the Thames tunnel super-sewer, but we should not underestimate how long the project will take and its cost. Concerns about rising costs, to which hon. Members alluded, were expressed in the evidence to the Committee.

[Mary Creagh]

The hon. Lady said that she was not clear whether we support the Bill. I want to put it on the record that I said at several points that we do support it. As for whether we would continue with it, we would have no plans to repeal it in government if we were elected in 2015.

[Miss McIntosh]

I am sure that the whole House will welcome the hon. Lady’s helpful clarification, because her concluding remarks were a little ambivalent.

Returning to DEFRA’s acceptance of some of our conclusions, some of the site-specific material has been moved to an annex that is part of the document that is not to be relied on by the decision maker in reaching a decision on a project. That meets, to some extent, our criticism about the inclusion of weak material on the Thames tunnel, as well as on Deephams sewage treatment works. Perhaps my hon. Friend the Minister will also give us a status report on those treatment works.

Points of Order

Mary Creagh Excerpts

Thursday 2nd February 2012 Commons Chamber

[Mary Creagh (Wakefield) (Lab)]

On a point of order, Mr Speaker. We look forward to debating the Water Industry (Financial Assistance) Bill, which is being presented by the Department for Environment, Food and Rural Affairs today. It will certainly be good finally to have some Government business to discuss. Can you advise me, Mr Speaker, whether it is normal when a Bill is introduced outside the legislative programme, as this one has been, for the Opposition to discover its existence through leaks from the other place? Can you further advise whether it is normal for a Secretary of State when approached by her opposite number to state, “I’m not speaking to you; I don’t have to speak to you,” which was the response of the Environment Secretary when I approached her yesterday? I am not sure whether she was feeling a little out of her depth. When I informed her office, at 6.15 pm last night, that I would raise this point of order about the lack of usual courtesies, I received an e-mail from her 20 minutes later finally informing me of the Bill’s presentation in the House now. May I ask you, Mr Speaker, to use your good offices and the usual channels to ensure that the Opposition are kept fully informed of any future urgent business and that the Government do not just drip-feed information to us?

[Mr Speaker]

I will say a number of things to the hon. Lady. First, on the whole it is probably unwise for the Chair to rule on the matter of normality, which the hon. Lady raised early in her point of order. I shall eschew any temptation to say anything about that. Secondly, she has regaled the House with a racy and intoxicating account of the recent sequence of events which apparently perturbs her but about which I do not think any further comment from me is either necessary or helpful.

Food Prices and Food Poverty

Mary Creagh Excerpts

Monday 23rd January 2012 Commons Chamber

[Mary Creagh (Wakefield) (Lab)]

I beg to move,

That this House notes that food prices rose by more than 4 per cent. over the last year and that an increasing number of families are relying on foodbanks; is dismayed at Government delays to the Groceries Code Adjudicator and that it has rejected recommendations by the Business, Innovation and Skills Committee and Environment, Food and Rural Affairs Committee to give it teeth; believes that the Adjudicator should have the power to fine retailers and that third party organisations should be able to report retailers for unfair practices; calls on the Government to bring forward proposals for the Groceries Code Adjudicator early in the next Parliament to ensure fairness across the food supply chain; and further calls on the Government to work with the retail sector to provide more responsible, transparent price promotions and clearer unit pricing to offer genuine value-for-money for consumers.

I am sure that hon. Members on both sides of the House will do their best to abide by your strictures, Mr Speaker.

On Friday, I visited a food bank in Bradford and met people who use its services. One woman had fled her violent husband when she was eight months pregnant. Another had left her husband but discovered that he had set up loans in their joint names for which she was still liable. There were women there who had held down high-powered jobs—one had been the personal assistant to the chief executive of a large bank in Canary Wharf—but, through a combination of bad decisions, bad luck and bad men, they had fallen on hard times.

One of the women apologised for not following politics, but said that she could not afford a television licence. Another described how she had found herself shouting at her children when they asked for a bit of jam on their bread, and how she visited relatives at teatime to ensure that her children were fed, while she herself went to bed hungry. Another described cooking tea for her children and eating their leftover food. One woman told me how, the first time she brought home a food parcel, she cried all night because she could not do something as basic as feed her own children.

[Robert Halfon (Harlow) (Con)]

The hon. Lady has mentioned food banks, and we have a very good one in Harlow. Can she explain why the previous Government stopped jobcentres handing out vouchers for local food banks? This Government have reversed that terrible decision.

--- Later in debate ---

[Mary Creagh]

I do not know the answer to that question. I am not sure whether it is the role of jobcentres to pass people on. There is a question mark over whether it is appropriate for a Government agency dealing with people’s welfare and benefits to outsource the food element of that to charities, so I throw that question back to the Government.

I went with the centre manager, Gareth Jones, to make up a food parcel. It contained cereal, tins of beans, four tins of meat and four tins of fish—all nutritionally balanced by a health visitor who advises the centre. The hardest part for me was choosing the four treats. Would the children prefer a pot of honey or a treacle sponge pudding, meringue nests or another pot of jam? Those are treats that we all put into our shopping trolleys without a second thought.

Gareth told me that it was important to put in a mix of branded and non-branded goods, so that when people opened the bags at home, they would feel valued. He told me how he holds pampering sessions at which mums can enjoy a hot chocolate while someone minds their children for half an hour. He described how the type of person coming to the food bank had changed from the homeless and destitute to the working poor. He said that families were referred to it by charities, social services or even—as the hon. Member for Harlow (Robert Halfon) said—the jobcentre. When the state does not provide, the big society is left to pick up the pieces.

[Alex Cunningham (Stockton North) (Lab)]

Much has been made of the importance of food banks, but does my hon. Friend share my concern that the New Life church in Billingham in my constituency has felt the need to set up a food bank for the first time, to help local people who are struggling? I support the church in doing so, but I am sure that she would agree that these facilities should not be necessary. Is not this another illustration of this Government’s failure to address the needs of the most vulnerable people in our society, who need food to eat?

[Mary Creagh]

I completely agree with my hon. Friend and pay tribute to the church in his constituency. We are seeing a proliferation in the number of food banks around the country and one of our challenges to the Government is to ask them to map where those food banks are and what social and economic policies are needed to tackle the proliferation of them and hunger in our society.

The Trussell Trust states that it now has 163 food banks around the country, with one opening every week. Last year, its food banks fed 61,000 people, 20,000 of whom were children, and this year it expects that figure to double.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

Is my hon. Friend aware that in Oldham a food bank has been established for the first time? That was in the paper today. The vicar who set it up said that the banks are not just for homeless people but for hard-working families who are at crisis point. Reports by the Joseph Rowntree Foundation and other organisations show that such problems exist up and down the country. Does my hon. Friend agree that the cuts and austerity are not working?

