Vesting of land and duties of the Authority with respect to land

HC Deb 21 March 1989 vol 149 cc966-1022

'( )—(1) Any land owned by a water authority before the transfer date shall on that date vest in the National Rivers Authority.

(2) The other property, rights and liabilities of those authorities shall be divided between the Authority and the successor companies in accordance with schemes made under Schedule 2 to this Act.

(3) The Authority shall in the case of any land in respect of which it creates a lease or other interest, attach and enforce such covenants or other restrictions as it considers necessary for the purpose of ensuring that no use of, or development upon, the land may occur where such a use or development would be likely to cause harm to the environment, flora and fauna, beauty or amenity, contained within the limits of any such land.

(4) The Authority shall, in respect of any lease or interest in land transferred to it, attach such restrictions as shall prevent the sale or transfer of any such interest to a third party except with the consent of the Authority.'.

Amendment No. 139, in clause 3, page 3, line 35, after `property', insert 'other than land'.

Amendment No. 140, in clause 3, page 3, line 36, at end insert— `(1A) The property (other than land), rights and liabilities allocated to the successor companies in accordance with subsection (1)(b)(i) above shall be those which, in the opinion of the Secretary of State on the advice of the Director or the Authority as appropriate, are required for the fulfilment by the undertakers of their duties under the provisions of this Act and the terms of any appointment made under Chapter 1 of Part II below.'.

Dr. Cunningham

This series of new clauses would represent a major amendment of this part of the Bill. They aim significantly to strengthen the environmental protection aspects of the Bill and to enhance the role and duties of the National Rivers Authority.

I wish to make it clear at the outset that we recognise the need for changes in environmental law, duties and safeguards, and in that sense we have always said that we would not oppose the principle of the National Rivers Authority. But, like many people and bodies, including the Select Committee on the Environment, we regard the proposals in the Bill as too weak, too vague and too incoherent ever to provide the rigorous environmental protection that we believe to be necessary.

New clause 1 addresses the need to reduce pollution and properly to allocate the costs. In other words, it is concerned with the principle of the polluter paying. It says: it shall be the duty of the Secretary of State and the Authority to ensure that in all reasonable circumstances the person who causes any pollution of a river or other water source, whether that person is a body corporate, water or sewage undertaker or an individual, shall bear the cost of remedying that pollution and of taking steps to prevent any recurrence. New clause 2 seeks the separation of environmental functions from water supply and sewage services and of contracting out functions.

New clause 15 places wide-ranging new duties on the National Rivers Authority, in particular the duty to publish a plan for water and the environment.

New clause 20 deals with the vesting of land and the duties of the authority in relation to the vast land holdings —approaching 500,000 acres—currently in the ownership and control of the regional water authorities and, therefore, in public ownership.

These changes are necessary because we believe the Bill to be weak, and deliberately so; to be confused about objectives; and to be incoherent and incapable of ever creating an effective framework within which to safeguard the environment. Indeed, in several respects the Government's proposals lay some of our most precious environment open to commercial exploitation.

The Secretary of State for the Environment (Mr. Nicholas Ridley)

A terrible thought!

Dr. Cunningham

Apparently, that is not a terrible thought to the right hon. Gentleman. It is a terrible thought to Opposition Members and to many millions of people in the country. Indeed, as I have said before, I know of no other nation which is putting huge areas of its national parks up for sale and, therefore, at the mercy of predatory developers and potential exploitation. That is what the right hon. Gentleman's proposals do, and I shall come later to that aspect of the matter.

As the Secretary of State seems to think that this view is not widely shared, I refer him to a recent report of the Select Committee on the Environment. In its second report on toxic waste published on 22 February 1989, the Committee endorsed the Labour party's policy on and view about the need to create a more comprehensive environmental protection agency than is envisaged in the Secretary of State's proposals for the National Rivers Authority. On page 12 of that report, in paragraph 9, the Committee said: We had hoped that this national body might be the same national body which we had previously recommended he created to regulate river pollution. However, in setting up the National Rivers Authority, the Government have treated it as a residuary authority to receive a variety of functions, each in itself extremely important. Our aim is to establish a national regulatory body which would assume responsibility for integrated pollution control and evolve 'into a full-blown environmental protection agency or Commission. The Government may still be in time to amend the Water Bill to take account of these views and lay the ground for the future expansion of the National Rivers Authority. Bui we do understand the difficulties of a sudden change of course. That is precisely what we are proposing. We say that those general conclusions of the Select Committee should be written into this legislation., Indeed, it is necessary to have more wide-ranging and rigorous safeguards because even the Prime Minister is not aware of the state of affairs over which she presides.

I say that because it is interesting to see what the Prime Minister said in a "Nature" interview on 2 March last when questioned by Michael Buerk of the BBC. I quote from the transcript of the programme: Is it right for a developed country like the United Kingdom at the end of the 20th century to be disposing of something like 6 million tonnes of sewage sludge in the waters around that country? You said"— referring to what the Prime Minister had said— 'It's treated sewage of course, it's not untreated. It's treated. Mr. Buerk then said: We also have a lot of outfalls that take raw sewage into the sea and are still building them. The Prime Minister replied: Well, it should be treated sewage that goes out, treated all of it … I think you'll find that it's treated sewage in this country. That showed the appalling ignorance of the Prime Minister about the state of affairs which prevails. I am anxious to emphasise how completely in error that statement by the Prime Minister was. With impeccable timing today, the Secretary of State for Wales, a member of the Cabinet, confirmed in a written answer the state of affairs in Wales on sewage outfalls to the sea. He said: The number of outfalls with no treatment is 90. The number of sewage outfalls relying on tidal storage schemes"— that is, with no treatment— is 23. The number of sewage outfalls where there is preliminary screened and/or macerated treatment only is 53. The number of sewage outfalls with primary treatment is 29. The number with secondary treatment is 61. In other words, 65 per cent. of all the sewage outfalls on the coast of Wales have no treatment process of any kind. That is how much the Prime Minister knows about the state of the environment in Britain.

I asked the Secretary of State for the Environment exactly the same question about the situation in England. Unlike his right hon. Friend the Secretary of State for Wales, he has refused to give the answer, no doubt to cover up his and the right hon. Lady the Prime Minister's embarrassment about this matter.

Mr. Tony Marlow (Northampton, North)

Since the burden of the hon. Gentleman's remarks is that he would like to see higher standards, I presume that he accepts that that will obviously cost more money. The Government have a system for bringing that about. The hon. Gentleman is bringing forward some amendments which would make life even more complicated and bureaucratic. He is asking for even higher standards, which of course will cost even more money. Can he tell the House how much he believes that these new clauses would cost, first, British industry and, secondly, the National Rivers Authority?

Dr. Cunningham

I am willing to set out all the answers to all those questions in a speech which I shall be making in a few weeks' time. But, yes, I agree that these things will cost money, and a great deal of money, and that the British people will need to pay. I also believe that, overwhelming-ly, they are willing to pay. It is not necessary to sell off the nation's water resources to achieve these objectives. The British people recognise that quite clearly and in overwhelming numbers, as they continue to demonstrate.

Sir Anthony Grant (Cambridgeshire, South-West)

rose——

Mr. David Ashby (Leicestershire, North-West)

rose——

Dr. Cunningham

No, I am not giving way. Sit down. I am answering the hon. Member for Northampton, North (Mr. Marlow).

The British people are not willing either to pay unnecessary charges such as those set out by the West Kent statutory water company when it announced a 42 per cent. increase for consumers, half of which, it pointed out, was due directly to the cost of privatisation, or to accept unnecessary additional costs to pay for dividends and high directors' fees, salaries and expenses, because they regard that as irrelevant to the need to improve and enhance the water environment of this country.

Mr. Rhodri Morgan (Cardiff, West)

Does my hon. Friend agree that the Prime Minister was obviously not aware that when raw sewage is discharged even through long sea outfalls at the south Wales coast, where there are many popular tourist beaches, it goes into the Bristol channel and the Greater Severn estuary and then enters that same body of water, 5 cubic km of sea water, that swishes up and down the channel twice a day, so that it has now become one of the world's largest flush lavatories? The volume of sewage that it takes is not discharged into the open ocean because, by and large, it is the same body of water that goes up and down the channel; therefore, the sewage is not dispersed into the ocean.

Dr. Cunningham

My hon. Friend is absolutely right. If the Prime Minister, after her speech in Scarborough on Saturday, had walked out of the Spa hall and looked at the beach and the sea in front of her she would have seen the outfall discharging untreated raw sewage into the marine environment. It is a pity that she so averts her gaze from the reality of environmental pollution in Britain that she cannot see what is obvious to so many people.

Mr. Ashby

The hon. Gentleman discloses a rather worrying state of affairs in Wales. I accept that and I think that all my hon. Friends would accept it. But that discloses that there has been a lack of investment over the years. Can the hon. Gentleman tell us what the level of investment was in the 1970s when the Labour Government were in power? Will he point out that it went down 50 per cent. under the Labour Government, that there was 50 per cent. less investment?

Dr. Cunningham

I can give the hon. Gentleman the figures at constant prices. The water authorities' capital expenditure in England and Wales set out the figures in water statistics. The average during the five years of Labour government from 1974 to 1979 was £1,344 million per year, and the average in the period of Conservative government has been £1,014 million—lower than in the five years of Labour Government during a period, apparently, of economic success.

7.15 pm

We know what is happening on the Conservative Benches. Hon. Gentlemen are unwilling to strengthen the environmental protection safeguards in this Bill because they realise that it will create a huge dilemma for the private enterprise monopolies they seek to create. They are planning to cosset those private enterprise monopolies. The Secretary of State has already, unprecedentedly, guaranteed them immunity from prosecution. That is an on-the-record statement. We know, because of our possession of the leaked memorandum from Mr. Michael Carney, the secretary of the Water Authorities Association —[Laughter.] That is true. We know only because it was leaked; he was telling a different story in public from the one he was telling in private. I do not see what hon. Gentlemen find so funny about that; it is a statement of the truth. Mr. Carney said: Any further strengthening of the regulatory framework now put forward would have significantly adverse consequences for the successful management of the privatised [water] companies. That is why the Government have rejected all attempts to strengthen the provisions in the Bill to safeguard the environment and enhance the role of the NRA.

Sir Anthony Grant

The hon. Gentleman has not really addressed himself to the question quite rightly posed by my hon. Friend the Member for Northampton, North (Mr. Marlow). He has come to the House with a series of new clauses and a determination to strengthen the Bill, but he must tell the House what additional cost there will be. It is no good his saying he will make a speech about it at some obscure place in three weeks' time. The House wants to know now. Surely he has not put forward these proposals without doing some arithmetic. If he has done his arithmetic, will he let us know what it is?

Dr. Cunningham

I have a copy of the Tory Central Office brief about this as well. Since the hon. Gentleman fleetingly shows an interest in these matters, I have to tell him that his right hon. Friend the Secretary of State can only guess at the number of billions of pounds that it will cost to make the necessary improvements, and we are in a similar position. My guess is that the Secretary of State's proposals have no hope of reaching fruition under private enterprise. So, if the hon. Gentleman wants more precise figures, perhaps he would ask his right hon. Friend to give the House more precise figures so that we can all enjoy the debate. [An HON. MEMBER: "He does not know."] That is true. That is what I have said, and, what is more, the hon. Gentleman's right hon. Friend does not know either.

We need to recognise that pollution cannot be controlled, our rivers and other water resources cannot be protected from further pollution and the existing polluted rivers, streams, brooks and ponds will remain polluted and dead if financial resources are not devoted to them. The purpose of the new clause is to make it a primary responsibility of the NRA to control the pollution as the first step and then to start reducing the pollution of our water resources.

The aim of new clause 2 is to expose, as it does quite clearly, one of the most blatant flaws in the Government's case. It shows that the existing situation whereby the water authorities police themselves in respect of pollution is wrong. That is what the Goverment say, and we agree. They omit to say that the status quo results from Conservative Government legislation in the first place. The Government claim that the Bill will—to use the Secretary of State's phrase—separate the poachers from the gamekeepers. However, he neglects to emphasise that the National Rivers Authority can and, as Ministers have admitted, will contract back many of its functions—including regulatory ones—to the private water plcs. That will take place principally because the NRA will have inadequate resources to perform all the functions itself.

Far from freeing these constraints from the public sector borrowing requirement—which the Secretary of State has always argued is one of the fundamental reasons for them—the proposals leave the financing of the National Rivers Authority fairly and squarely in Treasury control.

Mr. Tim Boswell (Daventry)

Will the hon. Gentleman say, with regard to the problem of contracting back, whether the duties imposed on the National Rivers Authority by the Bill will be waived—or diluted—by any contracting which the authorities may decide upon for sensible operational or other reasons?

Dr. Cunningham

Yes, it will be weakened because it will not be independent. Any work done by the very organisations that are supposed to be policed, monitored and controlled will be less than satisfactory. That is the point that I have been making, and I stand by it.

Mr. Boswell

I must press the hon. Gentleman on this point. Certain general duties have been laid on the authority by the Bill. If the authority chooses to contract out of certain of those functions, will the duties be in any way amended or reduced?

Dr. Cunningham

I refer the hon. Gentleman to the now infamous quotation of Mr. Keith Court, the chairman of the South West water authority, who said that after privatisation it would be the responsibility of his managers and scientists "to outwit the regulators". Those are the circumstances that we face.

Mr. Ashby

That is not an answer at all.

Dr. Cunningham

It is.

New clause 15 would lay a duty on the NRA to prepare and publish a national plan for the promotion of clean river water and the conservation and enhancement of the natural environment. Specifically, it would require the NRA to do so in respect of

1. (a) the state of cleanliness of waters in England and Wales, including their chemical quality and levels of compliance with notified water quality objectives;
2. (b) discharges of sewage effluents and trade effluents in breach of consent levels and the monitoring of compliance in respect of all such consents;
3. (c) the prescription by the Authority of precautions to be taken by specified persons for the prevention of pollution;
4. (d) a programme of works and operations to prevent, remedy, or mitigate pollution;
5. (e) levels of charges to be imposed by the Authority on persons in respect of discharges and the creation of pollution;
6. (f) the conservation and enhancement of sites of natural beauty or amenity, and the conservation of flora and fauna;
7. (g) the preservation and promotion of public access to waters in areas of natural beauty or amenity, and their use for recreational purposes;
8. (h) the conservation, redistribution and augmentation of water resources;
9. (i) the general supervision of land drainage and flood protection including a programme of works on designated main rivers and sea defences;
10. (j) the conservation, maintenance, improvement and development of salmon, trout, freshwater and eel fisheries in inland waters; and,
11. (k) the carrying out of navigation, conservancy and harbour authority functions".

In other words, new clause 15 makes the National Rivers Authority a far more comprehensive and wide-ranging environmental protection agency than is envisaged by the Secretary of State.

New clause 20 would transfer all the land of the existing water authorities to the National Rivers Authority, ensuring that it remained in public ownership and control. It would similarly transfer buildings, machinery and other rights, where necessary on operational grounds, so that they could be leased to the companies. The land could be leased back to water undertakers where necessary for their functions. No development on, or use of, the land would be permitted which damaged the environment, and no interest in land could be sold by the lessee without the consent of the National Rivers Authority.

The Government's proposals contain no justification of why the freehold of all the land currently in public ownership—owned by water authorities—should be sold. Technically, plcs would only need control over the necessary rights to fulfil their statutory responsibilities, which might include rights of access to land, right of water gathering and abstraction. The transfer of the freehold opens up the possibility of land exploitation and development, which runs counter to the best interests of land management and conservation.

The code of practice under which the Government claim that public interest is to be protected does not apply to subsidiary companies that will undoubtedly be created by water plcs.

Mr. Ridley

If the hon. Gentleman wants all the land to be vested in the NRA, what is there to stop the NRA from developing it as it surely should in order to maximise its assets?

Dr. Cunningham

Because that is not the duty of the NRA, which, as the right hon. Gentleman knows, will not have development powers. The aim of our amendment is to safeguard our national parks, areas of outstanding natural beauty and sensitive habitats from development. That is what people concerned with the countryside and our natural heritage overwhelmingly want to see. They do not want to see what the Government propose, which is——

Mr. Ashby

rose——

Dr. Cunningham

No, I shall not give way. The people do not want to see what the Government are proposing allowing or what, with a wink and a nod, they are hinting at to beef up interest in the flotation of the water industry —which is that people can make a quick buck by selling off land or developing or changing its use and using it for other commercial purposes.

Mr. Marlow

rose——

Dr. Cunningham

I shall give way in a moment. I wish to develop this point because it is important.

Mr. Ridley

It is a rotten point.

Dr. Cunningham

I wonder whether the Secretary of State has had the benefit of re-reading recently the letter of 6 February 1989 of his Minister of State to Mr. Jack Jeffrey, the chairman of the Statutory Water Companies Association. In the letter, the Minister of State refers to pathetic failed attempts to keep down price increases in the statutory water companies. He says that by agreeing to increases of 22 per cent. on average—three times the inflation rate—he has actually saved consumers money. That is a preposterous and pathetic claim.

In his letter, the Minister laid bare the Government's ideas about all this. Talking about ways of trying to avoid price increases and costs, he said: These should come out of dividends or reserves or proceeds of asset sales". There is no doubt about the Government's view. They are encouraging people to realise the assets that they will acquire after flotation—if a successful flotation ever takes place. People in the City know that very well. A brief on the future of the water industry has been prepared by Seymour Pierce Butterfield Ltd. It was written by Mr. Nigel Hawkins, who, when approached by a research assistant in my office today, declined to talk to her on the ground that it might get him into trouble. I am not sure what he meant by that, but it turns out that he is an aspiring Conservative parliamentary candidate.

7.30 pm

As Mr. Hawkins was unwilling to discuss his proposals in the document, I shall mention a couple which are germane to this part of the debate. Referring to land and assets, Mr. Hawkins writes: Given the heavy dependence of Water Authorities upon their `core' activities, it will be extremely difficult for most to expand the `non core' sector at anything like an acceptable rate … To compensate for this expected shortfall in growth, some Water Authorities with significant amounts of surplus land may well realise sizeable capital gains by selling it. He goes on to speculate about exactly who will be interested in acquiring assets in such a way: Companies in the chemical, waste disposal and heavy construction sectors might find particular attractions in bidding for privatised Water Authorities. There is no doubt in the City about the opportunities for exploitation in the proposals. They are vast, and they threaten much of our most priceless national heritage.

