HC Deb 09 December 1968 vol 775 cc167-74

10.6 p.m.

Mr. David Crouch (Canterbury)

I beg to move, That the Mid Kent Water (Canterbury) Order 1968, dated 17th July, 1968, a copy of which was laid before this House on 31st October, be annulled. The Order has been made as a result of a joint application by the Mid Kent Water Company and the Canterbury and District Water Company to the Minister. Objections to this amalgamation were made by the four local authorities which make up my constituency, and it is for that reason that I speak tonight. The four local authorities are the Canterbury City Council, the Herne Bay Urban District Council, the Whitstable Urban District Council, and the Bridge-Blean Urban District Council.

As a result of this protest and these objections from the four local authorities, the Minister ordered a public inquiry, which took place in September, 1966. On the findings of the inspector, the Minister decided that the Order should be allowed. I consider that the Minister has made a serious error of judgment in this case. In the prevailing climate of Government opinion regarding the encouragement of mergers in industry generally, the Minister has, I think, too readily accepted that this merger will be to the benefit of the public. I suggest that he was wrong to accept that the takeover of the Canterbury Company was necessary. It was not necessary. Not one of the four local authorities could find a valid reason for it. The Canterbury Company was, and is, an efficient water company providing a fully adequate supply of wholesome water.

All four local authorities were unanimous in their views, and they are certainly interested parties. They are the representatives of the people. Are they not to be heard? They are well advised by their officers and well informed on the complexities of water conservation and supply. They have their constituents' interest at heart, and so have I. They are the same people that we are talking about. That is why I am here at this hour, allowed by the special procedures that the House has voted to hon. Members to make a representation to the House at the eleventh hour, to argue that the Minister should recognise the strong feelings which are held by my local authorities and constituents. Will he not consider that Whitehall can sometimes be wrong and that the views of people directly affected may be right, perhaps just once?

It is my right to protest tonight against the Order. I ask the Minister to think again. We do not have much time to debate the issue, and I shall not range over a great many of the technical details which I could introduce if I sought to use them, but I regard the principle of the matter as outstanding: it is the local view versus the Whitehall view.

The local authorities say, and I say, that the decision is wrong. The Minister has accepted his civil servants' papers and used their rubber stamp without sufficient care. He normally takes great care in all his actions. In another office, the right hon. Gentleman earned the respect of both sides of the House for his understanding, for his readiness to listen, and for his acceptance of commercial requirements as well as social needs. Will he listen now and agree with me? Is he prepared to show that he is master of his Department, the political Minister who always puts the interests of the people before the expediencies of neat administration?

What is the need for this amalgamation of two water companies? What is the reason for it? There is no word of explanation in the Order. Is it to reduce the water rate charges? Is it to produce a better balanced supply to a larger area? Or is it bigness for bigness' sake?

There will be no question of reduced water rates. My advice is that they will rise. This is a monstrous factor to emerge from the merger. In my local newspaper, the Kentish Gazette of last Friday, 6th December, there was a report which said: Mr. Robert Robinson, a consultant engineer, claimed that the amalgamation would mean that Canterbury people who have in the past received water from underground supplies would be obliged to receive inferior water while the best went to Mid-Kent. There is thus the question of what type of water we are now to receive; not only the question of rising charges but the question of quality, too.

There is serious doubt regarding the engineering arguments which were put forward by the two companies proposing the amalgamation and which have been accepted by the Minister. The possibility of an enlarged water company to cover a larger area has been under review for many years by the local water experts. The local companies work in close harmony with one another, as it is essential they should. Each has its separate cachment area, and they do not attempt to poach one another's water. It would be disastrous if they did.

The Mid Kent Company takes water from the village of Barham near Canterbury. Another company, a third company, the Thanet Water Board, extracts water further down the underground line at Wingham and Littlebourne. There is an underground supply of water in this area, as the Minister will know from his advice. Increased extraction up the line at Barham would rob all sources lower down, but increased extraction lower down by the Thanet Water Board would not affect the source higher up at Barham, the source for Mid Kent Company. Obviously, there has to be good liaison between these two companies, and there is. But Littlebourne and Wingham, the two towns down the line from Barham, serve the Thanet Board as catchment areas. They are four and six miles from Canterbury respectively.

I agree that liaison is necessary between companies regarding adjacent water sources, but what is even more important is that, if there is to be a merger between two companies, it should be between the right two companies. The inspector spoke in his report of the need to amalgamate the Canterbury Company with a neighbouring authority, because he said that it was small. I suggest that the appropriate neighbouring authority, its natural neighbour, is Thanet. Why link Canterbury, Whitstable and Herne Bay—the area served by the Canterbury Company—with Snodland, an industrial area many miles north of Canterbury between Maidstone and Dartford? I know that Mid-Kent wants extra water because it has a large industrial area to supply.

What is the grand stategy of the amalgamation? Is it more water for the cement industry and less for Canterbury—at higher prices? It is a merger against the tide, a merger upstream. The only obvious merger is between Canterbury and the Thanet Board. There is an affinity of interests between them. They operate their extraction and supply side by side. They are geographically similar, and so natural is their similarity that I am advised that amalgamation of those two would very likely result in a decrease in water rates and not an increase. Furthermore, the resources of both companies are adequate for their joint needs.

