HC Deb 18 January 1983 vol 35 cc287-302

Amendments made: No. 35, in line 8, leave out 'repeal section 25(1)(d) of' and insert 'amend Schedule 5 to'.

No. 36, in line 9, at end insert Nto repeal'.—[Mr. Wyn Roberts.]

Motion made, and Question proposed, That the Bill be now read the Third time.

12.28 am
Mr. Denis Howell

Although other hon. Members may wish to intervene, it may expedite our proceedings if I speak now before the Minister. That may get us home a little earlier than would otherwise be the case. I must register our disappointment and concern over a number of areas, but I assure the House that I shall do so as expeditiously as possible.

It is no accident that in committee we spent 14 hours on clause 1. We have been unable to say anything about clause 1 on Report for the very good reason that Mr. Speaker did not select the brilliant amendment drafted by the Opposition, which sought to put on the statute book a substitute for the National Water Council.

That is a great pity. We totally opposed the decision to kill off the National Water Council. It was an ill-conceived decision, but I shall not bore the House by repeating the 14 hours of argument now.

What obviously emerges at the end of this long examination is that important national decisionsstill have to be taken within the water industry. We are in the ludicrous position that the Government propose to abolish the statutory National Water Council and at the same time to establish a national association of water authority chairmen which will have to do all the things which the National Water Council was charged with doing.

There is no escape from the fact that a national water strategy is needed, but the Bill does not say how it is to be achieved. One can only assume that it is to be done within the Department, so giving more and more centralised power to Ministers who will be taking decisions about subjects which we will not be advised upon and will have little opportunity to comment on.

There must be a national water strategy. It would have been much better if that could have been done by the Government accepting our amendment, although I admit that, as it was not selected for debate, it would have been a little difficult. However, Parliament has to be taken as a whole, like many other things, which means, thank goodness, that there is another place where the Government and other people may return to these issues.

The Under-Secretary of State referred to an association of water authority chairmen. In our new clause 2, which we would have preferred, we called it an association of water authorities. It means the same thing—a national water council by another name. Although the Government have not written this into the Bill they have, by providing for an association of water authorities, conceded the case that we have been making. All right. Perhaps they wanted it to have more of a consultative and advisory role than the old statutory National Water Council. I hope the Government, even at this late stage, will decide that provision for that authority should be put into the Bill, outlining some of the functions with which it should deal, such as the provision of advice to the Secretary of State on matters of national planning of water resources and a national strategy for water disposal and waterways. We lament the demise of the National Water Council.

With that comes the most fundamental objection to the Bill, which again we have not been able to deal with at all today, apart from a cursory reference by the Under-Secretary of State—the decision to remove from all positions of influence any elected local government representative. This is the first time it has happened since the inception of the water industry. It is very serious. As I have already conceded, no doubt the Secretary of State will show enough wisdom to ensure that there are on the water authorities people experienced in local government, but that is totally different from killing the concept of direct election and nomination of local authority interests. Who would have thought that it would be a Conservative Government who would strike this blow at the heart of local government democracy? Had the proposal come from a Labour Government or a Government of another complexion, the sounds of protest would have been reaching up to heaven.

Mr. Spearing

Eastern Europe.

Mr. Howell

Absolutely. As I said when these proposals were first brought forward, nothing so despotic in its intention can be found this side of the iron curtain. These proposals are coming from a Conservative Government.

Some of us, especially those of us with experience in local government, must stand up and say that this is a sad day for local government democracy and accountability. As the Government know, all the local authority associations, when pressed, have been forced to say that this is a lamentable day for local government and that the Government have behaved disgracefully.

I repeat that every one of our major water undertakings stemmed from local government. They were all provided by local government. Similarly, the great schemes for drainage and water disposal were provided by local government. They were provided by ratepayers throughout the country. It is a shocking state of affairs when local government is prevented from making any direct nominations, or from holding membership of such bodies.

That point must be considered alongside the other Government proposals that we regard with great suspicion and sadness. There is to be no local government membership, no ombudsman, no press representation at water authority meetings, no national joint industrial council and no national wage negotiations. We still do not know what will happen in that important area. There is no statutory provision for the representatives of sport and recreation. The abolition of the items on that shortlist means that considerable rights and safeguards are being removed from the people. It is our duty to bring that to the attention of the House.

There is to be no sensible system of equalisation or fair charging between one region and another. We should have preferred to debate amendment No. 16 rather than the amendment upon which minority interests have just forced a vote at a very late hour. It would have been much better if the representatives of those interests had been in Committee to vote with us on the subject. However, they chose not to be present and not to vote. Nevertheless, we must return to this issue. The politics of the situation will not allow any Government to leave it as it is.

