HC Deb 20 March 1989 vol 149 cc851-8

Queen's recommendation having been signified

Motion made, and Question proposed,

That, for the purposes of any Act resulting from the Water Bill, it is expedient to authorise the payment out of money provided by Parliament of—

  1. (a) any travelling or other allowances payable under the Act to members of the committee established and maintained for advising the Secretary of State with respect to matters affecting or otherwise connected with the carrying out in Wales of the functions of the National Rivers Authority; and
  2. (b) sums required by a Minister of the Crown for making loans to the National Rivers Authority for capital purposes in connection with the carrying out of its flood defence functions, so long as the aggregate amount outstanding in respect of the principal of sums borrowed by the Authority shall not exceed £160 million.—[Mr. Norman Lamont.]

10.29 pm
Mr. Bob Cryer (Bradford, South)

I shall raise several questions on this money resolution. I spoke on the Water Bill [Money] (No. 1) resolution. I am concerned, because the first money resolution—[Interruption.]

Mr. Speaker

Order. Would hon. Members who are not staying for this important debate please leave quietly?

Mr. Cryer

I am grateful to you, Mr. Speaker. After all, the hon. Members who are moving out of the Chamber in such a noisy fashion belong to the party that continually complains about looking after the taxpayer's money. We are discussing a money resolution that authorises the spending of at least £160 million, and Conservative Members are leaving the Chamber in a noisy and indifferent fashion.

The first section of the resolution deals with any travelling or other allowances payable under the Act to members of the committee established and maintained for advising the Secretary of State with respect to matters affecting or otherwise connected with the carrying out in Wales of the functions of the National Rivers Authority". The National Rivers Authority is part of the hierarchy which is established by this wretched bit of legislation—it is hardly a bit of legislation; it is one of the biggest Bills ever brought before the House—yet hon. Members were not informed that extra money would be required for a committee established by the Secretary of State to advise him about the NRA. We were told that the NRA would be a free-standing body able to operate on its own, and that grant aid would be provided for it. The Minister responded to me in that way on 8 December when we discussed the first resolution. He said: The hon. Member for Bradford, South rightly referred to the National Rivers Authority and the grants to it by the Secretary of State. Paragraph 17 to schedule 1 enables the Secretary of State, with the approval of the Treasury, to make grants to the NRA of such amounts, and on such terms, as he considers appropriate. He must, of course, provide the Comptroller and Auditor General with an account for each financial year of any grant paid and the Comptroller and Auditor General must then certify and report on that account. As the hon. Gentleman knows, copies of the Comptroller and Auditor General's report must be laid before both Houses of Parliament. I should like the Minister to confirm that that safeguard will apply to the expenditure sought—they may be minor amounts—for the committee which is being established to advise the Secretary of State on matters concerning the functions of the NRA in Wales.

Mr. Dennis Skinner (Bolsover)

Do not ask him too many questions, Bob, he has been busy.

Mr. Cryer

My hon. Friend the Member for Bolsover (Mr. Skinner) is referring to the extra-curricular activities of the Minister. I want him to be bright and alert and not feeling too weak and worn out, for whatever reason, to answer the debate.

The second part of the money resolution refers to sums required by a Minister of the Crown for making loans to the National Rivers Authority for capital purposes in connection with … flood defence functions". On 8 December, I raised the issue of the grant-making power. The Minister said: The grant-making power will enable grant-in-aid to meet the deficit on the NRA's operations. Although the NRA will be encouraged to maximise its income from direct charges, a deficit will arise largely because the environmental service charge will not be levied after 1989–90. Grant-in-aid is considered a more appropriate method of paying for services which are of benefit to the whole community."—[Official Report. 8 December 1989; Vol. 143, c. 539.] Clearly, flood defence arrangements are of benefit to the whole community. Why did the Minister tell me on 8 December that the benefits that would be enjoyed by the entire community would be paid for by grant in aid, to meet any deficits, when now, a few weeks later, the Government find it necessary to make loans? Is the wretched Bill so complex and so difficult to follow that Ministers could not produce a money resolution to cater for every contingency for which the Bill provides, as the contingencies were discovered in Committee? If so, that is not a good process of legislation. The Bill is complicated, but surely Ministers should have made provision at the beginning of the legislative programme, not when we are halfway through it.