--- Later in debate ---

[Mary Creagh]

I agree and it all comes back to the social and economic failure of this Government. We are seeing these problems in places that were never hotspots for homelessness, such as Oldham. We associate them with our big cities and do not expect them in our smaller towns. There is a food bank in Wakefield now, whereas previously there was not one.

[Kate Green (Stretford and Urmston) (Lab)]

My hon. Friend might be aware of the campaign conducted by Sainsbury’s shortly before Christmas, where the company invited customers to buy an extra item with their shopping and pop it in a shopping basket so that it could be distributed to needy households. I was shocked when I attended my local Sainsbury’s to meet many people who said that they would like to help but could not afford to buy that extra item. Is not the idea that we can rely on charity to meet the need bound to be too limited?

[Mary Creagh]

I agree with my hon. Friend. If Sainsbury’s is inviting consumers to put their hands in their pockets, it should match that investment item for item, rather than simply adding it to its bottom line.

[Kate Green]

In fairness, I should say that Sainsbury’s matched every donation.

[Mary Creagh]

That is very good to hear.

[Mrs Madeleine Moon (Bridgend) (Lab)]

Bridgend food bank covers four of the 10 most deprived wards in Wales, so the service it provides is critical. In its recent report, it said that the people who applied for food there did so because of

“low income or ill health…repossession of their home…job loss or desertion by the…breadwinner, or”

burglary,

“house fire or unexpected benefit cuts.”

People who go to food banks go for a variety of reasons, but is it not appalling that in 2012, when we are celebrating the Olympics and spending millions of pounds, people are still starving?

[Mary Creagh]

I agree. Charities such as the Salvation Army and HelpAge are seeing an explosion in demand as incomes fall, working hours are cut and prices rise.

[Mr Jim Cunningham (Coventry South) (Lab)]

I know that my hon. Friend, like me, comes from Coventry. Would she be surprised to learn that 35,000 children from Coventry and Warwickshire will now be on the poverty line, and does she think that that is an indictment of this Government’s failed policies? More importantly, many families are now struggling with electricity prices, heating bills and so on, which is feeding through—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. Interventions must be brief, as we are in a short debate with time limits on speeches.

[Mary Creagh]

I am very sorry to hear that my home city of Coventry has 35,000 children living in poverty. I am sure the number was similar when I was growing up there in the 1970s and 1980s and I am only sorry that much of the good work we did in government is falling away and poverty is increasing.

FareShare, which operates nationwide and works to redistribute aid from the food industry to charities, says demand is growing faster than supply. I pay tribute to both Sainsbury’s and Brakes, which recycle their in-date surplus to FareShare. It is important that the food is in-date so that there is no risk associated with that food, which includes fresh vegetables and, in particular, meat. Supermarkets could be doing much more to recycle food waste to hungry people. FareShare estimates it gets 1% of supermarket food waste, which prompts the question of where the other 99% is going. More of it should be recycled to hungry children in this country, which is one of the richest on earth. We can learn from food businesses such as Pret A Manger, which delivers surplus sandwiches around its London stores in the evening. We recall with horror the Tory proposals from Westminster council last year, when it wanted to make food distribution illegal. I pay tribute to all those who fought that proposal and protected people’s basic human right to a square meal even in the city of Westminster.

Gareth said that food is at the heart of everything his organisation does, but as my hon. Friend the Member for Bridgend (Mrs Moon) said, charities are tackling a complex web of abuse, abandonment by the breadwinner, debt, unemployment, non-payment of benefits and other equally serious issues such as house fires, which she mentioned.

[Mark Pritchard (The Wrekin) (Con)]

The hon. Lady is talking about the situation in the UK, but does she accept that rising food and commodity prices are an international phenomenon and that biofuels are taking out of production a lot of agricultural land, which means that food prices are rising not only in this country but around the world?

[Mary Creagh]

Commodity prices of certain things, such as wheat, have remained stable over the past 20 years, whereas others have risen. [Interruption.] Well, at the Oxford farming conference I saw the US Department of Agriculture’s figures on that. However, the hon. Gentleman is right that there is an issue with commodity pricing, particularly with the financialisation of that sector, which is leading to increased volatility, making it harder for food producers to hedge and putting on pressure. We can see from Department for Environment, Food and Rural Affairs figures that where we are self-sufficient we are more protected from those food price spikes than where we rely on imports, which have to have the costs of transporting those materials added on. Also, when our pound falls significantly against other world currencies that puts those prices up.

The people who food charities are seeing are no longer just the homeless and the drug and alcohol users but the respectable mums and dads who have fallen on hard times and the pensioners whose energy bills are so high that they cannot afford to eat. It is an utter disgrace that, although we are the seventh-richest country in the world, we are seeing thousands of people going to bed hungry at night—many of them children. We need to look this issue squarely in the face. A wave of invisible hunger is taking root in our cities, towns and villages. Those charities are the canaries down the mine telling us that respectable working-class and middle-class poverty is on the rise—and this is happening before the housing benefit changes and universal credit come in.

[Diana Johnson (Kingston upon Hull North) (Lab)]

Will my hon. Friend pay tribute to the work that Hull city council is doing to reduce the cost of a school meal to £1 in recognition of the increasing cost that families are having to meet, including those families just above the benefit level for free school meals?

[Mary Creagh]

I pay tribute to Hull’s Labour council for that, as well as for the work it did when we were in government on its free school meals pilot to make sure that children in Hull had access to a free school meal. I know that that experiment has been carried out by Islington council as well, and that it helps to ensure there is a wide take-up of free school meals and that no stigma is attached to them.

[Lyn Brown (West Ham) (Lab)]

I am grateful to my hon. Friend for mentioning the free school meals pilot, which Newham is continuing for primary school children. It wanted to extend it to secondary school children but simply could not afford to do so. One thing that I heard from parents in that pilot was that school holidays were a particularly difficult time because their children were burning up a lot of energy but there simply was not the food or the money to feed those children properly during holiday time. Again, that is a hidden form of food poverty.

[Mary Creagh]

I pay tribute to Newham’s Labour council and I find it amazing that, at a time when councils are experiencing a 28% cut to their revenue, they are still managing to subsidise school meals or, as in Newham, to fund completely free meals. What a tragedy it is that that scheme cannot be extended to secondary schools there. I will return to the issue that my hon. Friend raises about school holidays.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

Does my hon. Friend share my great concern that the removal of extended schools money means that many schools cannot afford to put on breakfast clubs? Many children who would previously have gone hungry if they had not got breakfast through a breakfast club are returning to a situation in which they do not have food in their stomachs, and so cannot learn and are not getting a healthy start to the day.