Therefore, in the absence of the strident voices of any representatives of the Liberal and Welsh nationalist Benches, I shall make it clear that we give a firm commitment—along the lines of amendment No. 16—to achieve fairness of charges by equalisation mark 2, or some other means. That is the inescapable commitment that I must give on behalf of the Labour party. As I have said, there is no provision for wage negotiations. It is incredible that, despite their seriousness, the Government are leaving a decision about whether to have any national joint industrial negotiations to the authorities.

I shall not talk about the wage dispute now, but I am sorry that the Minister did not take the opportunity to face up to the question of how, when the chairmen have decided how they will negotiate with the unions, to prevent any majority decision in favour of national negotiation from being undermined by allowing one or two authorities to go it alone and to opt out of any system. I hope that the Minister will give the matter further thought before the Bill returns from the other place. That is the point that we have tried to make.

Most regional water authorities think that there should be some national joint industrial negotiations. They are right to do so, but there is a minority who think the opposite. If my information is accurate, any such system must apply to the 10 water authorities and the Welsh water authority. It would be catastrophic if that was not so. Therefore, I hope that that is made clear. I should like it to be written into the Bill. I hope that if the chairmen have reached their conclusions before the Bill goes to or returns from another place the Government will take the opportunity to do so. I assure them that the writing in of a provision for national joint industrial negotiations will go a long way to remove many of the misconceptions and some of the bitterness that exist at present.

There is nothing in the Bill about the important question who will finance research in the industry. The water industry has had a good research record. One knows the different views that exist in the industry. Some of the regional water authorities do not see why they should contribute to a national research programme, because they think that they are big enough to do their own. However, it must be extremely wasteful to have 10 separate research programmes without any co-ordination or central direction. That again is a cause of considerable anxiety to us.

For all those reasons, we find the Bill disappointing and inadequate. Obviously we must accept what we have been able to achieve in the Bill. In Committee we were co-operative despite the clear divisions of principle between the two sides. We achieved some things and tried to improve some of the provisions. Obviously the country must have some machinery for providing for the industry's future. Therefore, this is not the time to vote against the Bill on Third Reading, although we opposed it in principle on Second Reading. We can only hope that in another place it is even further improved and that when it returns to the House some of our points will, on reflection, be conceded. In that belief I shall support the Third Reading of the Bill.

12.42 am
Mr. Durant

I wish to intervene for only a moment, first to thank my hon. Friend the Under-Secretary of State for his co-operation and help on the Bill, and, secondly, to ask him whether an amendment will be tabled in another place on the sewerage arrangements for local authorities. The local authorities are anxious about this. We had a debate on it in Committee. A new clause was tabled, but naturally it was not selected because of the rules of the House. However, I should like an assurance from the Under-Secretary that there will be an adequate amendment tabled in another place to deal with this important question of sewerage arrangements for local authorities.

12.44 am
Mr. Spearing

I agree with all that my right hon. Friend the Member for Birmingham, Small Heath (Mr. Howell) said about the Bill, but he was too kind. It is a destructive Bill. It takes away rather than builds up, and it destroys relationships and organisms which after 10 years are beginning to settle down and could have been improved by a different Bill.

It has been said recently that the House is a charade. I do not agree with that. However, as I knew something about water before I came to the House, I can well see why some people outside sometimes take that view of proceedings here on matters about which they have knowledge.

Conservative Members are debating an arcane subject late at night, and they want to go home, but they are being kept up. I point out to them that the Bill will have the same effect as the Acts that introduced health reorganisation and local government reorganisation. Like those Acts, this one is not fitted to the needs of the nation, the consumers or good government. We have this bad Bill because we have a bad Government, and—I have to say this, although the Minister is here—bad judgement by Ministers when they were looking for a solution to the problem of how to improve what we have.

When the Secretary of State, as a junior Minister, made a statement some months ago about what the government intended, he knows that I very nearly lost my temper with him. I intervened from a sedentary position, with some effect, as he will see if he reads Hansard. The proceedings today show just how bad a Government can be when they are dealing with matters that need improving, but they take the wrong turning.

When I came to the House, London's pure water was the responsibility of the Metropolitan water board, and the drainage was dealt with by the GLC board of works, an ex-LCC department. It was a large organisation by any standards. We did not wish it to be merged with the Thames water authority, and I moved an amendment, although not against the water cycle, which we all wanted to be brought into the water organisation. The amendment was for a number of small regional authorities coordinated nationally to provide a comprehensive system of water co-operation and government.