Indeed, tomorrow the House will be debating the Water Bill on Report. It is a bit late in the day for the Government to produce a second money resolution. It is clear that they have discovered oversights in the past few weeks. It is clear that there has been a lack of planning and understanding in the construction and progress of the Bill. There has been a serious miscalculation, bearing in mind that the original money resolution was, to all intents and purposes, massively comprehensive. The first section contained 12 parts, the first of which provided for grants by the Secretary of State to the National Rivers Authority. It seems that grants are not enough. Loans are required for a specific purpose. Why were grants authorised in the previous resolution for the generality of community purposes with loans being authorised only for flood defence purposes? Why was there that differentiation? I hope that the Minister who is to reply will provide an adequate response.

As I have said, the first resolution was comprehensive. Are the Government considering the introduction of further money resolutions? We know from our experience that the Government's calculations are often so incompetent that sometimes three resolutions have been required. It seems that they have no idea of making adequate provision. For example, they introduced two further money resolutions following the Second Reading of the Firearms (Amendment) Bill, as it then was, and the original resolution.

I hope that the Minister will be able to provide the assurances that I seek. I am surprised that an explanation was not provided in the first instance. It is outrageous that the House should be asked for £160 million, with a few extra million pounds, I suppose, for the expenses of the committee that is advising the Secretary of State for the Environment on the NRA. I suppose that the extras are too trivial to bother about. Approval is sought for the expenditure of £160 million, yet no explanation is vouchsafed to the House. In other words, a Minister has had to be forced to his feet. We are talking of a Government who are supposed to be concerned about the taxpayers' interests. It seems that if they think that they can get away with pushing expenditure of £160 million through the House on the nod, they will try to do so. That is a disgraceful attitude for any Government to take.

10.38 pm
Mr. Dafydd Wigley (Caernarfon)

I was surprised to find at 2.30 pm that the resolution was on the Order Paper. There was no announcement last week that any such measure would appear before us. I understand, however, that that is the normal way in which such business is handled. I suggest that in future there should be reference to a resolution such as that which is now before us when the business of the House is discussed on a Thursday. If not, the allegation of the hon. Member for Bradford, South (Mr. Cryer) that something is being slipped through will have additional credence. Nothing was said last week to the effect that a second money resolution would be on the agenda this week, whether on the nod or otherwise.

I was a member of the Committee which considered the Water Bill and I do not oppose the provisions contained in the resolution. In some respects, they meet some of the arguments that I and other Opposition Members raised in Committee over several weeks. First, the resolution will facilitate the acknowledgement in legislation that the advisory committee on rivers in Wales will have money made available to it to enable it to do its work. We had a long argument in Committee about whether the advisory committee in Wales would be a statutory one. For a long period the Government appeared not to be too keen on making it a statutory body. I am glad that we have won the argument and that the Government have conceded that. I hope that the statutory committee will feel that it has an important function to carry out and that the Secretary of State will take account of the weight of its opinion.

I hope that the sums made available to the Committee will enable it to undertake a professional job and that it will not be a committee of people who have retired or have independent incomes and are thus able to undertake do-gooding work for the Secretary of State. It must consist of people who do ordinary everyday jobs, and the scale of the allowances and costs must be adequate to recompense those who do not have private means or a retirement income. It is important to strike the right balance. I welcome paragraph (a) as a concession to the points that I made in Committee, as did the hon. Members for Cardiff, South and Penarth (Mr. Michael) and for Brecon and Radnor (Mr. Livsey).

