HL Deb 14 November 1983 vol 444 cc1089-112

4.53 p.m.

Lord Ashby rose to move, That this House takes note of the report of the European Communities Committee on The Polluter Pays Principle (10th Report, 1982–83, H.L. 131).

The noble Lord said: My Lords, this report was prepared by Sub-Committee G of your Lordships' Select Committee and I should like to begin by thanking the chairman for inviting me to open this debate. On behalf of the committee, I should first like to thank the expert adviser who served the committee over a very intricate and difficult problem; and, secondly, I should like to pay tribute to the quality of the evidence, which your Lordships will find contains a very valuable record of what is an extremely complicated subject and one which will become very important.

The background is this. Just about 10 years ago, the Council of the European Communities approved an Action Programme on the Environment, which stated: the cost of preventing and eliminating nuisances must in principle be borne by the polluter. That was the beginning of the so-called polluter pays principle. In the third action programme of the Community, published only last December, this polluter pays principle has been re-emphasised. A number of memoranda have been issued about it, and there is no doubt that member states are already expected to harmonise their practice in accordance with the polluter pays principle.

That is why your Lordships' committee decided to examine this principle and to see how it is being operated in member states. It has been brought to the House for debate because it is an issue of very wide importance. It affects every discharge of wastes into the environment, from power stations to water closets. It is not merely a matter for industry. It is a matter for every citizen who uses the environment.

At first sight, the polluter pays principle seems so simple and obvious that everybody agrees about it, but it was soon found by the committee that it was anything but simple. We could not even get the witnesses to agree on how to define a polluter pays principle. To abate pollution is a good thing—nobody doubted that. But when is a river, or when is the air over a city, clean enough—that was a problem which had not been faced—and how are the costs to be met?

There are two criteria for what is clean enough. One, which is favoured by industry, is that the environment should be in what they call "an acceptable state". If I may quote the evidence given by the Chemical Industries Association, a polluting industry should be prepared to pay to abate its pollution, to the level that society…is prepared to tolerate". The other criterion, the one formally accepted by the Community, is that pollution should be abated to a level at which it causes no harm to health, or to living resources or ecological systems, or damage to amenity. On this criterion, somebody has to decide what is this level that causes no harm, and there is very rarely sufficient scientific evidence for making such a decision. In England and Wales, the goals for the quality of a river are set by the regional water authority, and for the quality of the air they are set indirectly, through controlling emissions of smoke and gases, either by local authorities or by the industrial air pollution inspectorate. But these goals are not set by deduction from scientific evidence; they are set by a mixture of expediency and hunch.

The goals vary from place to place, even within member states, but the committee found a general agreement throughout the Community that some authority or other must set limits to the exploitation of the environment. Indeed, the Community has been busy for the last 10 years doing just that. The controversies that we have had have been about how the limits are to be set. Is it the quality of the air and the water that has to be acceptable, or is it the concentrations of wastes being put into them that have to be acceptable? And how are the costs to be met and who is to meet them? It is here that the issues become controversial.

Let me give your Lordships one example from evidence given by the Chemical Industries Association and the Confederation of British Industry over the discharge of wastes into rivers. Industry is willing to pay for wastes put into a public sewer to be purified by the water authority. This, of course, is payment for a service. Industry is also willing to pay to purify its own wastes before putting them into a river to meet the consent conditions imposed by the water authority. That is to comply with the law. But industry insists that any pollutant discharged within the consent conditions—it is called residual pollution—should not be paid for. The fact that consent has been given is regarded as a statement that that degree of pollution is socially acceptable.

Some of the member states do not take this view. In France, Germany and the Netherlands, industry is made to pay for all discharges into rivers. In addition, limits are set to the total pollution load that the river can receive. The charges collected in this way are used to improve the quality of the river, sometimes by way of subsidies or grants in aid. The main issue before the committee was whether the British style and method of control, through consents to discharge into water and presumptive emission standards for discharges into air, should be supplemented or perhaps even replaced by a direct tax on residual pollution.

Some economists believe that a direct tax on pollution is all that is needed—that the most efficient way to control pollution is just to leave it to market forces alone—for example, to sell or auction pollution rights. The committee could find no evidence to support this belief from the practice in other member states. The charge system in these member states does no more than supplement control by regulation, not unlike the regulation we have here. So, faced with a principle—and it is a principle—whether to control by regulation or to leave it to market forces alone, the committee rejected any move to replace regulation totally by taxation or by selling pollution rights.

The committee then considered whether Britain should adopt a supplementary system of charging for the use of the environment. The first question they asked the witnesses was whether the difference between the British system and those on the Continent was causing distortion of trade. On this one point the committee did receive a clear answer: there is no convincing evidence of distortion of trade. This seems rather surprising, in view of the fact that industry in some member states is paying for all its discharges and sometimes is even getting subsidies and tax allowances for abating pollution. We do not know what the explanation for that apparent inconsistency is. It may be just that abatement costs are small compared with total costs. Or it may be an interesting and more subtle reason; namely, that Britain has gone much further than have other states in dealing in the public sector with the back log of pollution.

To give your Lordships an example, 95 per cent. of our population in the United Kingdom is served by sewers, compared with only 50 per cent. in France, and in Britain sewage treatment removes 77 per cent. of the sewer load compared with only 32 per cent. in France. Industries discharging into sewers belonging to the water authorities are already paying for that service, and these payments may match the payments being made elsewhere for direct discharges. But the point your committee want to make is that we just do not know. We just have not got the necessary information.

If there is no evidence of distortion of trade, are there any other arguments for introducing supplementary charges into the United Kingdom for polluting air, water and land? Your committee did set out one argument in paragraph 48 of their report: The criterion of what is a socially unacceptable level of pollution has changed dramatically over the last 50 years and is likely to continue to change". Therefore, there is a need for a mechanism to improve the quality of the environment beyond what is acceptable today so that it can be made to meet the expectations of what will be acceptable tomorrow. This could be done in three ways: either by levying charges as an inducement to pollute less, or by offering subsidies, or simply by stiffening the standards required by regulation. All three of these mechanisms have been used on the Continent but the committee could get no convincing evidence as to how effective they are. But, even without hard evidence of the value of charges for pollution, they may be one way to remind the public that air and water can no longer be regarded as free goods. Your committee in paragraph 50 make one statement which they hope the Government will take very seriously: It should no longer be assumed by industry"— and, for that matter, by householders— that free use of the environment as a sink should be permitted as a right". On this ground there is a case for considering charges in some circumstances in a supplementary way in order to hasten the improvement of conditions in the environment.