The Government of the day—some present hon. Members were here at that time—attempted to put water into the straitjacket of something that they understood to be a public utility. The original Bill as conceived by the then Secretary of State aimed to treat water like electricity and gas. Perhaps the Ministers had played "Monopoly" too much when they were young and thought that they were all the same. They are not.

Electricity and gas may be natural phenomena, but they are channelled, stored, supplied and measured by man. Water is not like that. It is around us all the time. It is in the streets, on the roofs, on the roads, in the gardens, on agricultural land, on the mountains, on the moorlands, on the seas and in the estuaries. It is a natural phenomenon that would exist if we were not here. Yet the Government are putting it on a par with the other public utilities. Water impregnates the environment and the soil.

One cannot run an organisation dealing with this essential substance on the basis of a Whitehall bureaucracy. However, that is what the Bill is trying to do. I am not suggesting that the original water authorities were ideal: there was much wrong that should have been improved. They were probably too large and perhaps too remote. That could have been dealt with in other ways. There is certainly a need for a national co-ordinating mechanism.

I criticised the National Water Council when it started because I thought that it would be too weak. It has done a reasonably good job, but the Secretary of State now wants to destroy it. However, to do so, the Government are having to get together an association to fulfil those very important national functions that even the Government admit have to be carried out. We are taking away those functions by statute and having to create something else in their place. That is not a very sensible thing to do. I do not know the Government's objectives. They have never been explained in terms that make sense to anyone who knows anything about the water industry.

I appreciate the spirit in which the Minister replied to my proposal in the opening debate. He said that the job of the Water Space Amenity Commission had largely been done. Its pioneering work may have been done, but continuation of its executive work remains. The putative association of water authorities will certainly set up a replacement for the Water Space Amenity Commission, although not one with statutory responsibilities and powers. There is nothing in public life between hon. Members and the Secretary of State and every tap, cistern and pipe in every house in the country. It may be true that hon. Members cannot ask direct questions about day-to-day management, just as we cannot ask the Secretary of State for Transport why the 5.25 was late. Years ago, when the British Railways Board was first established, such questions could be asked.

Under the Bill, hon. Members will not be able to ask the Minister about the detailed conduct of any of the boards that he has appointed. That will be part of day-to-day administration. I make no complaint about the practice of the House under which hon. Members cannot ask such questions. If, however, it is argued that these matters are too detailed to be dealt with here, there should be machinery for them to be dealt with elsewhere. All that the Bill contains is the apology for consumer councils contained in clause 7, which is not really concerned with consumer councils at all. They exist within the clause but the obligations are concerned with reporting arrangements. The councils are not even set out in constitutional form. Everything will depend upon the guidelines about which the Minister has spoken.

The Government will be reneging on their responsibilities if they fail to state in statutory form how the consumer councils should work. Otherwise, there is nothing between every tap, cistern and lavatory and this House and the Secretary of State. It is certainly not desirable that the right hon. Gentleman should be burdened with those responsibilities.

The Bill creates further bureaucracy without accountability. It gives enormous powers of patronage to the Secretary of State. I trust that the right hon. Gentleman will not exercise them in the manner that the Secretary of State for Social Services appears to be exercising such powers in respect of health boards. However, if one Secretary of State can behave in this manner in health matters, another Secretary of State can do the same in respect of water.

There have been complaints by the Minister and Conservative Members that councils have not been too careful about their appointments to regional water authorities. It has been a place where old horses go out to grass or where people can be sent to Coventry. This has not been stated in so many words, but it has been the implication. What will the Secretary of State do? How will even the best Secretary of State be able to choose between the merits of the nominees to be appointed to regional hospital boards? He will be even more reliant on ladies and gentlemen to whom, by custom, we cannot refer in this place even if some of them are present.

The Government, who have views about Whitehall and the Civil Service, are adding to a machine that they criticise, not always properly. It is another feature of the Bill that is destructive and regressive in terms of good public administration. Almost every feature of the Bill is backward and is dismantling what has been started. It should never have been brought to the House. It should not be passed.