I should be grateful for clarification of how the second paragraph will work. Although I welcome any source of additional publicly originated finance available to undertake important works that should be undertaken in the public sector, such as flood defence mechanisms, it is important to know how the charging for that will be affected by the money resolution. Will there be additional charges to service the loans? They are loans, not grants. If there are additional charges, will they go through to communities which suffer from floods and need defence mechanisms? I should be grateful if the Minister, in responding to this brief debate, would give some indication of the additional implications that this part of the resolution may have for those who are to benefit from the work undertaken.

My other slight misgiving is whether £160 million is enough and about the mechanism for increasing the figure, if more is needed. Presumably it will not be necessary to go back to primary legislation and the money may be provided by an order on an annual basis or by some similar arrangement.

In introducing this money resolution the Government are providing a prelude to the debate on the Bill that we shall have in the next two days and on the first day after the recess, when they will have to introduce many amendments and proposals to meet the points of weakness that we pointed out to them in Committee. The Bill has been fully opposed in Committee because Tory Back Benchers, Opposition Members and people outside do not believe that it is coherent legislation. It will need considerably more than this money resolution to overcome the basic fallacies in the Bill, not least the financial ones.

10.43 pm
Mr. Alun Michael (Cardiff, South and Penarth)

It is a little surprising to see the scrappy way in which the Government are beginning to backtrack on this curious Bill. In view of the criticism that the Secretary of State and the Prime Minister made of the Ministers' handling of the Water Bill, it should be said in fairness that they have done their job throughout the Committee stage and given way on nothing. Now we see a little room for manoeuvre creeping in. Besides this money resolution are we to see more money resolutions about the writing off of debt or the suggestions made by the right hon. Member for Henley (Mr. Heseltine) to give grants to the privatised water companies?

I should like to make it clear that we will not oppose these proposals because they mark concessions wrung from reluctant Ministers who have taken a pounding. One has rarely seen Ministers in such disarray as we saw in Committee.

Paragraph (b) reflects a response to one element of the muddle through which Ministers have tried to find their way. That is certainly welcome as an important step by the Government in recognising the need for a loan facility, which Ministers, of course, failed to recognise throughout the Committee stage. The Secretary of State is obviously not aware of the difficulties that his junior Ministers have been suffering over recent weeks and months. Our response to paragraph (b) is that at last perhaps the Secretary of State has recognised—[Interruption.]

Madam Deputy Speaker (Miss Betty Boothroyd)

Order. Mr. Michael.

Mr. Michael

I am grateful, Madam Deputy Speaker. It is obvious that the Secretary of State is somewhat needled on this matter.

Paragraph (a) will give the financial requirements for a committee that will at last be written into the Bill. Of course, the Minister of State at the Welsh Office continually refused our request to write this into the Bill during the Committee stage. I am glad to see that it will be in the Bill and that the money resolution is before the House.

Tomorrow's debate will be about the committee's composition and what it will do. Our welcome, therefore, for paragraph (a) depends on the debate tomorrow. The Government are, in effect, accepting the amendment that we pressed on them in Committee that the advisory committee should be written into the Bill. Our amendments will give teeth to the committee, but they will require the same provisions as are given tonight. However, the purpose of our amendments—which also require the money resolution—are to protect the Welsh people from the worst effects of the Water Bill. Our plea is for a watchdog with real teeth. Our amendments will give real teeth without which the body would be completely meaningless.

The amendments will go further than simply to say that there will need to be a committee to advise the Secretary of State for Wales. They will seek to give proper weight to that committee by appointing to it representatives of local authorities in Wales, the chairman of the fisheries drainage and recreation committees and representatives of consumer, environmental and recreational organisations to be named by the Secretary of State. That will provide a meaningful committee and will give some purpose to the payments to be made under the resolution.