The Chief Engineer of the Thanet Board said in a report in April this year, which the Minister may not have seen as it was produced for the Board: The Thanet Water Board can no longer reasonably assume the future implementation of its overall strategy—believed to be known and accepted by the Minister—of development of the available local potential underground water resources. This establishes a need for a reappraisal of the development of the whole of the resources in North-East Kent which the Minister may feel leads through to a case for Canterbury and Thanet joining together and thus fulfil what is believed to be the intention of the Minister responsible for Water Supplies in 1948, as set out in the so-called "Vail Report" of that date. If there is a case for bigness, for yet another merger, with no disadvantage to the consumer, it is for one between Canterbury and the Thanet Water Board, and not between Canterbury and Mid-Kent.

I ask the Minister to accept my earnest plea that the Order should be annulled now, while there is still time. I know that he will feel that he wants to get on with the job of agreeing to the recommendation he has been given, but will he not pause? It is my duty, given to me by Parliament, to represent my constituents' wishes that he changes his mind and permits further studies to be made and a better judgment to prevail.

10.19 p.m.

The Minister for Planning and Land (Mr. Kenneth Robinson)

The hon. Member for Canterbury (Mr. Crouch) has deployed with great moderation his case against what he has categorised as a serious error of judgment by my right hon. Friend. As he told the House, the Order was made by the Minister on 17th July at the request of the two bodies and after a public local inquiry into objections by the four local authorities whose areas are wholly or partly supplied by the Canterbury Company, the four local authorities which comprise the hon. Gentleman's constituency.

The hon. Gentleman repeated many of the objections made at the inquiry. He said that local authorities are the representatives of the people, and then asked, "Are they not to be heard?" The main burden of what I have to say is that they have been heard. Their views have been carefully weighed by an independent inspector before a public inquiry and were not upheld.

Like the local authorities, the hon. Gentleman would have preferred the Canterbury undertaking to have been taken over not by the Mid-Kent company but by the Thanet Water Board. I shall come to that later. First, I wish to fill in some background.

Since before the last war, there has been an advisory committee on water supplies for Kent, consisting of repre- sentatives of the County Council, which provided the Chairman, and of the water undertakers. This Committee has planned regrouping in the County. The amalgamation we are discussing was recommended by the Committee in 1963. The Minister offered no objections in principle to the amalgamation of the two bodies and they made an application in 1964 for an Order under the Water Act, 1945.

The Mid-Kent company serves an area of about 800 square miles with a population of about 280,000. Its existing resources are sufficient to meet present demand and the development of new underground sources will enable it to meet expected demand until about 1980, after which a new river source and a large storage reservoir will be needed.

These figures compare with the Canterbury's company's 73 square miles and a population for its area which varies between 91,000 in the winter and 110,000 in the summer. Thus, the amalgamation joins a predominantly rural to a predominantly urban area, which is one of the general objectives in regroupings.

At the inquiry, the inspector found that the only practicable alternative to this merger—and the one which the hon. Gentleman and the objectors would have preferred—would have been a takeover of the Canterbury undertaking by the Thanet Water Board, which is the only other water undertaker adjoining the Canterbury area. This would have meant joining two similar, mainly urban, areas and the inspector recognised that there were arguments for and against this course. He did not, however, find any advantages in the alternative which would justify adopting it rather than the proposed amalgamation.

The hon. Gentleman suggested that, in some way, the water that will be going to Canterbury when the merger takes effect will be inferior to that which goes to the rest of mid-Kent. I doubt whether he put this allegation very seriously but, whilst the use of the resources available to any water companies is a matter for them, I assure him and the House that there need be no concern whatever about the quality of the water from whatever source it may come.

The hon. Gentleman talked about the cost of the water to his constituents, about which he is rightly concerned. The mid-Kent poundage is higher than that of Canterbury but the differential between the two has been tending to narrow—indeed, it has done so. During the current year, the poundage in mid-Kent is 1s. 8½d. and that in Canterbury 1s. 4d. The Order makes provision for a 25 per cent. reduction in poundage in the Canterbury area for the first five years. In other words, had this Order been in effect now, Canterbury would be paying almost exactly the same amount for its water as it is under the separate undertaking.

The Inspector considered that the financial effects were the most important in the case for the objectors and he gave considerable space to them in his Report. The evidence was not conclusive but he formed the view that the proposals would not cause hardship as compared with the probable movements in water rates and the charges, and that the tendency would be for the effects of capital expenditure in the absence of reorganisation to be proportionately heavier on Canterbury consumers than on those of mid-Kent.

I should like to refer to the alternative proposals for amalgamation with the Thanet Board. The situation was that when the pattern of regrouping was under consideration, as it was before the Order was made, the Thanet Board was not prepared to take over the Canterbury area. At the public local inquiry the Thanet Board was represented and at that time it said that it neither supported nor opposed the Order, and that if the Minister were to reject it it would be pre- pared in principle to take over the Canterbury undertaking, but that everything would depend on the terms and that it would expect provision for differential rates and charges. The inspector inferred from this that initially the Canterbury area consumers would secure no reduction in their charges, but no detailed proposals had been worked out. Having surveyed all the evidence and facts before him, he concluded that the objectors had shown no advantages in the alternative to be of sufficient importance to justify its adoption in preference to the proposals in the application from the two companies.

The hon. Gentleman quoted a report from an engineer dealing with the future of water in this area. No one will suggest that the present Order sets a seal to water organisation in Kent for all time, but one step at a time is sufficient and this in our view is a useful step in the right direction. It is difficult to envisage any revised system of water supply which would split the mid-Kent area from that of Canterbury, but both might fall into some larger area on further reorganisation.

I repeat, in our view this is a step in the right direction. Now that he has put his views and represented the interests of his constituents as he sees them, I hope that the hon. Gentleman will accept that all these matters have been fully and objectively examined, and for that reason I hope that he will not feel it necessary to pursue his Prayer to a Division.

Question put and negatived.