For all those reasons—because of the need to strengthen the Bill and to remove the gaping holes, weaknesses and inadequacies—I commend the new clause to the House.

Mr. Rupert Allason (Torbay)

I know that time is short, but I must say that I find much to commend in new clause 1. It attacks the basic problem of pollution, about which—and about the source of which—there is much anxiety. The new clause imposes a direct duty on the Secretary of State to ensure not only that a National Rivers Authority is set up but that those who pollute our rivers and coastlines are held responsible and have to pay to put matters right. That strikes me as entirely acceptable.

I speak from some personal experience. Although Torbay's beaches are regarded as some of the best in Europe and have received prizes, I am afraid that the same cannot be said of South West water. I very much doubt that it would win any prizes in a European contest. Parts of the north Devon coastline are quite simply a disgrace—and, indeed, a health hazard where there are short outfalls into the sea.

When people talk about treated or untreated sewage, they often use the term "macerated". It is not generally known that maceration is no more than a mincing process—by and large, the material is untreated and its strength is not bacteriologically reduced. It is a vile experience for people to go swimming and come across sewage, whether macerated or not. New clause 1 would go some way to improving the current position.

In my constituency, just off the coastline, there is a beauty spot called Thatcher Rock, a popular site for divers. I know that we are urged to wear condoms as frequently as possible, but the experience reported to me by divers of emerging off Thatcher Rock with condoms on their heads is pretty unpleasant. I also consider it entirely unacceptable that 27 per cent. of all sewage sludge is disposed of at sea. It is said that the position will have been improved by 1995, but that is six years too late for me.

I am concerned about Devon's position for two reasons. First, since 1980–81 our water rates have risen by just over 90 per cent. It is currently proposed that they should rise again by a staggering 13 per cent., which I believe to be the largest increase in the country. Two messages come back to me—first, that such increases are entirely unacceptable and an appalling burden on water rate payers and, secondly, that they are an indication of crisis management in the past, particularly at the time of the 1974–79 Administration. We know from the figures that in that period capital investment was cut dramatically —and capital investment, surely, is the key.

What is the capital structure for the new water authorities? Will there be a continuing burden on water rate payers? A scheme that has commended itself to me is one advocated in the Financial Times—a diversion of flotation revenue during privatisaton to the water companies rather than the Treasury. I accept that the Bill does not cover that, but I nevertheless regret that it was not considered because it would have got us off a particularly unpleasant political hook. Certainly capital is the key to the future—we cannot expect high standards without a satisfactory level of capital investment. The answer, in my view, would have been to allow the flotation revenue to go to the companies to provide a satisfactory capital basis. That would have been a neat solution and, I think, widely acceptable, along the lines of the TSB flotation. I am not arguing against the principle of privatisation, which I have always advocated strongly. No doubt the Secretary of State is gazing into his crystal ball and will tell us that it means more efficiency in the future. I know, too, that the NRA will be an important development.

Let me indulge in one of my occasional lapses into a history lesson. I remind the House that, when the water assets were taken over by the Government as a trustee, undertakings were given—not only about debt—implying that the Government would continue to look after those assets, which would be managed on behalf of the boroughs that had previously owned them. My constituency contained a particularly impressive water system, with two reservoirs. In some respects we are in competition with Bournemouth, which has retained a private sector system and where water rates are about 40 per cent. below those of Torbay. That, of course, is an argument in favour of private companies and privatisation.

It may well be too late to consider any diversion of the funds realised from the flotation to the water companies and not to the Treasury, which we know from the Budget is brimming over with funds and does not need the money. I seek an assurance from my right hon. Friend the Secretary of State that after privatisation there should not be a continuing burden on the water rate payers, and that there should be a proper capital structure for the industry so that we are not burdened with further rate increases. I remind the House that the water rate increases in Devon have been just over 90 per cent. since 1981, and that the current increase, which my constituents consider totally unacceptable, is just over 13 per cent. I hope that the Secretary of State will provide that assurance and give great relief to the people of Devon.

Mr. Peter L. Pike (Burnley)

The group of amendments and new clauses that we are debating touch on some important fundamental issues. Despite the many hours that we have spent debating the Bill, we are still far from satisfied that it contains adequate safeguards to protect the environment. Our fears are fully justified by the post that we continue to receive from organisations representing those involved in conservation, access to the countryside and other interests which still do not believe that the Government have got the Bill right.

The hon. Member for Torbay (Mr. Allason) touched on some vital matters. It is a pity that he was not on the Committee considering the Bill as he could have made some important contributions to those debates. He is absolutely right to say that even if the necessary safeguards were written into the Bill—we very much doubt that they are, which is why we have tabled new clauses and amendments—the problems could not be resolved without capital investment. That raises the argument as to whether the public sector or the private sector is better able to raise capital.

It is important that the National Rivers Authority should have sufficient powers and use them to deal with such matters. There is fear that that will not be done because it requires massive investment from the private sector. We can envisage that, having invested in the shares, the private sector will not be prepared to deal with the problems of pollution, sewage works, or the transfer of sewage out to sea. The money may not be available because investment in such basic requirements will not necessarily provide an adequate profit or return.

My hon. Friend the Member for Copeland (Dr. Cunningham) referred to the Select Committee report on toxic waste. I served on that Select Committee which agreed that the National Rivers Authority should have been the basis of creating an environmental protection agency. I believe that the Secretary of State would do better to ignore the privatisation clauses of the Bill that we are to debate later, and allow us to have a constructive debate on how to make part I work in a positive way. That would be welcomed in the House and by many interested organisations. I hope that the Secretary of State will think again, although that is unlikely. I hope that he will recognise that there is genuine concern on the issues raised in the amendments and new clauses that we are discussing.

New clause 20 deals with the ownership of the land and suggests that it should be vested in the National Rivers Authority. We recognise that under the Bill as drafted the water authorities will become pies and decide what is and is not operational land and will be able to dispose of the non-operational land. Historically, the water authorities own a great deal of land in towns and city centres that easily could be designated non-operational and could be disposed of, with large amounts of profit accruing to the privatised water authorities. More important still, the water authorities own land in areas such as the Lake district, the Peak district and, in my constituency, the Pennines, Worsthorne moor and many water catchment areas surrounding Burnley and other towns on both sides of the Pennines.

7.45 pm

The water authorities own acres of valuable land which are water catchment areas but are easily designated as non-operational. If a water authority were to dispose of some of that land to raise money to fund some necessary work, it would cause tremendous damage to our heritage in many of the most beautiful areas of the country. We do not want that to happen, so we believe that new clause 20 should be added to the Bill. Many organisations take that view. The North West Council for Sport and Recreation sent me a fairly long brief expressing those fears. It says: We consider that the Water Bill, when enacted, will represent a major threat to recreational interests". It goes on to discuss the status of land sold off or not directly related to the water supply. It feels that land will be disposed of, that we shall destroy our heritage, remove recreational facilities, and access to the countryside will be lost. It goes into great detail as to why it takes such a view.

The Burnley borough council planning officer, Mr. Andrew Walker, has written a detailed letter to the Secretary of State expressing similar fears about the code of practice and the ownership of land, with particular reference to the catchment areas. He stresses that not all the land will be alongside a river and that in moorlands and other areas there will not be a river in the immediate vicinity, but it is important that those moorlands should be retained for public access and to protect the birds and animals in their natural habitat. He explained why the Government have got it wrong, and that one acceptable improvement would be for the Government to accept new clause 20.

The Greater Manchester countryside unit also expressed concern. Locally and nationally anglers have written expressing their concern about the future ownership of the land. I hope that the Secretary of State recognises that the Bill as drafted raises great fears that the land will be developed. Even if only small sections of the Peak district or the Lake district are sold off and developed for exclusive housing, which will be extremely valuable, the whole nature of such areas and our heritage will be destroyed.

It is no use Ministers saying that this will be dealt with by planning laws. Hon. Members on both sides of the Committee read submission after submission and saw evidence from many organisations demonstrating that there were not sufficient planning safegurds to deal with possible development.

On new clause 1, it has been said that the polluters should pay. I agree that polluters should be made to pay more for the problems of agricultural or industrial pollution, and we have to consider that.

It is not good enough that new sewage treatment works are being built at Bootle, in the constituency of my hon. Friend the Member for Bootle (Mr. Roberts), to deal with the sewage from Manchester, which will go along a pipeline instead of by sludge boat along the ship canal, and to deal with the sludge from the Liverpool area, because when those works become fully operational they will merely take sludge out into the Irish sea and dump it. We need more thought and investment to deal with such problems.

The North West water authority is extending the sewage pipe at Rossall near Fleetwood and dumping sewage a little further out into the Irish sea. The hon. Member for Torbay made the point that the coast of Devon is not suitable for swimming because of the sewage being pumped out into the sea. The sea at Blackpool, Morecambe and other places in the north-west is not suitable for swimming, either.

The amendments are positive improvements to the Bill. The Government must recognise that the Bill contains too many loopholes to deal with pollution, river quality, sewage treatment works or drinking water quality. If more safeguards are not written into the Bill, we know that the Government will make exceptions, give derogations and extend the periods of time for compliance. Drinking water quality and river quality will not be dealt with and we shall have pollution for many years. Those are the reasons why I hope that the Government will be prepared to move in a positive way for the first time and show that they want genuinely to ensure that the Water Bill protects our environment in a better way than it does at present.

Mr. Robert Adley (Christchurch)

I hope that the hon. Member for Burnley (Mr. Pike) will forgive me if I do not follow him, but I want to be brief. In principle, I am relaxed and fairly happy about the Bill. One of my constituents wrote to me yesterday, accusing the Government of being about to poison him through the Bill. What he did not seem to realise was that he is, and always has been, a customer of a private water company. I was thus able to reassure him that, whatever the problems about the legislation, he could rest easy.

I support new clause 1. I have a reasonable track record on pollution and I believe that we must be seen to be serious in the Bill about giving the National Rivers Authority the teeth and powers to ensure that pollution is controlled. In 1979, when the Merchant Shipping Bill was in Committee, I managed to persuade Committee members of all parties to amend the Bill so that when dealing with oil pollution at sea the owner of the oil rather than the carrier of the oil would be made responsible for any pollution at sea. That concentrated the minds of the oil companies no end, but because of the collapse of the Government led by the present Lord Callaghan, I was threatened that we might lose the entire Bill if I was not willing to withdraw the amendment at the truncated Report stage on the Floor of the House. The proposition that pollution must be paid for by those who create it is thus a long-held view of mine. I hope that, even if my right hon. Friend the Secretary of State cannot accept the amendments, he will consider as the Bill proceeds whether to accept any reasonable proposal that comes forward to ensure——

Mr. Ridley

I am delighted to meet my hon. Friend's point. The two points contained in new clause 1 are already amply and fully covered in the Bill. New clause 1 is wholly unnecessary, so my hon. Friend can vote against it with complete equanimity.

Mr. Adley

I am grateful to my right hon. Friend, but I told the Chief Whip some weeks ago that I was especially concerned about the National Rivers Authority, so he would be disappointed if I did not vote in favour of new clause 1. I do not want to detain the House indefinitely, but I must point out that from time to time my right hon. Friend and I have taken common cause on certain issues. However, I had better do as I said and vote in favour of new clause 1, while registering the fact that, in principle, I am happy with most of the other provisions of the Bill.

Mr. Wigley

The contributions made by Conservative Members have been much more encouraging on Report than in Committee. I suspect that there was careful selection of those chosen to serve on the Committee. There has been a breath of fresh air in the speeches made by the hon. Members for Christchurch (Mr. Adley) and for Torbay (Mr. Allason). The matter of concern to them and to all of us is how to upgrade standards on pollution. Those of us who represent maritime constituencies are very much aware of the large distance that we have to go to reach EC standards. The fact that they are European standards is neither here nor there because we ought to be insisting on them ourselves. As we come to the end of the 20th century, our standards should be well ahead of their present levels.

The Secretary of State tried to give assurances that those points were met by the Bill, but had he been in Committee he would know that week after week we were far from convinced that the Bill was sufficiently rigorous and, more fundamentally, that we were far from convinced that adequate financial resources would be provided to undertake the job that is so desperately needed.

The hon. Member for Copeland (Dr. Cunningham) spoke about the proportion of sewage outfalls in Wales —he said that it was 65 per cent.—discharging untreated sewage. That caused considerable concern in the Select Committee on Welsh Affairs when we looked into the question a couple of years ago. That Committee produced a far-reaching report which was supported by hon. Members of all parties, but regrettably the overwhelming majority of its main recommendations have still not been implemented. Many of them come back to the question of finance. What was disturbing to the Committee was to understand that when the implications of the Bill were hitting home to those who might have to find the finance for privatisation, the doubts began to emerge—so much so that the leading story in the Financial Times on Monday 6 February, under the headline: Water privatisation rules make industry 'less attractive'", said: The Government's water privatisation plans were in disarray last night as ministers faced threats of increases in charges of up to 50 per cent. from statutory water companies. Industry leaders also warned of a significant drawback in privatisation legislation that would make the water authorities much less attractive to investors. The industry's problems, which are becoming a major embarrassment to the Government, flow from the huge capital investment programme required to meet the increasingly stringent European Commission Regulations on drinking water quality, cleaner beaches and more effective sewage treatment. That is the guts of the case.

Obviously, as hon. Members have pointed out, costs will be involved in improvements. Last Thursday, at Prime Minister's Question Time, the Prime Minister and the Leader of the Opposition acknowledged the extent of those costs. The question is whether the costs can be met from the privatisation structure.On 28 November 1988, the Secretary of State said that water charges might increase by between 7.5 per cent. and 12.5 per cent. in real terms in the decade following privatisation. It is not credible that increases of up to 12.5 per cent. over 10 years would generate sufficient resources to undertake the capital investment programme needed to upgrade our sewage treatment and water outfalls. Conservative Members taunt the Opposition by saying that we do not face up to the cost of our demands, but we do. All Opposition Members face up to that cost. We are prepared to see that cost funded either from general taxation or from public sector borrowing, whichever may be more appropriate.

Mr. Tim Boswell (Daventry)

What would the basic rate of income tax have to be to fund any proportion of the environmental programme that has been suggested by the hon. Gentleman and his hon. Friends?

8 pm

Mr. Wigley

I cannot comment on the environmental programme put forward by the Labour Front Bench because I am not privy to the details of that, but I know that Wales needs a capital investment programme of about £90 million year by year to meet the standards looked for by the Select Committee on Welsh Affairs. I also know that last year Welsh Water's retained profit was about £27 million and, even if all interest were written off, would barely generate another £50 million, so there is a shortfall of between £20 million and £30 million in Wales in terms of the capital injection needed. The shortfall would be nearer £50 million to reach EC standards. If that is multiplied by 20 for the United Kingdom, we may be talking of a shortfall of £1,000 million. If it helps the hon. Gentleman, that shortfall could be met by 1p on income tax. I would be more than happy to see 1p on income tax to reach those standards.

The Opposition accept that such improvements have to be paid for one way or another, but do the Government accept that? It is not credible for the Government to say that those standards can be reached with an increase of no more than 12.5 per cent. in real terms over 10 years. Funding is central to the problems facing a maritime constituency such as mine, sticking out into the Irish sea, which is one of the most polluted seas in the world. It is not acceptable to go into the next century with the kind of standards that we have at present. Wales has to deal not only with maritime pollution but with the effects of both older and modern industrial pollution. In many instances, it does not seem to be making much headway.

The hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) will be aware of the pollution of the river Taff. I saw the hon. Gentleman just before the rugby match on Saturday. I was travelling down from Pontyprydd to Cardiff. Looking at the river, very little progress seems to have been made in the past 15 years. I do not criticise the Welsh water authority, which is undertaking important work, but this underlines the work that we still have to do, and which has to be paid for one way or another, whether from general taxation or by the polluter. [Interruption.] It is all very well Conservative Members heckling, but if we are to achieve the necessary standards, we must find a way to pay for that. I am convinced that that is not possible under the privatisation structures which have been proposed. It is not possible with the 12.5 per cent. ceiling to which the Secretary of State referred. If Conservative Members say that that 12.5 per cent. increase is wrong and that we need a 50 per cent. or 60 per cent. increase in real terms for such a level of funding over the next decade, the sums would add up—but they are not saying that.

Mr. Rowlands

The situation is not made easier by the fact that the private companies will also have to pay dividends.

Mr. Wigley

That is the whole point. If the Welsh water authority is to give a return of 10 per cent. on capital, assuming that its assets, with a current cost of £1,700 million, are to be given away for, say, £300 million—a figure that has been bandied around—with £1,400 million being written off, a profit of £30 million is still needed to give a 10 per cent. return. That is a higher profit than at present. All the profit will go on that and there will be that much less to meet the capital programme that is needed.

Mr. Tim Devlin (Stockton, South)

Does the hon. Gentleman accept that one of the difficulties in his pan of the world, as in mine, has been the short-term nature of the water industry in the past 20 years? Each year the water industry has had to spend within the capital constraints put on it by the Government. Under the new arrangements, water companies will be able to act like any private company and go out into the market, borrow the money that they need and invest it in cleaning up all the beaches about which the hon. Gentleman is so worried.

Mr. Wigley

Of course I should have been delighted to see the water industry, like many other industries, investing money over the past decade, particularly in a period of high unemployment. There should have been much greater investment in the capital infrastructure—for example, in sewers. I regret that water authorities have been under such constraints from the Government, funding more and more of their capital investment from retained profit. That is the Government's philosophy.

Mr. Devlin

rose——

Mr. Wigley

I am still dealing with the hon. Gentleman's point.

The hon. Gentleman argues that Government constraints have created difficulties over the past decade and that the water industry will find things easier when it is privatised, but that is a non sequitur. It presupposes that after privatisation it will be possible to obtain hundreds of millions of pounds from the market, but that will be possible only if substantial interest is paid by way of loan or share capital. That means a rate of return substantially higher than the water industry is obtaining at the moment. In Wales, the rate of return at the moment is 2 per cent. We cannot get money from the market at 2 per cent.—we shall need to pay 10, 12 or 15 per cent. to get the money in for the sort of programme that is necessary.

Mr. Chris Mullin (Sunderland, South)

We should also bear in mind that the first investment that the newly privatised water authorities will undertake is the cost of metering—an unnecessary expense of about £1.3 billion.