There will also be the possibility of the Secretary of State giving that committee some real work, by enabling it to carry out any function exercisible by him by virtue of the Bill. I refer to Wales because, of course, the first part of the resolution refers to Wales. It appears that the Secretary of State for the Environment does not require those functions for England.

It is important that there is an environmental oversight by a proper body. We believe that that should be carried out by a Welsh rivers authority and we have tabled an amendment to that effect. However, failing such an authority, there is a need for a Secretary of State's committee that is not just a nominal cipher, but has some power and responsibilities and can be seen to exercise functions within Wales.

During the Committee stage we won from a reluctant Minister of State the concession of a special committee for Wales, which has led to the money resolution. After fresh controversy, the Minister has tabled an amendment to write the committee into the Bill. However, unless the committee is given proper authority by our amendments, it will be a toothless corgi.

We propose further changes to make the body effective and representative of Welsh interests. As the paragraph now stands, the Secretary of State could use the money resolution simply to pay for three or four members of the Conservative party to meet in a hotel somewhere near the Welsh border, or even in London, for half an hour once a year and to offer him private advice that he could then ignore. That would be completely meaningless, but I suspect that that is what the concession means as it stands. If the amendments debated tomorrow are accepted, however, the money resolution will enable proper payment to a proper committee that will consist of proper representation from environmental groups, fishermen as well as local authorities and the chairman of the committees to which I referred earlier.

If the sell off of our water goes ahead information will be vital, but it will not be available to the public in Wales unless we have the powers that are allowed for in our amendments to the Government's new clause. Our amendments will empower the committee to require information from the water companies and from the rivers authority. In that event, the payment called for in the money resolution will be money well spent. Without such expenditure it is difficult to see how the public in Wales will be properly protected.

The Secretary of State for Wales will be able to delegate any of his powers under the Bill to the committee and give it a real job to do. That will also give some purpose to the financial provisions that we are debating.

We believe that the privatisation of water will do nothing positive for the environment or for the consumer in Wales. The minimum that we shall seek tomorrow is the establishment of a Welsh rivers authority and a consumers' charter of measures to be included in the Bill. Failing that, the Secretary of State for Wales should recognise that the amendments that we shall debate tomorrow and the financial provisions before us tonight are modest, constructive and positive proposals which would be welcomed in Wales and which the Secretary of State should accept if he has the slightest desire to protect Welsh interests.

We hope that the money resolution will pave the way for the Secretary of State for Wales to accept our amendments to the new clause tomorrow so that there will be something in the Bill that means something to the Welsh people.

To a great extent, tonight's debate is meaningless until we have tomorrow's debate. The way in which the Government have sought to rush through such an amendment by putting it on the Order Paper in such an extraordinary fashion leads to us having to refer to tomorrow's business while we debate that of tonight. That is a nonsensical way in which to deal with business but that is the way in which the Government operate. They have got themselves in a complete mess, but, because of that, we welcome what we think today's money resolution may mean and look forward to the substantive debate tomorrow.

10.52 pm
The Parliamentary Under-Secretary of State for the Environment (Mr. Cohn Moynihan)

By the tenor of the laboriously scribed responses of the hon. Member for Cardiff, South and Penarth (Mr. Michael) in Committee, I often thought that his mind was not even on the same Committee. Tonight is no exception. We have won the argument, we have won the debate and tonight the hon. Gentleman has stood at the Dispatch Box to agree with us on the money resolution.

The first part of the money resolution relates to the establishment of the advisory committee for Wales, which the Secretary of State for Wales will be able to appoint if new clause 8 is approved by the House. The advisory committee's role is to ensure that the Secretary of State for Wales is kept fully informed, and obtains a Welsh view, of National Rivers Authority policies which affect Wales and of the needs of the NRA if Welsh requirements are to be met.

The clause provides for the Secretary of State to pay —with the consent of the Treasury, out of money provided by Parliament—to the members of the committee sums reimbursing them for loss of remuneration, for travelling expenses and for other out-of-pocket expenses. The costs are not likely to be "a few million pounds", to quote the hon. Member for Bradford, South (Mr. Cryer). We expect them to be about £25,000 per year.