12.55 am
Mr. Neil Thorne

My hon. Friend will remember that in Committee I expressed concern about the powers to be vested in the water authorities to assist in winning overseas business, and I said that the Association of Consulting Engineers had expressed grave concern about possible unfair competition by water authorities. My right hon. Friend gave certain assurances, and concluded his remarks by observing: Why the involvement of the public sector is so important is that we can have this co-operative approach of enabling overseas customers to visit water authorities and water companies and actually see British plant operating and to see something of the success of their work".—[Official Report, Standing Committee B, 9 December 1982; c. 205.] That was important, but it appears that the rules to be laid down for this type of operation will be by the issue of guidelines. Can my hon. Friend tell me whether he has made any further progress in preparing those guidelines, and whether they will have the force of law? If not, presumably they could be breached at any time, and therefore would not provide safeguards likely to last as long as the Bill, when it becomes law. That would be less than satisfactory.

The consultation document on the matter published in June 1981 said: It is not intended that the export activities of the bodies should extend to competition in the fields of design, engineering construction or supply of plant which is the province of the private sector. The exercise of export powers by the bodies would be subject to the written consent of the Secretary of State who would be able to impose conditions". It is clear from this that it is the Government's intention not to allow unfair competition at the expense of the water ratepayers. If my hon. Friend acknowledges the very real concern that was expressed in Committee and accepted by my right hon. Friend, now the Secretary of State for the Environment, will he please be more specific about what he has in mind to allay that fear?

12.56 am
Mr. Ogden

At 12.56, I am well aware of the lateness of the hour and the desire of most hon. Members to be in another place—and not necessarily the place at the red end of the Corridor. I am also aware that on 19 January, the day after the publication of the Franks report, there is little general interest in our affairs from the press, which earlier was notable for its absence. I believe that it was at a party elsewhere in the building—whether to celebrate the Prime Minister's acquittal, I do not know. However, the results of the Government's reorganisation of the water industry may have a much greater effect on the lives of my constituents than the Franks report that is getting all the attention today.

I want to put one or two questions to the Minister, and one or two to the right hon. Member for Birmingham, Small Heath (Mr. Howell). The right hon. Gentleman did a rollcall a short time ago. It amounted to about half a dozen Members on the Opposition Benches—now three enthusiasts, all men—and half a dozen enthusiasts on the Conservative Benches, and possibly 154 pressed men and women to maintain the Government's majority. The right hon. Gentleman said that he intended to support Third Reading. Perhaps he would have been more accurate if he had said that he would not oppose Third Reading.

Mr. Denis Howell

That is exactly the position.

Mr. Ogden

As a former colleague, I just wanted to clarify that. The fact that there is no formal Note against Third Reading does not mean that we approve the Bill, as cosmetically amended. We accept the reality of the situation that there are 160 votes on the Government side.

Some changes have been made. As I said, they are essentially cosmetic. The balance that we had on Second Reading between a service authority and a service industry, between an efficient authority and an accountable authority, has gone too far. We have virtually excluded the formal interest of the press, local authorities and the ombudsman, and so the accountability of the water authorities comes direct to this place. I shall be interested to read the Minister's replies about what questions we can ask and what we cannot.

If we are formally to exclude local authorities, the press and the ombudsman, and if this is to be the only place in which questions can be asked, a responsibility is placed on hon. Members to organise their affairs in their parliamentary activities within the districts and the regions. The relationship of hon. Members to the water authorities in their areas must be much closer and perhaps much more formal than hitherto. In the past we could leave it to local authority members, the ombudsman and the press to be the public's watchdogs, but it will be necessary now to achieve a more formal relationship. I shall be asking for that in the North-West and no doubt the hon. Member for Stockport, North (Mr. Bennett) will be asking for the same thing.

I ask the Minister to help encourage a more formal link and association. This will not mean committees, but if we are the only ones who will be able to call the authorities to account through Parliament we shall want to establish closer links for the sake of the authorities and the consumers. I do not support Third Reading, but I recognise that it is inevitable that it will receive it tonight.

1.2 am

Mr. Nicholas Baker (Dorset, North)

I want briefly to share the concern expressed by my hon. Friend the Member for Reading, North (Mr. Durant) about the change in arrangements for sewerage agencies that is contained in the Bill. I urge my hon. Friend to examine carefully the change that is proposed. In my experience the arrangements whereby district councils have the right to exercise the agency work effectively, informally, efficiently and cheaply. It could be costly to change the present arrangement and I hope that my hon. Friend will re-examine the proposed change.

1.3 am

Mr. Andrew F. Bennett (Stockport, North)

We are about to complete the second reorganisation of the water industry in 10 years. Rather than having learnt by the mistakes of the previous reorganisation, the Government are extending and enlarging the mistakes. The Conservative Government between 1970 and 1974 reorganised local government, the Health Service and the water industry. They were all pretty disastrous reorganisations, but of the three I believe that they made the worst job of the water industry. They have done little to remedy their earlier mistakes. Indeed, they have made them far worse.