[Mary Creagh]

It is a tragedy that both breakfast clubs and after-school clubs are under threat. The chef Richard Corrigan did a film for Sky called “Richard Corrigan on Hunger” in which a lady who runs clubs that are provided for by a charitable provider, Magic Breakfasts, talks about children being admitted to hospital in the school holidays for malnutrition—that comes back to the point made by my hon. Friend the Member for West Ham (Lyn Brown) about the challenge that school holidays pose for families’ food bills—and scurvy appearing in children of primary school age, which I find deeply shocking.

[Robert Flello (Stoke-on-Trent South) (Lab)]

I am listening with great interest to my hon. Friend’s speech. Does she accept that some of the problem is hidden, because really good, well-meaning staff at schools are finding ways of feeding children during the day? That is hiding some of the scale of the problem.

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[Mary Creagh]

That is true, and I am glad that there are so many passionate teachers—and passionate friends and neighbours, who may suspect that all is not well. I remember people telling me, when I brought forward my Children’s Food Bill, that they would invite their neighbours and friends in for tea on a Saturday and make sure that the children had as much meat and fruit juice as they could get into them, because it became apparent from the way that they were eating that they had not been fed since Friday lunchtime. That point, from my constituency of Wakefield, has certainly stayed with me.

In addition, the Agricultural Wages Board is to be abolished. That is a particularly nasty Government decision that has nothing to do with the deficit, but will take £93 million from the sick pay and holiday pay of low-paid agricultural, horticultural and food processing workers over the next 10 years. That money will leach out of the rural economy, where those workers live—out of local pubs, post offices and shops—depressing the rural economy when spending is already squeezed. It costs more to live in the countryside, and the abolition of the AWB could mean that we have in this country food workers who are unable to buy the food that they produce. We know that those agricultural workers are the most socially excluded people in our country. They are often migrants who speak limited English. Their work is seasonal, short-term and low-skilled. They are not in a trade union, and they move from county to county, picking daffodils in Cornwall in February, and following the crop and fruit cycle across the country.

After the Morecambe bay tragedy in 2004, Labour created the Gangmasters Licensing Authority to regulate labour providers in the food processing and packing, and agricultural, horticultural, forestry and shellfish-gathering sectors. Our aim was to ensure that workers received a minimum wage, decent accommodation, safe transport, contracts and decent working conditions, yet the GLA’s latest annual report reveals that, in the year to March 2011, it uncovered more than 800 workers being exploited in the UK. It prosecuted 12 companies and revoked the licences of 33 gangmasters. In 2010, there were horrific reports of children as young as nine picking onions in a field near Worcester. While the Government, continuing with their red tape challenge, are deciding on the future powers of the GLA, we say: “We will work with you to stamp out modern-day slavery, people trafficking, and serious organised crime, wherever they occur in these sectors.”

In government, my right hon. Friend the Member for Leeds Central (Hilary Benn) brought stakeholders together to look at the risks to our food security, and the challenges of feeding a growing global population sustainably. The result was Food 2030, the first Government food strategy since world war two. Peter Kendall, president of the National Farmers Union, has described how that strategy has been left on the shelf, and has been relegated to

“a one-line objective in the business plan”

by the current Government. Labour gathered stakeholders together in September last year to look at that food strategy. We believe that we must not lose sight of the direction that it sets out, and we are pleased that the Government have set up their green food project, imitation being the sincerest form of flattery. We look forward to it reporting this summer.

In government, along with many hon. Friends who are seated behind me today, I campaigned for improvements to children’s diets through the Children’s Food Bill. That led to nutritionally balanced school dinners, an end to junk-food vending machines in schools, and lessons on cooking and growing food as part of key stage 3.

[Mark Tami (Alyn and Deeside) (Lab)]

Does my hon. Friend accept that the Government’s cuts to Sure Start have made that problem worse, because much of that educational knowledge about what is good food to give to children has been lost?

[Mary Creagh]

I agree. Sure Start has been an amazing tool in the fight for good food in families, and for cooking lessons. The 20% cut imposed by the Government centrally can only make that more challenging for those dedicated workers.

[Kerry McCarthy (Bristol East) (Lab)]

Does my hon. Friend share my concern that the Secretary of State for Education has decreed that free schools and academies do not have to meet the same nutritional standards in school meals as state schools?

[Mary Creagh]

Yes, it is slightly bizarre that that should be the case. I do not understand why, having battled so hard to secure minimum standards across the sector, the Secretary of State should think it acceptable to water them down, unless it is about saving money in pursuit of an ideological objective, but that could surely never be the Government’s intention.

I have mentioned “Richard Corrigan on Hunger” and the hospitalisation of children. People also talk in that programme about lunch boxes containing last night’s cold chips and ketchup. In government, we set up the School Food Trust, whose latest research shows that the average local authority-catered school dinner has gone up by 5p in the past year to £1.88 in primary schools, and by 4p to £1.98 in secondary schools. Councils are forced to charge more as their Government funding has been cut. We have heard today about councils that are doing their best to prioritise children’s nutrition. Those price rises could force parents to take their children out of school-meal provision and make do with a lunch box. If someone has three children who do not qualify for free school meals, £6 a day or £30 a week is an awful lot of money to find.

Food will be a defining issue for this century. The price spike in food commodities in 2008 showed that the era of cheap food may not be with us much longer. Increases in commodity prices—oil, fertiliser and pesticides—all contributed to year-on-year food price inflation of 6% last September: the second-highest increase in the EU, apart from Hungary. That 6% added £233 to the food bill of a family of two adults and two children. Food inflation, currently at 4%, remains higher than most pay rises that people will receive this year. As prices rise, people are eating less beef, lamb and fish, and more bacon. People are shopping around and trading down, and there is less supermarket loyalty. Figures from DEFRA reveal a 30% fall in the consumption of fresh fruit and veg by the poorest fifth of families since 2006. Those families are eating just 2.7 of their five-a-day fruit and veg.

We need a better understanding of what is driving up food prices, and how costs and risk are transferred across the supply chain. However, shopping is confusing and labels do not always show the true costs. Supermarkets are not required legally to show the unit cost on special offers, so they give the price pre-discount, which makes it impossible to compare prices on the shelf; or they give the price per unit of fruit, rather than by 100 grams, making comparisons impossible. We want supermarkets to be more transparent in their labelling to ensure that shoppers get the best deal. We want them to help people to eat healthily. Our traffic light system was rejected by significant players in the food industry, who have turned their back on what consumers want and need to make healthy choices.