Paragraph (b) of the resolution provides for the payment of loans to the NRA in connection with its flood defence function, and sets a limit to the amount that the NRA could borrow for this purpose. The resolution is necessary because we have tabled amendments to the Water Bill to provide for such arrangements. Paragraph 18 of schedule I already allows the NRA, with the consent of the Secretary of State or the Minister of Agriculture, Fisheries and Food, and the approval of the Treasury, to undertake temporary borrowing. That power is intended to enable the NRA to overcome any problems that may arise with short-term cash flow.

The hon. Member for Bradford, South wanted to know why we should have to discuss these details now when we have already debated a money resolution. He would be the first to accept that we should listen very carefully to points raised in Committee by his hon. Friends and also by our own hon. Friends, and that is what we did. Concern was expressed that a power for the NRA to borrow temporarily was not sufficient on its own and that the NRA should also be able to undertake long-term borrowing to fund its flood defence work.

Mr. Peter L. Pike (Burnley)

We debated the issue of temporary borrowing in Committee. I argued then that temporary borrowing was unnecessary because all borrowing is temporary if the intention is to repay it. Why has the Minister produced a proposal after all this time when he refused to accept in Committee that there was any need for additional provision in the Bill? If money is borrowed, the intention must be to pay it back.

Mr. Moynihan

In Committee, the hon. Gentleman and his hon. Friends put the case for long-term borrowing powers, to which we are responding positively now. We have taken account of the hon. Gentleman's views and of the admirable views expressed by my hon. Friends on this point in the debate in Committee.

Mr. Alistair Burt (Bury, North)

I wonder whether my hon. Friend the Minister noted the point made by the hon. Member for Burnley (Mr. Pike) that money which is borrowed is intended to be paid back. I do not know where the hon. Member for Burnley was while the Labour party was in government, but the Labour Government did not pay back a penny piece. The Conservative Government are paying money back, whereas the Labour Government just kept on borrowing, leaving the burden to the next generation.

Mr. Moynihan

If we ever wanted living proof of the fact that we won the argument in Committee, it exists in the form of my hon. Friend the Member for Bury, North (Mr. Burt).

We do not believe that it is necessary to provide the NRA with long-term borrowing powers for situations other than emergencies. It should be possible for the NRA to plan a balanced budget for the normal run of its flood defence work without recourse to borrowing. Indeed, water authorities have generally managed without significant and new borrowings in recent years.

I confirm that the report that Ministers are required to make to both Houses of Parliament under paragraph 21(3) of schedule 1 will include a reference to money expended on the Welsh committee. This money resolution is necessary because of the amendment to provide borrowing powers following the strong views expressed in Committee which I reflected in my earlier comments.

In response to the points raised by the hon. Member for Caernarfon (Mr. Wigley), the money resolution provides for loans to the NRA to finance emergency flood defence work. The cost of servicing the loans will come from the land drainage precepts. The effect of that is to spread the costs of major emergency works over a number of years. I hope that in a spirit of harmony and agreement between hon. Members on both sides of the House about the great benefits and wisdom of this money resolution the House will accept the motion without a Division.

Question put and agreed to.

Resolved, That, for the purposes of any Act resulting from the Water Bill, it is expedient to authorise the payment out of money provided by Parliament of—

  1. (a) any travelling or other allowances payable under the Act to members of the committee established and maintained for advising the Secretary of State with respect to matters affecting or otherwise connected with the carrying out in Wales of the functions of the National Rivers Authority; and
  2. (b) sums required by a Minister of the Crown for making loans to the National Rivers Authority for capital purposes in connection with the carrying out of its flood defence functions, so long as the aggregate amount outstanding in respect of the principal of sums borrowed by the Authority shall not exceed £160 million.