The committee asked the National Water Council whether this would he feasible. They are not enthusiastic about charging systems but they did tell the committee that it would be feasible to levy charges based on the consent conditions negotiated with each industrial plant. In any case, it would seem reasonable to expect those who discharge directly into air and water to be prepared to pay something to cover the costs of monitoring pollution levels, which has to be done by public authorities financed by the taxpayer.

Then, over subsidies offered to industry to abate pollution, the committee know that they have not been used in Britain to improve the quality of air or water, although they are offered as incentives for abating noise pollution, to recover derelict land and to help individual householders to convert to smokeless fuel. The Department of the Environment, in evidence, implied that they would not be against subsidies if the need for them could be demonstrated, but this is what they added: no environmental problems have (as yet) been perceived where the need for action to secure compliance with standards has been so acute that industry would not reasonably be expected to bear the cost Your committee were not impressed by this statement, and they recommend in paragraph 46, which I personally think is an understatement on behalf of the committee, that a somewhat less rigorous attitude to subsidies for pollution control purposes might be adopted.

Although much has been done, the committee would like to dispel any impression of complacency about the application of the polluter pays principle in the United Kingdom. Industry does indeed pay for the costs of compliance with standards set by regulation, but this is no guarantee that the polluter pays principle is being followed if the standards are then relaxed. The Environmental Data Services in their evidence to us gave examples where polluters were damaging the environment without paying for the damage. For instance, chronic pollution from intensive livestock units has, according to the 1980 River Qualities Survey: led to the downgrading of stretches of hitherto unpolluted water courses by five regional water authorities". Also, there are some serious kinds of pollution where the costs are certainly not being met. For instance, the Association of County Councils told the committee, over marine pollution, that: The proportion of the costs of clearing the mess made by pollution on sea coasts recovered for polluters was … less than 8 per cent. The main impression left with the committee over the polluter pays principle in other member states was that there is no harmonisation between their practices—and certainly they offer no model to be adopted in the United Kingdom. What is urgently needed—and this was put in the admirably lucid statement the committee received from the National Water Council—is something which that council called "transparency"; a clear understanding by each member state of the way in which other member states operate a polluter pays principle so that valid comparisons can be made. At present, the committee find that even the Commission itself in Brussels does not fully understand how the member states are operating the polluter pays principle. Your committee suspect that the Department of the Environment is in a somewhat similar condition.

We could begin by being more transparent about the way in which we operate the principle in Britain, for there are at present two incompatible policies for setting standards. On the one hand, there is the system of consents based on that which is regarded as socially acceptable for the rivers. On the other hand, there is the approval made by the Government in their response to the Fifth Report of the Royal Commission on Environmental Pollution of the "best practicable environmental option" as the basis of environmental policy. An extension of the policy of "best practicable environmental option" to discharges into rivers would be likely to lead to a great stiffening of consents by water authorities. If that policy were followed, it might be an even more effective way to improve enviromental quality than charges would be.

It is because there are so many unresolved questions, and so much plain ignorance, about he application of the polluter pays principle that the committee have no crisp recommendation to make to the House. They hope that the House is now persuaded that the polluter pays principle is not simple. The committee have only one recommendation: it is, that the Department of the Environment should give much more serious attention than it has been giving to four issues.

They are, first, the need to base environmental policy on the principle that air and water are not free goods and that no one—householder or industrialist—has a right to discharge wastes into the environment and not expect to pay. Secondly, that the use of subsidies in some special cases where it is important to improve the quality of the environment should be given further consideration. The great cleanup proposed by the North West Water Authority is a possible case in point. Thirdly, firm action should be taken where the costs of pollution are certainly not being met by the polluters—I have quoted the livestock industry discharging into some rivers and polluted beaches. Finally, that there should be a much more thorough understanding of the ways in which member states interpret the polluter pays principle than your committee were able to discover, even after taking evidence for some months.

If we can do that, and if the Department of the Environment can clarify the issues much more than it was able to do when it gave its evidence to the committee, then, if practices are efficient, we can stick to them. If they are not efficient, then we shall know how to adapt in a way that will harmonise with the rest of the Community. I beg to move.

Moved, That this House takes note of the report of the European Communities Committee on The Polluter Pays Principle. … (Lord Ashby.)

5.15 p.m.

Baroness Birk

My Lords, I should first like to thank the noble Lord, Lord Ashby, for initiating this debate on the report of the European Communities Committee on The Polluter Pays Principle, and for his lucid explanation. It is an excellent report—something the noble Lord was too modest to say, being himself a member of the committee. The committee obviously encountered a great many difficulties, to which the noble Lord has pointed, in getting answers to some very difficult questions. One of the great values of this report is that it is the only report, and the first report in the Community, to study the subject so thoroughly. I am quite sure that the report will be considered as a source of guidance to the Community and will be very much welcomed by the Commission in Brussels.

The report draws our attention to some very important issues, as the noble Lord has pointed out, which concern not only our present quality of life but also that of future generations. We have a collective responsibility to ensure that the environment in which we live is both preserved and improved for those who will have to bear the consequences of our present decisions on environmental policy. That is an integral part of our own quality of life. We can no longer treat the environment as though it were capable of infinitely absorbing waste materials and other unwanted substances. The report concludes: It should no longer be assumed by industry that free use of the environment as a sink should be permitted as a right". I was delighted that the noble Lord, Lord Ashby, underlined that point in his own speech. It is to the problem of how to encourage industry to "internalise" the social costs of production that we are addressing ourselves today.

There is a choice between what Professor Dasgupta describes in the report as "two polar modes of regulating industry": on the one hand, regulations limiting the amount that firms can emit into the environment'", and, on the other, a taxation system per unit emitted". In fact, I do not see the choice as being a stark one but one of carefully selecting the optimum balance between regulations, on the one hand, and charging, on the other. According to the report, The evidence indicated that, in practical application, a charging system must be accompanied by controls establishing levels of discharge, irrespective of payment"— so what sorts of measures should we be seeking to implement?