The Government have attacked the principle of local democracy. It is odd that a Government who are so dependent on the principle should be so happy to erode it at local level. Unless we are prepared to defend local democracy we can hardly expect others to defend and subscribe to the principle of national democracy. As long as the water authorities had an element of local democracy in them, it was considered necessary for an ombudsman to scrutinise individual complaints, to allow the press into their meetings and to have a substantial number involved in the letting of contracts so that it would be extremely difficult for an individual to be bribed or persuaded to allow a contract to go in a certain direction. The Government have decided drastically to reduce the element of democracy and the number of those involved in decision making, and at the same time they have made it far easier to corrupt the whole process. It seems that the Government feel that they no longer need to check.

It is odd that when the Government set up a quango and appointments are made purely on the Government's whim, it is thought unnecessary to involve an ombudsman. This means that no one can make individual complaints aout maladministration. It is considered unnecessary for the press to be at meetings and no major safeguards are built into the new system to ensure that there are no allegations of corruption, or that no corruption actually occurs in the granting of contracts.

Mr. Spearing

Does my hon. Friend agree with the cynic, who may be the realist, who said that the only thing that makes sense in the proposals is the whiff of contracts?

Mr. Bennett

I accept those comments. It will be difficult for the new water authorities to establish confidence in the general public on the basis on which they are appointed when there are none of the checks and balances that existed in the past.

I very much regret that the Bill in no way deals with the major complaint of most constituents about the water authorities. The problem is that one has no control over the size of the bill. If one consumes less, the bill is not less. The Government keep saying that the water authorities should be treated like public utilities. The one thing that distinguishes the gas and electricity boards from water authorities is that the amount of gas and electricity that my constituents and others consume determines their bills. However, for water, there is no way in which they can control their bills. The Government should have introduced into the measure some rebate for those on low incomes, pensioners and others so that the ability of individuals to pay their water rates is taken into account.

The Government should take account of people's consumption of water. Water consumption, by the elderly is small compared to that of neighbours who live in identical houses, who at the moment pay identical water rates, but consume different amounts.

I deeply regret the fact that the Government have not looked at one of the reasons why the sewerage element of the water charges has gone up dramatically in many areas. In the north-west of England one of the major problems is sewer dereliction. A number of sewers have collapsed. Most sewers in the big cities in the north-west were built last century, and were built well. They would have every prospect of lasting a long time if they had to deal merely with the sewage that travels through them. What has been destroying the sewers is not the sewage but the number of heavy road vehicles, particularly the heavy lorries, which now move about the city streets. It is a question whether those who are damaging the sewers should make more contribution to their renewal rather than letting the charge fall on those who live in the area, who in many instances do not want the heavy lorries there anyway.

I also deeply regret the fact that the measure does not deal with water conservation. The demand in the water industry for new reservoirs has slackened because of the general malaise in the economy created by the Government. If the economy were to pick up, there might be demands for more reservoirs in areas of outstanding natural beauty.

We should consider water conservation. It is crazy that considerable volumes of water fall on the roofs of most houses, and are used in no way, but become a further problem to be dealt with by the sewers. We should make some use of that water.

With regard to domestic appliances, there are continual efforts to sell dishwashers and washing machines, which use vast quantities of water and are not designed to conserve water. In building regulations the systems for toilets are supposed to be designed now so that two different quantities of water are used, but there is no encouragement to individual householders to instal in replacement of a damaged system one that conserves water.

There are no measures to encourage the sensible use of water in this country. The Government have missed an opportunity to bring some sense into water conservation and to ensure that we do not keep demanding more and more reservoirs all over the country to meet future needs for water when simple conservation measures and modifications to domestic appliances would enable us to make far better use of existing resources.

We had a long debate earlier on the use of leisure facilities. Again, the Government have missed an opportunity to make far better use of those facilities and to do a little more to try to bring together the conflicting interests of the many groups that want to use water for leisure purposes.

If the Government are so determined to break the link between the water authorities and local government, I hope that they will encourage local government to ensure that enforcement of proper standards is imposed on the water authorities and that the public health departments of many local authorities will be encouraged to take action against water authorities when failures of sewage works and equipment lead to major pollution problems.