Mr. Wigley

Any such additional expenditure will come from the limited capital that is available, or more will have to be paid to attract more capital. I understand what Conservative Members say, but their arguments add up only if there is a substantial increase in the price of water. They argue that improvements should be paid for by such increases. We agree that the money is necessary, that we need the capital expenditure and that the money must come from somewhere, but we are prepared to see it coming from the public purse because it is a matter of such importance to all in our communities.

Mr. Ridley

A few minutes ago the hon. Gentleman said that he believed in the principle that the polluters should pay. In relation to sewage pollution, which demands by far the greatest proportion of expenditure, who does he think is the polluter?

Mr. Wigley

To a large extent, it is the community. That is why general taxation is so relevant. I look for a method of equitable payment for pensioners, those on low incomes, disabled people, and so on. They should not be burdened in the way that they are by the poll tax. The most reasonable way to obtain the necessary funds is through progressive taxation. The capital has to be obtained and it has to be paid for.

Mr. Alistair Burt (Bury, North)

rose——

Mr. Wigley

I shall not give way as other hon. Members wish to speak and I have taken more time than I intended.

On Second Reading, the Secretary of State said that over 10 years the increase in prices would be between 7.5 and 12 per cent. Does he stand by that assessment? Will he give a commitment from the Dispatch Box today that all the necessary improvements in standards in terms of the pollution of our coastal and inland waters can be paid for with no more than a 12.5 per cent. increase in real terms in the price of water between now and 1999? I suspect that he realises from what is happening in existing private companies—the way in which they have run for increases in their prices—that his proposition does not stand up.

The money will not come in because the Government's sums do not add up. That is why it is so important to have issues such as the reduction of pollution and the allocation of costs written into the Bill, as new clause 1 provides. I suspect that many Conservative Members know in their hearts that that is the case. I hope that when the time comes to vote they will have the courage of their convictions.

Sir Giles Shaw (Pudsey)

Having listened to the hon. Member for Caernarfon (Mr. Wigley) on the problems of the water industry, I cannot help but feel that for about 100 years these problems have been dodged. It is surely an industry which, probably more than any other, has failed to have any serious renewal of investment since its establishment in the opening decade of this century. The greatest development now in investment is the replacement of aging structures which have not been touched for at least 60 years. It is just the problem which the hon. Member for Caernarfon so eloquently put about how the water industry will obtain the renewal of asset capital, which is so desperately needed, which is fundamental to my right hon. Friend the Secretary of State's measure in this Bill.

My hon. Friend the Member for Torbay (Mr. Allason), who is no longer with us, was referring to the outfall. I remember, a few years ago, when I was in the Department over which my right hon. Friend presides with such distinction, going to Torbay to examine that outfall. I think it was in 1981. It was then a fine pumping station, built about 1908. It was all in brass, and had been converted to oil at no small cost, and was still merrily pumping the sewage of Torquay into Torbay. That is the kind of problem which exists all round the coastline to which all hon. Members refer. I recall that in Newcastle the first sewage works ever was opened in about 1983, replacing the practice of discharging completely untreated sewage into the Tyne.

So the great problem with the water industry has been a lack of interest in renewing and modernising its assets. For the vast majority of this period it was in the hands of local authorities, and it was the fact that the public purse was involved which, almost by definition, starved the water industry of assets. It is exactly the same now as it is within the national public purse, because the water industry comes at the bottom of the list of priorities from one year to the next of the state or council.

There are two simple reasons for this. First, there are very few votes in sewerage or sewerage replacement, because the public does not want to know. Secondly, there is an infantile belief that water is free and therefore cannot be charged for adequately, and there is a reluctance to disturb this happy myth. It is the disturbance of that myth and the regeneration of a drive towards capital improvement and the fairly skilful presentation in this Bill of controls balanced by liberating the assets of the authorities to obtain capital in the private sector which is the very nature of my support for the Bill.

Speaking to new clause 1 and the allied clauses moved by the hon. Member for Copeland (Dr. Cunningham), I have to say to my right hon. Friend that the argument on the National Rivers Authority is utterly crucial to this whole structure. I am not a supporter of the NRA. I have never been wholly convinced that the arrangements currently in place for the whole water cycle to be managed by authorities of the kind we possess are not perfectly satisfactory for the running of the hydrological cycle and for dealing with water supply and pollution. However, my real worry about the NRA from the time when the concept was first introduced by my right hon. Friend has been that it could so easily become the mortmain of the industry and the dead hand of Government, and the controls, the extension of influence and the manipulation of committees would mean that the water industry would not be privatised but slowly strangled.

Nothing convinces me that I am right more than new clause 1 and the allied new clauses promoted by the hon. Member for Copeland, who is no fool, never has been and probably never will be. When he seeks to increase the powers of the NRA and prays in aid the importance of pollution controls and making certain everybody pays, and so on, I get very worried indeed, because he is quite right to say that, once established, the NRA will be an absolute godsend to any Socialist Administration. Heaven forfend the day when they use the NRA as the great mortmain of Government, because it must be seen as that.

8.15 pm

The balance of this Bill at the moment is weighted too heavily towards controlling the activities of the private companies in relation to the controls applied by the NRA. However, having said that, I recognise that it is now necessary to see that it is set up efficiently and that the powers given to it over its wide remit are sufficient to discharge its responsibilities. In the case of pollution, in other portions of the Bill, clauses 103 and beyond that, there is an enormous range of powers available to the Secretary of State, the Director General of Water Services and the authority itself to do practically everything possible so that the NRA ensures that the privatised water authorities or any other polluter meets its requirements. I cannot see the need to strengthen the powers, as suggested by new clause 1.

Mr. Allan Roberts (Bootle)

Will the hon. Gentleman say whether his proposal to leave what will now be functions of the National Rivers Authority with the water authorities will increase the possibility of privatisation being successful or make it more difficult, bearing in mind that all the functions being given to the NRA, environmentally essential functions, do not make any profit?

Sir Giles Shaw

I quite understand why the hon. Member is anxious about that. I am not advocating recasting the Bill in relation to the NRA; I am merely warning my right hon. Friends that the NRA is potentially an instrument of very great power, and I do not accept that its powers need increasing.

In relation to access to land, I find it extraordinary that hon. Gentlemen express such great concern over the disposal of land in the current ownership of the water authorities. I understand that the development of land increases its value, and there are various ways of selling such assets for the benefit of shareholders. I understand also that over the last few years the water authorities, encouraged by this Government, have been able to extend public access to their land to a quite remarkable degree. Not long ago water authorities would not allow the public anywhere near their reservoirs, and acres of land were fenced off. Now, commendably, there are many acres available for public use, provided that the public respects the fact that it is catchment land or water designated for public supply.

The vast majority of water authority land is clearly catchment land. If there is really a fear among hon. Gentlemen that catchment land has enormous develop-ment potential, they are setting at naught the planning system. The vast majority of water authority land is already in national parks, green belt areas, areas of outstanding natural beauty and probably conservation areas too. It is ludicrous to have this phobia, when the policies of authorities have steadily developed towards marketing their catchment land for environmental purposes and to think this will suddenly be destroyed by the fact that the authorities are being privatised. It is crucial that their consumers, who pay their bills, should have access to the land which they currently enjoy. In relation to Yorkshire water authority, which I know well, there is no intention whatever to alter the existing policy of access to its catchment land. That land has the lowest possible development value and nobody will build a block of flats on Upper Wharfedale.

Mr. Elliot Morley (Glanford and Scunthorpe)

Is the hon. Gentleman aware that Yorkshire water authority is considering, for example, selling part of its land in the Tophill low reservoir for the creation of a commercial fishpond, which will go in a site of significant environmental and scientific interest, will destroy rare plants in that area and completely obliterate an area which is part of a voluntary nature reserve?

Sir Giles Shaw

The answer to the hon. Gentleman's question is that I do not know of that proposal. There will always be substantial conflicts in the conservation and environmental policies to be pursued in regard to any piece of land, particularly the aquatic environment as opposed to the catchment land, to which I referred. There will be alternative uses. There could be people who find it more beneficial for the land to be used as a fish farm than for a protection zone for flora or fauna. That is where the local office of the NRA will come in. It will be responsible for ensuring that the water authority pursues a conservation policy which is consistent with national objectives.

We can forget catchment land being on development land. Development land tends no longer to have a potential use, with redundant sewage works and things of that kind. It certainly could be development for commercial use. I sincerely hope that my right hon. Friend —even the hon. Member for Copeland—will consider that a redundant sewage works should be replaced by something moe profitable as soon as possible. If it is for domestic buildings or for buildings of another nature, so be it. That is a far cry from saying that the policy of disposal of land will somehow be turned on its head by water authorities trying to build flats in upper catchment areas and river valleys.

Mr. Eric Martlew (Carlisle)

It is a pity that the hon. Gentleman was not a member of the Committee. He seems to deal lightly with what he calls catchment land. The area that I come from, Cumbria, includes the Lake district national park. Is the hon. Gentleman aware that 45 per cent. of Lake district planning appeals are presently allowed by the Secretary of State? There would be great worries that, if large tracts of what is now water authority land become available, this Secretary of State especially will continue to give planning permission by overruling the Lake district planning board.

Sir Giles Shaw

I would be well out of order if I were to refer to planning applications in a local authority such as Cumbria. There will be occasions when planning applications will be granted, which will cause great concern for the hon. Gentleman's constituency.

Mr. Martin Flannery (Sheffield, Hillsborough)

Will the hon. Gentleman give way?

Sir Giles Shaw

I must proceed, otherwise I will exceed my time limit.

Urban land in the ownership of water authorities must be considered in relation to the land register. At the moment, as public authorities, water authorities are required to list such lands for which they have no present purpose. The Derelict Land Act 1982 is an important instrument to dispose of derelict land for the betterment of public use. It will apply to the water companies just as it applies to British Rail, other bodies and local authorities. There is a positive inducement to get rid of derelict land for other purposes in urban areas, and I fully support that.

What worries me most is that, by adding these further powers to the NRA, as the hon. Member for Copeland and his colleagues seek to do, we would so extend the powers of that body that it would make it much more difficult for a privatised water company to try to run its business in a cost-effective way. We know that profits will be limited, that charges and costs will be controlled by the Director General of Water Services, and that the conservation and environmental powers vested in the NRA will be implemented. Those powers include major powers against pollution and discharges. When privatised, water companies will also be under the control of my right hon. Friend through the NRA. There will be immense control on the activities of the companies.

For that reason, their capitalisation should not be high, and the return on assets should be modest—suitable for public utilities, which always had a reasonable place in a share portfolio as safe but not stunning. For that reason also, the privatisation of water authorities will be a major achievement.

I wish the Bill well, but I counsel my right hon. Friend to make sure that we defeat the extended powers that he and the hon. Member for Copeland wish to impose on the NRA.

Mr. Rowlands

My few remarks follow those of the hon. Member for Pudsey (Sir G. Shaw). I shall identify a vital area where the exploitation of assets will become a major concern to the communities that I represent. Fundamental issues have been raised by my hon. Friends and by the hon. Member for Caernarfon (Mr. Wigley). I endorse all that has been said, so I will not go over it again.

However, I shall pick up the points that were made by the hon. Member for Pudsey and illustrate what they could mean in community terms if we privatise water companies. As he rightly described, they will desperately look around for asset sales and for means of raising income. Unlike almost any other company, their main business is not capable of major expansion. It is a mature industry. It supplies its main sales, and its service is already provided to almost every household in the country. There is no way in which there can be any significant increase in sales per se. Therefore, there cannot be a major expansion of sales to boost dividends to finance the company or to give better dividends to the City that invests in it.

Where is the opportunity to deliver the returns that are required in the City for the investment that it will make? The hon. Member for Pudsey has understandably said that there will be restrictions on the development of land, that planning permissions will be required in respect of national parkland, and that there will be enormous problems in trying to exploit land. Hon. Members have cast doubt on that point. A potential exploitation of land in my area deeply concerns me. I refer to the exploitation of operational water belonging to water authorities, in particular the reservoirs that form an important part of the recreational requirements of many of our communities.

I have the distinguished privilege of being the president of the Welsh Anglers Society. Therefore, I know of the ways in which we anglers and Welsh Water have been trying to develop relationships in the expansion of opportunities for local angling organisations and individual anglers in the communities around the reservoirs of the Principality. Nowhere in the Bill is there a sufficient safeguard against large-scale exploitation of reservoirs by commercial enterprises, which would undermine the importance of local angling associations and individual anglers. It is the one other major area which, when privatised water companies put all their assets into subsidiary bodies, the City will try to exploit. There will be no planning permission objections or difficulties of the kind that the hon. Member for Pudsey mentioned. They will be able to offer powerful commercial leases and lease out our reservoirs. They are our reservoirs—they were built and financed by the communities—and they are of tremendous commercial potential.

Mr. Nigel Spearing (Newham, South)

My hon. Friend was a member of the Committee.

Mr. Rowlands

I was not.

Mr. Spearing

Does he agree that the area of reservoir available for fishing is proportional to the amount of storage capacity for drought purposes and the extent to which water companies must have water for purification by sunlight? What restraints will there be on private water companies, which are currently municipal bodies, from cutting such areas or volumes of storage and cutting corners that are not cut at the moment?

Mr. Rowlands

I am unable to answer the powerful and important technical point that my hon. Friend raised. I did not serve on the Committee.

I was making a good, simple community point. It is not mentioned in the Bill and I want to find out about it before the night is out. What safeguards will the Secretary of State, himself a keen angler, provide for angling communities? How will he prevent commercial exploitation? This is not a fanciful idea that we have dreamed up as an objection to the Bill.

We have watched while short stretches of Welsh rivers have been sold for enormous sums. They are becoming precious assets for use as business perks and weekends. There is a huge market in these assets in the Principality. But there is no provision in the Bill to safeguard the development of local activities for anglers and angling organisations on operational waters after the privatised water companies are running them. I hope that the Secretary of State can answer me. The lack of that safeguard is another fundamental reason why we should object to this act of privatisation.

Mr. Boswell

Has the hon. Gentleman studied the draft code of practice for the conduct of conservation, access and recreation and specifically the reference to the way in which established recreational activities should be able to continue wherever possible?

8.30 pm

Mr. Rowlands

I have certainly read those weasel words. The codes of practice will not last five minutes with a private company looking around to finance the dividends of its new investors. They will be pushed aside. There need to be statutory rights. Compared with those weasel words, I find no satisfaction in "where possible" or "in a code of practice". We all know too well how they will be pushed easily and quickly aside with a big offer for a major lease of a reservoir for the fishing and angling facilities in our communities. I find no satisfaction in the code of practice or those words.

I apologise for talking now about angling because it seems like a sideshow. [HON. MEMBERS: "No."] The main issues of water prices and charges are important, if not fundamental, but we are also dealing with the various side effects of the legislation. The existing situation is not satisfactory. The arrangements have not been effective. I know that the hon. Member for Pudsey was a Minister for water a long time ago. I can remember the neglect and difficulties that occurred due to lack of investment in sewage plants and other areas. Nobody is arguing that it is not a historic problem; we wonder whether any of these measures will make the situation better.

Dr. Cunningham

Perhaps I can draw my hon. Friend's attention to clause 7(5), which says: Nothing in this section or the following provisions of this Act shall require recreational facilities made available by a relevant body to be made available free of charge.

Mr. Rowlands

My hon. Friend has underlined the point that I am making, I hope with some effect. I want to add another thought. We do not find that the provisions about pollution——

Mr. Martin M. Brandon-Bravo (Nottingham, South)

rose——

Mr. Rowlands

In fairness, I want to be as brief as possible. I am sure that I would be tempted to reply at length to the hon. Gentleman.

The history of the situation is unsatisfactory. Anyone who has been a Minister or who has had responsibility knows that there are inherited problems that remain unsolved. But I do not believe that any of this backlog will be effectively dealt with, especially when the water companies hand out dividends to shareholders. The money will go into the shareholders' pockets, not into improving the rivers and dealing with pollution. It will be handed out to those who invest in the privatised companies.

Why do the Government oppose simple arrangements of the kind proposed in Committee? At least we ought to know when pollution occurs. It should be registered properly. In the Rhymney valley we have been developing exciting new local angling associations. We have stocked local rivers, yet overnight and at a stroke all those efforts will be wiped out by one irresponsible or negligent action, not by a domestic consumer but by a commercial or industrial operator.

I fully understand why hon. Members have received letters, as I have done, asking why we cannot strengthen the Bill so that we know who the polluters are. We should know when they pollute rivers. There should be a register. Even if the National Rivers Authority took no effective action, we could pursue the polluters. But that, too, has been rejected by the Government in Standing Committee.

Before we pass the Bill, which I fear we will do, I must say that it has no mandate in Wales. Of all the sensitive issues, water has been a special case. It has no mandate in Wales although the Government have a general mandate. We accept that as elected Members of Parliament. Therefore, the Government should heed our warnings, as represented by the new clauses.

Mr. Michael Latham (Rutland and Melton)

The hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) does not need to apologise to the House for talking about angling, because millions of people do it and also because many of us have received representations on the subject. I have had eight letters in the past 24 hours. The only shame was that they were all exactly the same and typed on what appeared to be the same pieces of paper. Nevertheless, they show a strength of feeling on this issue.

I wish to raise only one matter with my hon. Friend. It concerns Rutland water, which is in my constituency. My right hon. Friend will doubtless remember when Rutland water, the largest man-made lake in Europe, was created by Act of Parliament in the 1970s. The proposal was so unpopular at the time that Sir Kenneth Lewis, then the Conservative Member for Rutland, felt unable to introduce the private Bill to the House but opposed it. It was introduced by Mr. Tom Bradley, then the Labour Member for East Leicester. The Bill having passed, and the reservoir being duly flooded, my good friend Sir Kenneth Lewis was invited to the opening—which was carried out by Her Majesty the Queen—and Mr. Tom Bradley was not, which rankles with both of them to this day.

Rutland water has become a very important natural resource in my constituency and for the whole of the east midlands and even wider still. It is one of the most important wildlife reserves in the world. It has angling, sailing, and a fine nature reserve. It is a tremendously popular resort for the people of Leicestershire and others. They can walk around the area and enjoy themselves.