Almost exactly two years ago the House debated a report produced by the Select Committee on Science and Technology on Hazardous Waste Disposal. I intervened from this Front Bench in the debate on that report. A recommendation of that report, which was reiterated during the course of the debate, was that the burden for ensuring against damage to the environment should be firmly shouldered by waste disposal site operators and not by local authorities. Your Lordships will not be surprised to hear that nothing has been done about that; no action whatsoever has been taken. We find ourselves in the same position in respect of the subject we are discussing today, where local authorities again find themselves responsible for so much of the clearing up of pollution, as was so in the case of hazardous waste disposal. Today, local authorities are even harder pressed to find funds to provide essential services due to the severe financial cuts which have been imposed upon them. So it seems to me valid to ask the question: how on earth are they going to find the money to deal with pollution in a way that is satisfactory and which serves the community?

It is totally unjustifiable that the ratepayer should be expected to meet the cost of neutralising environmental harm if it has been caused by another agent. The polluter pays principle is one which seeks, first, to control the level of pollution; and, second, to distribute more fairly the burden of payment for repairing environmental damage. I am not suggesting that this is an easy subject with which to deal.

The Department of the Environment argues in favour of the principle on two distinct grounds, political and economic: first, that it promotes a form of justice within the economy; secondly, that it promotes a more efficient pattern of trade by the harmonisation of costs being borne by producers. It is a principle that appears to be self-evidently right. It is widely supported, and I am pleased that in its perception of the principle the Department of the Environment, which was my old department when I was a Minister, sees it primarily as a means not of raising money or of ensuring a just distribution of the burden of costs, but of ensuring the health and safety of our community. It is right that our social well-being should take precedence over everything else.

I welcome the report's conclusion, which was mentioned and stressed by the noble Lord, Lord Ashby, that the department should undertake a careful study of the polluter pays principle and of subsidies for pollution control equipment and for cleaner technology as they operate in European countries. I would only say that, if a study is going to be undertaken, for goodness sake let the department see that the study is undertaken quickly and action is then taken on it. So many of the facts are there, and it is a case of gathering them together and coming forward with some hard recommendations. Also, it should investigate the possibility of incorporating these policies into the United Kingdom's overall approach to environmental issues. However, I believe that the polluter pays principle, while right in principle in itself, is highly complex in practice. Therefore, while it is part of environmental policy, it must also be viewed as an important element in the Government's entire social and economic, as well as environmental, policy.

I am concerned that if we adopt a radical policy of forcing all manufacturers to bear the costs of pollution abatement without state aid—that is, applying the PPP with rigid inflexibility—then in the climate of economic recession many firms will suffer: they will reduce the size of their workforce and some may close down altogether. The industries most vulnerable are those which have the greater propensity to pollute, and will tend to be the older industries, such as those cited by the CBI in their evidence to the committee—leather manufacturers, the textile industry, including wool scouring and carpet industries. Unemployment is already dangerously high in areas dominated by the traditional industries. I say "dangerously" because these areas are not blighted solely by unemployment, which is bad enough, but also by the the social disintegration and the social consequences which are a result of that unemployment.

I am not arguing in favour of accepting the social cost of pollution for the sake of preventing unemployment. What I am advocating is that the Government should show flexibility in their application of what is an essentially sound concept and take the responsibility which a Government should take in this area. The costs of pollution abatement will not necessarily be borne by the producers; they will surely be passed on to the consumer by way of higher prices. So, again, the individual will suffer, unless the free operation of the market ensures there is sufficient competition to allow consumers to buy from producers who incur less pollution abatement costs. But this is not likely to be widespread; in fact, it will be only patchy, and is not something on which one can base a long-term and viable policy. Therefore, inflexible adoption of the polluter pays principle may generate unacceptable levels of hardship in terms of unemployment or of price rises.

I believe, therefore, that we cannot advocate pollution control through market forces alone. The market is a cold and uncaring system, blind to special cases and the hardships incurred by those less able to cope with its rigorous demands. The policy of the present Government is supposedly one of a "free market economy", but in fact it is highly interventionist. This is probably one of the most interventionist Governments we have ever had. Although the EEC Commission permits state aids of up to 15 per cent., this Government have not taken advantage of the allowance, unlike what is happening in other European countries. According to the Department of the Environment, there has been sufficient co-operation in securing compliance with standards set to make it reasonable to expect industry to meet the costs. I agree with the noble Lord, Lord Ashby, when he says that the committee was not impressed by this argument put forward by the department, and neither am I. The report rightly criticises the Government for this approach, which is too insensitive and too short-sighted to special needs.

It seems to me that the complexity of the polluter pays principle can be regarded in two ways: the complexity arising from the practical difficulties which I have tried to illustrate, and the complexity arising from the elusiveness of the definition of the polluter pays principle, which was expressed by the noble Lord, Lord Ashby. In the submission of the Chemical Industries Association, it is asserted that: every industrial (indeed human) activity in some way contaminates the environment. This is, unfortunately, probably true. Also unfortunately, it would be impossible to seek compensation for all pollution, and for this reason the definition of PPP involves the concept of a "socially acceptable" level. This is a dangerously subjective element, open to abuse and misconstruction. Indeed, as the report points out in paragraph 14, it is a "moving target". Who is to decide what is "socially acceptable"? Who is to decide what sorts of pollution should be included in the category to which the polluter pays principle should be applied?

I am sorry that the committee did not consider the question of noise, which is a tremendous polluter of our environment. Noise is a growing source of complaint and of real human damage, both physical and mental, to many people, both working and travelling. Yet it is an area where solutions are readily available, given the will and the financial means. It would seem an ideal target for consideration under PPP controls. Already the cost of maintaining, monitoring and enforcing are almost entirely carried by the local authorities, and are therefore met by the ratepayers. This is something I should like the Minister to comment on. Perhaps, also, Lord Ashby may say a few words at the end, or perhaps one of the other members of the committee, who I am delighted to see are speaking, might comment on why noise was not considered.