Finally, I am disappointed that Opposition Front Bench spokesmen did not give a clear undertaking that as soon as they have the opportunity they will reorganise the water industry and bring local democracy back to the collection and distribution of water and the collection of sewage, even if that means a national measure in relation to water collection. I deeply regret that after the 1973 reorganisation had made such a mess of the water industry the Labour Government merely embarked on consultations rather than actually putting the mess right. I hope that we should have a clear commitment today that the next Labour Government will not simply wait and consult but will take action to put the industry back under local democratic control at the earliest possible opportunity.

1.13 am
Mr. Ioan Evans

Having served on the Committee and spent a great deal of time trying to persuade the Government to think again on many of the matters that we have discussed on Report and now on Third Reading, I hope that there will be some deep thinking by the Government when the Bill is considered in another place and some serious amendments made before it returns here.

My hon. Friend the Member for Stockport, North (Mr. Bennett) described what a future Labour Government should do. I am sure that he is right and that my right hon. Friend the Member for Manchester, Ardwick (Mr. Kaufman), who is present for this debate, will agree that a Labour Government should not allow this legislation to remain on the statute book. I appreciate the feelings of my hon. Friend the Member for Stockport, North about what the last Labour Government should have done about the 1973 Act, but he will realise the difficulties that we had in that parliament. I think that the belief was that one should not start reorganising again immediately after a major reorganisation but should first consider the effects.

It is important that Governments should think things through before introducing legislation. The weakness of the Government is that they are still thinking about the Bill on Report and Third Reading. Indeed, Ministers have told us today that they are still not in a position to say how they will proceed but are having consultations. That is scandalous.

If we were to nominate the 10 worst Bills in this Parliament, this Bill would certainly feature in the list. It is a damnable Bill. It does nothing to solve the problems facing the water industry. The Government recognise that the 1973 reorganisation was wrong, but this Bill is even worse. At least the 1973 Act allowed for the representation of local authorities. The Bill cuts out local authority representatives completely.

We have heard a great song from Conservative Members about not wanting a lot of quangos. They say that they want bodies to be accountable, yet we are creating 10 quangos, the members of which are nominated by and are the servants of the Secretary of State. Moreover, we have a Conservative Secretary of State for Wales in a country which is predominantly Labour. He will nominate those who will serve on a body that will not represent the beliefs of people in Wales. The same will happen in many regions in England, such as the north and the midlands.

I congratulate the Secretary of State on being the successor of the present Secretary of State for Defence. If we are to have regional bodies, I should have thought that they would be more accountable if they consisted of people who had been elected to local authorities rather than those who are nominated by the Secretary of State. Local authority representatives served water authorities well, but the fact that they are democratically elected representatives is of no account to this Government.

The Government say that they will consider making appointments. We are to have the farcical circumstance that some members of the bodies will have experience of fishing, others will have experience of agriculture, still others will have experience of local government. There might be a councillor who does a little fishing and a little farming, but there is no guarantee that there will be accountability.

Mr. Bob Cryer (Keighley)

Will my hon. Friend put on record his anxiety, which is shared by the rest of the Labour Party, that the executive appointees will not be subjected to any scrutiny through election? What is more, the press is to be excluded from meetings of water authorities. They are to be shut out of them deliberately and will be limited to press conferences afterwards. That is a real step backwards for democracy.

Mr. Evans

All hon. Members who have served on the Committee have expressed deep anxiety about the way in which local authorities are being treated. Local authorities throughout Britain, their members and their associations oppose what the Government are doing about local government representation. There is no justification for doing away with such representation.

The Government have paid tribute to the work of the National Water Council. In Committee, we discovered the emergence of an association of the water regions. There is to be a National Water Council under another name. We do not know what will happen. Presumably consultations are still taking place. I hope that there are consultations before the Bill returns from the other place, but they just go on and on. We do not know what body will replace the National Water Council.

The Government's action is deplorable. If we have a regional system of organising water, not a national one, there must be a national water policy. If there is a national water policy—every nation must have one—there must be an organisation such as the National Water Council.

The Water Space Amenity Commission has also been abolished. The Government have made only a few concessions in that regard. In Committee, we found that the National Water Council dealt with the activities of overseas water authorities.

Other countries are developing their water industries. The National Water Council has put them in touch with regional water authorities. That has meant trade for our industries. We have put them in touch with companies that can help them to develop their water industries. When I challenged the Minister on that point, he said that a company would be formed. One of his colleagues said that it would be named the Aberdare company. We can take jokes, but it is a serious business. What about the company? We have not been told the details yet. What will happen to the important work of the National Water Council in dealing with other countries?

