Water and Sewerage Charges (Hansard, 15 March 1993)

§ 3. Mr. Madden
To ask the Secretary of State for Social Security if he will make it his policy to increase that proportion of income support paid to contribute towards water and sewerage charges.

§ The Parliamentary Under-Secretary for Social Security (Mr. Alistair Burt)
Water and sewerage charges are treated similarly to electricity and gas in that there is no separate identifiable proportion of income support.

§ Mr. Madden
Is it not about time that there was a specific, and substantial, amount? Is not the Minister worried that water disconnections are now running at the rate of 400 a week nationally, 50 a week in Yorkshire and 40 a week in the Minister's area? Is he not aware that, as water charges rocket, a large number of people on income support are having deductions made from their benefit to pay those charges? Is it not time for a ban on water disconnections in homes and an end to compulsory water metering?

§ Mr. Burt
In fact, the number of deductions made is about 3 per cent. of the total income support load, which shows that the vast majority of people are able to manage water charges. Water charges are analogous to electiricity and gas charges rather than to anything else. It is up to the water companies to make provision for low-income customers. Over the years, the electricity and gas companies have developed a variety of methods—often frequent payment methods—to help those on low incomes who might otherwise get into difficulties. The best way to prevent disconnections is for the water companies to follow that lead.

§ Mr. Jacques Arnold
Is not the important point the overall amount available to low-income families? Is not it a fact that income support for low-income families has gone well ahead of inflation in recent years?

§ Mr. Burt
Yes. The changes to income support made in the late 1980s enabled extra money to be channelled to low-income families. An extra £1 billion will have been spent by the end of the current year. The income support system, by providing premiums for disability and for families, tries to ensure that those who use more of a particular commodity, such as water, receive more money.

§ Mr. Kirkwood
The improvements made by the Government are welcome, as far as they go. However, does the Minister accept that water charges in the year to January 1993 went up by 10 per cent.compared with a 1.7 per cent. increase in the retail prices index? That position is set to worsen in the next 10 to 15 years as water authorities and local authorities in Scotland plan future capital investment in the water industry. Will the Minister at least consider the possibility of a formula or mechanism to take account of the drastic increases so that people who can hardly afford to buy food can at least afford water?

§ Mr. Burt
I am not sure that I can help the hon. Gentleman. As he knows, income support is not based on specific amounts for particular goods, simply because 4 people on low incomes want the opportunity that everyone else has to spend what they want on different commodities. A change to that system would be a massive administrative change and I am not convinced that it would work to the benefit of low-income families. The national proportion of deductions for water charges remains at about 3 per cent. which suggests that the majority can manage.
The difficulties that the hon. Gentleman mentioned with the increasing investment in water must be covered by the water companies and by their charging policies. The electricity and gas companies do that far better than the water companies. The Office of Water Services has recommended that all water companies should provide at least one frequent payment method. That would go some way towards alleviating the concern, which I share, expressed by the hon. Gentleman and others about disconnections.

§ Mr. John Marshall
Can my hon. Friend confirm that those on income support can look forward to an increase in their living standards in April because income support rates will rise by more than the rate of inflation? Can he also confirm that the introduction of the council tax will benefit those who are on community charge benefit and in receipt of income support?

§ Mr. Burt
Yes. The amount that was previously in income support to cover the 20 per cent. payment of community charge has not been clawed back. It will provide £750 million for low-income families—[Interruption.] Opposition Members may scoff; it shows what they think about amounts such as £750 million. Once again, large amounts are like water to them.

§ Mr. Spearing
In so far as there is support for the rapidly rising water charges, is not the Minister aware that those charges cover potential losses incurred by the water companies in any business in virtually any part of the world? Will he look into the matter and will he confirm, or otherwise, that those charges and public money will defray the possible losses incurred by the companies virtually anywhere?

§ Mr. Burt
The hon. Gentleman is straying somewhat from my responsibilities. As I said, responsibility for water charges rests with the water companies. There are different ways in which the companies can help low-income customers.