HC Deb 30 November 1994 vol 250 cc1193-5
8. Mrs. Helen Jackson

To ask the Secretary of State for the Environment what representation he has received from the water industry about future charging arrangements for water and sewerage.

Mr. Atkins

As the hon. Member knows, the water industry associations have recently presented to Ministers their views about future methods of charging for water and sewerage services which are being considered.

Mrs. Jackson

Does the Minister recognise that in an industry where there is not usually political consensus, there is consensus—apart from the Government Front Bench and the Director General of Ofwat—that, because water and sewerage are public services, it is both fair and sensible to allow water companies to continue to use the local taxation base as a reasonable core charging method? Will he respond positively to the document which was presented to him by the water industry associations and say that they can use council tax data for their charging systems? Will he do that as soon as possible?

Mr. Atkins

The hon. Lady and other Opposition Members must realise that, if they believe as much as we do in sustainable development of a natural resource, it is logical that a cost must be levied on the basis of consumption. That is the case with gas and electricity, and I do not see how water is any different.

It is crucial that we make the right decision. The water industry associations and others, including the hon. Lady, have presented their views to us. I give the hon. Lady an undertaking that my right hon. Friend and I will make a decision as quickly as we can.

Mr. Ian Bruce

Will my hon. Friend think very carefully before moving to increase metering? I hate to agree with the hon. Member for Sheffield, Hillsborough (Mrs. Jackson), but there appears to be a great deal of evidence that water companies bear costs in the area of distribution of water as opposed to production of water. Therefore, the additional costs that may be added because of the introduction of metering might be out of all proportion to the benefit to consumers. If people were to reduce the amount of water they use, the price of water per gallon might rise dramatically. I hate to think what the political implications would be if we went ahead with metering.

Mr. Atkins

My hon. Friend recognises, as we all do, that there is no party political division in this area; there is no dogma on this matter. Opposition Members keep telling us about the need for sustainable development and an environmental approach, but they seem to fly in the face of the logic of that stance, which is that cost should be based on consumption. If that is the case, metering is the logical answer.

I recognise that there are other views, and we will make a decision on the basis of people's thoughts and concerns in due course.

Mr. Matthew Taylor

Does the Minister accept that, if he decides to go ahead with compulsory water metering across the country, that cannot be brought into effect to meet the present time scale for ending charging on the old rating system? Therefore, would it not make sense to allow that system to be updated by using council tax to ensure a modern system with up-to-date values? That would open the possibility of providing help to people on low incomes and those who live alone, particularly those with high water charges, on the same basis as the council tax.

Mr. Atkins

The hon. Gentleman and his party spend a lot of time preaching at us about the environment and about sustainable development. As I said to the hon. Member for Sheffield, Hillsborough (Mrs. Jackson) earlier, if we believe in the policy there has to be a consumption-related tax. Frankly, when it comes to water matters, I take less notice of what Liberal Members say than anyone else in the House.

Mr. Dobson

Why do the Government insist that it would be right for everyone in the country to be forced to have a water meter and to find the cost of installing that meter? The public have made it clear that they do not want meters. The water companies have now described it as an untenable option. Why do not the Government abandon the idea and allow the companies to charge instead on the basis of council tax bands or rateable values? Only the Government and the water regulator persist in believing that compulsory metering is right. We have to start asking whose side the water regulator is on: the Government or the public?

Mr. Atkins

When the hon. Gentleman has been doing the job a little longer, he will understand the complexities of the matter. Then he will realise that the logic of his policy, as often declared, to support sustainable development of scarce and declining resources is to ensure that consumption is the factor, just as it is with gas and electricity. There is no compulsion as the matter stands. There are alternatives, and people have the opportunity to take them up. I suggest that the hon. Gentleman reads the subject up and then talks to me. I will tell him what it is all about.

Mr. Harry Greenway

Bearing in mind the intense hardship to people whose water is cut off for non-payment or other reasons, will my hon. Friend join me in welcoming the fact that fewer people are cut off nowadays? Will he undertake to initiate research which will ensure that every possible step is taken before people are cut off, including finding other ways of paying their bills, perhaps through social security or in one way or another?

Mr. Atkins

My hon. Friend is right to say that disconnections are declining. The recent figures announced for this year showed a continuing decline. The process that has to be followed by a water company before it can obtain disconnection—a court order, several letters and various other requirements—means that disconnection does not take place unless it is the absolute ultimate sanction. All the evidence, certainly from research by the water companies among customers in my area in the north-west, suggests that the majority of customers, by which I mean a substantial percentage, wish to retain the option of disconnection as an ultimate sanction for non-payment.