My right hon. Friend the Secretary of State will therefore not be surprised to learn that there is concern about the prospect of development around Rutland water. I have carefully studied clauses 7, 8 and 9 which I think are well intentioned. I have studied new clause 20, which was tabled by the Opposition. It does not tackle the issue in the right way. I cannot see any advantage in vesting the land in the National Rivers Authority.

I know for a fact that under the existing system of statutory water authorities one of the most detrimental planning applications that was made to develop around Rutland water was made by the Anglian water authority in 1984. It proposed some hideous Swiss-type chalets around the catchment area—to follow the theme of my hon. Friend the Member for Pudsey (Sir G. Shaw). Thank God that that very prejudicial application was rejected. The water authority did not proceed with an appeal.

I must ask my right hon. Friend the Secretary of State —[Interruption.] The hon. Member for Bootle (Mr. Roberts) should not anticipate me. I am just leading up to that point. I am now fixing my beady eye on my right hon. Friend and saying to him that I shall take seriously the assurances which I hope that he will give this evening and which were given to me in writing by my hon. and learned Friend the Minister for Water and Planning and by my hon. Friend the Under-Secretary of State, the Member for Lewisham, East (Mr. Moynihan).

I accept that of itself ownership is not decisive in that the privatised water companies do not need to sell land to developers. They can put in planning applications themselves if they want to, as the existing Anglian water authority did a few years ago. What I want from my right hon. Friend the Secretary of State is a clear assurance that the Government will not grant appeals for development around Rutland water because that is simply not acceptable. There will undoubtedly be applications. Indeed, an application is outstanding at present, with a written appeal that has been before my right hon. Friend, and we shall take the way in which he deals with that appeal to be a touchstone. It is a planning application for an hotel on the edge of Rutland water. If I have any reason to believe that the water authority or anybody else is allowed to believe that it can come along with proposals for developments all around Rutland water and that they will be supported on appeal by Ministers, I shall not put up my hand for the Bill. However, I do not believe such things because I have had assurances from my hon. and learned Friend the Minister of State and from my hon. Friend the Member for Lewisham, East.

Mr. Mullin

If I were the hon. Gentleman, I should not take such assurances too seriously. We had many such assurances in Committee and we did not take them seriously.

Mr. Latham

The hon. Gentleman can take them seriously or not, just as he likes. I am making this speech to put my right hon. Friend the Secretary of State on notice that the Rutland people expect the Department of the Environment to defend the environment around Rutland water—[HON. MEMBERS: "Not in my back yard."] Opposition Members know nothing about Rutland water.

Mr. Ashby

Does my hon. Friend agree that it is not the Rutland people but the Leicestershire people who will not accept that sort of development?

Mr. Latham

I thank my hon. Friend. I am glad that he drew a clear distinction between Leicestershire people and Rutland people, although the present Secretary of State for Wales tried to abolish the difference between the two in 1972 by that most regrettable reform of local government, which is not accepted in Rutland to this day.

Mr. Ashby

Will my hon. Friend accept that I am giving him my support?

Mr. Latham

I do not think that I shall give way to my hon. Friend again because he is worsening his chances of taking part in the debate, which I know that he wants to do.

If I may have the attention of my right hon. Friend the Secretary of State and of my hon. and learned Friend the Minister of State, I repeat that the planning procedures must remain inviolate. Rutland district council has developed a Rutland water plan. The Leicestershire county structure plan does not agree with proposed development around Rutland water. If the planning procedures are to be the defence—I believe that they must be and that they are—I want assurances from Ministers that that is the way in which they wish to proceed.

Mr. Livsey

The National Rivers Authority, to which we are referring in terms of pollution in our discussions on new clause 1, is essentially an environmental protection agency. New clause 1 specifically attends to the question of the polluter paying.

The record on pollution is not good because 903 km of rivers were downgraded in the period 1980–85 and 2,800 km are biologically dead in the United Kingdom. In the last year for which recorded figures are available—1987 —more than 20,000 pollution incidents were registered, but only 1 per cent. were prosecuted and only one case received the maximum fine of £2,000. When one considers that 20 per cent. of all sewerage works do not come up to standard, one realises that we face a serious problem.

The Government's past record on water authorities and their ability to bring the polluters to book is not a good one. I hope that the Bill will bring about improvements, especially under new clause 1, which insists that the polluters must pay for the environmental damage that they do. I wonder whether the Government really believe that that should happen or whether it is just an idea that sounds good but that cannot be adhered to in practice. I hope that it can be adhered to, because if we make the polluters pay, and if the NRA is effective enough to bring that about, there will be a vast improvement in the quality of our rivers. The new environmental protection agency—the NRA—is hopelessly underfunded and I do not believe that it will be in a position to carry out its environmental protection functions effectively.

8.45 pm

New clause 2 deals with contracting out. It is clear that that should not be allowed by the NRA. It would not be acceptable because if the water plcs are to carry out that contract work, it is obvious that we shall be back to having the gamekeeper and the poacher under the same roof. One could say that, by stealth, the plcs could carry out the contracting out functions for the NRA, but that would result in a hopelessly compromising situation. I hope that the Government will give us definite assurances that the water plcs will not be in that position post-privatisation and that they will not be doing the work of the NRA on environmental protection.

Much has already been said about the statutory water companies. There are many misconceptions about them, especially on the part of the Prime Minister, who has stated that a quarter of the industry is already privatised. Clearly, statutory water authorities do not operate in anything like the same way as the plcs will operate post-privatisation. When we learn that statutory water companies charge 25 per cent. less for their water than the water authorities, the reasons for that become clear. Part of the profit of the statutory water companies is, in law, recycled back to the consumer to reduce the price of water. That will undoubtedly be unscrambled when they become plcs, as can be seen from what has happened in terms of the recent water price increases from the statutory water companies, pre-privatisation, of between 30 and 50 per cent.

New clause 15, on producing an environmental plan, is excellent and will work specifically to protect the environment. Like many hon. Members who served on the Committee, and like many other hon. Members, I am an exceptionally keen angler. I like some aspects of new clause 15, which states that the NRA should be pro-active in developing angling resources and in increasing the productivity of our waters. Angling is undoubtedly an important recreation. We know that more than 3 million people enjoy it. As the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands) said, the unfortunate thing is that if those aspects are privatised, the price of angling will he prohibitive for local people.

I live in a constituency where most of the rivers cost £100,000 per mile and I know how galling it is to be brought up in such an area as an angler but to be unable to fish the river. My first opportunity to fish the river Wye in my constituency was at the behest of two brothers from Stoke-on-Trent who had made a lot of money and generously offered me the opportunity to fish the river. That was my only legal opportunity to fish the river Wye. In the past, such situations have caused great problems. We do not want the reservoirs of Wales to become unaffordable to local people. In the past, local people were able to fish some of our waters only by using hand grenades. That is very deleterious—it ruins fisheries and spoils people's enjoyment. However, it may again become the only way of catching fish, which would be most regrettable.

There must be proper provision, as in new clause 15, for restocking rivers with trout, salmon and other migratory fish. In this respect, it is particularly important, from an environmental point of view, to ensure that the compensatory flows from reservoirs keep rivers at levels that will cater adequately for fishing and other recreational interests. It is important that the plcs do not, through avarice and a desire for extra profit, take action that will lead to rivers drying up. That is what might happen as a result of lack of effective controls by way of compensatory flows. No doubt the NRA, given the necessary power, will ensure adequate compensatory flows from reservoirs into rivers.

New clause 20 deals with the vesting of land. The land ought to be transferred to the NRA—there is no question about that—but the House should know that, under this privatisation measure, 99 per cent. of it will go to the plcs. I regard that as an unsatisfactory state of affairs.

In the context of the NRA, we are talking about environmental protection. The water protection zones around our reservoirs ought to be in the hands of that body to ensure that pollution does not occur. The Government have no right to maximise the assets of the water authorities—assets that were given to those authorities in 1973. Now those are to be sold off. That is not a satisfactory state of affairs. In fact, under this legislation, approximately 10 per cent. of my constituency —66,000 acres—will be sold off. That is very worrying. The Welsh water authority owns 45,000 acres of the Elan valley, and 21,000 acres in the Brecon Beacons national park. The Government are selling off assets that they do not own, which amounts to misappropriation. The Elan valley originally belonged to Birmingham corporation and that water complex was brought about through the corporation's Water Act of 1892.

Mr. Pike

While the hon. Gentleman was referring to the disposal of land in his constituency, the Minister was shaking his head as though he did not believe that it was possible. If the Government really did not believe that there is any danger of the water authorities disposing of land, there is no good reason for their rejecting new clause 20, which would put the land in the ownership of the NRA but would allow the water authorities to operate exactly as the Bill proposes.

Mr. Livsey

I am sure that the hon. Gentleman is quite right—that the NRA and the plcs could function adequately with the land in NRA possession. Indeed, that would be a far cleaner division of responsibilities than is proposed in the Bill.

I have referred to the Birmingham Corporation Water Act of 1892, under which the Elan valley complex was built. There is no doubt that the current situation is very worrying. When the water authorities were set up under the 1973 legislation, the assets were transferred to the Welsh water authority and certain payments were made to Birmingham corporation. Everyone appeared to be satisfied because there was local authority representation on the water authority, giving some democratic control of the situation, but all of that is to go by the board and the assets are to be sold. It is not surprising that the leader of Birmingham corporation says that he would like £500 million for those assets. After all, they were paid for years ago and have served the water consumers extremely well.

Important large assets ought to be transferred to the NRA. It is also important that local reservoir fishing rights, going back a very long way, should be safeguarded. They ought not to be sold off over people's heads.

For all those reasons, the amendments before the House should be accepted. There is a great deal of logic in them, and they would do much to improve the Bill.

Mr. Edward Leigh (Gainsborough and Horncastle)

I am delighted to take part in this debate—the longest today—because it will focus the attention of Parliament and the country on what ought to be one of the proudest achievements of this Parliament—the setting up, for the first time, of a national environmental protection agency, in the shape of the National Rivers Authority. That is something that no Government, of either party, has succeeded in doing. Government Members should welcome this long, four-hour debate, as an opportunity to say again and again that we are proud that, as the environment becomes more and more important in politics, we have taken this initiative, whereas no other Government has succeeded in doing so.

Mr. Allen McKay (Barnsley, West and Penistone)

Can the hon. Gentleman explain why it is necessary to confiscate the people's water and land to create a'National Rivers Authority?

Mr. Leigh

I simply turn that question on its head: if it was unnecessary, why did the last Labour Government do it? Does the hon. Gentleman seriously believe that, but for privatisation, we would have the resources to set up the NRA? Of course, the answer is no. It is because of the pressures created by privatisation that we are setting up the National Rivers Authority.

I accept that in the country there are some doubts about this measure. That is hardly surprising. There is bound to be some doubt about any new measure. If food had been nationalised by the Attlee Government, there would have been concern. If we had food queues, and if the Prime Minister were to suggest the privatisation of food, there would be worries in the country. But that would not make it wrong to privatise food distribution, and I think we could show that food retailers are no profiteers but actually provide an excellent service in respect of an essential commodity.

Mr. Allan Roberts

Does the hon. Gentleman accept that the functions of the National Rivers Authority are those which are necessary, which do not result in profit, and that if they had been left with the water authorities that would have been a bar to successful flotation? Is not that the only reason for the setting up of the National Rivers Authority? Is it not a fact that Lord Crickhowell, who is chairman of the National Rivers Advisory Committee and will be chairman of the National Rivers Authority, has said: I think I should make it absolutely clear that I see it as one of the priority objectives of the National Rivers Authority to operate a slim, efficient, cost effective organisation"? What resources will it be given?

Mr. Leigh

The National Rivers Authority has to be set up because it is not right that private companies should regulate the affairs of other private companies.

Mr. Allan Roberts

rose——

Mr. Leigh

I am sorry, but I cannot give way again. Other hon. Members want to make their contributions, and I am making a short speech.

When I go out into the country I always ask people whether they are entirely satisfied with the service they are getting from the nationalised water industry. The answer is, of course, that they are not. This week, I visited a small sewerage works in Welton, in my constituency, where there has been under-investment. The village is suffering from under-investment, and there have been delays in implementing what is quite obviously an essential scheme.

I do not want to make a party political point, but it has to be said—and it should be said again and again—that investment in sewerage was cut by 50 per cent. under the Labour Government. They did not do it deliberately. They were speaking the language of priorities. They did not want to cut investment in sewerage but, as my hon. Friend the Member for Pudsey (Sir G. Shaw) said in his cogent speech, there are no votes in sewerage but there are plenty in hospitals and schools. The measure is necessary from an environmental point of view and also to attract private capital into an industry which has been underfunded historically and in which there has been under-investment.

9 pm

We have an excellent case to take to the country in arguing for a National Rivers Authority, in saying that poachers do not make the best gamekeepers, in saying that it is not right that the Government should set the standards and then provide the cash, and in saying that historically the Treasury has had more power in these matters than the Department of the Environment. We can say that again and again. As I said at the beginning of my speech, we can be proud of the fact that we are the Government who are setting up an independent, nationally funded and adequately funded national environmental protection council.

I can deal briefly with the Opposition's proposals. In regard to new clause 1, no one has mentioned clause 110, which deals with anti-pollution works and operations. I am sure that in replying to the debate my hon. Friend the Minister will make it clear that in clause 110 we have in legislation, for the first time so far as I am aware, a provision to enable the National Rivers Authority to carry out works and operations where it is likely that there has been pollution. In that clause we have the powers that are needed by the National Rivers Authority. New clause 1 is not needed. It is a debating device. All it has done is to enable my hon. Friends to debate what we want to debate —the NRA and what it will do to improve standards.

As regards new clause 2, it is suggested by the Opposition that the NRA will be in the pockets of the plcs. In the early days following vesting, there may be only one computer or other resource available for the NRA function and the plc function. Are the Opposition suggesting that the NRA should not be allowed to use that essential resource?

Neither new clause 1 nor new clause 2 makes sense. New clause 1 might not be enforceable. I can illustrate the point by referring to nitrates. What will happen if it is decided that nitrates are polluting land? Who should pay? Should it be the present generation of farmers, the farmers of a previous generation, or the Ministry of Agriculture, Fisheries and Food, which encouraged farmers of previous generations to put nitrates on the land? New clause 1 is not practical. None of the amendments that the Opposition has placed before us makes sense.

I am not dogmatic about whether the ownership of land should rest in the hands of the NRA or the plcs. I simply pose one question: is it seriously contended that nationalised industries or nationalised bodies are necessarily better housekeepers or environmentalists than plcs? I am not convinced of that or that the planning process in areas of outstanding natural beauty is not fully equipped to deal with the problem.

In short, here we have an opportunity to go to the country with a good case. We should not be apologetic about the Bill. Tomorrow, if I am fortunate enough to catch your eye, Mr. Speaker, I shall develop the argument to show that we have got an even better case to put on why, as well as setting up the National Rivers Authority, we should create strong, powerful, well-regulated plcs.

Mr. David Hinchliffe (Wakefield)

It has been interesting to listen to Conservative Members airing their differences on the latest Government attempt to rob the people of public assets. It is particularly interesting to note that the hon. Member for Gainsborough and Horncastle (Mr. Leigh) has been the only hon. Member to give enthusiastic, unthinking support for what the Government are putting forward. With the exception of the hon. Gentleman, Conservative Members have all had reserva-tions or qualms about various aspects of the Bill. That indicates to some extent the way in which the new clauses are being discussed against clear changes in public opinion. Our constituents are concerned about what the Government propose.

I made the point in Committee that one good thing that had come out of the progress of the Bill was that public opinion had changed and that there was increased public awareness of the problems of pollution and other aspects of the water industry. The fact that the media have highlighted the issues is interesting. Newspaper after newspaper—all of them newspapers that support the Conservative party—has expressed the view in editorials that the Government should drop the legislation. They have exposed the fact that not only are there major problems because of pollution in our rivers and estuaries, but that the Government's legislation will worsen the position.

We have heard during the debate of divers at Torbay coming out of the water with condoms on their heads. We have heard about problems in other parts of the country. There has been frequent evidence from hon. Members of the NIMBY syndrome. We should also remember that this week we have had a major pollution problem in the English channel because a cargo of lindane has gone astray.

It is not just in the channel that we have these problems. Within the Yorkshire Water area there is evidence of lindane having been dumped in rivers and estuaries and of other dangerous toxic chemicals having been dumped in rivers and estuaries and of other dangerous toxic chemicals having been dumped in rivers beside populated areas. The way in which the Yorkshire Post has exposed in detail what has been going on in the area is commendable. That is how public opinion has been changed during the progress of the Bill. The people have learned exactly what is happening. One major concern has been that the polluters are getting away scotfree under the present system, but that will still be the case with the proposals put forward by the Government.

Pollution is likely to get worse as a result of the Bill. Indeed, it has been seen to deteriorate in the run-up to the privatisation of water. Over the past four years river pollution in Yorkshire has been getting progressively worse. During the 1980s there has been a frightening decline in the quality of our rivers. Figures have already been given in the debate. Ten per cent. of all rivers in Britain are biologically dead. That is a disgrace. The Government have been in power for nearly 10 years but they have been complacent. It is no excuse for them to blame previous Governments.

Mr. Boswell

The hon. Gentleman has said that 10 per cent. of the rivers of Britain are biologically dead. I take it that he is referring to rivers in classes C and D. Will he give the figure for Europe at large? Would it be 25 per cent. of the rivers in the same categories?

Mr. Hinchliffe

I am concerned with the Bill which relates to this country. We could spend all night talking about Europe. I am talking about the fact that 10 per cent. of our rivers are biologically dead. If the hon. Gentleman defends that, or if he is proud of it, I find that incredible. It is a disgrace that so many of our rivers are in that state.

In 1980, 12,500 pollution incidents were registered; in 1987–88, there were nearly 24,000. That is a huge increase in known incidents of pollution. Of course, as we all know, many pollution incidents are not reported. I made the point in Committee that I and many other hon. Members are receiving representations from constituents who are deeply concerned about the local aspects of the legislation.

I was contacted by the West Yorkshire canoe club which is based in Wakefield in my constituency. It asked me what I could do about the fact that many young people want to learn to use canoes but must travel 15 miles from the club to find a river that they can safely use. If a youngster tips out of a canoe into the river Calder in Wakefield, his or her health can be seriously affected. I live right next to the river Calder and young people ask me, "Why can we not fish in our local river? Why are there no fish? As a Member of Parliament, what will you do about it?"

