"When in any quarter in which, owing to insufficiency of supply or pressure, fracture of mains, or any other cause than the default of the water consumer, water shall not have been supplied to any premises on every day in 591 accordance with the law, the owner or occupier of such premises may complain to the Railway and Canal Commission that such deficiency of supply has occurred; and the Commission, if satisfied that the complaint is well-founded, may order the company to repay to the water consumer the proportionate Part of the quarter's water rate paid for the days on which the supply was insufficient."
§ He said that the new clause was consonant with the scope and purpose of the Bill, and was so reasonable an extension of it that he trusted the Government would be able to give favourable consideration to it. In his judgment the general principle of the clause could not be objected to. In no other legal relation in life had a man to pay when the consideration failed, and in the ordinary sense it would be absurd to suggest that a. man should pay for what he did not receive. But it was argued that the relationship between the water consumer and the companies was a peculiar one, that it had been set up by Parliament, and ought not to be disturbed to the detriment of the companies without compensation, because it was on this basis people had invested their money in the water companies. It should be borne in mind, however, that Parliament had allowed the supply of water to the metropolitan area to drift into a monopoly. ["Hear, hear!"] That was not the original intention of Parliament; in fact, it was contrary to the original intention. The original intention was that there should be a competitive supply in every district, but by the insertion of provisions in Private Bills which had received the sanction of Parliament, the companies had found it to be to their convenience to create a monopoly in each district which a company served. The existence of this monopoly threw a great responsibility on Parliament, and Parliament had never hesitated to vary the terms of any monopoly which had received its sanction when any of those terms appeared to be onerous or contrary to the public good. The charges of water companies were altered from time to time as a condition of further powers, and on this point there could be no distinction between a Private Bill and a Public Bill. The only point they had to consider, then was whether it was a fair and just condition to impose on the consumer that he should pay for what he did not 592 receive. ["Hear, hear!"] The provision he was suggesting would be of considerable utility, for it would safeguard the consumer's position and stimulate the companies to take every precaution to ensure a regular and full supply. He would give one illustration on this point. The frost of 1895 was felt with especial severity in South London, and Major Scott, who held an Inquiry for the Local Government Board, reported that a great deal of inconvenience, discomfort, and risk to health was caused from. January to the middle of April; that the consumers' connection pipes were sound, and that they had a real grievance and cause of complaint against the company. He further reported that a proportion of the pipes of the Lambeth Company were laid at a depth wholly inadequate to protect them from frost—["Hear, hear!"]—so that, whatever expense the frost threw upon the company, and whatever quantity of water they pumped into the mains, as a matter of fact seine consumers were deprived of their water through causes that were avoidable. To take an extreme case. In Rotherhithe there were cases of a deficient supply for 111 days, and the company's pipe was only 17 in. below ground. In Lambeth there were cases of a deficient supply for 98 or 99 days, and in one case the company's pipe was only 11 in. below surface. The vestry could summon a private consumer if his communication pipe was not laid at a sufficient depth; and in March last year a Lambeth consumer was brought to the police court and forced to increase the depth of his pipe. But this law could not be enforced against the company. In East London they had a bad time during 1895, through both frost and drought—the frost occasioned a deficient supply from the end of January to the middle of April; and the drought from the middle of June to (he was told) September. The Local Board Inquiry exonerated the East London Company from blame for the failure through drought. While fully accepting that decision, and admitting that the company had been perfectly willing and ready to build reservoirs, he did contend that if the companies had at an earlier period agreed to some scheme of amalgamation, so as to make the system of supply throughout London more complete, that drought 593 might have been avoided. ["Hear, hear!"] In August the President of the Local Government Board received a deputation which urged upon him to put pressure upon the New River and Grand Junction Companies to help the East London; and in his reply he pointed out that the New River Company were already doing all they could in justice to their own consumers, while as to the Grand Junction he said the difficulty was this—that the East London Company had a main connected with the Grand Junction works, but it was already full of water and could carry no more. He had been told, as a matter of fact, that had there been a second connecting main the Grand Junction could not have afforded to give much more water. But whether that was the case or not, it showed that if the companies chose to go to the expense of amalgamating their supplies and connecting their systems they would he able to meet the deficiencies of one district with the surplus of another. Indeed, when a meeting was held in East London and this argument was used in favour of an entire alteration in the system of supply, a journal interested in the water industry triumphantly replied that it was not a good argument, because any of the mains put down could be connected so as to make a complete system throughout London, and this would present no difficulties which the water companies could not deal with. All that this clause suggested was that the Commissioners should be able to encourage them to