Another problem is that of "residual pollution" and who is to pay for it. The question is the central theme of the submission by the CBI, which argue that the "residual pollution"—that is, the pollution that falls below the maximum level that is "socially acceptable" in a regulatory system of pollution control—should not be the subject of charges. But it is absolutely true (the noble Lord, Lord Ashby, has already mentioned it) that certainly in 10 years' time the "residual pollution" of today which is considered acceptable will be quite rightly unacceptable. So we must have a built-in mechanism to improve standards all the time, in the same way as the alkaline inspectors are continuously doing now. It shows it can be done, and if it can be done in one area there is no reason why it should not be done in other areas.

The use of a financial mechanism as the only instrument of pollution control is not adequate, although the report asserts that it is the most cost-effective means of reducing pollution. The European Commission has concluded in favour of a balanced system operating both a financial incentive scheme and regulations. If there were only a financial incentive scheme, there is the fear that firms would prefer to pay the charges instead of investing in pollution abatement equipment, and I would agree that charging alone has the intrinsic philosophy of the "right to pollute". This is why we need a combination of charges and regulations. Charges can provide money to use as subsidies for getting industries to do more by way of moving towards a "clean technology".

This action programme will try to get environment policy concentrating less on the cleaning up of pollution after it has occurred and more on preventing it in the first place. But as the report points out, such subsidies are being allowed by the Commission only until 1986; so the importance of this report is, I hope, that it will encourage the Commission to make up its mind that such subsidies towards getting a "clean technology" should become a permanent and regulated feature of environmental policy, and not cease in 1986.

Society has a crucial responsibility to treat our environment with great care. I repeat, the environment is not the property of the present generation, but of all generations. Therefore, I ask the Government: how are they to ensure that that duty is fulfilled, and how will they improve on the present inadequate pollution abatement? There is one specific question that I put to the Minister for an answer. In future, who will take the place of the National Water Council on inquiries such as this? What immediate plans do the Government have for acting on this valuable and vital report? We do not want to see a series of studies, sub-studies, multicoloured papers, of green or white, and consultation. The committee has studied and consulted, and it has issued a first-class report. The time has now come for the Government to act.

5.31 p.m.

The Earl of Cranbrook

My Lords, I have listened with great interest to the wide-ranging and thoughtful speech of the noble Baroness, Lady Birk. She raised many points which, if time allowed—and it would take a long time—I would dearly love to follow to their conclusion. In particular, she asked members of the committee who were present why they ignored noise. I think I can quickly reply that the committee has not ignored noise as a pollutant. In fact, not long ago it investigated the whole issue of noise pollution control within the Community and issued a report. I am absolutely certain that I can speak for other members of the committee in saying that we regard noise as a serious pollutant which must be subjected to the same general rules as other forms of pollution.

I also listened with great interest to the introductory speech of the noble Lord, Lord Ashby. I join in the thanks he expressed to our specialist adviser and to the witnesses who appeared before us. I also thank him personally for taking on a chore that was, in fact, mine in taking the chair on a couple of occasions when I was unable to be present and then himself doing a very great deal with the draft and to form the structure of the report which is now before your Lordships. On both those counts I am extremely grateful to him. I am also grateful to the noble Lord for taking on the duty of introducing this report to your Lordships which frees me from the chairmanly role, as it were, and allows me to concentrate on a couple of issues on which I feel free to give vent to my personal views.

As your Lordships will see, on page ix of the report the committee reviews alternative definitions of "pollution". I do not think there was any dispute over these; nor that any witnesses would have had difficulty in accepting the version given in paragraph 8 of the report, which is a very widely accepted definition. In this it is important to take note of the phrase "liable to". Pollutants as a class are characterised by their harmful effects. In practice, the control of pollution can either be remedial, if damage is currently being caused, orpreventative if it seems that damage is liable to be caused. As was drawn to our attention by the noble Baroness, Lady Birk, many of the most severe problems faced by the United Kingdom and by other member states of the European Community fall into the first class.

We all have serious cases of pollution which have been inherited from the past. But, again as stressed by the noble Baroness, Lady Birk, anti-pollution measures must also look to the future if we are to avoid handing on to subsequent generations a worse legacy than we ourselves receive. My noble friend on the Front Bench will recall that it is the declared policy of European Community legislation on pollution to take a preventative role. The preventative approach was stressed in the Third Environmental Action Programme. This has been accepted by Council and I therefore assume it is fully agreed by the United Kingdom Government.

In taking evidence we found, as the noble Lord, Lord Ashby, pointed out, that all witnesses declared support for the polluter pays principle. Indeed, who could not? But there were differences in interpretation. In particular, as has already been said, witnesses representing industry accepted that the costs of pollution control should be internalised, but only to the extent that emissions are reduced to levels prescribed by the relevant authorities. The balance of the contaminant load is called residual pollution. Contrasting views on the problems of residual pollution are discussed in the report in paragraphs 36 to 38 and 56.I intend to confine my remarks mainly to this issue. However, I also want to take this opportunity to draw attention to a difference in approach to the problem of black list substances in residual pollution that is creating serious divisions between the United Kingdom and our partners in the Community.

In discussions on residual pollution Dr. Konrad von Moltke (whose answer is No. 146 on page 78) viewed all effluent discharges to water as a demand on a common resource for which no individual or organisationcan claim exclusive use. Professor Partha Dasgupta (Answer No. 162 on page 82) refined this notion in terms of property rights. Whatever is the most appropriate analogy, no one in my hearing has disputed the fact that a discharge to the environment of substances liable to cause harm at the very least restricts the options available to other members of society and to this extent does them an injury. The Select Committee accepted these arguments in paragraph 56.

As the noble Lord, Lord Ashby, pointed out, at present in the United Kingdom, after any treatment that may be required, the free use of the environment is permitted for final discharges. It is therefore important to ask, first, who pays for the residual pollution and, secondly, what monetary value should be attached to it? I shall deal rather quickly with the second of those questions and return to the first, linking it with my discussion on inter-Community relations. As can be seen in the report, witnesses from industry emphasised to the Select Committee the high marginal costs of removing pollutants from discharges when they occur at low dilutions. But it can be even more expensive to restore or to retain environmental quality.