Not long ago it was brought to my attention that the family of someone who had drowned in the river Calder was dissuaded from seeing the body because of the stale of the body after being in the river for only a few hours. Those are the issues with which the Bill should be dealing, but it does not do so.

There is clear evidence in the preparation for privatisation that the Government have added to the problems that I concede have existed for a considerable time. Water authorities under the present Government are concerned with financial targets and not with targets to tackle pollution. The water authorities are concerned specifically with budgeting and not with the general issues about which my constituents are concerned in relation to the standard and quality of the rivers in their area. Artificially high profit targets have been set for the water authorities in a deliberate attempt to push up the profits prior to the industry being sold off, thereby making it attractive to potential investors.

Under the Government we have seen the lowering of capital spending and restrictions on borrowing powers, which have meant that it has not been possible to invest in tackling such problems as sewage effluent and other matters about which we are all concerned.

Even more alarming is the evidence during the past few months about the way in which applications for the relaxation of sewage discharge consents are encouraged by the Government to avoid legal wrangles that might complicate the selling off of this precious industry. I heard some time ago that the maximum number of relaxations that the Government would allow would be 1,000. I understand that that figure has now been exceeded. I should be interested to hear from the Minister the number of relaxation of sewage discharge consents. How many are there in each of our areas? Are they temporary or are they permanent? What investment is going into improving that sewerage——

Mr. Devlin

rose——

Mr. Hinchliffe

I saw the hon. Gentleman wander in. Other hon. Members have sat in the Chamber throughout the debate.

Mr. Devlin

I was here before the hon. Gentleman.

Mr. Hinchliffe

Other hon. Members wish to speak in the debate.

How temporary is a temporary discharge consent? How many are there throughout the country? What difference is that making to the quality of our rivers and the amount of pollution arising from sewage works in our rivers?

New clause 1 establishes the important principle of the polluter paying for the damage that he or she causes—and why not? It appears to be plain common sense that they should be made responsible. It is a straightforward reasonable way of making a polluter responsible for the damage that he causes.

Mr. Devlin

That is nonsense

Mr. Hinchliffe

The hon. Gentleman will have the opportunity to speak later. I object to such comments.

Mr. Devlin

Give way then.

Mr. Hinchliffe

I have said why I will not give way. The hon. Gentleman has just wandered in. He was not in the Chamber earlier. He has not heard what I have said.

Mr. Devlin

I was here before the hon. Gentleman was. I have been here all the time.

Mr. Hinchliffe

It is known that pollution is often a byproduct of highly profitable processes, so that the individuals concerned with serious pollution and such chemicals as I have mentioned in areas such as Yorkshire Water are frequently involved in profitable businesses and should be made responsible for the damage that they do to our environment. I believe that the charges faced by the polluters should reflect the extent of the damage that they have done. I do not see how anyone could object to that as a basic principle.

9.15 pm

This measure could reduce the effects of pollution more than any others in the Bill. It is pleasing to note that some Conservative Members support new clause 1. However, it will be resisted by the Government because it would mean in certain circumstances that the water plcs would be charged with meeting the costs of the environmental damage that they cause. As we know, at present it is the water authorities and the water companies that are among the worst polluters.

New clause 2 deals with another issue of serious concern to the Opposition and it was certainly discussed in great detail during the Committee stage. It provides for the subcontracting of certain aspects of the work of the NRA, possibly to the same people working alongside the water plcs. The fact that monitoring and control could be subcontracted to polluting plcs, or the same people concerned with the plcs' functions, indicates that the Government are not in any way serious about the role of the NRA, despite the comments made by such hon. Members as the hon. Member for Gainsborough and Horncastle, who says that the new clause is a great innovation by the Government. They have brought in a new body that will have a major impact on the environment. We know that the NRA was not proposed initially by the Government, because the Government favoured the water plcs being involved with self-regulation. The NRA was foisted on to the British Government by outside bodies. That is a fact that no one can contradict.

The Minister for Water and Planning (Mr. Michael Howard)

indicated dissent.

Mr. Hinchliffe

The Minister can shake his head, but everyone knows that that is the case. If it was not the case, why was it not included in the initial proposal that the Government brought forward? They have had plenty of time to consider the proposals in detail. The question of getting away from the poacher and gamekeeper issue is frankly nonsense, because the same situation could arise as that proposed in the Bill for subcontracting. I believe that it is the same as giving control of rat infestation to the rats. When we consider the proposals for subcontracting, we can see that it is essential to include new clause 2 in the Bill.

Despite what the hon. Member for Gainsborough and Horncastle said, the concept of the National Rivers Authority is completely alien to the philosophy of the Government, who believe in free play of the market and self-regulation. I support the NRA and I believe that it will be useful in the context of a publicly owned water industry. However, the NRA has been forced on the Government in order to get the measure through the House. The proposals on contracting out give the game away completely.

The Bill has been portrayed as a green Bill. If we consider the representations that we have received from various organisations with green concerns, outlooks and interests, it will be seen that it is not a green Bill, but a greed Bill. It is about the greed for profits and dividends. It is about a greed for personal gain. It is not about our environment and pollution, but about people making a fast buck. We should forget the green nonsense, because the Bill is all about greed.

Mr. Brandon-Bravo

I spoke in favour of the Bill at Second Reading and I have read and heard nothing since to make me change my mind. However, I was committed to other things and was not privileged to join the Committee. I was sad about that, because I was very interested in the Bill, having been privileged as a junior to be involved in much of the early work in the 18 months prior to the last general election. That is why I feel that I can say that when the hon. Member for Copeland (Dr. Cunningham) moved what I suppose could be called environmental clauses, he was perhaps unjustly bidding for canonisation. He certainly cannot have been bidding for ministerial promotion—that is very unlikely. The hon. Member for Copeland gave the impression of wearing a halo as he moved this series of Opposition new clauses. If he thought he was wearing one, it was undeserved and, despite the remarks of the hon. Member for Wakefield (Mr. Hinchliffe), my right hon. Friend the Secretary of State can claim the credit for the National Rivers Authority.

When this measure was being researched and discussed in the last Parliament, the National Rivers Authority was not even under consideration. There was just a river basin entity, as my hon. Friend the Member for Pudsey (Sir G. Shaw) pointed out. I cannot agree with my hon. Friend because, in my view, the present Secretary of State felt that the environmental issues had to be separated out—that the commercial function had to be separated from the controllers and the legislators—and he made the right decision.

The new clauses are simply window-dressing to try to obtain for the Opposition, as the hon. Member for Wakefield tried to do, public acclaim for being interested in environmental issues and wanting the separation of the commercial from the environmental function. That separation is entirely the brainchild of the Secretary of State.

There seems to be no need for the opening subsection of new clause 1. Clauses 99, 100, 101 and 102 appear to fit the bill well. Clause 99 describes the waters that we are discussing; clause 100 sets out the form of classification; clause 101 gives the quality objectives; and clause 102 imposes the duties to maintain those objectives. Clearly, therefore, new clause 1(1) is unnecessary.

Subsection (2) of new clause 1 is equally unnecessary because clause 103 sets out the offences and procedures of enforcement. Commentators outside have suggested that the punishments for breaches should be tougher. Perhaps the Minister will underline, when he replies, the power that the courts will have and the sort of punishments that are envisaged. That would help to put our minds at rest on that issue.

I see no reason for new clause 2, other than as a piece of window-dressing by which the Opposition seek to achieve some kudos from what the Bill already achieves. Subsection (1) of that new clause is already covered amply by the Bill. Subsection (2) is covered by clause 99 onwards in part III of the Bill. Subsection (3) of the new clause is covered by clauses 3 and 6 of the Bill. Clearly, therefore, we do not need new clause 2.

New clause 15 is really only clause 101 of the Bill but listed in enormous detail. The danger of listing on the face of the Bill the sort of detail that new clause 15 would achieve is that in due course, when the Bill is law, someone will say that something has been left out or forgotten. Clause 101(4) of the Bill deals with the whole subject in a more practical way because the House, through the Secretary of State, can vary the objectives at regular intervals, when hon. Members will have the opportunity to debate such changes to ensure that the public interest is protected.

When dealing with new clause 20, the hon. Member for Copeland seemed determined that the new plcs should not own any freehold land. I find that puzzling. Be they waterworks, buildings or just open land, those items will have to be valued and people will have to make a judgment about what might or might not happen in the longer-term —[Interruption.]—and that is the sort of judgment we must all make when we buy something.

I regret that the hon. Member for Copeland is not in his place. He seemed to suggest that the vast majority of the land that the water authorities will obtain is national park land. One might have believed, listening to him, that the water authorities will turn our national parks into housing estates. I understand—perhaps the Minister will make this clear—that only a small part of our national parks is owned by water authorities. Most of the land is privately owned, and I think that the Ministry of Defence owns a large slice of it. But whoever owns it, I can see no way by which planning consents will substantially change our national parks.

I hope that the Minister will reassure us on the question of access. In playing to the gallery, the hon. Member for Copeland, when referring to clause 7(5), referred to free access and free recreation. Britain's 4 million anglers already pay substantially for what they get. It is unfair to suggest that they are getting it free.

Mr. Allen McKay

British anglers pay a rod licence, not an access licence.

Mr. Brandon-Bravo

Let us not play with words. The hon. Member for Copeland, when referring to clause 7(5), sought to create the impression that after privatisation people would have to pay for things that they now get free. That is patently untrue and I believe the right hon. Gentleman knows it.

In short, it is perfectly clear that everything that is referred to in these new clauses is already adequately covered in the Bill. I therefore have no worries whatever about joining my hon. Friends in voting them down.

9.30 pm

Mr. Martlew

This is a terrible Bill and I am surprised that there are not more hon. Members in the Chamber tonight. I suspect that the reason is that they know that we do not have to worry too much about the Bill because, even if it becomes law, nobody will buy the shares. And they know, of course, as we come nearer a general election, that it is not worth buying them anyhow because we have to take water back into public ownership—[Interruption.] We have obviously upset hon. Gentlemen. We must have touched a raw nerve—which is more than the hon. Member for Nottingham, South (Mr. Brandon-Bravo) did.

Mr. Burt

The hon. Gentleman is telling us new things here because the last we heard from those on his Front Bench was talk about beefing up the regulation side but leaving the privatised supply absolutely alone. If he is telling us one thing and his hon. Friends on the Front Bench are telling us another, we need to be told which is the truth.

Mr. Martlew

I am delighted to reply to the hon. Gentleman. I think that the last time he intervened was in Committee and at that time, too, he was crawling. There is no doubt that the Labour party will take water hack into public ownership.

In connection with the new clauses, I want to deal with two matters. One is the question of the contracting out of the National Rivers Authority functions and the other is the principle of the polluter paying.

We have already had a great deal of debate on the NRA. We do not believe that it will protect the rivers and water courses of this country, but we accept that it is better than nothing, and it is better than what the Government were proposing before. But we do not believe that the Government should be able to hand over the function of testing the rivers to the plcs. That worries us greatly because it is not a credible alternative for the plcs to do the work for the NRAs. There is an old saying that he who pays the piper calls the tune, but in this case that will not hold water—I am sorry about that. Especially in the North-West water area, there will not be the option for the NRAs to do their own testing because the decision has already been taken that the main laboratories at Dawson house in Warrington will be transferred to the plc. I deliberately asked the chairman of the North-West water authority about this when I visited Warrington last year.

Furthermore, no real attempt has been made to provide alternative laboratories for the new rivers authority; so there is no possibility of the NRA carrying out its own tests in the north-west. The only option it will have for the foreseeable future is to contract it out to the water plc, and that just is not credible. Even if the tests are carried out correctly and there is no hint of doubt, people will not believe this is so if the plcs are doing it.

At the sewage works in my own constituency there is a very good small, well-equipped laboratory for testing the effluent as it goes out into the river Eden. But that is to be transferred to the plc and that laboratory will do the testing for the NRA. That, again, has no credibility. The separation of the two about which we have heard so much from the Government and their supporters is a sham. It will not work. Nobody will believe that one body can be judge and jury. I only wish that the Secretary of State had taken the example of the Home Office and the way it dealt with the situation with regard to the police and the Crown Prosecution Service. They were divided and now have the Crown service dealing with the prosecution and the police dealing with the job of catching the criminals and arranging——

Mr. Mullin

Arranging the confessions.

Mr. Martlew

—arranging the convictions. I would not like to cast any aspersions on the working of our police force.

What we have here, instead of that, is the NRA giving the job of providing the evidence to the criminal. The water plcs will be taken to court but the job of providing evidence will also be given to them. Therefore, my guess is that not many of them will be taken to court and even fewer will be convicted.

I turn now to new clause 1 and the question of making the polluter pay. I agree with that. Too often large companies pollute our rivers and get away with small fines. None of their directors takes personal responsibility and yet they are often guilty of wilful neglect, the consequence of which can mean the killing of hundreds of thousands of fish in many miles of river.

Let us consider the way that companies are treated compared to poachers. Often, high fines or imprisonment are imposed on poachers who have taken 10 or 20 fish. I am not soft on poachers who get everything they deserve, but they do less damage to the rivers than do some of our major industries.

Mr. Pike

In the scenario that my hon. Friend has painted, is it not possible that some industrial polluters could invest in the water plcs? It would be cheaper for them to purchase a large stake in those industries rather than deal with the pollution. They could then carry out the tests for the NRA. Is not that how this Government intend privatisation to work?

Mr. Martlew

Obviously, my hon. Friend has been reading my notes. The polluters are not only likely to invest in the plcs but have already made an investment in the Conservative party. That is why there is some opposition to this clause, because it is well known that big business does not want it.

Pollution in my own area is usually caused by caustic soda, which is used by many industries. They fail to place fail-safe systems round the caustic soda tanks, somebody leaves the valve on and as a result thousands of fish die. In one case, a thousand gallons of fresh cream went down the river, which did not harm the fish but was not good for the print works further down.

Directors must be accountable for their companies' actions. Directors who are wilfully negligent should be brought before the courts and treated in the same way as poachers. We must ensure that when pollution occurs those responsible are not only fined heavily but made to pay the full cost of restocking the river and bringing it back to life. Some compensation should also be given to the angling clubs whose sport on the river is spoilt. That is the way forward.

However, I recognise that if we impose tight standards on factories that have been polluting rivers for many years —many such have been mentioned in the industrial north —it could well mean their closure. Unfortunately—I understand this view—people often prefer a polluted river to life on the dole. Therefore, in genuine cases grants should be made available to such companies to help them to stop polluting the rivers. If those factories are eventually forced to close, the Government will provide derelict land grants to clear the site and plant trees on it and, therefore, it surely makes sense to support those companies with a tradition of polluting the area and which cannot afford the necessary equipment. If the Government gave them financial assistance it would create better factories and clean rivers. I hope that the Minister will take up that point.

The agro-chemical industry also concerns me. More and more farms are causing problems which are not all the farmers' fault. Much of the slurry contamination must be the farmers' responsibility but many of the agro-chemicals —some of which are recommended by the Government —create problems. Only last week the Hexham Courant —not coroner—carried an article about an area not far from where I live in Alston. The headline reads: Cot deaths linked to sheep dip in river". A scientist, Dr. Lewis Routledge, who has been monitoring the river Tyne, says that a problem could well result from Government-approved sheep dips running into the river and causing serious health problems to the local community. Within four hours of infected sheep dip going into the river it is running through taps in various parts of Newcastle. The Government should not alway blame the farmer when things go wrong.

My hon. Friend the Member for Wakefield talked about biologically dead rivers—rivers that cannot sustain life. That is not strictly accurate: people may die, but rivers can be brought back to life. All that we need to do is spend money, give it time and have the necessary will. I do not think, however, that the clauses that we have talked about today will enable us to bring those rivers back to life. It is no good saying that the position is worse in other parts of Europe; I am interested only in rivers in the county that contains my constituency.

I have heard Ministers going on about being green. They are indeed green—like the scum on the top of a stagnant pond. The Bill should be taken seriously, and I believe that people will refuse to buy shares in the privatised industry with which it deals. I also believe that they will refuse to vote for this Government in the next election.

Several Hon. Members

rose——

Mr. Speaker

It may be helpful if I say to hon. Members who are now rising that I understand that the Front-Bench Members will seek to rise at 10.20 pm. Will hon. Members bear that in mind so that all who wish to speak may do so?

Mr. Ashby

At the beginning of the last century, people got together to provide much-needed sewers in the cities to take away the effluent. Gradually, in the latter part of the century, the water authorities were built up, and provided the clean water that was so necessary to the urban environment. The sewerage undertakers were at first largely owned by the municipal authorities, while the water authorities were privately owned, later to be nationalised. The two came together in the 1970s. The history of the sewerage and water authorities contains a common theme. In the last century no one provided any real control or set sufficiently high standards for the water that was to be consumed.

It is a sad fact that over the same period of 80 or 90 years we have seen a decline in our waterways, which we all regret. We have seen many waterways die, and we have seen heavier pollution over the past 40 years in areas such as the Fens, much of it due to the deposit of nitrates some years ago. I remember going on the Broads some 30 years ago when they were alive. I remember the joy that I experienced fishing from a boat. I went there several times. I have not been recently, but I understand that it is no longer possible to fish from a boat because there are no fish. That is very sad.

The one theme that runs through the history of public water supply is that there has been nobody to set the standards and to enforce them. At long last, the Bill creates the National Rivers Authority to set standards and enforce them. The Opposition have said time and again that they would like to wave a magic wand so that those standards would be enforced immediately, but such things are not achieved by waving a magic wand or by willing the changes to occur, as has been suggested. Those standards will be achieved only by perseverence and education, by explaining to people, encouraging them and ultimately enforcing standards upon them.

9.45 pm

The National Rivers Authority will provide all that. It is necessary to set out a timetable and a scheme. We must know that after a given time all waterways will have to reach acceptable standards. The National Rivers Authority will have to set a five, 10 or 15-year scheme. All the changes are costly and will take time, but the National Rivers Authority will create a policy to clean up the country.

We all talk about green policies. The Opposition and the Government believe that it is necessary to control pollution and to improve the environment in our country.

Mr. Devlin

Will my hon. Friend give way?

Mr. Ashby

No, time is short.

