Water Rates (Provision of Rebates) (Hansard, 13 July 1982)

§ Mr. Dafydd Wigley (Caernarvon)

I beg to move, That leave be given to bring in a Bill to amend the Water Act 1973 to allow water authorities to vary their scale of charges so as to distinguish between water rate imposition on single person households, pensioners and families on low incomes, and other categories of consumers; and for related purposes. You may be aware, Mr. Speaker, that this is not the first time this year that I have mentioned water charges in the House. They are an issue of great controversy in Wales. However, the Bill that I seek to introduce will be of benefit not only to people in Wales but also to pensioners and others on low incomes everywhere. The Bill relates to the unfairness of the impact of the present system of water rates on those most vulnerable in our community. The burden of water rates has increased enormously on all groups in the population over the last eight years. In Anglesey in my own county of Gwynedd the water rate in 1973–74 was 3.6p in the pound. It is now 28p in the pound, an increase of 800 per cent.

This increase, like all inflation, hits particularly hard those on low incomes, pensions and fixed incomes. The National Old Age Pensioners Association of Wales has written to me stating: Our members are adversely affected by the way in which the water rate is based on rateable value. This latest increase will make it a hardship for many to pay, and if you have been thrifty, bought your own house and put by a little money so that you are not a burden to your children, then it is impossible for you to get help to pay the extra. I have also had an opportunity to study the headquarters files of the citizens advice bureaux on this issue. From all parts of England as well as Wales, dozens of formal representations have been made by their local staff calling for a rate rebate to be available on water rates for those on low incomes or pensions. This is a general and widespread complaint and one which will be known to every hon. Member.

I wish to make it clear that water rates hit not only those who own their own homes but also those who are in rented dwellings, whether council houses or privately rented houses. The increase in water rates hits them just as hard. In those areas where direct billing to council houses has recently been introduced, the impact of this burden is felt particularly acutely. Likewise, many private landlords who formerly used to collect the water rates as part of the rent, now insist that water rates are paid directly to the water authority by the tenant.

The unfairness can be summed up by four cases. Mrs. A, a widow living on a pension in Caernarvon in a one-bedroom rented flat, is having to pay £127 in water rates this year. Mr. and Mrs. B from Clwyd, aged about 80 and living in a small flat, have a bill of over £100. Mrs. C, who wrote to me from Glamorgan and who is another pensioner, had to sell her sewing machine to pay the electricity bill. When the water bill of over £100 came along, she had to consider what other personal possession she would have to sell to pay the bill. Mr. D of Harlech, who has been on invalidity benefit, having had to retire with angina in 1946, lives in a two-bedroomed small bungalow and has a water rate bill of £132.

The nub of the problem is that the water rates payable depend on one thing only—the rateable value of the dwelling. No regard is paid to the amount of water consumed, to the number of persons in the household or 856 to the ability to pay. Unlike domestic rates, for which there is a rebate scheme to alleviate the burden of those on low incomes, there is no such provision for water rates. As a result, a family of half a dozen people with perhaps three of four incomes coming into the household will pay a water rate identical to that of the pensioner next door living alone. Given the relative consumption of these two households, it is likely that the pensioner is paying five or 10 times more for every gallon of water consumed.

No water rebate scheme exists because no such scheme is allowable under present legislation. The chairman of the Welsh water authority recently said that he would welcome greater flexibility to try to overcome this anomaly in the legislative framework within which he has to work. But a change to the Water Act 1973 is needed to accomplish this.

I was told by a Welsh Office Minister some time ago that section 30(5) of the 1973 Act is expressly designed to eliminate preference to any class of persons. It is on the basis of this section that water authorities have been advised that they cannot facilitate any such rebate scheme for pensioners and other persons on low incomes. It is therefore the intention of my Bill to amend section 30 of the Act. Together with consequential provisions, this will enable rebates to be paid to persons on low incomes in order to reduce the unfairness of the present system.

I should like to deal with two excuses sometimes made for not introducing a rebate scheme. First, it is said that there is an option for those living by themselves to have meters installed. This is a costly business and may involve expenditure of £35 or £40. Metered water is not free. The break-even point beyond which meters give a better deal for a couple receiving pension has been assessed as property of a rateable value in excess of £150. Metering is, of course, no solution for families on low incomes. Secondly, it is said that supplementary benefits can help those hard hit by water rates. In some cases, the benefits can help. I would advise anyone with problems with their water rates to ask the local DHSS office for assistance.

There are, however, three problems. First, the benefits are still insufficient to bridge the gap facing people who have been landed with enormous water bills and a weekly payment can also cause cash flow problems. Secondly, many people are caught in the poverty trap and miss supplementary entitlement although they undoubtedly need help with their water bills. Thirdly, there is the take-up of supplementary benefits particularly among elderly pensioners living alone.

I readily acknowledge that this is not the first attempt to introduce a Bill of this nature. A few weeks ago, the House gave a first reading to the Fuel Standing Charges (Exemption for Pensioners) Bill which overlaps part of the area covered by my Bill. The hon. Member for Stockport, North (Mr. Bennett) has introduced several Bills over the past five years to try to get a rebate scheme accepted. I raise the issue again for three reasons. First, there has been an enormous recent increase in water charges in Wales, amounting to 18.7 per cent. this year, a greater increase than the rise in income of most pensioners. Secondly, over the past couple of years, an increase in direct billing has caused much anxiety and distress. Thirdly, the Government are this year reorganising the water industry, and now would be an opportune time for this change also to be undertaken.

I therefore ask the House to give the Bill a First Reading, not because it is likely in itself to make much 857 progress in this Session but to show the Government the feeling within the House that legislation on this matter is required and in the hope that the Government will see fit in the next Session of Parliament to introduce legislation to achieve this aim.