We want a fair and competitive supply chain for growers, processors and retailers. The Competition Commission in 2008 found that there was an adverse effect on competition from unfair supply chain practices. It recommended that supermarkets with a turnover of more than £1 billion a year should be prevented from imposing retrospective discounts and from changing terms and conditions for suppliers. That leads to an unfair spread of risk and cost down the grocery supply chain, and to short-termism in relationships. [Interruption.] I thought I heard a phantom sedentary intervention, but that is not the case. We wanted a voluntary approach, but the supermarkets were unable to agree a way forward. That is why Labour in government secured cross-party agreement for a groceries code ombudsman to ensure a fair deal for farmers and producers. This Government’s delays and procrastination mean that the adjudicator will probably not be up and running until 2014-15.

[Andrew George (St Ives) (LD)]

I note that the motion expresses dismay at the Government’s delay, yet it asks for the groceries code adjudicator to be introduced in the next Parliament, rather than in the next parliamentary year, which I assume is a drafting error. Leaving that aside, given the fact that the first Competition Commission report was in 2000, and the Competition Commission report to which the hon. Lady refers was completed in 2008, what word other than “dismay” would she use to describe the Labour Government’s response to that report?

[Madam Deputy Speaker (Dawn Primarolo)]

Order. May I remind everyone in the Chamber that the debate ends at 7 pm? There is already a time limit of eight minutes on Back-Bench speeches. Interventions should therefore be short, and I hope opening speeches will not be overly long.

[Mary Creagh]

I quote back to the hon. Member for St Ives (Andrew George):

“Every week the government fails to act, farmers are finding themselves in more difficulty.”

That is what he said. The supermarkets were insistent. We wanted an ombudsman. The supermarkets asked for a voluntary approach. It is right to try a voluntary approach first, which we did, but it did not work. This is the anti-regulation Government, but that approach failed. What we need now is action from his Government.

The commission recommended the powers to levy significant financial penalties, but the Government are recommending that only in reserve powers in the Bill, not on the face of the Bill, meaning that fines for anti-competitive practices are even further away than 2015. The Financial Times quoted an executive of a large supermarket chain saying that

“it is an adjudicator rather than an ombudsman, which suggests that it is a watered-down role.”

Suppliers can complain anonymously, but they are liable for full cost recovery if the adjudicator finds that the complaint was vexatious or wholly without merit. The Business, Innovation and Skills Committee recommended that whistleblowing from within retailers should also be grounds for launching an investigation, which BIS Ministers are currently considering.

Consider this anonymous salad grower who works with the Food and Drink Federation:

“X”—

the name of a supermarket—

“have expected us to support their current pricing campaign in store by contributing with reduced price returns, to maintain their margin demands. It has been made very clear that lack of support could be seen as showing no commitment to”—

the supermarket—

“and the potential loss of business, forcing us to drop our prices and support the activity. Interestingly none of this has been put in writing.”

This suggests anti-competitive practices across the sector. If there is bad treatment at the top of the pyramid, that sets the tone for treatment all the way down the food chain, right down to the workers in the field. What we want is culture change across the food industry.

[Mark Tami]

My hon. Friend raises an important point. In the case of many buy one, get one free offers, the cost is not borne by the supermarket. It puts pressure on the supplier, because the supermarket is saying, in effect, “Unless you fund this, we will move the contract somewhere else.” In the end, it is often the workers in that company who suffer.

[Mary Creagh]

My hon. Friend makes a good point. Such offers increase the volume of sales, but often reduce the margin. That places enormous capital and liquidity costs on small companies in order to fund that as they wait for the money to come in from the supermarket.

[Philip Davies (Shipley) (Con)]

I cannot allow that to stand. As somebody who worked for a supermarket chain for 13 years, may I tell the hon. Lady that suppliers used to fall over themselves to come to retailers and ask to do buy one, get one free offers or three for the price of two offers, because it was a good marketing tool for them? When I worked for Asda, we used to ask them whether we could have every-day low prices instead of all those offers, but it was the suppliers who were pushing buy one, get one free offers. The idea that supermarkets are forcing them on them is just guff.

[Mary Creagh]

That is interesting. I am sure the hon. Gentleman will have a range of suppliers who will appear in the press tomorrow to say that the groceries code adjudicator is not required. No doubt they will make their thoughts very clear through the Food and Drink Federation, which represents the sector. However, I will not hold my breath for that. I like shopping in Asda, but I am not sure that it represents the sunlit uplands that the hon. Gentleman remembers from his happy times working there.

We want the Government to act swiftly on the grocery ombudsman. That will lead to less pressure on suppliers and an end to unfair competition, and greater price transparency in the supermarket sector. We want supermarkets to commit to clearer price labelling, particularly on those buy one, get one free promotions. If they do not do so voluntarily, Government should act. We call on supermarkets to commit to sending their in-date food waste to charities such as FareShare, which will ensure that it goes to a good home. We want supermarkets to publish the amount of food they waste, and if they do not do so, the Government should take action in the next waste review. We want supermarkets to commit to recycling more of that food to hungry children and less to landfill.

We call on DEFRA Ministers to work with stakeholders to define food poverty, identify the extent and scale of the problem and commit to tackling it. We have heard about the extent of the problem today and the obscenity of food being wasted while people are going hungry in our towns and cities, but anecdotes are not evidence. We ignore the perfect storm of rising food prices, falling incomes and food poverty at our peril.

Oral Answers to Questions

Mary Creagh Excerpts

Thursday 19th January 2012 Commons Chamber

[Mrs Spelman]

Clearly nutrition is a lead for the Department of Health, but it is quite clear that meat forms part of a balanced diet. I am very proud of the fact that producers in this country produce meat to the highest standards of animal welfare, food and hygiene anywhere in the world. As we have just discussed, we actively promote the consumption of food that is produced to those very high standards within Government and among the wider public.

[Mary Creagh (Wakefield) (Lab)]

Labour believes that public procurement should be reformed to play its part in our economic recovery and to support jobs, skills and apprenticeships here in the UK. The Government spend £2 billion a year on food and are well placed to support British farmers and food businesses by buying British. I heard what the Secretary of State said and was unclear about the percentage that is sourced from UK producers, but her latest figures show that the Department bought less than a third of its food from UK producers in 2011. Why is that, and what does she intend to do about it?