We are being dogged by the Labour party's opposition to privatisation or profit and to the idea that any private company should own the land and provide the water. The Opposition have forgotten that over the past 80 years public companies have been the worst providers. For the past 80 years there has been a decline in standards and the public companies have been absolutely hopeless at preventing pollution. Only now are we experiencing the consequences of the nationalised industries and publicly-controlled authorities. They are absolutely hopeless for a number of reasons. They do not provide sufficient capital investment. I blamed the Labour Government in the 1970s because there was a decline of something like 50 per cent. because of the country's economy at the time, but all Governments have tried to restrict capital investment by public authorities. All Governments look at any profit made by a public authority and decide to take it back into the Treasury because it is needed for hospitals, tax cuts or some other reason. So the public companies and authorities have been starved of investment and have gradually declined.

The Bill provides us with the only opportunity to break out of the straitjacket. The National Rivers Authority will set the standards, but the Bill will also free those authorities from financial restrictions and allow them to invest. Nobody will want to invest in the public companies or buy shares in them unless they provide an ongoing investment to show that they are strong, powerful companies providing good water supplies, and so on. That would be a spur to higher standards and to the benefit of the community as a whole. Without such a provision, we shall have a stop-go process for years to come and there will be no improvement.

I was astounded when I heard that 65 per cent. of the sewage discharged into the sea in Wales was raw sewage. That is wholly unacceptable. I am looking forward to the NRA setting up a scheme and telling companies, "You cannot go on like this—you have 10 years to clean up your act and see that you discharge only clean effluent into the North sea, or you will be prosecuted thereafter." It is essential that we consider the matter in that way. Clause 110 is important and has my wholehearted support. I reject new clause 1.

Amendment after amendment was proposed in Committee, but when we examined them we found that they were meaningless because the same provisions were already in the Bill. We have heard only scaremongering from the Labour party and there has been little constructive opposition. The important point was made by an Opposition Member who said that the Bill had been well drafted and constructed, but that the one point to which he was opposed was privatisation. We are arguing about the NRA when, in effect, there is opposition only to privatisation.

The weakness of the drafting of new clause I can be seen when one looks at clause 110, which deals with the control of the National Rivers Authority over effluent and its powers to prosecute. It says: Where the Authority carries out any such works or operations as are mentioned in subsection (1) above. it shall, subject to subsection (4) below, be entitled to recover the expenses reasonably incurred in doing so from any person who, as the case may be— (a) caused or knowingly permitted the matter in question to be present. The person referred to is the one who allows the pollution to take place. Is that not exactly what is proposed in the new clause 1?

Mr. Robin Maxwell-Hyslop (Tiverton)

Will my hon. Friend give way?

Mr. Ashby

No—other hon. Members wish to speak and I am about to finish.

Every amendment proposed today has been a graphic example of surplus, and a waste of time because the real opposition is to privatisation. The Bill is excellent and does not require amendment. It provides a strong National Rivers Authority which will do all that we require. For that reason, I shall vote against any amendments and will continue to support this excellent Bill.

Mr. Morley

We have had an admission of failure from the Conservatives today. We have heard a succession of speeches trying lamely to defend a Bill which seeks to put a natural monopoly into the hands of private companies and is a confession that the Government have failed to release the water companies from the wholly artificial straitjacket of financial restraint. There is nothing to stop the Government removing that straitjacket because the Chancellor of the Exchequer is knee deep in money with a £14 billion surplus, with which he intends to pay off the national debt. Some of that could easily have been directed towards the water companies for infrastructure invest-ment. By admitting their failure, the Government are throwing the water companies out into the private sector, where higher charges and higher revenues will be required to meet that investment. It is far more unfair to charge consumers, with no differentiation between those who can and cannot pay, than to raise money by way of taxation and surpluses.

The most recent opinion poll on people's attitudes towards water privatisation showed that 96 per cent. of the public were against it. The 4 per cent. in favour must all have been on the Conservative Benches today, lamely trying to defend the indefensible.

New clause 1 embodies the principle that the polluter pays.

Mr. Devlin

rose——

Mr. Morley

I shall not give way because time is short and others wish to speak.

On numerous occasions the Government have claimed to believe in the principle that the polluter should pay, so they should support the new clauses.

The Yorkshire Post inquiry found that 140 companies in the Yorkshire Water area were breaking the legal limits on discharges, but only four were prosecuted, although one company was discharging more than 800 times the legal limit. Other companies were found to be breaking the limit every time the water was sampled but were never once prosecuted. That could be put right by a determined Government, committed to environmental and green policies, rather than one following doctrinaire policies with the aim of privatising everything in sight without thought of the consequences for Britain's long-term future or its essential services.

New clause 20 has not been dealt with in any great detail. It deals with the control of the freehold of land which will be ceded to the new companies. That issue is the crux of the Government's privatisation policy. Is it the Government's intention that private companies should control water distribution, quality and sewage, or is it their intention that there should be yet another asset-stripping exercise involving all the land that goes with the water companies? There is no reason why the new water companies will need the freehold of such land to do their job properly. That includes operational land, catchment land, reservoir land, and land for sewerage works. The leasehold would be sufficient to enable them to do their job. If the freehold were held by the NRA, the future of that land would be safeguarded and there would be no attempt to asset-strip it or to develop it in ways that would be unsympathetic to the environment, destroying sites of scientific interest or denying people access to footpaths, whether for sporting activities such as fishing or walking or the many other activities which presently take place on water authority properties.

In supporting new clause 20, I am not speaking simply for myself, or even for the Labour party. The bodies that support new clause 20 range from the Council for the Protection of Rural England, the Ramblers Association and various conservation groups. Even the National Farmers Union has expressed concern about the future of land held by water boards. It is concerned about the tenant farmers, many of whom rent or lease their land from the water companies, and who face a real threat.

The Secretary of State recently had to step in to resolve a row in north Yorkshire where the Yorkshire water authority was inviting bids for a valley occupied by tenant farmers. It was offered a bid by the chairman of Barratts over the heads of the tenant farmers. Under regulations and guidelines laid down by the Government, the Yorkshire water authority was under an obligation to accept the highest bid. Fortunately, the Secretary of State stepped in and allowed Yorkshire water authority to dispose of that land to the tenant farmers at the bids they put in, but the Secretary of State could do that only because he controlled the freehold of that land and had the final say over what happened to it. If that land was held by a plc, the company could dispose of it as it wished following privatisation. If the Government succeed, despite the problems that the Bill is in, the private companies could—quite logically from their point of view—simply take the highest bid, which would have been from the chairman of Barratts, and goodness knows what would have happened to the tenant farmers. Their livelihoods could have been wrecked and they could have been kicked out of farms where their families had lived for generations.

If the Government are serious about providing core services—that is what the Bill is all about—there is no reason why they cannot accept this group of amendments, including new clause 20, which will guarantee control over land use. Potential polluters will thus be eliminated and people will have some confidence in privatisation.

10 pm

That links in with new clause 15, which calls for a plan for water and the environment, which in turn fits nicely with new clause 20. There is a case for a National Rivers Authority, although it has been grossly undermined by the fact that it can, and in some cases must, contract out services such as the sampling and checking of water. That is the same argument as we have at the moment with integrated water management—the gamekeeper is also the poacher, which undermines the whole concept of the NRA. If the NRA is to be successful it must have resources. The comments of Lord Crickhowell, who is currently in charge, are a matter of concern because he talks about the need for a "slim" organisation. Two thirds of the NRA staff will be involved in flood defence, which leaves only one third to ensure pollution control and water quality as well as conservation management.

The conservation and leisure guidelines are full of weasel words and get-out clauses such as "will take note", "will have regard to", "if possible" and "where convenient". It is not a tight code to ensure conservation management and leisure access and to defend permissive rights of way. It has no teeth and I suspect that the resources to be given to it will also be inadequate for it to do its job properly.

If the Government are serious about conservation and the management of areas of outstanding natural beauty, which many of the water companies will inherit, of sites of special scientific interest, and of the voluntary nature reserves, into which people have put many years of effort and concern, they ought to accept these clauses, which will ensure that those who despoil our environment have to pay to clean it up. In my constituency Bottesford Beck, an area south of Scunthorpe, was recently polluted—probably by British Steel, although I make no accusation because the Severn-Trent water authority has not yet replied to my letter to tell me who is the culprit—and whoever despoiled that stream in Bottesford ought to pay to clean it up. As my hon. Friend the Member for Carlisle (Mr. Martlew) has said, people caught poaching are given quite punitive fines, but those who ruin a river are given derisory fines and nothing in the Bill demonstrates the Government's will or commitment to tackle the problem and to ensure that those who despoil our environment pay to put it right.

I have no confidence in the Bill as it stands or in the way the Government are handling it. I certainly have no confidence in the Secretary of State or in his guarantees about the quality of our rivers and the protection of our environment, and I believe that the public also have no confidence in the Government or their privatisation proposals.

Mr. Maxwell-Hyslop

I had been intending to keep the comments which I wanted to share with the House until we reached my new clause 11. My hon. Friend the Member for Leicestershire, North-West (Mr. Ashby) said something which was inaccurate. Because some people know him to be a barrister, they might reasonably have supposed that he had read both new clause 1 and clause 110 when he said that they were—I think that I quote his words—exactly the same. They are not exactly the same. New clause 1 is mandatory. Clause 110 of the Bill is merely permissive. If anyone cares to read the Bill for themselves they can see it. Clause 110 of the Bill is entitled "Anti-pollution works and operations" and says that if an individual or body corporate causes pollution, the authority shall be entitled to carry out the following works, and later on it shall be entitled to recover the expenses.

That is a discretionary power, which is not exactly the same—I repeat that it is not exactly the same—as what is in, I think, the excellent new clause 1, which makes it mandatory and not discretionary. It states that it shall be the duty of the Secretary of State and of the Authority to ensure that in all reasonable circumstances the person who causes any pollution of a river or other water source, whether that person is a body corporate, water or sewerage undertaking or an individual, shall bear the cost of remedying that pollution and of taking steps to prevent any recurrence. It is necessary to point out to the House that there is an unfortunate distinction, which is a very real difference, between the new clause that we are debating tonight and what is already in the Bill. It is not a duplication of what is in the Bill. It is a transference of the discretionary into the compulsory. That is particularly important in the circumstances to which some hon. Members have alluded —for instance, where the NRA may actually sub-contract some of its functions to a body which has already proved itself hopelessly lacking in will to prosecute. If it is lacking in will to prosecute, will it be lacking in will to recover under discretionary powers?

On the basis of experience to date, certainly the subcontracted body will not, and we have yet to know whether the National Rivers Authority will. I, of course, hope that it will, but the track record of the alkali inspectorate to date is not such as to give one complete confidence that even an independent body will use its powers to prosecute or, in this case, to recover costs, if it is discretionary to it whether it does so or not.

For those reasons, I think that new clause 1 would effect an improvement in the Bill rather than merely duplicate that which is already in it.

I will not say any more, because it is my hope that we may reach later on—indeed, immediately after this series —new clause 11 which would, if we ever reach it, have the result of transferring by way of interest-free loan the proceeds of privatisation to the works necessary to meet the EEC anti-pollution requirements for water and sewerage instead of those costs falling on the user by way of increased charges, either to pay for the works in the first place or to pay the interest and then repay the principal of loans. But of course I would be in danger of straying out of order if I pursued that further at this moment.

Mr. Mullin

These new clauses do not challenge the principle of privatisation, to which we are unshakably opposed. The clauses mitigate the disastrous effects that hon. Members on both sides of the House believe will result from the privatisation of water. They are, in a way, a test of Government rhetoric. The Government, at all levels, continually insist that they believe, in principle, in the aims of the clauses, yet when it comes to it they always advise Conservative Members to vote against them.

New clause 1 deals with the attempt to enshrine in legislation the principle to which everyone seems to pay lip service, that the polluter should pay. Until now, the underlying principle has been that the consumer pays. That is likely to remain the case unless the Bill is amended because, as the Secretary of State acknowledged earlier, the water authorities are among the biggest polluters. The outrageous behaviour of Yorkshire Water has been adequately exposed in the Yorkshire Post. In the area of Northumbrian Water, which is closer to the area that I represent, 36 of the 190 sewerage stations were in breach of the limits in 1986. That is not a very hopeful sign of what might happen after privatisation.

In the area covered by Anglian Water an exciting new concept in pollution has been developed, called the sewage lagoon. Anglian Water has been putting its untreated sewage into the sea. Now, it has done a deal with several Suffolk farmers to dig deep and large lagoons in their fields. It will sink untreated sewage into them. The authority tried to persuade Essex county council to do that, but the county council, God bless it, would have none of it. But in Suffolk they are made of weaker stuff. These large lagoons will cover 40 m by 30 m and be 2.5 m to 3 m deep. A 6 ft high chain-link fence will surround them. It will take 125 lorries to fill them with 500,000 gallons of sewage. The objective is that the content of these lagoons will be sprayed over the fields, which will take 10,000 to 20,000 gallons per acre.

I believe that the first of these sewage lagoons will be at the village of Troston. The sewage is being delivered in unmarked lorries, despite the trouble taken by Anglian Water to design a logo for them. It is not very proud of this particular enterprise. It seems to be in a rush, as no doubt the authority wants to get this out of the way before the National Rivers Authority is functioning. Other lagoons are proposed at Nactow and at Sizewell, to go with its nuclear power station, and at Alderton, which I believe is a heritage coastal village. Those areas are not represented by Opposition Members, but by Conservative Members, so in due course perhaps we can expect to hear something from them. No doubt their constituents who live in those areas will be mightily upset. It does not take a great deal of imagination to understand the dangers to the water supply, not to mention the smell, that the new sewage lagoons will have if one happens to have one in one's backyard.

10.15 pm

As we know, there has been a long history of inactivity on the part of all the water authorities in prosecuting offenders. I shall refer again to the example of Northumbrian Water. Between 1980 and 1986 it prosecuted just seven out of 4,272 breaches of the sewage regulations. That inactivity over a long period is now combined with an arrogance and excessive and obsessive secrecy that does not inspire confidence in the plans for the future after privatisation.

In addition, some of the biggest polluters will be buying shares in the new privatised water companies. Indeed, some are already represented on the boards. They have been put there courtesy of the Secretary of State, who has turfed off elected local councillors and put in, in Northumbria for example, Mr. Norman Pryn who, if one runs one's eye down the list of directors of Northumbrian Water, one discovers to be the deputy group secretary of ICI Billingham, which we all know in the north-east to be one of the major polluters. As one runs one's eye further down the list one runs across the name of Mr. Ralph Iley, who turns out to be the group development director of the Cookson Group plc, which has nothing to do with travel or romantic novels; it is a chemical company.

I cast no aspersions on those two gentlemen—no doubt they do their jobs to the best of their ability—but there is a clear conflict of interest that will be obvious to every hon. Member and to every person of goodwill between the interests of privatised water company and those of the polluter. It is not good enough for the polluters to get a major stake in our industry, which is what now seems to be about to happen. The only way to inspire confidence is to create a strong and genuinely independent National Rivers Authority with the power and the resources to impose serious penalties.

New clause 2 addresses the question of the NRA, when it is set up, contracting back some of its key functions to the water authorities, the activities of which it is supposed impartially to be supervising. This matter came up in Committee on 10 January. I quoted then to the Minister the words of Mr. Bob Smith, who is the director of operations at Northumbrian Water, who told a staff meeting in December that Northumbrian Water would be bidding for many NRA contracts, including the control room, maintenance of telemetry on weirs; the radio system; vehicle maintenance; buying fish; the berth of the fisheries protection vessel; administering the salaries of the NRA staff and, above all, that it proposed to bid for laboratory services. In other words, the samples that will be taken from the polluters that we have been talking about will be tested in the laboratories of the organisation that may well be doing much of the polluting.

When that was mentioned in Committee on 10 January, it brought a number of assurances from Ministers. They said that it was a legitimate point and that we must all think seriously about it. However, when one talks to the staff of the proposed NRA—that is difficult these days because they are scared having received lots of warnings about threats to their jobs—they are not at all confident that the NRA will be independent.

The opportunities for the manipulation of samples are manifest and obvious. They include the time at which one takes the samples, the number of samples taken, whether one's results are published in gobbledegook that is incomprehensible to the average citizen, and what action it is proposed to take.

The Northumbria branch of the NRA will be housed in the same building as the Northumbrian water authority. There will be a close overlap between the managements, and there is already a question of a lack of resources. I am told that the tentative NRA set-up in the Northumbrian water authority area has already asked for greater frequency of sampling and has been told—in the words of one potential member of the NRA staff—to "Sod off." I am told that, even as we sit here, the Northumbrian water authority is looking for ways of reducing consents, and that there is now being drawn up a list of works where standards can be varied without spending any more money. My hon. Friend the Member for Copeland (Dr. Cunningham), in his introductory remarks, rightly recalled—as it pays us all to recall, at regular intervals —the immortal words of Mr. Keith Court, who comes from the home of what we now know as the Camelford poisoner. Mr. Court said that he wanted the best staff because he wanted them to outwit the regulators. If the National Rivers Authority is to enjoy public confidence, it must be seen to be independent of those whose activities it is supposed to be supervising.

New clause 15 raises the most central question of all: what kind of body is the National Rivers Authority supposed to be? Will it be just another toothless Tory quango in the great tradition of the Police Complaints Authority or the Press Council, to become, in due course, the object of public ridicule? Or will it be an independent organisation, free of vested interests, a body with the resources and the will to face up to what we all know to be a major national problem? I have to say that the signs are not auspicious. The Government offer us a lot of interesting rhetoric. Some of us can agree with that rhetoric from time to time, but will it be matched by action? These new clauses contain nothing that contradicts the Government's principle of privatisation, but they put to a severe test the rhetoric about the circumstances in which privatisation will take place.

Mr. Deputy Speaker (Mr. Harold Walker)

Order. The hon. Member for Crawley (Mr. Soames) should not be reading a newspaper in the Chamber.

Mr. Ridley

In my opinion, my hon. Friend the Member for Leicestershire, North-West (Mr. Ashby) got it right: throughout the debates on this Bill the Opposition have failed to find any flaws in it. Instead, they have resorted to highly dubious, irrelevant and misleading stunts and scare stories to try to muddle the public and themselves. Indeed, the paucity of thought among Opposition Members that brings these four new clauses up for debate is an absolute tribute to the draftmanship of the Bill. Two of the new clauses are totally unnecessary, and the other two are totally undesirable.

