DUTY OF WATER AUTHORITIES TO REFUND CERTAIN CHARGES (Hansard, 23 March 1976)

§ The Minister of State, Department of the Environment (Mr. Denis Howell)
I beg to move, That this House doth agree with the Lords in the said amendment.

§ Mr. Deputy Speaker (Mr. Bryant Godman Irvine)
With this we may take Lords amendment No. 2.

§ Mr. Howell
These two amendments—indeed, all of them—are to meet points properly raised by the Opposition at the previous stage of the Bill—points that we undertook to examine and to table in another place, where we thought they were appropriate. I am glad to say that they received a welcome there, and I hope they do here.
The first two amendments are concerned with the question of ratepayers who had involved themselves in legal action by taking out summonses in connection with the collection of the general service charge for sewerage when they were not connected up to the general drainage system, and which subsequently the House of Lords, in the Daymond judgment, declared to be illegal.
On examination, we have accepted the point—particularly raised by the hon. Lady the Member for Plymouth, Drake (Miss Fookes) and others—that in that case, where people are able to relate the specific legal charges in which they have been involved with their non-payment of the general service charge, it would be right to deal with the question of their legal charges.
I hope that the House will find these two amendments acceptable.

§ Mr. Keith Speed (Ashford)
I should first like to thank the right hon. Gentleman very much indeed for these two 356 amendments. As he said, my hon. Friend the Member for Plymouth, Drake (Miss Fookes)—and my hon. Friend the Member for Bodmin (Mr. Hicks)—first raised this matter, because most of those concerned come from the South-West rather than anywhere else, although there are people concerned in other parts of the country. They were powerfully reinforced by my right hon. Friend the Member for Crosby (Mr. Page) when we were discussing this matter in Committee. We are most grateful for what was said in another place and certainly accept these amendments.
I should like to ask a practical question, concerned with the way in which the money is to come back to those who disburse it, and with publicity. There has been very little publicity about the goings on in another place. Indeed, I read in the newspaper this morning that the Bill had received a Third Reading in another place, as if that were the end of the matter.
Quite an important point is involved here, and a number of people who are to be particularly benefited by the two amendments should be told about it. It would be helpful to know whether, apart from the reports that may or may not come from our deliberations tonight, there are to be advertisements, or perhaps local authorities' advice, to assist in putting into effect what we welcome here.

§ Mr. Graham Page (Crosby)
I am not quite sure whether Amendments Nos. 1 and 2 meet the point we raised when the Bill was passing through this House. The amendments seem to relate only to the costs awarded to the local authority in bringing the action against the defendant. Our concern at the time was not only with the costs awarded to the local authority against the defendant but with the costs that the defendant himself had incurred in defending the action.
As far as I can see from these amendments—particularly Amendment No. 2, which defines what is referred to as the "associated legal costs" in Amendment No. 1—the costs that will be recoverable by the ratepayer will be only those which were awarded against him in the course of the proceedings, that is to say, the cost of the summons and the cost to the local authority of its legal advisers and of appearing in court and obtaining 357 judgment against the ratepayer. Surely that is rather niggling on the part of the Government. We were certainly asking that the defendant who has now been proved right, at least by their lordships in a judicial capacity, should recover the costs awarded against him, but why should he not get back the costs which he wrongly had to incur in fighting the action?

§ Mr. Denis Howell
I am grateful for the general welcome given to the amendments. I agree with the hon. Member for Ashford (Mr. Speed) that this matter has not yet had sufficient publicity. It is difficult to embark upon publicity before the House has passed the Act, but we certainly intend to do so afterwards, and we intend to ask the regional water authorities to do the same.
The second point raised concerned court costs. The right hon. Member for Crosby (Mr. Page) was correct in saying that the amendment will give relief to people against whom summonses had been taken out. But that is exactly what the hon. Member for Plymouth, Drake (Miss Fookes) asked for.

§ Mr. Graham Page
That is not what I asked for.

§ Mr. Howell
The right hon. Gentleman has always been more adventurous than his hon. Friends. I am glad to say that this was exactly what Baroness Vickers—who has a continuing and abiding interest in South-Western and Plymouth matters—had been pressing for.
If the right hon. Gentleman thinks about it he will appreciate that if we go wider than cases that have actually found their way to court we would open a door so wide that it would be totally impossible to confirm claims against regional water authorities for engaging surveyors, solicitors and a host of other professional men, much less to enable the authorities to determine whether such claims were specifically related to the matter in hand.

§ Mr. Graham Page
The Minister is referring to cases that never got to court. I agree with him entirely that it would be difficult to assess costs in those circumstances. I am talking, however, about 358 the cases which got to court, and where only the costs awarded against the defendant are recoverable under the amendments. If that defendant had been successful and had achieved what the Law Lords subsequently achieved for him he would have been awarded his own costs of appearing in court and of being represented there. He will not be able to recover those under the amendments.

§ Mr. Howell
I shall endeavour to keep talking until I get further and better advice.

§ Mr. Graham Page
Perhaps I may give some figures relative to the recovery which the ratepayer will be able to get added to the refund. He will get about 20p by way of fee on the summons. He may be awarded a guinea or two to cover the cost of the local authority's representation in court by its "tame" solicitor, the solicitor of the borough, or whatever he may have been. It would be a paltry sum compared to his own legal costs, which he would have got if he had won and if he had been represented, perhaps not only by a solicitor but by counsel. If he won, as he should have done according to the Law Lords, he would have been awarded some costs.