overcome these difficulties. ["Hear, hear!"] So much for drought and frost. The other excuse for not giving a sufficient supply was accident and the necessity of making repairs. But the case of the consumer was much stronger in the case of accidents, for no manufacturer who had contracted to supply goods would expect his customer to accept that as an excuse for failure, especially if the customer had prepaid. ["Hear, hear?"] His argument, shortly, was this. That Parliament, when it sanctioned a monopoly, preserved the right of varying and altering the terms in the public interest. That in the case of water companies what was practically an absolute monopoly had been created. That it is essential to the health, comfort, and convenience of the people of London that their water supply 594 should be sufficient and adequate, and that the companies were bound to incur every necessary expense to secure an efficient and constant supply. Then he submitted that the ordinary sense of justice was against a man being obliged to pay for what he did not get; and lastly, that the Commissioners should be enabled to make the interests of the companies identical with their duty. For these reasons he hoped the Government might be able to look with favour on his Amendment. He should like to add that he believed most sincerely that if the companies were desirous of maintaining their present position they would be very unwise if they did not agree to make concessions such as would remove a great cause of irritation and sense of injustice. The time must come when terms of control or terms of purchase would have to be settled by that House; and he should imagine, for the sake of their own shareholders, that the companies would be well advised to meet the consumers half way and endeavour to secure their good will. He begged to move.
§ Clause read the First time.
§ MR. CHAPLIN
said no one who had heard the statement of the hon. Member could complain of the manner in which he had submitted his proposals to the House He had addressed to them a reasonable, temperate, and able argument in support of this clause—[cheers]—and he frankly owned that there was a great deal to be said upon the merits of the case. The hon. Member told them—and few would differ from him—that any water consumer must deem it hard to have to pay for water he never received. ["Hear, hear!"] He then reminded them that whenever Parliament conferred monopolies upon public companies it always reserved the right to alter the terms of those monopolies if it thought fit. There, again, he admitted the full force of the hon. Member's observations. That was one side of the case. He wanted the Committee to listen for a moment to the other. As he explained in introducing the Bill, the principle by which the Government were guided was to give greater facilities for enforcing the existing duties imposed by statute upon the water companies. The Government did not intend to alter 595 the existing law by this Bill, or to increase the obligations of the water companies, and it would be inadvisable for them to enter upon any such course at the present moment, when a Royal Commission had been recently appointed, and was even now inquiring into all these questions. The new clause, he might also point out, would make a great alteration in the position of the water companies. No notice of such a change had been given to them; they had been given no opportunity of being heard on the point and of urging objections to the proposal. To accept the clause would be to depart altogether from the principle of the Bill as introduced. The idea of the Government was to give greater assistance to the consumer by creating another tribunal in his interests and by bringing to his aid all the power of the local authorities in the metropolitan area. Upon the understanding that the law regulating the duties of the companies was not to be altered, their representatives had refrained from opposing the Bill in that House. There was another circumstance to be considered. There were many ocasions when a deficiency in the supply was due to causes over which the companies had really no control and for which they were not to be blamed. There was, for example, the case of prolonged frost or drought, and mains were sometimes injured seriously by the traffic, the company being blameless. Yet in this clause no account was taken of these things. [Mr. HOLLAND: "Yes, for a discretion is given to the Commissioners."] He agreed that the word "may" might be held to import some discretion in the Commissioners, but doubted whether the water companies would consider the question to be thereby satisfactorily settled. Cases in which pipes and mains were injured by frost owing to their being laid at an insufficient depth would, he believed, come within the purview of the Commissioners' powers. There would be great practical difficulties in the way of carrying out the provisions of this clause. It would, for instance, be very difficult to determine in many cases what proportionate part of the water rate represented the days—only two or three perhaps—during which water had not been supplied. It must be remembered that in the case of small tenements the whole water rate for the 596 year did not amount to more than 6s. or 7s. When the Royal Commission should have reported, he had no doubt that it would be found that there were a great number of questions concerning the water supply which deserved and required the fullest consideration, but there was no reason that he knew why they should select the particular question raised in this Amendment for legislation on that occasion. His hon. Friend had expressed the opinion that the time undoubtedly would come when the question of purchase must be considered and decided by Parliament. He would remind his hon. Friend that the Government had never pledged themselves to a policy of purchase. It was a matter upon which they had reserved their judgment, and the question whether it would or would not be advantageous to adopt a policy of purchase in the interests of the ratepayers had been specifically referred to the Royal Commission. He mentioned this subject because he did not wish it to be supposed that he assented to the views expressed by the hon. Member.