The House as a whole has realised the importance of developing the role of the local authority commissioner. Local water industry boards have been responsible to the local authority commissioner. People who felt that there had been maladministration complained to the ombudsman. The Government are abolishing that role. It is not a step forward. We had hoped that there would be a role for the ombudsman in other Government activities.

Hon. Members have referred to the Water Charges Equalisation Act 1977. The Labour Government's activities were not sufficient to deal with injustices whereby people in different regions paid a different price for an adequate water supply. There are great injustices. My right hon. Friend the Member for Birmingham, Small Heath (Mr. Howell) dealt with the matter. We have heard assurances that a Labour Government will tackle the problem. Someone said that it was a burning question in Wales. It is an importat and serious question which the Government have ignored.

The Franks report and the way in which the press was treated have been referred to today. The Prime Minister, in her maiden speech, said that the press should be allowed access to certain discussions. Yet the Government will exclude the press from discussions among the water authorities. Until the Bill is enacted, the press are allowed to attend meetings. We have heard quotations from numerous editors who are deeply concerned about the effect of the Government's proposals. There are to be arranged meetings—no doubt they will refer to recommendations being made by the water boards—

Mr. Spearing

Paragraphs in the report.

Mr. Evans

They will refer to certain of their activities. Until now members of the press hae been allowed to listen to the deliberations.

There is a need for national negotiations on wages in the industry. The Government's proposals are a major step backwards and a recipe for chaos. Different arrangements will be made at different trade union negotiations in different regions. Will there be a great disparity in the wages paid to workers doing a similar job?

The Bill is deplorable. I hope that major amendments will be made in another place. If not, I hope that my right hon.and hon. Friends, who said that a Labour Government will not sustain the measure, will make it a priority to introduce legislation to organise the water industry on a far better basis.

1.24 am
Mr. Giles Shaw

Of course, there are those who see no prospect of improvement for the water industry in this Bill and who wish to oppose the principles on which it is based. Therefore, it is unlikely that my remarks will help to alleviate their worries. However, I make it clear that we must form the association of water authorities. We have always said that there are some essential functions on which there should be consultation between regional water authorities and agreements on policies to be pursued. They should be the basis of agreement between the authorities and not emanate from a statutorily based, separate organisation. Those consultations, and the policies that emerge from them, should be provided at a lower cost to the consumer and should be more efficient. The association of water authorities has issued its memorandum of association. Matters are proceeding, but the consultations are incomplete.

The hon. Member for Aberdare (Mr. Evans), who has now resumed his silent seat on the Opposition Front Bench, rather than his loquacious seat, should bear in mind that the continuing negotiations show that progress is being made. He would be the first to be upset if we did not have full and adequate consultations about such an important industry. We are even consulting the House of Commons and have made significant changes to the Bill as a result of that consultation. Let us draw pleasure and, I hope, comfort from that.

The right hon. Member for Birmingham, Small Heath (Mr. Howell) mentioned research. There is a commitment that research should continue. The water authority chairmen recognise that fact and they also recognise the collective importance of backing the water research centre, which is a crucial part of the research in the industry.

My hon. Friend the Member for Reading, North (Mr. Durant) asked about sewerage arrangements, as did my hon. Friend the Member for Dorset, North (Mr. Baker). I know about the worries of local authority associations on such matters. Hon. Members who served on the Committee will know that we distributed the consultation paper on amendments, and it is likely that amendments will be made in another place which will have resulted from the consultations that are still being assessed. However, I assure my hon. Friends that the Government emphasise the fact that there should be no fundamental change in the present position. The Government do not intend to go beyond the recommendation of the Monopolies and Mergers Commission, which was that no fundamental changes should be made. The agency arrangements should continue to play a major role in the way in which sewerage and drainage are undertaken by local authorities. The Monopolies and Mergers Commission confirmed that, in many cases, those arrangements work well. When we have reached firm conclusions, we shall introduce amendments in another place and there will be a subsequent opportunity for the House to discuss those issues.

My hon. Friend the Member for Ilford, South (Mr. Thorne) asked about export powers. In addition to the assurances that I gave to him in Committee, may I say that we shall ensure that water authorities which set up arrangements for overseas ventures will be strictly controlled. The bodies will be required to report to the Secretary of State any likely loss under a contract and how they propose to remedy it, to keep separate accounts for overseas business—which in many cases will be business undertaken by a separately established company—to take one year with another to meet their outgoings, to meet on their overseas activities any financial targets set for that business as a whole and, finally, to take out insurance and require bonds where necessary. In that way, proper competitive and fair conditions will be applied to the activities that water authorities undertake in overseas markets. However, they should be encouraged to take those opportunities where there are export orders to be won.