[Mrs Spelman]

As we have discussed, the situation has not changed since the hon. Lady’s party was in office. The difference is that the Government have placed a requirement on all Departments to procure food to British standards. As a shadow Secretary of State, she cannot encourage the Government of the day to breach WTO rules by calling for British products. That is the distinction. We want to encourage the industry to produce more food to the high standards that we require and to encourage Government Departments and the wider public to consume food that is produced to that very high standard.

[Mary Creagh]

The Secretary of State is confused. DEFRA Ministers are simply failing to deliver jobs and growth in the UK food industry, which is the country’s largest manufacturing sector. We have seen how unfair competition from abroad for egg producers has been allowed—DEFRA is supine. My hon. Friend the Member for Ogmore (Huw Irranca-Davies), the shadow food Minister, has asked many questions, yet No. 10 has not revealed how much of its food is sourced from the UK. There is confusion across Government: some Departments reply on what British produce they bought, and some reply on food that is sourced to UK standards. Will she have a word and ensure that the next time guests sit down for dinner with the Prime Minister, the food they enjoy is 100% UK-sourced and that it supports jobs in this country?

[Mrs Spelman]

There is no confusion at all here. Government buying standards are mandatory across all Departments. They require food to be procured to British standards. That is compatible not only with WTO rules but with the rules that cover the operation of the EU internal market—the very basic framework that any Secretary of State or shadow Secretary of State should understand.

The hon. Lady also completely overlooks the importance of our drive on exports. I remind her that in the last year alone, there has been an 11.4% increase in food and drink exports from this country to the wider world.

Bovine TB

Mary Creagh Excerpts

Wednesday 14th December 2011 Commons Chamber

[The Secretary of State for Environment, Food and Rural Affairs (Mrs Caroline Spelman)]

Today I am setting out the next stage in the bovine tuberculosis eradication programme for England.

Bovine TB continues to be a major problem in England. In 2010, nearly 25,000 cattle were slaughtered in England and the cost to the taxpayer is set to top £1 billion over the next 10 years. The problem is particularly bad in the west and south-west of England, where 23% of cattle farms were unable to move stock off their premises at some point in 2010 due to their being affected by the disease, causing much distress and hardship.

As I explained in my statement in July, cattle measures, including routine testing and surveillance, pre-movement testing, movement restrictions, and the removal and slaughter of infected animals, remain the foundation of our TB eradication programme. We have already strengthened cattle controls and will continue to do so. The Government are working in partnership with the farming industry and the veterinary profession to further promote good biosecurity and to provide advice and support to farmers. We also intend to invest a further £20 million over the next five years to develop effective cattle and oral badger vaccines as quickly as possible.

We know that to tackle this disease we need to look at each and every transmission route, and that includes transmission from badgers to cattle. Ultimately, we want to be able to vaccinate cattle and badgers, but there are practical difficulties with the injectable badger vaccine, which is currently the only available option. Badgers have to be trapped and caged in order to administer it. As I told the House in July, we are working hard to develop a cattle vaccine and an oral badger vaccine, but usable and approved vaccines are still years away and we cannot say with any certainty when they will be ready. In the meantime, we cannot just do nothing.

This terrible disease is getting worse and we have to deal with the devastating impact it has on farmers and rural communities. It is difficult to quantify or put a monetary value on that, but a report by the Farm Crisis Network describes the feelings of panic, stress and emotional devastation for farming families as they repeatedly have to send their cows to be slaughtered.

I think that we would all agree that we need to stop the disease spreading further, bring it under control and ultimately eradicate it. Evidence tells us that unless we tackle the disease in badgers, we will never eradicate it in cattle. No country in the world that has TB in its wildlife has been able to eradicate it in cattle without addressing it in the wildlife population. In July, I set out revised proposals for controlling the disease in the badger population. In order to reduce TB in cattle in the worst affected areas we proposed to allow a controlled reduction carried out by groups of farmers and landowners, as part of a science-led and carefully managed policy of badger control. The policy would be piloted in two areas in the first year.

Following the responses to the consultation that we launched in July on draft guidance to Natural England, the policy has been further refined. I am now in a position to announce that we will go ahead with a pilot of the policy in two areas next year, to confirm our assumptions about the effectiveness, humaneness and safety of controlled shooting. An independent panel of experts will oversee and evaluate the pilots and report back to the Government, and we will then decide whether the policy should be rolled out more widely.

This has not been an easy decision to make, and it is not one that I have taken lightly. I have personally considered all the options and evidence, and at present there is no satisfactory alternative. Today, I am publishing a detailed policy document, copies of which will be available in the Vote Office after the statement. We need to strike a balance between taking the actions needed to control and eradicate the disease, maintaining a viable cattle industry and using our resources in the most effective and efficient way possible.

Badger control licences will be issued by Natural England under the Protection of Badgers Act 1992, to enable groups of farmers and landowners in the worst-affected areas to reduce badger populations at their own expense. Guidance to Natural England sets out strict criteria that applicants for a licence will have to meet to ensure that the pilots are carried out safely, effectively and humanely.

Scientists agree that if culling is conducted in line with the strict criteria identified through the randomised badger culling trial, we can expect it to reduce TB in cattle over a 150 sq km area, plus a 2 km surrounding ring, by an average of 16% over nine years relative to a similar unculled area.

Licences granted by Natural England will be subject to strict conditions based on evidence from the randomised badger culling trial, which are designed to ensure that the result is an overall decrease in the disease in the areas where culling takes place. Applications for licences will be considered only for an area of at least 150 sq km over a minimum of four years, and with the pilots to be conducted by trained and proficient operators. Groups of farmers will have to take reasonable measures to identify barriers and buffers at the edge of culling areas such as rivers, coastlines and motorways, or areas where there are no cattle or where vaccination of badgers occurs, to minimise the perturbation effect in places where disturbing the badger population could cause an increase in TB in cattle in the surrounding area.

The Department has assessed the known and estimated effects of badger culling and vaccination, and its veterinary and scientific advice is that culling in high TB incidence areas, carried out in line with the licence criteria, will reduce the number of infected badgers, and thus the weight of TB infection in badger populations in the treatment area, more quickly than vaccination. It will therefore have a greater and more immediate beneficial impact on the spread of TB to cattle and the incidence of infection in cattle.

Nevertheless, we still see a useful role for vaccination, particularly in the future, and I have listened carefully to the views of groups that would like to help develop a vaccination programme. To support and encourage vaccination, DEFRA will make available up to £250,000 in each of the next three years to help meet the costs of badger vaccination in accordance with a badger control plan, with priority given to areas where culling is licensed. We will also support staff or volunteers of voluntary sector organisations wishing to train to carry out vaccination.