§ MR. SYDNEY BUXTON
congratulated the hon. Member opposite on the ability and moderation of his speech. He understood that the right hon. Gentleman (Mr. Chaplin) agreed with the view of the hon. Member that it was an anomaly that a consumer of water should have to pay for water that he did not consume; that, whatever might be the cause of the deficiency, he should have to pay the same rates when there was a deficiency as he paid when there was a proper supply. But the right hon. Gentleman said that that was not the proper time to raise the question, and that it ought to be deferred until the Royal Commission should have reported. He differed from the right hon. Gentleman on that point; in fact, some of the right hon. Gentleman's own statements had strengthened him in his opinion that this was the proper time for considering the question. The hon. Member opposite had pointed out that this question was closely connected with that of the purchase of the water companies, and the right hon. Gentleman said that he was not pledged to the policy of purchase. He would remind the right hon. Gentleman that when the Chelsea Water Bill was under consideration the other day, he expressed views which were 597 very favourable to purchase. The Committee would see by the Government's treatment of this Bill whether they really meant to improve the position of the metropolitan water consumer. With the exception of Clause 2, there was nothing in the Bill at present which would put the matter on a better footing than it was on now, but if this clause were accepted the position of the consumer would certainly be greatly improved. On two occasions recently the East London Water Company had ceased in some cases to supply water at all, and in other cases it had only supplied a very limited quantity. A state of things of that kind continued for a considerable number of months in two successive years, but all the time the company was exacting the same water rates as before. The right hon. Gentleman said that the water companies were often not to blame. He did not deny that. What he said was that it was unjust that the whole of the loss and inconvenience in such cases should fall on the consumer. He thought that the companies ought, at any rate, to bear sonic of the loss and inconvenience caused by a deficiency in the supply. If the clause did not give the Railway Commissioners sufficient discretion in respect of the apportionment of damages in such cases, an alteration could easily be made in it. The right hon. Gentleman said that there were practical difficulties in the way of carrying the clause into operation, and instanced eases in which the rates were very low. He doubted, however, whether for any house in London the water rate did not exceed the small amounts mentioned by the right hon. Gentleman. He did not see that even in that ease any difficulty would practically arise. It was simply a question of a mathematical sum. The advantage of the clause was that it would induce the Water Companies to take more trouble than they did at present to provide a constant supply. If the clause were accepted it would make the Bill an advantage to consumers, but otherwise he was afraid the measure would be a mere mockery and a sham, which simply created an expensive tribunal and gave the consumers no advantages.
§ *MR. BOULNOIS
said the Committee had little idea of the enormous wilful waste of water on the part of consumers 598 in the Metropolis, notwithstanding all the agencies of the companies to prevent it; and no doubt if a clause were inserted in the Bill giving them power to bring consumers who wasted water before the Commissioners, and have orders made that such consumers should pay the cost of the waste, the companies might be disposed to make concessions in other ways. But he would point out that the Water Companies assented to the Second Reading of the Bill on the distinct understanding, which was expressed at the time, that their rights would not be disturbed by the Bill. If they did not, believe that their rights would not be disturbed they could have prevented the Measure being brought in as a public Bill. He thought the clause would place the companies at the mercy of every schemer, because it would be extremely difficult to decide in many cases whether the insufficiency of the supply were the fault of the Company or the fault of the consumer. The hon. Member for Bow had said the companies ought to have done more in the way of the interchange of water, or the amalgamation of water supplies. The companies could only have done that at considerable cost, and hitherto the companies had not received that treatment at the hands of the House of Commons which would encourage them to apply for Bills and spend a large amount of money for the purpose. Indeed when some of the companies did come to Parliament their Bills were defeated by Members opposite, and it was only recently that the companies got extended powers and increased capital. The hon. Member for Poplar had said that in cases of insufficiency of supply it was only fair that the companies should bear some of the loss. The companies did bear some of the loss. Owing to the prolonged and intense frost of a few winters back the companies had to spend enormous sums of money in lowering their mains. In the case of his own company the expenditure was £25,000. The companies had no control over the communication pipe of the consumer—they could not compel the consumer to place his communication pipe three feet under ground, which was practically to what the mains had been lowered; and was the company 599 to be held responsible if the communication pipe got frozen? He trusted the Committee would reject the Clause.