As a quick example, of late around the country a number of calculations have been made of the conservation-related compensations that are liable to be paid under the terms of the Wildlife and Countryside Act. These calculations, in my experience, are bringing home to local authorities and, I hope, to Government, some idea of the very high cost involved in environmental protection at the level of marginal effect. I am not convinced that the financial aspects of residual pollution loads are adequately taken into account under our existing system of granting discharge consents or in development control. If it is accepted that all economic penalties should be clearly evaluated, I believe that more strictly formalised procedures for the assessment of environmental impact are needed in these instances. Until this is done there can be no firm basis for the financial costing of effects.

My main point concerns relations with our fellow members of the Community as much as with the commission. The situation is serious because it has led to mistrust and mutual reproaches. I believe that the issue has to be resolved. I am also of the opinion that the way forward is through a reappraisal of the United Kingdom position. It is clear enough that pollution of the air or of the water is not limited by national boundaries. In these cases those who are forced to pay for residual pollution can be geographically far removed from the source. What is worse, if the pollution is persistent and accumulates. those who ultimately pay may also be removed in time. The preventive policy of the European Community emphasises that the responsibility for safeguarding the environment of future generations rests in our hands today. This responsibility must be kept in mind when we review the dispute between the United Kingdom and the commission over discharges of residual pollution to the marine environment.

For the United Kingdom the seas around our islands form our national boundaries. At the same time these seas are a resource shared with neighbouring states. While respecting legitimate United Kingdom territorial and economic rights, other states of the Community have an undeniable interest in these waters. It is in this area of sensitivity that there are divergent views on the matter of residual discharges.

In evidence submitted to Sub-Committee G in the course of this inquiry, and in other contexts, representatives of British industry have presented the dispute in terms of conflict between a commission approach involving fixed emission standards and a particularly British policy based on environmental quality objectives. In truth, as Mr Grainger noted quite correctly (answer 6 on page 19), the disagreement arises only over the black list substances. British industry wishes to apply variable emission levels, reflecting the nature of the receiving waters, to black list substances as is done in the case of other pollutants. In particular it is argued that limit levels on emissions to the marine environment should be less stringent than those to fresh waters. Industry's arguments in support of this position are mainly economic. The opposing view is based on the conviction that the potential hazards to man and the environment posed by black list substances are so serious that the best available technology must be applied to minimise discharges in all circumstances.

I remind my noble friend the Minister that the black list substances are defined on the basis of, first, their high toxicity; secondly, their indestructibility; and, thirdly, their capacity to accumulate in living organisms. In simple words these are the real nasties among pollutants. All parties in all the member states agree that pollutants with these characteristics must be removed as far as is technically possible from discharges to fresh water. Can more concentrated discharges to the sea be justified?

In the past decade much scientific work has been done to elucidate the patterns of circulation of water and the loading and distribution of pollutants within the seas of the north east Atlantic area. For the North Sea itself a particularly comprehensive and authoritative study was made by the Council of Environmental Advisers of the Federal Republic of Germany. That corresponds to our Royal Commission on Environmental Pollution, with some differences. I shall call it the RSU after the initials of its German name. This report was published in 1980. The RSU found no serious present disfunction in the environment of the open sea, but in its report nonetheless strongly urged the adoption of policies that would preclude future environmental deterioration. In this same report it severely criticised the British for refusing to accept minimum emission standards for black list substances.

The strength of feeling on this issue was brought home to me a few weeks ago when I took part in the International Water Tribunal at Rotterdam. This body chose to take a quasi-judicial stance, deliberately evoking the Russell tribunals, but of course it had no official standing. In evaluating its conclusions I invite my noble friend the Minister to take note of the status and qualifications of the professionals, politicians and administrators who consented to take part, in all cases for no fee or other personal reward. I consider that the tribunal's decision in the case of British Nuclear Fuels Limited is illuminating. The words used exactly reflected the views of the combined group of self-styled jurors and expert advisers. They were these: The jury is perplexed at the long enduring discharge …and condemns its continuation". I believe that there are many other professionals, academics and politicians in Germany, Belgium, the Netherlands and Denmark who are thoroughly perplexed at the apparently entrenched and, in their opinion, narrowly shortsighted attitude of the United Kingdom in negotiations over the emission of black list substances to the marine environment.

I think that it can be argued that there is room for review of the composition of the black list. Many substances have been proposed for inclusion. It may be the case that in fact not all share the characteristics that I have mentioned: being poisonous, persistent and accumulating. This possible change can be the subject of further investigation and negotiation based on scientific facts. But if any substance definitely meets the horrific criteria for inclusion in the black list, I strongly question how there can be justification for local relaxation at any European coastal site in the most stringent emission limits that are technically possible.

The issue is not confined to our care for the quality of the present environment but extends to a justifiable fear of irreversible deterioration in the future. I believe that United Kingdom industry and the Department of the Environment must look at the matter again and reappraise their attitudes. The importance of an anticipatory, preventive environmental policy must be emphasised, especially where black list substances are involved. The justifiable concern of other North Sea states deserves to be recognised. The reputation of the British as a nation caring for the environmentis in jeopardy. I accept that it is likely that some industrial plants in coastal sites in the United Kingdom may be forced to incur substantial costs in eliminating black list pollutants from discharges. Here the approach advocated by your Lordships' Select Committee offers a partial solution.

I do not expect my noble friend to make any specific responses here and now, but I wish to join both previous speakers in re-emphasising the recommendation of the Select Committee in paragraph 57 that: the Department of the Environment should undertake a careful study of the operation of … subsidies"— in this case I am concerned only with subsidies— for pollution control equipment and for clean technology in other Member States, and evaluate the extent to which such systems should be incorporated in present United Kingdom environmental policy.

5.48 p.m.

Lord Nathan

My Lords, it has been a rare privilege to sit in the committee under the noble Earl, Lord Cranbrook, and the noble Lord, Lord Ashby, who are two of the most distinguished scientists and specialists in this field that we have in this county. I thought that in speaking this afternoon I should not trespass upon the ground which they have so admirably covered (together with the ground which the noble Baroness, Lady Birk, has also covered) but confine myself to a rather different field. I thought that I would confine myself to the title of the debate, and indeed of the report; that is, The Polluter Pays Principle.