I look to the farming industry to show that it takes its responsibility very seriously and that it is committed to delivering the programme effectively, safely and humanely. That will be carefully monitored in the pilots, and on an ongoing basis if the policy is rolled out more widely.

To select the pilot areas, I will invite the farming industry to bring forward a shortlist of areas, from which DEFRA will select two. Those two areas will then be invited to apply for a culling licence. Natural England will assess the applications against the licence criteria and decide whether to grant them a licence.

After the conclusion of the six-week pilots, from what we observe and learn, and taking into account the evaluation by the independent panel, we will take a decision on whether to roll out the policy more widely. Following the pilots, if we decide to proceed with a wider roll-out, a maximum of 10 licences will be granted to start each year.

Ensuring public safety is a key concern. In finalising the policy, we have worked closely with the Home Office and the Association of Chief Police Officers to scope out the role of the police in supporting those licensed operations.

I know that there is great strength of feeling on the issue, but I also know that we need to take action now before the TB situation deteriorates even further. We need to tackle TB from all angles, using all the available tools. I am acutely aware that many people oppose badger culling and I wish that there was a current satisfactory alternative. However, we cannot escape the fact that the evidence supports the case for a controlled reduction of the badger population in the areas worst affected by bovine TB. The impact of that terrible disease shows us that we need to act now. We cannot keep delaying.

In making the decision, I have considered all the evidence and have listened to the full range of views. Having listened to all sides of the debate, I believe that this is the right approach.

[Mary Creagh (Wakefield) (Lab)]

We recognise that bovine TB is a devastating disease—that is why the Labour Government spent £50 million on randomised badger culling trials. Any decision on a badger cull must answer four key questions. Is it science-led? Is it cost effective? Is it humane? Crucially, will it work?

The independent scientific group on cattle TB, which reported on Labour’s trial culls, stated:

“After careful consideration of all the RBCT and other data presented in this report… we conclude that badger culling cannot meaningfully contribute to the future control of cattle TB in Britain.”

The Secretary of State quotes scientists who told the Government that TB in cattle will be cut by 16% over nine years if the cull is carried out by trapping and then shooting the animals. However, her culls will not be carried out in that way. They will depend on farmers hiring people to free-shoot badgers at night—a method that has never been scientifically assessed as a way of controlling bovine TB.

Perturbation occurred in the first three years of Labour’s trial culls when badgers were humanely captured. What scientific advice has the Secretary of State sought or received on the likelihood of free shooting increasing the perturbation effect, which will reduce that 16% net figure still further?

Is the cull cost-effective? The right hon. Lady’s statement was curiously silent on the costs to farmers, yet DEFRA estimates that it will cost farmers £1.4 million per cull area. Farmers will need to prove they have the funds to complete the cull in the event that one pulls out or sells up. How will she access those funds in the event of a default? Who will access those funds, and on what basis? How will the money be held—in an escrow account or in joint names? How will liability be shared between farmers?

What guarantees can the Secretary of State offer taxpayers that the costs of completing a four-year cull will not fall on them in the event of those indemnities disappearing or becoming the subject of protracted legal wrangling? How many staff will the right hon. Lady need to issue those cull licences? What is the cost to the taxpayer of hiring those extra staff at Natural England, a body that has shed nearly 500 staff since her disastrous settlement in the comprehensive spending review?

We know that the Home Secretary has warned the Secretary of State against proceeding with the cull. Will she confirm that the culls will not start until the Olympic games are over? Will she confirm today that trained firearms police will be needed to police any public protests against the culls?

In the Secretary of State’s 2010 consultation, she estimated the costs to the police at £200,000, yet today’s report has revised those costs up to £2 million per cull area. If 10 cull areas are licensed every year, that is a compound cost of £20 million a year to the police. Will she confirm that DEFRA will meet those costs in full? If so, from which budget, given that the Department has had a 30% cut? How will local police forces access those funds?

In written answers to me, the right hon. Lady estimates that the cull will save the taxpayer £2.9 million in each cull area over 10 years. With 10 cull areas set to go ahead from 2013, that is a saving of £2.9 million a year, which is just 3% of the £85 million cost of testing and compensation to farmers. Will she therefore confirm that the costs of bovine TB will continue to be borne by the taxpayer?

The third question the Secretary of State must answer is this: is her cull humane? In 2010, 48 people were prosecuted for offences against badgers and 29 were found guilty. The police wildlife crime unit is concerned that illegal badger persecution will be carried out under the pretext of culling. Who will monitor cull licences and how will the conditions of the licence be monitored? She mentioned a six-week cull period, but how can she ensure that farmers will not go beyond that?

Between 60,000 and 120,000 badgers will be killed over a four-year period depending on the number and size of cull areas, yet in the Secretary of State’s statement, she curiously failed to mention the new national badger count announced this week, which will cost £871,000. Surely she should have commissioned that survey before announcing her pilot culls. How can we measure the impact of a cull on the badger population when we have no scientific baseline? What measures is she taking to prevent the extinction of badger populations in cull areas, and how will she ensure we remain in compliance of our international obligations under the Bern convention?

Finally, will it work? The scientific group warned that

“several culling approaches may make matters worse”.

Is not the Secretary of State in danger of sleepwalking into a disaster by licensing badger culls, the method of which is unproven and untested, and which could make things worse? The Government have constructed the ultimate game theory test for farmers in TB-hit areas: join in the cull or face increased TB in the herd from badger perturbation. How will the views of farmers and landowners in areas affected by perturbation be collected and considered? What happens to farmers who do not wish a cull to proceed on their land? How will the Secretary of State ensure the health and safety of the people carrying out the cull and disposing of infected carcases, the police firearms officers policing the cull and the protesters who will undoubtedly turn up at cull sites?

Today’s announcement is bad news for wildlife, bad news for farmers and bad news for the taxpayer. The cull will not be cost-effective or humane and it will not work. In “Yes, Minister”, Jim Hacker said: “Something must be done. This is something. Therefore we must do it.” Today the Secretary of State has turned her back on the scientific advice. Page 11 of her own document states:

“It is a matter of judgement, not science, whether the farming industry can deliver an effective, coordinated and sustained cull.”

I hope she has got everything crossed.