§ MR. C. E. SCHWANN (Manchester, N.)
said the hon. Member who had just spoken had argued that if in case of drought and frost the consumer was occasionally deprived of his water supply the company should not be held responsible. Any municipality outside London would be scandalised by such a proposition. They conceived their duty to be to see that the wants of the communities they served were supplied. As a consumer and ratepayer in London he trusted the Committee would accept the Clause.
§ *MR. ERNEST GRAY
cordially supported the Clause. Anyone familiar with the difficulties and troubles experienced in the East of London in regard to the water supply during the years 1895 and 1896, knew well that there was no question on which the small householders felt more strongly than on the question involved in this Amendment. While the drought continued demand notices were presented to householders in East London to pay for that which they had never received. The argument of the hon. Gentleman was that while the Amendment was perfectly justifiable this was not an appropriate opportunity for pressing it. It seemed to him that every opportunity was an appropriate opportunity for doing right. He contended that the Amendment was just and fair to water companies and consumers alike. He was surprised that the water companies objected to it. If the water companies had any desire whatever to renew their lease of life they would readily have adopted some such amendment as this. With all due respect to the hon. Member for Marylebone he should say that, to contend that the fact that one consumer wasted the water was a sufficient excuse for charging another for what he did not receive, was a ridiculous argument. He would certainly punish those who wilfully wasted one of the necessaries of life, but it was a monstrous proposition that the companies should place on the shoulders of the careful man costs that were due to the negligent man. The small householder had additional cause for irritation in the knowledge that while he had to pay for what he did not receive, the large consumer, who drew 600 his water through a meter from the main, paid only for what he received. The company which served the Chelsea district had already had the sense to put this amendment into operation, and nothing had more enhanced their popularity than the slight remissions which they had made in the demand notes.
§ MR. BANBURY
said that he lived in the district and had had no remissions.
§ *MR. ERNEST GRAY
said that that was because the hon. Member's supply had not run short. If it was within the power of the company to assess these remissions, it ought not to be beyond the power of the Commissioners. The complaints which had been made for years back had given assurance to the companies that this demand would be made as soon as Parliament dealt with the Water Question. He hoped the Government would leave hon. Members free to vote as they liked on this Question.
§ MR. BANBURY
said that the Amendment was drawn in such a way that it would be most unjust to the companies. Suppose a constant supply of 26 gallons a day were provided, and by reason of drought, the company were only able to supply 20 gallons, they would not be allowed to charge for the 20 gallons at all. Therefore the result would be that the company would be driven to supply no water at all in such circumstances.
§ MR. B. L. COHEN (Islington, E.)
said that he regretted the speeches of the President of the Local Government Board and his hon. Friends, who spoke for water companies. He had stood up for water companies when they had been unjustly attacked, though he was neither a director nor a shareholder, and if he did not believe that the present Amendment would be conducive to the interests of the companies, he should not support it. On the whole he believed that the administration of the water-supply of London had been advantageous to the consumers and creditable to the managers; but the relations between the consumers and the companies were at present just a little strained; and he could conceive nothing which would more promote harmony between them than the recognition by the companies of the principle that they should not charge for what they do not deliver. The President of the 601 Local Government Board said this was not a Bill to alter the law, but only to give greater facilities for enforcing it. The title of the Bill was: "A Bill to amend the Law respecting the London Water Companies," and clause 3 altered the law in terms. The financial difference to the company would be very slight.