One of the reasons for my concern to do so is that we have heard much—and rightly so—about internalising costs of pollution. This is in fact technical jargon of an economic kind. I think that those of us who are concerned in the environmental field are very inclined to internalise our discussions and to use technical terms between ourselves in the belief that they have some clear meaning to the public at large, who are so greatly concerned with matters concerning the environment and pollution in particular. Those who are active in environmental matters are a small proportion of those in the country who are concerned. Evidence indicates that the vast majority of the people in this country are greatly concerned, and therefore it is with those in mind that I thought that I would speak on this subject.

I believe that it is timely to consider whether there is such a principle, and, if so, what it is. Words which have become so hallowed generate modes of thought and courses of action; they do not just reflect ideas and policies which have been adopted. The fact that a slogan or catch phrase of this kind has this character results in its being important in itself, for if it is treated as the basis of policy or action but is interpreted differently by different people, it will lead to confusion rather than conformity and certainty. This is what has happened.

I am myself suspicious of a slogan or catch phrase with moral overtones. The findings of the committee in this report reinforce my concern. To the ordinary man in the street, if indeed he has heard of the slogan, it must surely imply that he who pollutes must pay the penalty; and this point has frequently been made to me by those on the periphery of environmental matters. The slogan has moral overtones which make the polluter analogous to a criminal. That may indeed have been the thought behind those who first evolved the slogan, but those days are long past. Now the object is to integrate environmental policy into industrial policy; not to oppose one against the other.

An alternative interpretation is that the polluter must pay for the privilege of polluting—payment for a licence to pollute. But the object of environmental policy is to eliminate or reduce pollution, not to make money.

Neither of those interpretations is adopted among those who are daily concerned with the prevention or abatement of pollution, and yet, as I have said, they are a very small minority of those who are concerned about pollution. The first point I would make, therefore, is that the polluter pays principle is a bad foundation on which to base policy. A phrase which has contradictory overtones of retribution and permissiveness—he who pollutes shall pay the penalty, and he who pays may pollute—cannot be a good starting point. I emphasise this because it has been a foundation of environmental policy, a cornerstone of the environmental action programmes promulgated by the Commission. I believe that we are on false ground there.

One is left then with the interpretation of these words as denoting a principle upon which economic policy should be formulated with a view to controlling pollution. It is this which is adopted by those who are day-to-day concerned and is the basis of the report under debate. Even here, as the report shows, there are many different ways in which the so-called principle is thought to be applicable. There is the idea that the elimination or abatement of pollution, for instance, caused by discharges shall be effected by appropriate equipment in the production plant and that the cost of this equipment and its operation shall be to the charge of the producer, the polluter. There is nothing exceptionable about such a proposition, and in fact it has been in force for many years.

For instance, long before public sewerage became as commonplace as it now is, a household was not permitted to discharge raw sewage and was bound to install, at its own expense, appropriate sewage treatment such as cesspits or septic tanks. Regulations of certain gaseous emissions has long been the subject of control. The cost of compliance lies with the polluter; it always has. So there is nothing novel in this idea. What is novel is the increasing extent and stringency of the controls and their enforcement, made necessary by the ever-increasing damage caused by pollution and public recognition of the need to eliminate or control it.

An extension of this idea is that under which the polluter pays somebody else to eliminate or abate the pollution created by him. This is really a form of sub-contracting, and is not different in principle from the first category. Instances of this are of course sewage works where a notional cost is applied to each household in the collection of water rates or charges, and the specific charges made by water authorities to industries whose effluent flows into the sewers.

There are, however, two further interpretations which have been advocated. First, it is thought that in the operation of market forces the imposition of charges on an escalating scale will result in industry finding it more economic to install appropriate abatement processes than to play these charges. This proposition has been much debated and, as the conclusions of the report indicate, there is not sufficient experience upon which a judgment can be based.

It would seem to me, however, that while market forces may have some part to play, in particular where the conditions of free and equal competition really exist and where the goods produced are price-sensitive, they are unlikely to have any major impact such as those who advocate this idea envisage. This interpretation implies acceptance that an option should be given to pollute at a price, if it pays to do so. I do not find that at all attractive.

There is a further view that it is wrong, as has been said, that the environment shall be defiled by pollution even if any regulations have been complied with. This "residual" pollution may vary in importance from that which causes no identifiable harm to the case where even though the regulations have been fully complied with, there is still pollution which creates harm, but which it is thought it would be too expensive to reduce further by more stringent regulations with regard to emission. Some have suggested that a charge or tax should be imposed in relation to this residual pollution to compensate the community for damage to its right to a clean environment; and that has already been referred to in particular by the noble Earl, Lord Cranbrook.

To take a specific example, there is no doubt that generation of electricity by use of fossil fuels in compliance with all regulations produces pollution by gaseous emissions. The effect of this interpretation would be to impose a charge for doing so, and thus increase the cost to the consumer. Increased cost accruing from additional abatement might be sensible and acceptable. Increased cost arising from paying a sub-contracting charge to clean up rivers suffering residual pollution may be acceptable. A supplementary charge relating to monitoring pollution might indeed be acceptable. What I should find unacceptable is a charge for emissions which is purely a penalty or tax going to the general revenue fund. This is not I believe the way to go forward.

There is no doubt that one of the means to achieve environmental improvement is economic pressure. This can undoubtedly play a part, but how that pressure should be applied is not resolved by the adoption of the slogan, the polluter pays principle, which is capable of so many interpretations and which, as the report says, is interpreted in so many different ways in the Community. The best course, therefore, I suggest, is for us to recognise the importance of economic pressures and to utilise them where appropriate, but to dispense with the slogan, the polluter pays principle, which has promoted such a prodigious literature on its interpretation. This itself must surely demonstrate that it is defective, or indeed that it does not exist.

6 p.m.

Lord Mottistone

My Lords, I, too, should like to congratulate Sub-Committee G on producing a splendid report on a difficult subject. I should like also to congratulate my noble friend Lord Cranbrook, as chairman, for having taken on this task; and also the noble Lord, Lord Ashby, for taking it on at a later stage and for his own clear introductory speech. I am advised by the CBI in what I have to say to your Lordships. The CBI is concerned about the overall balance of opinions in Section IV of the report. Some of the points that I shall want to make try to bring out where there is a difference of opinion. I was particularly impressed by the speech of the noble Lord, Lord Nathan, which I considered most thoughtful. I strongly support his objection to the rather flamboyant title, the polluter pays principle, as not being a good guideline for studying what is a very difficult subject. It is a subject, as many noble Lords have said, that is confused by a plethora of differing definitions, interpretations and policy lines. I shall have something to say on each of these points.