§ Mr. Howell
The right hon. Gentleman has still not talked for long enough. It would be best for me to write to him to try to clear up that point. I should be surprised if he is correct and that the legal costs, as distinct from costs awarded by the court, could not be claimed. But I am not a lawyer. I speak in total ignorance. I shall look into the matter, and if I think that the situation differs from what I have said, I shall let the right hon. Gentleman know, although by that time the Bill will have received Royal Assent, which is essential if the regional water authorities are to have power to collect charges by 1st April. I am sorry that the matter was not raised elsewhere, or in the House, before tonight.

§ Mr. Denis Howell
I beg to move, That this House doth agree with the Lords in the said amendment.

§ Mr. Deputy Speaker
With this amendment we may take Lords amendments Nos. 4, 5 and 6.

§ Mr. Howell
The amendments meet points of importance raised in Committee, when we had a lengthy discussion on what charges would be appropriate for dealing with surface water for garages, for example. We have tried to tidy up the situation to make it clear that such properties will be eligible on charge only if they are connected, for instance, by a pipe that carries effluent from the property to the public sewer. We take the point raised by hon. Members in all parts of the House that it is important to word the clause correctly to prevent further cases similar to the Daymond case coming back to the courts. I hope that we have succeeded in that endeavour.

§ Mr. Speed
A good debate took place in Committee, in which the hon. Member for Leicester, South (Mr. Marshall), my hon. Friend the Member for Harborough (Mr. Farr), and others, took part.
The Association of District Councils, in particular, was at one stage concerned about the definition. The Lords made that point, and their amendments are an improvement on the previous esoteric ways of getting rid of surplus water. A series of Daymond cases could have arisen if the matter had not been cleared up. Do I take it that those concerned—the local authority associations, in particular—feel that this is now the right solution to the problem? I suspect that they do, because that was my understanding. It would be helpful to have confirmation.

§ Mr. Graham Page
It would be convenient if I could put one question to the Minister before he replies. I am sorry if I seem ungracious about these amendments.
Reading the next line to that in which the alteration is made, it seems that it is sufficient under this paragraph if the property is not drained by a sewer or drain connecting, either directly or through an intermediate sewer or drain, with a public sewer provided for foul water or surface water or both". 360 If it is connected merely with a drain for surface water and, therefore, the foul water cannot be taken away from the premises, it is apparently still connected to a sewer and the owner is obliged to pay the rate or he will not get the refund.
There was pressure by some of the authorities concerned that the connection to a surface water drain only should not be sufficient to say that the premises had sewerage, but the Bill still provides that if there is a drain merely going to a surface water drain or a drain taking surface water, the premises are treated as having sewerage facilities and therefore will not get the refund.
I do not know whether the Minister wishes me to talk any longer on this point. I have no doubt that he has the answer.

§ Mr. Denis Howell
The answer is that the right hon. Member for Crosby (Mr. Page) is right in his interpretation of this situation, but wrong in suggesting that we should change the situation which we have brought about. It is difficult, once water and drainage are delivered into the sewerage system, to distinguish the sources from which they come. Almost all water gets into the drainage system. We have said that the water authority shall be enabled to charge only where it can specifically show that it has got into the sewerage system. If it is just running away, there will be no charge. That is what we were asked to do and that is indeed what we have done.
In reply to the hon. Member for Ash-ford (Mr. Speed), I can say that we have now had indications from the local authority associations, as well as all the regional water authorities, that they are satisfied with the amendments that we have introduced. Their overriding concern, which goes back to a debate in Committee, is that nothing should be done which interferes with the process—almost complete—of working out the rate and the rate demands which are likely to be sent to households early in April.

§ Mr. Graham Page
Do I understand that if a house has gutters to its roof and a drain pipe down from those gutters leading into the surface drains along the gutter of the pavement outside that house, and if that is the only form of drainage the house has—it has no flush toilet or 361 anything like that, and no sewerage drainage—it will be treated as having sewerage facilities?

§ Mr. Howell
I do not think that the right hon. Gentleman is right. The main reason for introducing this amendment is the effect there would be on the general charges to large-scale industry if it were not there. The House will recall that we discussed at length a number of nationalised undertakings and large companies which, because they do not discharge their sewage effluent into the main drainage system, are now, as a result of the Daymond judgment, relieved of that charge. That is the principal reason why there has been such a tremendous increase this year. If we did not amend this Bill in this way, and set out this obligation clearly, it would aggravate the situation even more considerably.
11.15 p.m.
I can confirm that there must be a pipe from a property to the public sewers before the clause and amendment become operative.
May I refer back to the question raised earlier by the right hon. Member for Crosby (Mr. Graham Page), about extra costs? He was asking what costs a court might award if they had to decide something that was vague and hypothetical. Our amendment creates a very hard and definite line, but I can advise the House now that regional water authorities have told us that if the amendment creates hardship in respect of costs, when a case is taken to court they will consider that sympathetically and, if necessary, make ex gratia payments in respect of them.