[Mrs Spelman]

The hon. Lady asked a lot of questions so I will answer them as quickly as I can. First, I should point out that this is a science-led approach to the pilots and that when in office the previous Labour Government spent £50 million on trials. The science is important and this Government have responded to what was learned from those trials. We learned that culling could be more effective if the boundaries of the control area were firm ones, to reduce the perturbation effect. In addition, the ground she cited—she said that the cost would be prohibitive—overlooks that fact that the farmers have agreed to pay. I encourage the shadow Secretary of State to look at the long tail from that trial. Five and a half years after the analysis, the trial continues to provide a benefit in reduced TB incidence in those areas.

The method to which the hon. Lady referred—controlled shooting—is commonly used to control other wildlife populations, such as deer, foxes and rabbits. We therefore have reasonable confidence in our assumption that the method will be both effective and humane in relation to badgers, but, to be absolutely clear, those who undertake the culling will be required to have deer-stalking level 1 proficiency or equivalent, and they will be required to undertake an additional course to ensure that they understand badger physiognomy.

On cost-effectiveness, in the end, it is up to farmers to choose whether or not to be part of a controlled reduction of badgers in their area, but the Government make a requirement that groups of farmers form a limited company that puts aside in a bank account the four-year cost of the culling programme plus a 25% contingency, which deals with the hon. Lady’s point about the contingency cost.

Natural England’s existing staff will contribute to the programme. The overall cost to the Government of £6.22 million over 10 years must be seen in comparison with the overall cost of the unchecked progress of the disease, which will be £1 billion a year or more to the taxpayer over the next 10 years. The costs need to be seen in the context of the overall burden on the taxpayer.

I have had helpful and constructive conversations with the Association of Chief Police Officers, but it is up to the police to deal with the precise operational details of ensuring public safety throughout the pilot process. We should not simply extrapolate an estimated cost from the pilots, as, I am afraid, the hon. Lady just did. Part of the point of the pilots is to establish more precisely what the exact cost will be. I have agreed with the Home Office to share those policing costs in so far as additional and reasonable costs are incurred.

On humaneness, we can be assured that Natural England will monitor the cull licences very carefully. If any farmers should be so minded to exceed the six-week period, they would obviously lose their licence. I do not believe, therefore, that that will happen.

It is important to remember that the species is protected but not endangered. The last time the population was surveyed—in the 1990s—there were between 250,000 and 300,000 badgers in Great Britain. Of course, the previous Labour Government had ample opportunity to launch a survey if they had wanted to, but this Government have seen fit to do so. That is important in ascertaining the population in the controlled areas. We have satisfied ourselves that the Bern convention would not be breached by the policy that I have proposed.

Finally, I agree with the hon. Lady on this point. She said that a matter of judgment and not the science alone drives this decision. If the previous Government had exercised their judgment and acted when they had the chance, the disease, and the cost of dealing with it, would not have escalated to the point it has reached today.

Water White Paper

Mary Creagh Excerpts

Thursday 8th December 2011 Commons Chamber

[Mary Creagh (Wakefield) (Lab)]

(Urgent Question): To ask the Secretary of State for Environment, Food and Rural Affairs if she will make a statement on the water White Paper.

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

Making sure that we have enough water for everyone will be one of the major challenges this country will have to deal with in the years ahead. Today’s publication of “Water for Life” recognises that water is essential for economic growth and that we must protect the environment for future generations.

The White Paper is a blueprint for action. It outlines plans to modernise the rules that govern how we take water from our rivers; it explains how we will improve the condition of our rivers by encouraging local organisations to improve water quality and ensure we are extracting water from our environment in the least harmful way; it announces plans to reform the water industry and deregulate water markets to drive economic growth; it enables business and public sector customers to negotiate better services from suppliers and to cut their costs; it removes barriers that have discouraged new entrants from competing in the water market; it asks water companies to consider where water trading and interconnecting pipelines could help to ensure secure water supplies at a price customers can afford; it enables water companies to introduce new social tariffs for people struggling to pay their bills and seeks to tackle bad debt that ordinary householders have to bear the cost of to the tune of £15 a year; and it tackles the historic unfairness of water infrastructure in the south-west.

The White Paper is the Government taking leadership on an issue of critical importance to our economy and our environment. It is a bold vision for the management and harnessing of an increasingly scarce but vital resource and I welcome this opportunity to discuss it with hon. Members today.

[Mary Creagh]

I start by thanking the Secretary of State for her note explaining why the market-sensitive parts of the White Paper were briefed to the stock exchange this morning and expressing my disappointment that she is not giving us her views on this.

We have just had the driest 12 months since records began 100 years ago. That has affected water quality, restricted boating activity and seen wildfires destroy valuable habitats. Last month, the Department for Environment, Food and Rural Affairs granted Anglian Water a drought permit, a highly unusual move for the autumn, when reservoirs are normally filling up. Last Thursday, the Environment Agency’s drought prospect report revealed that south-east England is at high risk of drought next year with some restrictions possible on customer supply. Ensuring a safe, affordable and continuous supply of water while protecting the environment and managing unpredictable rainfall is a major challenge. The White Paper is of intense interest to the public, who are worried about rising bills as real incomes fall and household budgets are squeezed. It builds on Labour’s Cave and Walker reviews, which we commissioned, and takes an evolutionary approach.

We welcome the proposals to introduce greater competition for business and public sector customers and to establish a cross-border market between England and Scotland for water and sewerage services. We also welcome the fact that water efficiency measures will be part of the green deal, as proposed by my hon. Friends the Members for Ogmore (Huw Irranca-Davies) and for Liverpool, Wavertree (Luciana Berger) during the passage of the Energy Act 2011. However, the White Paper is silent on how the water sector will reduce its carbon footprint and encourage energy from waste, and the proposals on the removal of historical abstraction licences, which cause such damage to our environment, are given an end date of 2025, which is far too late.

Last week’s autumn statement announced £40 million a year to help 700,000 households in the south-west pay their water bills. Will the Minister tell the House when the £2 billion capital investment in the south-west that South West Water invested be paid off and how long the £40 million subsidy will continue for those customers? How will he ensure that those proposals for South West Water meet EU state aid rules? We know that bills in the south-west are, on average, £157 higher than those across the rest of the country, reflecting the botched Tory privatisation of 1989, which left 3% of the population paying for 30% of the country’s coastline and the £2 billion investment in new sewerage services. Does that money set a precedent for other areas of the country to receive help to offset capital investment costs? The cost of the Thames tideway tunnel is now estimated to be over £4 billion, so can Thames Water customers look forward to receiving similar help with their bills?