§ SIR J. SAVORY (Westmorland, Appleby)
said that there had been some bitter attacks on the water companies, and he wished the House to remember that there was another side to the question, as far as the New River Company was concerned at any rate. During the severe frost of 1895 not one of that company's mains was frozen, and if many consumers were deprived of the supply, it was because the pipes connecting the houses with the mains had frozen, and with those pipes the company had nothing to do. But the company provided a number of stand pipes for the convenience of those who were suffering from their own neglect. During the whole of that period the mains were fully charged with water. The water companies had been attacked and often with extreme virulence in this matter, and he should like to assure hon. Members that the directors of the water companies were anxious to the utmost of their power to discharge the duties intrusted to them. He was quite sure the House of Commons was not alive to the onerous conditions imposed upon water companies which discouraged them from further extensions which would be of great use to their undertaking. ["Question."]
§ SIR. J. SAVORY
said he only rose to contradict some of the statements made.
§ MR. STUART
admitted that the New River Company, which the hon. Gentleman represented, satisfactorily fulfilled their obligations, but that fact only lent additional point to the necessity for some such clause as this. The clause would never require to be put in force against the New River Company. But there were companies in London whose pipes were rotten, who allowed their water to run to waste by their own default, whose mains were laid so close to the surface that they were constantly freezing, who were to blame for the water not reaching the consumers. He could not see why the 602 clause was to be postponed until the Royal Commission had reported on the question whether purchase was the proper thing or not. What had that todo with the propriety or otherwise of people paying for what they did not receive? The clause would not injure any company which was acting properly, and, on the other hand, it would bring a fine upon those who were acting improperly or whose plant was insufficient and inadequate. The right hon. Gentleman was surrounded by a phalanx of water directors, but if they were fulfilling their obligations the clause would not make their position a penny the worse. The main object of the Bill was to compel water companies better to fulfil their obligations. One of their obligations was to supply water for which they were paid. An hon. Member opposite said that if the companies were not to be paid when they supplied twenty gallons instead of twenty-six, what they would do would be to stop the supply altogether. Well, it was easy to amend the clause. He had no wish that the companies should be unjustly treated, and power might be given to the Committee to compel the consumer to pay such proportion of the rate as they thought fit. The remark of the hon. Member, however, only illustrated a very extraordinary state of facts, namely, that if the London water companies could take such action, as he dared say they could, it was because the Metropolitan water companies were in a different position from any other companies. This was a point on which there was great unanimity of opinion in the House among Members who were not connected with the water companies. What he complained of in the President of the Local Government Board was that he made this question hang on the question of purchase, whereas it had nothing to do with purchase. He appealed to the meeting to allow the House to vote upon this matter as it would, for if he did he thought they should have an expression of opinion which would show the right hon. Gentleman that this question was not likely to be suspended until purchase was settled.
§ MAJOR H. F. BOWLES (Middlesex, Enfield)
said that one point appeared to have been overlooked. There were water companies in other parts of England, and, though the water companies might not be 603 supplied with water on occasions of drought or burst pipes, they had, nevertheless, to pay their rates when the corporations sent in the demand notes.
MR. GIBSON BOWLES (Lynn Regis)
said that this clause seemed to him to be the very touchstone of the sincerity of the Bill, which proposed to bring the companies under the jurisdiction of the Commission of general misdoing. This was a matter to which the Government ought not to exercise the influence of their majority; the question involved was one of carrying out the principle of the Bill.
§ MR. WOOTTON ISAACSON (Tower Hamlets, Stepney)
said that he was in sympathy with the view that the consumer should not be asked to pay for what he had not used. The consumer in paying for the water he consumed should be charged by meter; that was the only fair way of levying a charge for water. He thought, however, that as it stood the Bill was in favour of the consumer. The new clause was, in his judgment, a little premature, and it would be better first of all to give the Bill a fair trial.
Motion made, and Question put, "That the Clause be read a Second time."
The Committee divided:—Ayes, 75; Noes, 134.—(Division List, No. 313.)
§ MR. SYDNEY BUXTON
moved the following new clause: —