HL Deb 26 July 1977 vol 386 cc876-8

Page 1, line 14, leave out subsection (2) and insert—

"(2) Subject to subsection (5A) below, in relation to each statutory water undertaker by which, in the year ending 31st March 1976, a supply of water was provided on an unmeasured basis, the Secretary of State shall determine for the purposes of this Act the amount which appears to him to represent the value at that date of that part of the undertaker's assets which was then referable to the supply of water on an unmeasured basis.

(2A) In this section the "qualifying asset value" of a statutory water undertaker for any accounting period means the amount determined under subsection (2) above in relation to the undertaker, less such amount as appears to the Secretary of State to be appropriate in respect of depreciation for any previous accounting period or periods beginning on or after 1st April 1976.

(2B) Subject to subsection (2C) below, any reference in this Act to the relevant financing costs of a statutory water undertaker for any year is a reference to an amount which is determined by reference to the qualifying asset value of the undertaker for the corresponding accounting period and consists of the aggregate of—

  1. (a) such percentage (in this subsection referred to as "the qualifying percentage") of the interest payable by the undertaker in the corresponding accounting period as appears to the Secretary of State to be referable to indebtedness incurred with respect to assets whose value is reflected in the qualifying asset value for that period, and
  2. (b) so much of the provision for depreciation made by the undertaker in the corresponding accounting period as appears to the Secretary of State to be referable to any such assets, and
  3. (c) in the case of a statutory water company, the qualifying percentage of the franked payments, within the meaning of Part V of the Finance Act 1972, made by the company in the 877 corresponding accounting period, multiplied by the appropriate factor.

In this subsection the "appropriate factor" means the proportion which the average bill for general rates and water services in respect of premises to which a supply of water is provided by the undertaker on an unmeasured basis bears to the average bill for general rates and water services to such premises throughout England and Wales.

(2C) The amount ascertained under subsection (2B) above shall be reduced by any relief received in the corresponding accounting period through the rate support grant by premises to which a supply of water is provided by the undertaker on an unmeasured basis to the extent that such grant takes account of water supply charges.

(2D) For the purposes of this Act, in relation to the year 1978 or any subsequent year the corresponding accounting period of a statutory water undertaker is the accounting period of the undertaker which is co-terminous with or begins in that year."

The Commons agreed to this Amendment and proposed the following Amendments thereto:—

2 Page 1, line 14, Line 14, leave out "Subject to subsection (2C) below"

3 Page 1, line 14, Leave out lines 35 to 41.

4 Page 1, line 14, Leave out lines 42 to 47.

Lord STRABOLGI

My Lords, I beg to move that this House doth agree with the Commons in their Amendments Nos. 2, 3 and 4 to the Lords Amendment No. 1.

Moved, That this House doth agree with the Commons in their Amendments Nos. 2 to 4 en bloc to the Lords Amendment No. 1. —(Lord Strabolgi.)

Lord SANDFORD

My Lords, although there is not much to say I should like to say just a little. If the noble Baroness, Lady Birk, were here I would say rather more, but as she is not and it is near the end of term, I will not. It would be useful if the noble Lord, Lord Strabolgi, could let us know what are the reasons. It is rather unusual, except in respect of privilege Amendments, to give no reason at all for disagreeing to a Lords Amendment. All I should like to say is that from this side of the House we welcome very much the Government's decision to embrace the water companies into the water industry. Although they are still sticking to what we consider to be their mistaken view that the water companies are an anomaly and it is wrong in principle to have them there, they have been embraced into the industry, and for that we are grateful.

Lord STRABOLGI

My Lords, I am grateful to the noble Lord for what he has said. I will convey his remarks to my noble friend and I am sure she will communicate with him as soon as possible.

On Question, Motion agreed to.