More than 2,250,000 pensioners, single adults and families spend more than 5% of their disposable income on water bills. The Government’s proposals to help people with rising bills elsewhere in England and Wales are weak and unclear. How does the Minister propose to force water companies to ensure that those eligible people receive help with their bills when that will come straight off the companie’s bottom line? What sanctions will there be for water companies that consistently fail to help people with their bills? Has he decided whether to fund Water Sure through public expenditure, as mentioned in the consultation in June, and, if so, what will the cost be per annum? Has he rejected the idea of match funding for company social tariffs in the south-west and modifying sewerage charges for non-household sectors?

Today’s water White Paper is more than six months late, and it is a curate’s egg—good in parts. We will work with the Government to ensure a fair deal for water customers, whatever part of the country they live in.

[Richard Benyon]

I am grateful to the hon. Lady for the welcome she has given to large elements of the White Paper. She is right that it builds on work that has been done over many years. I am grateful to Professor Cave, Anna Walker and to David Gray for his report on Ofwat, which informed the White Paper, as have the contributions of many stakeholders, other organisations and Members of the House.

The hon. Lady made a slightly predictable and lame remark about why I am dealing with the issue today, rather than the Secretary of State. We have a style of management in this Government that encourages people to take control of the issues. It is a highly motivational style that I recommend to her, because it encourages greater understanding of the issues. The Secretary of State and I have spent many hours preparing the White Paper and have immersed ourselves in the detail.

The hon. Lady is wrong to suggest that there is not enough in the White Paper on reform of the abstraction system. The abstraction rules go back to the early 1960s and do not take into account changes to our climate and weather patterns, and it is important that we have new and clear rules that take us into the future. We will consult in 2013 on our long-term approach to a transitional system of changing abstraction that will work and be sustainable in every sense.

There are urgent measures that we need to take forward, because in constituencies similar to mine, much-loved and much-valued rivers, which are vital to our eco-systems and to the general health of our environment and to the way in which we value it, are running dry. The White Paper sets out clearly how the Environment Agency will work to bring forward speedily measures that change how we abstract water, so that we return water as quickly as possible to river systems, and our catchment approach, which we announced in March, will soon start to benefit water quality and pollution. I urge the hon. Lady to support that measure, which involves many local people, is effective and tackles the urgent situation that we face, brought about by the current low rainfall and the impending drought, unless we have a proper, wet winter.

The hon. Lady mentioned South West Water. We believe that the announcement in the Budget, on which the Chancellor gave more detail in the autumn statement, sets out a way of righting a long-term wrong. It is to the credit of this Government that they have tackled it, because Members from all parts of the House have raised the issue for a great many years, and we are dealing with it. I am not going to pretend to her or to the House that the announcement will create the equivalence that people in the south-west might feel they deserve, but it is a considerable contribution and is separate from what we are doing to assist those on low incomes throughout the country to pay their bills.

We are consulting on the guidelines that we will produce for companies’ social tariffs, and I recommend to the hon. Lady the details in the White Paper on the excellent work that several water companies are doing to make it easier for people to pay their bills, and on the work that the companies are doing with organisations such as Citizens Advice and others.

The hon. Lady asks how long the payment announced by the Chancellor will continue. In an almost unique announcement, I can tell the House that it will continue beyond the end of the spending review and, in fact, until at least the end of the next spending review. Of course, it will be for Ministers then to decide what happens after that.

The hon. Lady talks about other high-cost items and their impact on people’s bills, and refers to the Thames tideway tunnel, which, as she rightly recognises, imposes a high cost on Thames Water customers. The cost of the project is of great concern to Ministers and to the Government, and we are looking at it very closely. We remain supportive of the scheme, however, and page 55 of the White Paper shows the Government’s clear support for it. The Thames is one of the most important rivers running through an iconic city, and we need to ensure that it is clean. We believe that this scheme offers the best solution.

The hon. Lady asks me about the guidance on tariffs. Water is a monopoly industry, and the monopoly industries are highly regulated by three regulators, so Ofwat will continue to set prices and to be an independent regulator. We will give clear guidance on where we think it should be going, but the relationship will remain the same and its responsibility will be to keep bills affordable.

Oral Answers to Questions

Mary Creagh Excerpts

Thursday 24th November 2011 Commons Chamber

[Mrs Spelman]

Two things have emerged. We had more than 2,000 replies to the consultation, which showed that carbon is reported in very different ways. One challenge is to find a way in which it can be reported meaningfully so that investors know which company to invest in, because they understand the information they receive. Secondly, the Department for Business, Innovation and Skills is consulting on the content of company accounts—narrative reporting, as it is known. We need to synchronise the issue because carbon reporting would be in a set of company accounts. I perfectly understand the requirements of the Climate Change Act 2008 in that regard.

[Mary Creagh (Wakefield) (Lab)]

Climate change is the biggest market failure the world has seen and the Secretary of State’s decision on whether to introduce carbon reporting to correct the failure is imminent. That decision is a once-in-a-Parliament opportunity to create green growth and drive the development of low-carbon products and services across UK plc. With youth unemployment at record levels and mandatory reporting supported by Britain’s largest employers, how many jobs does she estimate would be created in the UK’s green economy if it was introduced?

[Mrs Spelman]

The hon. Lady shares entirely with me an appreciation of how important it is that we make progress in that area. She will have seen how the coalition Government have committed to challenging targets in order to change our economy to a low-carbon basis. In the spirit of being on the same page on this matter, I can say that I am keen to do what I can to transition the economy in that regard. On this specific question, however, I hope that the hon. Lady will appreciate that, as I said in my reply to the hon. Member for Edinburgh East (Sheila Gilmore), we need to synchronise carbon reporting in a way that investors can understand. At the moment, there are different requirements on companies to report in different ways. We need a meaningful measure of carbon reporting in the spirit of achieving that low-carbon economy.

[Mary Creagh]

The Secretary of State signally failed to answer my question. There is no estimate in the impact assessment of the number of jobs that the new products and services would create. When the global recession struck in 2008, Labour’s future jobs fund created green jobs for young people in wildlife trusts, country parks and green charities across the country, but they are now on the dole. Carbon reporting will help us to move to the low-carbon economy. When did she last sit down with the Chancellor, one to one, to discuss the autumn statement that he will make on Tuesday and how DEFRA will play its part in creating the conditions for green jobs and growth to tackle the crisis?

[Mrs Spelman]

I do not think it is my job to share in advance with the hon. Lady the content of the autumn Budget statement. As I just said, I share with her the clear vision about opportunities to create jobs if our economy is transitioned into a low-carbon economy. If her party felt so passionately about that, why did it not proceed with what she now claims we should be doing during its 13 years in office?