The hon. Member for Copeland (Dr. Cunningham) came in again with his stale, dog-eared file of old quotes, leaks and cooked figures, to which he has treated us ever since the Bill appeared. He even got a leak, about which he boasted to The Guardian, by squinting at his neighbour —one of my civil servants and reading the papers on his lap. That is the standard of the information that the hon. Gentleman stoops to, and it is typical of him.

Dr. Cunningham

For the sake of greater accuracy, in which the Secretary of State is not interested, perhaps he had better he clear and have it on the record that it was not I who observed on the lap of one of his civil servants the minute which said that all the substance had been removed from his speech. It was someone else who observed it and who conveyed the information to me.

Mr. Ridley

I accept that. It only confirms my view that The Guardian is not an accurate newspaper because what I quoted is what The Guardian said.

The hon. Member for Copeland has got us into a muddle. On Second Reading he said: I say, without any hesitation, that a Labour Government would not allow private monopolies in water to exist—and we shall take them into public ownership."—[Official Report, 7 December 1988; Vol. 143, c. 345.] The hon. Member for Carlisle (Mr. Martlew) foolishly relied upon that. The only way to discover the policy of the Opposition is if, by chance, it is leaked. It is extraordinary. Their policy is kept so secret that nobody knows what it is until it is leaked. It was leaked to The Sunday Times last weekend. I shall be happy to tell the hon. Member for Carlisle what his policy is. He does not know, but I am in the privileged position of being able to tell him. I quote again: Instead of renationalising the companies, Labour would create new regulatory bodies with tough new powers and force the industries to improve their services. That is why we have the demonstration of the new-found realism in the four new clauses; it is to substantiate what the Labour party is trying to maintain—that it now believes in private ownership, together with——

Mr. Martlew

rose——

Mr. Ridley

I shall give way, but I want to finish the point.

Therefore, we come to the NRA. I have to tell the hon. Member for Copeland that I thought up the NRA and announced it before the last election when he did not even know how to pronounce the word "environment". He had never heard of it. For him now to suggest that the NRA should be stiffened in some way in order to show that his credentials are better than they are is absolute rubbish. The hon. Member for Wakefield (Mr. Hinchliffe) suggested that the NRA was being foisted on the Government. I can tell him that I foisted the NRA on him. I am delighted that he is so pleased to see it.

I am grateful to my hon. Friends the Members for Gainsborough and Horncastle.(Mr. Leigh), Nottingham, South (Mr. Brandon-Bravo) and Leicestershire, North-West, who were right to welcome the creation of the NRA and to believe that it was perhaps the most important environmental protection agency, if I may coin a phrase, that has ever been put before the House. That is how I see it.

Mr. Allan Roberts

If it is such a powerful environmental agency, why is the Secretary of State allowing it to subcontract its regulatory functions back to the private water companies, thus recreating the gamekeeper and the poacher being one and the same again?

Mr. Ridley

I will come to that. I am trying to answer every point made in the debate. If hon. Members do not interrupt, I will have more chance of doing so.

The other muddle that the hon. Member for Copeland tried to put across was that higher standards are required. The Opposition accept that, but then they try to blame the resultant higher costs on privatisation. Privatisation in itself will tend to reduce costs, but I have never denied that higher environmental standards will increase them. In fact, I have gone out of my way from the beginning to make that clear.

I can perhaps help the hon. Member for Caernarfon (Mr. Wigley). He asked me to confirm what I said before. I will. As I said on Second Reading, an initial estimate of the additional cost to the water authorities of the compliance programmes now required under the European Community drinking water directive, the EC bathing waters directive and the sewage treatment works discharge consents under the Control of Pollution Act 1974 is approximately £2.4 billion. That is equivalent to an extra 7.5 per cent. to 12.5 per cent. in real terms in financial costs over the next 10 years. That is little more than 1 per cent. per year in real terms. As I have said, that is over and above the increases that would have been required without those additional programmes. That is just a ready reckoner so that the hon. Gentleman can assess its scale. He said that he thought that it would cost £1 billion for the country. My best estimate is £2.4 billion, and even that comes out only at the figure that I have quoted.

Mr. Wigley

Will the right hon. Gentleman give way?

Mr. Ridley

Quickly, as I have much more to say.

10.30 pm

Mr. Wigley

I should be grateful for a quick answer. When the right hon. Gentleman made his statement on Second Reading before Christmas, was he not suggesting that the overall increase in costs would be more than 12.5 per cent.? That was most certainly the interpretation of the papers referred to in the Financial Times.

Mr. Ridley

It is a quick reference point in the hon Gentleman's memory.

My hon. Friend the Member for Torbay (Mr. Allason) was a little unfair, because he said that the South West water authority's prices had gone up by 92 per cent. since the beginning of the decade. In fact, that relates to the cash figure. In real terms, the figure is about 23 per cent. That would have been a more accurate figure for him to quote.

I would like to say a word in reply to the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands), because I cannot allow him to cast aspersions upon the validity of the Bill to protect the interests of fishermen. Fishing is a sport that both he and I pursue. He expressed fears that reservoirs would be commercially exploited to the detriment of local angling bodies. With clause 7, we impose a duty on the companies to put their waters to best use for recreation, and we make clear in the code of practice that that means meeting a wide range of interests and protecting the proper interests of existing established users. Those duties are enforceable under clause 19, and the Secretary of State of the day must have regard to how far the code has been followed in exercising his enforcement powers. If he neglects to do so, he is open to challenge in the courts.

I shall refer the hon. Member for Merthyr Tydfil and Rhymney to clause 151 of the Bill. That provides that where the Secretary of State approves an order authorising works in connection with the construction or operation of a reservoir, he may include in that order requirements for the provision of recreational facilities for local people. I hope that that gives him the reassurance that he sought.

Mr. Rowlands

I am grateful to the right hon. Gentleman. However, will he simply tell us that there is no way that our reservoirs can become the subject of commercial bidding, as our river waters have become?

Mr. Ridley

I hoped that the protections that I have set out would have the exact effect——

Mr. Rowlands

Yes or no?

Mr. Ridley

Yes, that is right.

I confirm to my hon. Friend the Member for Rutland and Melton (Mr. Latham) that the planning procedures that at the moment protect land in many parts of the country, especially near Rutland water, will remain inviolate and will continue in force in exactly the way that he has asked. I hope that that is the assurance that he seeks, but I shall be delighted to confirm it in writing if he wishes.

Mr. Allan Roberts

It is not in the Bill.

Mr. Ridley

Planning is not part of the Bill. My hon. Friend asked me a question and I have just as much right to answer it as any other question.

New clause 15 would require the NRA to prepare and publish at some unspecified time in the future a plan for the carrying out of its functions. Some 15 functions are mentioned and, although they are all worthy, one could make the list as many or as few as one liked. However, making plans betrays a lack of urgency. Opposition Members are under the naive fallacy that to produce a plan is to solve a problem. Above all, there is that detachment from the real world of events and actions.

The amendment is pure 1970s or even before. It reminds me of the late Lord George-Brown and his famous national plan. It resulted in inaction. I believe that action is important. In any event, it is not appropriate for a body such as the NRA. Many of its key functions are those of a regulatory authority, responding to applications from others and policing their activities. It must be reactive, able to respond to events, whether they are pollution incidents or flooding emergencies.

One speaker after another from the Opposition Benches wondered whether the NRA would be tough enough and quick enough to move in. If it spent the next five years producing a plan, it would not be tough and quick enough to do that. As my hon. Friend the Member for Pudsey (Sir G. Shaw) rightly pointed out, the fear is that the NRA will have too much power—the mortmain of the industry, he called it—and I was happy to hear the balance between both sides of the House on whether we had the powers of the NRA right. I firmly believe that we have.

I was delighted by the quick mind of my hon. Friend the Member for Christchurch (Mr. Adley), and the fact that I was able to assure him—as I shall assure my hon. Friend the Member of Tiverton (Mr. Maxwell-Hyslop) shortly —that the precise points of new clause I are covered by provisions already in the Bill. With characteristic loyalty and enthusiasm, my hon. Friend the Member for Christchurch said that he would not be prepared to break his word to the Patronage Secretary and vote against the clause. I was wondering whether, if I said that I supported the clause, he would then vote against it. That is the logic of his position, but as my hon. Friend is not in his place, I need not pursue that further.

The new clause has two subsections. Subsection (1) simply states that the provisions in clause 3, part I of the Bill, for controlling and reducing pollution shall have effect for the purpose of controlling and reducing pollution. I do not argue against that. The Labour party has rightly grasped what the Bill is about. Subsection (2) of the new clause is designed to ensure that, where possible, he who causes pollution pays to have it cleaned up and to prevent it from happening again.

The two subsections have one thing in common: they are both unnecessary, and I need not delay the House beyond the one point that my hon. Friend the Member for Tiverton raised. Subsection (1) is little more than a tautology, since the purpose of the control of pollution provisions in chapter I of part III of the Bill is, by definition, controlling pollution. What is more, our declared objective of controlling pollution and improving water quality is built in, clearly and inescapably, to the legislation itself.

Thus, under clause 102, the Secretary of State and the NRA have the duty to exercise their powers under chapter I so as to achieve the statutory objectives set under clause 101. My hon. Friend the Member for Tiverton had seen clause 101 but had not realised its inter-reaction with clause 102. In the words of clause 101(1), these objectives—which will be set after public consultation—will be For the purpose of maintaining and improving the quality of controlled waters".

Mr. Maxwell-Hyslop

My point was not about the objectives but about whether forcing the polluter to pay was discretionary or mandatory.

Mr. Ridley

That is the point I just answered. There is a duty under clause 102 to make the NRA achieve the statutory objectives set out in clause 101. So it is mandatory, not discretionary.

New clause 2 is designed to deal with contractual agreements between the NRA and the undertakers. I see no reason why these two bodies should not contract between each other, or indeed why the river authorities—the river companies, as they will be—should not contract with the NRA, except in those cases where it would affect the NRA's ability to be clear about standards or to engage in prosecutions.

Mr. Anthony Beaumont-Dark (Birmingham, Selly Oak)

rose——

Mr. Ridley

May I finish my point, then I will give way to my hon. Friend?

The hon. Member for Carlisle was particularly concerned about laboratory work and taking samples. I see no reason why contractual arrangements with the plcs should not include laboratory work provided that there are adequate safeguards to ensure the independence of the NRA.

The hon. Gentleman may not have noticed, but the NRA advisory committee has already put forward a set of safeguards, which we have endorsed. First, all samples must be collected by NRA staff or under direct NRA control. Secondly, there must be guaranteed anonymity of samples so that there can be no question of a person doing the analysis knowing where the sample has come from. Thirdly, there must be proper arrangements for independent audit or cross-checking so that there are frequent checks that the work is being done to the NRA's specification. That is the requirement that he and the hon. Member for Sunderland, South (Mr. Mullin) properly seek and that I am able to give as part of a published document for their benefit.

Mrs. Ann Taylor (Dewsbury)

On the specific point of the way in which samples are analysed, the Secretary of State has said that there will be anonymity of samples. Surely the laboratories of the water companies will already have their own samples from their own outflows and will know which samples come from those outflows. So there will not be anonymity as far as the technicians from those laboratories are concerned.

Mr. Ridley

That is not true. The NRA has made sufficient arrangements from its own laboratories to be able to safeguard precisely the point that the hon. Lady has raised.

I come finally to new clause 20——

Mr. Beaumont-Dark

Will my right hon. Friend give way?

Mr. Ridley

I have only three minutes left.

Mr. Beaumont-Dark

I asked my right hon. Friend to give way earlier and he said that he would do so.

Mr. Ridley

I hope my hon. Friend will understand. He has not been present during the debate and I have to reply to other hon. Members who have spoken.

New clause 20 is an act of land nationalisation proposed as a new clause on Report by the Opposition. It is indeed an extraordinary proposition: that we are able to trust a company, subject to the full and proper regulation which we shall provide, to provide drinking water and dispose of sewage—functions of great importance—but we cannot trust it to own an acre of land. Just as the provision of water and sewerage services will be regulated, so already——

Dr. Cunningham

The Secretary of State says we cannot trust private enterprise to own an acre of land. It is not quite that simple. We are talking about selling to private enterprise 500,000 acres of land in national parks, areas of outstanding natural beauty and sensitive environments. The Opposition certainly do not trust private enterprise to look after that well.

Mr. Ridley

I am absolutely delighted that this Bill achieves the privatisation of nearly 500,000 acres of land. I am sure that my hon. Friends are just as pleased as I am. I can well understand the hon. Gentleman's sourness and chagrin that his backdoor nationalisation plan to get hold of this land is frustrated by this Bill—[Interruption.] This is what it is all about. It is about the Opposition wishing to nationalise as much land as possible. They have not heard of planning permission. They have not understood that land cannot be developed without planning permission, whether it belongs to a water authority, a privatised water company, the Government or a private individual. To ignore the strict paraphernalia of planning controls, particularly in a national park, shows the ignorance of the hon. Member for Copeland and the Labour party. Does the hon. Member for Copeland really want to change the NRA into a vast property company which is able to develop or sell land?

The Labour party's motive is not to protect the land —if that were so it would opt for planning. Its motive is to keep in public ownership as much land as it can. Clause four rides again—new clause 1 will kill it.

10.45 pm

Mrs. Ann Taylor

As the Prime Minister might say, the case for the Bill has been badly presented—again. The Secretary of State chose not to serve on the Standing Committee on the Water Bill, so today was his first opportunity since Second Reading to make an impact on the Bill. Following his performance this evening, we well understand that he can have a negative impact on the Bill and I wish him and his Minister well for any future opportunities that they have to present it to the country. The more the Government talk in the terms used by the Secretary of State today, the more the Opposition will benefit from the Government's privatisation plans.

Perhaps we should not be too surprised at the Secretary of State's contribution. The Prime Minister recently praised him for being a brilliant artist and civil engineer. I cannot comment on his artistic talent—my hon. Friend the Member for Copeland (Dr. Cunningham) assures me that he is a good artist—but I trust that in his retirement he will find plenty of time to practise that hobby. I was interested to read in the New Civil Engineer, the magazine of the Institution of Civil Engineers, that the Secretary of State —[Interruption.] The Prime Minister has been talking about the Bill and about the Secretary of State's talents. As we missed him in Committee, we should spend a minute——

Sir Anthony Grant

On a point of order, Mr. Deputy Speaker. Is this relevant to the new clause?

Mr. Deputy Speaker

I am sure that the hon. Member for Dewsbury (Mrs. Taylor) will have regard to what has been said.

Mrs. Taylor

I have a great deal of regard to the relevance of civil engineering to the water industry. As one who is married to a civil engineer and knows the work of the profession in this industry, I was interested to read that the Secretary of State has not been a member of the Institution of Civil Engineers since the 1970s. Clearly, the Prime Minister is nearly as far behind the times as the Secretary of State.

I shall return to the specific amendment about which the Secretary of State eventually said a word or two. The Opposition support the new clauses because they wish to strengthen the National Rivers Authority and to make it work in practice. We should not forget how the NRA came about. When the Secretary of State spoke earlier, it seemed as though his mind was playing tricks on him. He seemed to think that the NRA had emerged from his own mind, with no suggestions from anyone else. Perhaps he has forgotten that the original water privatisation proposals made no mention of the National Rivers Authority. It was only when the Labour party and other environmentalist and conservationist groups put pressure on the right hon. Gentleman ——

Mr. Ridley

The hon. Lady must do better than that. She may not be aware that I did not make the original proposals.

Mrs. Taylor

The right hon. Gentleman is right about that, but he took them over and I did not notice him dissenting from the original Conservative proposals. Anyone who believes that the Government or their Ministers are green has a lot to learn. I am sure that, on reflection, the Secretary of State—and certainly the Minister—will wish that these privatisation proposals had suffered the same fate as the previous ones, and had been withdrawn late one Thursday evening to put Ministers out of their misery.

The National Rivers Authority was introduced into the proposals only to make them less unpalatable, and to appease all the interest groups which were so opposed to them. At present the authority is not strong enough. Opposition Members are not alone in saying that. Anglers, environmentalists, conservationists and the Council for the Protection of Rural England—all of whom have studied the Bill carefully—agree with us, as do one or two Conservative Members. They support the principle of the NRA but feel that it is too weak.

There is no doubt about the need for a strong body to counter the pollution problem. Incidents of pollution have doubled in the past 10 years under the present Government, and river quality has declined for the first time since records began. We feel—this is why we have tabled new clause 1—that it is time to get tougher with the polluters and to stop turning a blind eye to the problem.

We have heard this evening of problems in many different parts of the country. I consider my part of Yorkshire to be typical. Last year, 140 companies broke their consents with regard to pollution. Many of them were big companies such as British Steel, British Coal, BP, Tarmac and many large chemical firms. Some exceeded their permitted limits by 100 times, but only a tiny fraction were prosecuted. As the hon. Member for Brecon and Radnor (Mr. Livsey) pointed out, on a national basis only 1 per cent. are prosecuted.

Mr. Ridley

To a large extent I agree with the hon. Lady, but if she wants those things put right, why does she oppose the Bill when that is what it will do?

Mrs. Taylor

The Secretary of State is well aware of the offer that the Opposition have made, and have repeated on several occasions. We will support the establishment and, indeed, the strengthening of the National Rivers Authority because that, rather than privatisation, is the way to deal with pollution.

In recent years many polluters have made the simple decision that it is cheaper to flout the law—even if they are caught—than to invest in avoiding pollution. We all pick up the bill in our water rates while the polluter gets off lightly. The Government's attitude, agreed with the water authorities, has been to try to persuade the polluters to be good boys, but that strategy simply has not worked. Now the Government are pushing it further by not allowing the National Rivers Authority to take decisions. The Government are pre-empting the role of the NRA by inviting water authorities to reduce standards of sewage treatment plants in advance of privatisation and the establishment of the NRA.

In a letter dated 21 November 1988, the Department invited water authorities to apply for relaxations for many treatment plants which were breaching consents. Last month, a near-frantic letter pleaded with local authorities to submit plans not for the improvement of those treatment plants but for relaxations to let treatment plants in breach of consents off the hook. Although we questioned the Minister frequently in Committee, he has given no date by which he guarantees that improvements in those treatment plants will be achieved. In all our discussions in Committee and in the answers that the Minister has been forced to supply, little attention has been paid to the reasons why sewage treatment plants are unable to meet their targets and are breaching their consents. It is often trade effluent which overloads the system. New clause 1, which establishes the principle that the polluter pays, will help to prevent that. On selected occasions Ministers have used and promoted that principle, but they are not consistent and cite it only when it suits them.