On definition, British industry would not concede that pollution exists when a concentration of a substance in the environment causes no harm or cannot reasonably be expected, from scientific information, to cause harm. It is not a case of wishing to use the environment as a sink, as I think was suggested by the noble Baroness, Lady Birk. It is a case of using a valuable resource properly. The environment has a natural capacity for absorbing the inevitable by-products of human activity and rendering them innocuous. Pollution only occurs——

Baroness Birk

My Lords, will the noble Lord allow me?

Lord Mottistone

One moment, please. I should like to finish this sentence. Pollution only occurs when this natural physical capacity is abused.

Baroness Birk

My Lords, I wish to put the noble Lord right on a point of fact. My notes have been whipped away to Hansard but if I used that phrase I was quoting something in the Committee report. It was not something that I stated.

Lord Mottistone

My Lords, I think that the Baroness said it. She may have been quoting from the report. But that does not mean to say that she did not say it. I take issue with the report on that point, if that is what it intended. However, it is not clear from the report whether it is accusing all industry of treating the environment as a sink. It is not clear, but it is a sort of emotive thought, rather like the title of the subject we are discussing. It makes a matter emotive when it is perhaps rather too serious for that purpose.

Turning to interpretation, I must point out that in England and Wales industry dischargers already pay the full cost of reducing discharge levels and quantities to the standards set by the control authorities. Sometimes, the discharger pays an authority for carrying out purification at a sewage works. Alternatively, a discharger may install his own treatment facilities in which case he bears the cost himself. It is a system geared to ensure that individual companies meet individual control authority demands and that the environment is properly safeguarded. The system is fair, avoiding cross-subsidisation of one industry by another. It is certain, avoiding elements of speculation, aid and taxation. It is uniformly enforced, avoiding hidden subsidies from different enforcement practices. In short, the United Kingdom interpretation is a very reasonable way of interpreting the polluter pays principle and one that we should preserve.

Turning now to policy, our Government do not give aid specifically for pollution prevention purposes. Pollution abatement is an integral part of the production cycle and is rightly costed as such. There are a multitude of reasons which can be put forward in support of the Government providing aid. However, the inevitable effect is to cause something different to happen than would occur if normal commercial factors were paramount. Individually and cumulatively, the general direction of aid is towards distortion of treating conditions. It is therefore sensible, and industry fully supports the United Kingdom policy of avoiding aid for environmental purposes rather than encouraging a greater proliferation of such financial encouragements.

It is important also to point out that industry is not the only discharger. In listening to various speeches by noble Lords, I was perhaps being extremely sensitive on the part of industry, but it came through to me, although it does not come through nearly so clearly in the report—which is in favour of the report—that most noble Lords took it for granted that industry was the main polluter. It will be found, I think, on the one hand, that industry, if it is thought of as manufacturing industry, is no more a polluter than the general public. It is no more a polluter than agriculture. Looked at another way, industry under Government control, that is nationalised industry and the Government themselves, is probably a greater polluter than private industry. So those noble Lords who feel, "Aha, we have a stick to beat industry with" are perhaps treating this subject a little emotively. Here again, I thank the noble Lord, Lord Nathan, for his wise remarks.

Industry sees no need for significant changes in United Kingdom policy in this area nor for further detailed studies into particular aspects. We should instead seek a greater commitment in Europe and elsewhere towards the line that we already practice.

6.8 p.m.

Lord Skelmersdale

My Lords, I am well aware that what I am about to say might sound patronising. It is not intended to be, but taking risks is, by virtue of it, part of my job. To say that the report that we are discussing is the most thorough and understandable report to come from your Lordships' Select Committee for a long time is no overstatement. I am encouraged in this belief by the remarks of noble Lords during the debate.

At the beginning, I should like to associate myself with the introductory remarks of the noble Baroness, Lady Birk. I am sure that we can all agree that this has been a most informative debate. In no small measure this is due to the admirable way in which your Lordships, whether members of the Select Committee or not, have set out the issues. They are clear even to me. I am particularly grateful to the noble Lord, Lord Ashby, for initiating the debate and, like another noble Lord, allowing me sight of the guidelines for his speech. This has of course provided a quality objective for my own. I am confident that my noble friend Lord Cranbrook, who chaired the sub-committee which produced this report, will be as gratified as the Government are that the debate has been both constructive and useful.

The noble Lord, Lord Nathan, spoke interestingly I thought of the problems of definition and the logical corollaries of the theory of the polluter pays principle. I agree with him that at first sight the concept of polluters paying for their pollution is an extremely dangerous one. Fortunately, the principle is designed to operate along with regulations. There is no question either of the polluter polluting as he wishes, and then simply paying, rather like the all too familiar story of the motorist getting parking tickets and continuing to park illegally while not paying until summonsed or, perhaps worse, regarding fines as a part of the general cost of keeping a car on the road. It is not like that at all. In this country the system of pollution control acts to prevent dischargers from polluting whether or not any charges are involved. The polluter pays principle comes in mainly by requiring that the polluter should meet the costs of complying with the standards laid down. In other words, that those who cause pollution should pay the costs of averting it or, in the last resort, of cleaning it up. This does not give them the absolute right to pollute.

As the Committee made clear, pollution can be defined in various ways; but the accepted working definition in this country, which is accepted in the OECD and by the European Community, is that pollution results where discharges cause hazards to health or damage to the environment. The essential point is that there have to be harmful effects—discharges in themselves are not pollution.

It needs to be understood that the PPP is a guide to be applied in dealing with the control of pollution and legislation in this field. It is one of a large number of similar principles, for example, that an Englishman's home is his castle: or that barriers to trade should be dismantled. Such principles cannot be absolute; and there can be good or even necessary reasons for making exceptions to them.

I should also like to draw a distinction between the setting of standards and paying the costs of meeting them. Although the two are related. PPP is mainly about the second. Thus views on existing rules and regulations ought to be separated from the question of who pays the cost of meeting such rules and regulations. I am afraid that this difference was not always made clear by witnesses in their evidence to the Committee.