I agree with the hon. Member for Liverpool, West Derby (Mr. Ogden) that there should be close contact with Members of Parliament in the new phase of water authorities. Water authority chairmen would welcome that, and I am sure that that is the case in the north-west as it is in other areas. Assistance with water bills is available under DHSS arrangements but is not available in the same context as a rebate for local rates, as water bills are charges for services that have been delivered.

I am well aware that there are some major differences of view. The hon. Member for Newham, South (Mr. Spearing) launched his attack on what is proposed in a most extraordinary way. I take note of his views on this matter. Many hon. Members have played a part in the proceedings. I thank my hon. Friends who served on the Committee and my hon. Friends who are present tonight. I value their support and help in processing the Bill. It is a further step forward in trying to make improvements in the way in which water authorities discharge their functions. Based on principles with which my hon. Friends will be content, I trust that commercial operations run in the water authorities will gain the confidence of the House and of consumers.

1.32 am
Mr. Bob Cryer (Keighley)

I was not in the Chamber earlier as I have been in the Committee dealing with the Transport Bill. If Conservative Members are worried about the Bill going on into the night, they should not be trying to trample through Parliament in such rapid succession legislation which takes many hon. Members into Committees because the Government want to get the transport legislation, for example, on the statute book in order to affect the position of local authorities in the next financial year. If the Government had any sense, and introduced legislation in a more ordered way, it would not be necessary to have to spend long hours in late sittings, as Parliament would not be subjected to the pressure it is under purely as a result of the action of the Government.

It is a matter of concern that bodies that are already regarded with some dissatisfaction by the consumer because of their remoteness, should be made even more remote by the Government by replacing the indirect nominations from the elected bodies—the local authorities—with executive appointees, who moreover, will not be subject to proper and adequate scrutiny through the local press. The local papers keep an eye on what local water authorities are doing and report to the consumers in their regions. Many local papers have expressed strong criticism of the Government for taking away the obligation of local authorities, including the water authorities, to be subject to such scrutiny. Indeed, local authority representation on the water authority is indirect. There are no direct elections.

The Opposition should seek, when we get into government after the next election, to replace these appointees with directly elected representatives on the water authorities so that there is more accountability, and give the press access to their meetings.

As my hon. Friend the Member for Stockport, North (Mr. Bennett) said, there will be a strong feeling that behind closed doors funds may be misapplied, tenders wrongly allocated and rules bent instead of the open decision-making to which our democratic bodies are subject. This Bill is a retrograde step. It is a move closer to central government control. That is characteristic of this legislation and of other Bills such as the Transport Bill. The Government's claim is that the man in Whitehall knows best.

We see Conservative Members of Parliament on television talking about abolishing the metropolitan county councils and suggesting that those elected bodies should be replaced by boards of people nominated from metropolitan district councils, the very system which the Conservative Government are abolishing for the water boards. If it has merit for metropolitan county councils, it is strange that in another area the self-same Government formed by the Conservative Party are abolishing the system which they propose as a suitable replacement for metropolitan county councils.

The best method of accountability in a democracy is a democratically elected body. We are a democratically elected body. If anybody interferes with Parliament or makes suggestions about interfering with Parliament, there are cries about breach of privilege. When people stand up in the Gallery and make suggestions about what we should be debating there are great cries about non-interference with an elected body. But when it comes down to water authorities, even the modest vestiges of democracy are swept aside by the very people who talk in such glowing terms about parliamentary democracy.

This is simply a further aspecct of the corporate state which is developing under the present regime and is a half-way stage towards privatisation. Some of the water concerns are potentially highly profitable. By virtue of their organisation they are bound to be monopolies. Under this sort of system, with a narrow group of executives running these businesses, they would be much more easily sold off to private enterprise. Indeed, some water supplies are already operated by the private sector.

The trade unions do not want that sort of reorganisation. They view it with apprehension and concern. If the Minister is not aware of it, there is the making of a major dispute in the water industry. It is very much to be hoped that the Minister will keep the House closely informed.

This Bill clearly cannot assist in maintaining good industrial relations within the industry. Therefore, on those counts hopefully it will not come into operation by virtue of the curtailment of the life of the Government. When the Labour Party gets into power we will establish a democratically elected system which is genuinely accountable. We will not only apply our policy of open government in central Government but will restore open government at this level by giving the press access to the control of these important bodies.

Question put and agreed to.

Bill accordingly read the Third time and passed.