Some Conservative Members have reservations about the principle that the polluters should pay. This evening we learned that the hon. Member for Pudsey (Sir G. Shaw) has reservations even about the existence of the National Rivers Authority. That is not surprising as he is chairman, or at least a member of the privatisation steering committee which has been advising and assisting the Conservative-appointed chairmen of the water authorities on how to deal with privatisation. As my hon. Friend the Member for Copeland pointed out earlier, the water chairmen are gearing up for privatisation. It is therefore not surprising that the hon. Gentleman resists new clause 1. A letter from the secretary of the Water Authorities Association states: Any further strengthening of the regulatory framework now put forward would have significantly adverse consequences for the successful management of the privatised company. The CBI has been briefing Conservative Members and its latest brief makes clear what it wants: We are seeking to ensure that the Government does not create a situation which would be completely unacceptable to all those discharging trade effluents". That gets to the nub of the Government's resistance. A strong NRA and a strong regulatory framework will affect profits. The hon. Member for Pudsey was more honest than the Minister about that.

Perhaps the Secretary of State was more honest than he has been throughout the proceedings of the Bill when he intervened in the speech of my hon. Friend the Member for Copeland. When my hon. Friend referred to new clause 20, which suggests that the water authorities' land should, if privatisation goes ahead, pass to the National Rivers Authority, rather than to the water companies so as to ensure that the land stays in the public sector, the Secretary of State asked what was to stop the NRA developing the land. His first thought was not whether the Bill would provide better protection for the land, but whether the NRA would be able to develop the land. The Bill is about making money out of developing that land. The Secretary of State let the cat out of the bag this evening. He should retitle the Bill because it is not about water privatisation, but about the privatisation of the assets of the water authorities.

It being Eleven o'clock, MR. DEPUTY SPEAKER proceeded, pursuant to the order [6 February] and the Resolution this day, to put forthwith the Question already proposed from the Chair, That the clause be read a Second time:—

The House divided: Ayes 222, Noes 316.

Division No.126]	[11 pm
AYES
Abbott, Ms Diane	Faulds, Andrew
Adley, Robert	Fearn, Ronald
Allason, Rupert	Field, Frank (Birkenhead)
Allen, Graham	Fields, Terry (L'pool B G'n)
Anderson, Donald	Fisher, Mark
Archer, Rt Hon Peter	Flannery, Martin
Armstrong, Hilary	Flynn, Paul
Ashley, Rt Hon Jack	Foster, Derek
Banks, Tony (Newham NW)	Foulkes, George
Barnes, Harry (Derbyshire NE)	Fraser, John
Barnes. Mrs Rosie (Greenwich)	Fyfe, Maria
Battle. John	Galbraith, Sam
Beaumont-Dark, Anthony	Galloway, George
Beckett, Margaret	Garrett, John (Norwich South)
Beith, A. J.	George, Bruce
Benn, Rt Hon Tony	Gilbert, Rt Hon Dr John
Bennett, A. F. (D'nt'n & R'dish)	Godman, Dr Norman A.
Bermingham, Gerald	Golding, Mrs Llin
Bidwell, Sydney	Gordon, Mildred
Blair, Tony	Graham, Thomas
Blunkett, David	Grant, Bernie (Tottenham)
Boyes, Roland	Griffiths, Nigel (Edinburgh S)
Bradley, Keith	Griffiths, Win (Bridgend)
Bray, Dr Jeremy	Grocott, Bruce
Brown, Gordon (D'mline E)	Harman, Ms Harriet
Brown, Nicholas (Newcastle E)	Hattersley, Rt Hon Roy
Bruce, Malcolm (Gordon)	Healey, Rt Hon Denis
Buckley, George J.	Heffer, Eric S.
Caborn, Richard	Henderson, Doug
Callaghan, Jim	Hinchliffe, David
Campbell, Ron (Blyth Valley)	Hogg, N. (C'nauld & Kilsyth)
Campbell-Savours, D. N.	Home Robertson, John
Cartwright, John	Hood, Jimmy
Clark, Dr David (S Shields)	Howarth, George (Knowsley N)
Clarke, Tom (Monklands W)	Howell, Rt Hon D. (S'heath)
Clay, Bob	Howells, Geraint
Clelland, David	Howells, Dr. Kim (Pontypridd)
Clwyd, Mrs Ann	Hoyle, Doug
Coleman, Donald	Hughes, John (Coventry NE)
Cook, Frank (Stockton N)	Hughes, Robert (Aberdeen N)
Cook, Robin (Livingston)	Hughes, Roy (Newport E)
Corbett, Robin	Hughes, Sean (Knowsley S)
Corbyn, Jeremy	Illsley, Eric
Cousins, Jim	Ingram, Adam
Crowther, Stan	Janner, Greville
Cryer, Bob	Johnston, Sir Russell
Cummings, John	Jones, Barry (Alyn & Deeside)
Cunliffe, Lawrence	Jones, Ieuan (Ynys Môn)
Cunningham, Dr John	Jones, Martyn (Clwyd S W)
Dalyell, Tam	Kennedy, Charles
Darling, Alistair	Kinnock, Rt Hon Neil
Davies, Rt Hon Denzil (Llanelli)	Kirkwood, Archy
Davies, Ron (Caerphilly)	Leadbitter, Ted
Davis, Terry (B'ham Hodge H'I)	Leighton, Ron
Dewar, Donald	Lestor, Joan (Eccles)
Dixon, Don	Lewis, Terry
Dobson, Frank	Litherland, Robert
Doran, Frank	Livsey, Richard
Douglas, Dick	Lloyd, Tony (Stretford)
Dunnachie, Jimmy	Lofthouse, Geoffrey
Dunwoody, Hon Mrs Gwyneth	Loyden, Eddie
Eadie, Alexander	McAllion, John
Eastham, Ken	McAvoy, Thomas
Evans, John (St Helens N)	McCartney, Ian
Ewing, Mrs Margaret (Moray)	Macdonald, Calum A.
Fatchett, Derek	McFall, John

McKay, Allen (Barnsley West)	Rooker, Jeff
McKelvey, William	Ross, Ernie (Dundee W)
McLeish, Henry	Rowlands, Ted
McNamara, Kevin	Ruddock, Joan
McTaggart, Bob	Salmond, Alex
McWilliam, John	Sedgemore, Brian
Madden, Max	Sheerman, Barry
Mahon, Mrs Alice	Sheldon, Rt Hon Robert
Marek, Dr John	Shore, Rt Hon Peter
Marshall, David (Shettleston)	Short, Clare
Marshall, Jim (Leicester S)	Skinner, Dennis
Martin, Michael J. (Springburn)	Smith, Andrew (Oxford E)
Martlew, Eric	Smith, C. (Isl'ton & F'bury)
Maxton, John	Smith, Rt Hon J. (Monk'ds E)
Maxwell-Hyslop, Robin	Snape, Peter
Meacher, Michael	Soley, Clive
Meale, Alan	Spearing, Nigel
Michael, Alun	Steel, Rt Hon David
Michie, Bill (Sheffield Heeley)	Steinberg, Gerry
Mitchell, Austin (G't Grimsby)	Stott, Roger
Moonie, Dr Lewis	Strang, Gavin
Morgan, Rhodri	Straw, Jack
Morley, Elliott	Taylor, Mrs Ann (Dewsbury)
Morris, Rt Hon A. (W'shawe)	Turner, Dennis
Mowlam, Marjorie	Vaz, Keith
Mullin, Chris	Wall, Pat
Murphy, Paul	Wallace, James
Nellist, Dave	Walley, Joan
Oakes, Rt Hon Gordon	Wardell, Gareth (Gower)
O'Brien, William	Wareing, Robert N.
Orme, Rt Hon Stanley	Welsh, Andrew (Angus E)
Owen, Rt Hon Dr David	Welsh, Michael (Doncaster N)
Patchett, Terry	Wigley, Dafydd
Pendry, Tom	Williams, Rt Hon Alan
Pike, Peter L.	Williams, Alan W. (Carm'then)
Powell, Ray (Ogmore)	Wilson, Brian
Quin, Ms Joyce	Winnick, David
Radice, Giles	Winterton, Mrs Ann
Randall, Stuart	Winterton, Nicholas
Redmond, Martin	Wise, Mrs Audrey
Rees, Rt Hon Merlyn	Worthington, Tony
Reid, Dr John	Wray, Jimmy
Richardson, Jo	Young, David (Bolton SE)
Roberts, Allan (Bootle)
Robertson, George	Tellers for the Ayes:
Robinson, Geoffrey	Mr. Frank Haynes and
Rogers, Allan	Mr. Allen Adams.

NOES
Aitken, Jonathan	Bowden, A (Brighton K'pto'n)
Alexander, Richard	Bowden, Gerald (Dulwich)
Alison, Rt Hon Michael	Bowis, John
Amery, Rt Hon Julian	Boyson, Rt Hon Dr Sir Rhodes
Amess, David	Brandon-Bravo, Martin
Amos, Alan	Brazier, Julian
Arbuthnot, James	Bright, Graham
Arnold, Jacques (Gravesham)	Brooke, Rt Hon Peter
Arnold, Tom (Hazel Grove)	Brown, Michael (Brigg & Cl't's)
Ashby, David	Browne, John (Winchester)
Aspinwall, Jack	Bruce, Ian (Dorset South)
Atkins, Robert	Buchanan-Smith, Rt Hon Alick
Baker, Rt Hon K. (Mole Valley)	Buck, Sir Antony
Baker, Nicholas (Dorset N)	Budgen, Nicholas
Baldry, Tony	Burt, Alistair
Banks, Robert (Harrogate)	Butcher, John
Batiste, Spencer	Butler, Chris
Bellingham, Henry	Butterfill, John
Bendall, Vivian	Carlisle, John, (Luton N)
Bennett, Nicholas (Pembroke)	Carlisle, Kenneth (Lincoln)
Benyon, W.	Carrington, Matthew
Bevan, David Gilroy	Carttiss, Michael
Biffen, Rt Hon John	Cash, William
Blackburn, Dr John G.	Channon, Rt Hon Paul
Blaker, Rt Hon Sir Peter	Chapman, Sydney
Body, Sir Richard	Chope, Christopher
Bonsor, Sir Nicholas	Churchill, Mr
Boscawen, Hon Robert	Clark, Dr Michael (Rochford)
Boswell, Tim	Clarke, Rt Hon K. (Rushcliffe)
Bottomley, Peter	Colvin, Michael
Bottomley, Mrs Virginia	Conway, Derek

Coombs, Anthony (Wyre F'rest)	Heathcoat-Amory, David
Coombs, Simon (Swindon)	Henderson, Doug
Cope, Rt Hon John	Heseltine, Rt Hon Michael
Cormack, Patrick	Hicks, Mrs Maureen (Wolv' NE)
Couchman, James	Hicks, Robert (Cornwall SE)
Cran, James	Hinchliffe, David
Currie, Mrs Edwina	Hind, Kenneth
Curry, David	Holland, Stuart
Davies, Q. (Stamf'd & Spald'g)	Hood, Jimmy
Davis, David (Boothferry)	Hordern, Sir Peter
Day, Stephen	Howard, Michael
Devlin, Tim	Howarth, G. (Cannock & B'wd)
Dicks, Terry	Howell, Rt Hon David (G'dford)
Dorrell, Stephen	Howell, Ralph (North Norfolk)
Douglas-Hamilton, Lord James	Hughes, Robert G. (Harrow W)
Dover, Den	Hunt, David (Wirral W)
Dunn, Bob	Hunt, John (Ravensbourne)
Durant, Tony	Hunter, Andrew
Dykes, Hugh	Hurd, Rt Hon Douglas
Eggar, Tim	Irvine, Michael
Evans, David (Welwyn Hatf'd)	Irving, Charles
Fallon, Michael	Jack, Michael
Favell, Tony	Jackson, Robert
Fenner, Dame Peggy	Janman, Tim
Field, Barry (Isle of Wight)	Jessel, Toby
Fishburn, John Dudley	Jones, Gwilym (Cardiff N)
Forman, Nigel	Jones, Robert B (Herts W)
Forsyth, Michael (Stirling)	Jopling, Rt Hon Michael
Forth, Eric	Kellett-Bowman, Dame Elaine
Fowler, Rt Hon Norman	Key, Robert
Fox, Sir Marcus	Kilfedder, James
Franks, Cecil	King, Roger (B'ham N'thfield)
Freeman, Roger	Kirkhope, Timothy
French, Douglas	Knapman, Roger
Fry, Peter	Knight, Greg (Derby North)
Gale, Roger	Knight, Dame Jill (Edgbaston)
Gardiner, George	Knowles, Michael
Gill, Christopher	Knox, David
Glyn, Dr Alan	Lamont, Rt Hon Norman
Goodhart, Sir Philip	Lang, Ian
Goodlad, Alastair	Latham, Michael
Goodson-Wickes, Dr Charles	Lawrence, Ivan
Gorman, Mrs Teresa	Lawson, Rt Hon Nigel
Gorst, John	Lee, John (Pendle)
Gow, Ian	Leigh, Edward (Gainsbor'gh)
Grant, Sir Anthony (CambsSW)	Lennox-Boyd, Hon Mark
Greenway, Harry (Ealing N)	Lester, Jim (Broxtowe)
Greenway, John (Ryedale)	Lilley, Peter
Gregory, Conal	Lloyd, Sir Ian (Havant)
Griffiths, Peter (Portsmouth N)	Lloyd, Peter (Fareham)
Ground, Patrick	Lord, Michael
Grylls, Michael	Luce, Rt Hon Richard
Hague, William	Lyell, Sir Nicholas
Hamilton, Neil (Tatton)	McCrindle, Robert
Hampson, Dr Keith	Macfarlane, Sir Neil
Hanley, Jeremy	MacKay, Andrew (E Berkshire)
Hannam, John	Maclean, David
Hargreaves, A. (B'ham H'Il Gr')	McLoughlin, Patrick
Harman, Ms Harriet	McNair-Wilson, Sir Michael
Harris, David	McNair-Wilson, P. (New Forest)
Hattersley, Rt Hon Roy	Madel, David
Hawkins, Christopher	Major, Rt Hon John
Hayes, Jerry	Malins, Humfrey
Haynes, Frank	Mans, Keith
Heath, Rt Hon Edward	Maples, John

Marlow, Tony	Shephard, Mrs G. (Norfolk SW)
Marshall, John (Hendon S)	Shepherd, Colin (Hereford)
Marshall, Michael (Arundel)	Shersby, Michael
Martin, David (Portsmouth S)	Sims, Roger
Mates, Michael	Skeet, Sir Trevor
Maude, Hon Francis	Smith, Tim (Beaconsfield)
Mellor, David	Soames, Hon Nicholas
Miller, Sir Hal	Speller, Tony
Mills, Iain	Spicer, Sir Jim (Dorset W)
Miscampbell, Norman	Spicer, Michael (S Worcs)
Mitchell, Andrew (Gedling)	Squire, Robin
Mitchell, Sir David	Stanbrook, Ivor
Moate, Roger	Stanley, Rt Hon Sir John
Monro, Sir Hector	Steen, Anthony
Montgomery, Sir Fergus	Stern, Michael
Moore, Rt Hon John	Stevens, Lewis
Morris, M (N'hampton S)	Stewart, Allan (Eastwood)
Morrison, Sir Charles	Stewart, Andy (Sherwood)
Moss, Malcolm	Stewart, Rt Hon Ian (Herts N)
Moynihan, Hon Colin	Stradling Thomas, Sir John
Neale, Gerrard	Sumberg, David
Nelson, Anthony	Tapsell, Sir Peter
Neubert, Michael	Taylor, Ian (Esher)
Nicholls, Patrick	Taylor, John M (Solihull)
Nicholson, David (Taunton)	Taylor, Teddy (S'end E)
Nicholson, Emma (Devon West)	Tebbit, Rt Hon Norman
Norris, Steve	Temple-Morris, Peter
Onslow, Rt Hon Cranley	Thatcher, Rt Hon Margaret
Oppenheim, Phillip	Thompson, D. (Calder Valley)
Page, Richard	Thompson, Patrick (Norwich N)
Paice, James	Thorne, Neil
Parkinson, Rt Hon Cecil	Thurnham, Peter
Patnick, Irvine	Townend, John (Bridlington)
Patten, Chris (Bath)	Townsend, Cyril D. (B'heath)
Patten, John (Oxford W)	Tracey, Richard
Pattie, Rt Hon Sir Geoffrey	Tredinnick, David
Pawsey, James	Trippier, David
Porter, Barry (Wirral S)	Trotter, Neville
Porter, David (Waveney)	Twinn, Dr Ian
Portillo, Michael	Vaughan, Sir Gerard
Powell, William (Corby)	Waddington, Rt Hon David
Price, Sir David	Wakeham, Rt Hon John
Raffan, Keith	Waldegrave, Hon William
Raison, Rt Hon Timothy	Walden, George
Rathbone, Tim	Waller, Gary
Redwood, John	Wardle, Charles (Bexhill)
Rhodes James, Robert	Warren, Kenneth
Riddick, Graham	Watts, John
Ridley, Rt Hon Nicholas	Wells, Bowen
Ridsdale, Sir Julian	Wheeler, John
Rifkind, Rt Hon Malcolm	Whitney, Ray
Roberts, Wyn (Conwy)	Widdecombe, Ann
Roe, Mrs Marion	Wiggin, Jerry
Rossi, Sir Hugh	Wilshire, David
Rost, Peter	Wolfson, Mark
Rowe, Andrew	Wood, Timothy
Rumbold, Mrs Angela	Woodcock, Mike
Sackville, Hon Tom	Yeo, Tim
Sainsbury, Hon Tim	Young, Sir George (Acton)
Sayeed, Jonathan
Scott, Nicholas	Tellers for the Noes:
Shaw, David (Dover)	Mr. Tristan Garel-Jones and
Shaw, Sir Giles (Pudsey)	Mr. David Lightbown.
Shaw, Sir Michael (Scarb')

Question accordingly negatived.