This debate is about the way in which we should consider and implement PPP in the face of practical and economic considerations, and in an international setting in which other countries may do differently from us.

I should now like to turn to the report itself. There can be no doubt that the subject is a complicated one. I noticed with interest that paragraph 1 began: The evolution of the Pollution Pays Principle". I am sure that your Lordships would all agree that this is just the principle that should not be adopted! Despite this unfortunate misprint, the Government welcome the report and agree that the principle is a useful guideline limiting the exploitation of the environment by polluters.

Although the recommendations are not listed separately by the Committee—perhaps to encourage the reader to take account of the detailed argument and not merely to cheat by turning to the end of the book to the solution—the main recommendation is that the Department of the Environment should undertake: a careful study of the operation of charging systems and of subsidies for pollution control and for clean technology in other Member States". I should say straightaway that the department agrees that more work should be done in this area. It must be accepted that an improved understanding of the situation is not possible on the basis of presently available information. I am therefore pleased to announce that my department has already put in hand a small scale research study on the subsidies question and intends to follow this up next year with a further look at evidence on charging in other member states.

Paragraph 46 of the report suggested—and this was emphasised by the noble Lord, Lord Ashby—that the United Kingdom should adopt a less rigorous approach to the question of subsidies. It will not surprise the House to learn that I disagree with the noble Baroness, Lady Birk, on this subject. The Government have not seen the need in the past to subsidise industry directly for pollution control purposes from public sector funds. In certain circumstances, as was mentioned by the noble Baroness, this can be done without breaching the Community rules and a capital grant of up to 15 per cent. can be paid by the national authority. The point is that we must distinguish between direct subsidies and help given as part of other aid where grants, for example, are made for industrial developments. Pollution control expenditure would of course in this case not be excluded. Thus some help is given in this country indirectly. However, neither the Government nor the CBI have seen the need for direct subsidy.

Some witnesses have suggested that financial aid should be given to plant in declining industry in order to help meet pollution control costs. However, for most firms the cost of complying with environmental standards is not a major proportion of total costs although there will of course be exceptions. If a particular plant cannot raise the necessary funds for pollution control through the normal channels, its viability must be very much in doubt. The granting of direct aid for pollution control in circumstances of this kind usually makes little commercial sense and is certainly against the spirit of the polluter pays principle. Once we started to give subsidies, polluters could begin to think that the Government would always be there to hale them out. Comparisions between other member states on this issue are hampered by the lack of relevant data—as the Committee found—but we hope that our study on subsidies will reduce this.

Reference has been made by several noble Lords to the agricultural sector and specificially to intensive livestock operation. The Government do, of course, recognise that the PPP should apply to agriculture as it does to the rest of British industry. Like all sectors, it has its special problems which call for careful consideration. The departments concerned—that is, the Department of the Environment and the Department of Agriculture, Fisheries and Food—are willing to undertake an examination of any specific claim of non-compliance with the principle, consulting where appropriate with other organisations; but I must make it clear that, if pollution problems occur because of agricultural practice, the pollution control authorities concerned (especially the Ministry of Agriculture) would take action without delay.

The evidence presented to the Committee was again more concerned with standards rather than just the PPP, and many of the points raised were in fact considered in the seventh report of the Royal Commission on Environmental Pollution, and we expect to respond to that report shortly.

In any event, we will he debating the Motion of my noble friend Lord Cranbrook on the report of the European Communities Committee on Sewage Sludge in Agriculture quite soon, and perhaps I may be allowed to respond more fully then.

The question of trans-boundary pollution has of course been mentioned this afternoon. It is worth noting that the Community recommendation of the polluter pays principle does enjoin countries to take account of the effect of discharges of pollution on other countries. This is particularly important where industry is located on or near the common boundary of two countries. Until recently, this has not affected the United Kingdom in its island position, but concern over trans-boundary air pollution is now drawing us into this area, although I must say that the scientific evidence is as yet somewhat equivocal.

Before I leave the question of air, I should like to tell the noble Baroness, Lady Birk, that, so far as noise —which is an air transmitted pollutant—is concerned, it is very difficult to allocate the costs at the local level. But I would agree with the noble Baroness that it is a problem and an increasingly disturbing one. Much work has been done to reduce noise on, for example, aeroplane engines and, as I am sure she knows, mowing machines. Incidentally, that has been done at the Commission's instigation.

The noble Baroness, Lady Birk, also highlighted the fact that witnesses to the committee raised the question of polluters paying the costs of administering site licences for waste disposal and of monitoring during the operational life of land fill sites, together with post-closure monitoring remedial work. It is worth noting here that, in response to the report of the Select Committee on the Disposal of Hazardous Wastes, under the chairmanship of the noble Lord, Lord Gregson, the Government gave a commitment to introduce charges for applications for site licences. This would be in line with the Government's general philosophy of charging for planning applications. The timetable for implementing the necessary legislation has not yet been agreed upon. Although the charges proposed might include a charge to cover monitoring costs, no decision on this aspect has been taken.

On monitoring costs themselves, the committee suggested—and this was highlighted by the noble Lord, Lord Ashby—that all pollution monitoring costs should he borne by the polluter. This, of course, is dealt with in paragraph 55 of the report. However, that is not required by the EC recommendation on the PPP, which says that: the cost to the public authorities of construction, buying and operating pollution monitoring and supervision installations may be borne by those authorities". In this country, some monitoring costs are borne by public authorities and some by dischargers; the monitoring done in connection with water authority consents is often a combined effort. It is clear that, given the line taken in the Commission recommendation, this question should take account of what goes on in other countries and might usefully be included in the studies recommended by the committee.

However, underlying the committee's suggestion is the thought that the free use of the environment as a sink should no longer be permitted as a right. They bracket these two thoughts together in paragraph 56 of the report. Like my noble friend Lord Mottistone, I find this latter point to be much more difficult. Taken to its logical conclusion, it implies that there should be a general charge on the use of the environment, and this raises fundamental, practical and conceptual questions that are not answered in other parts of the report.

Industry in this country, in particular, has always opposed the concept of a general charging system whereby charges are imposed both on polluting and non-polluting discharges. Wastes discharged into the environment which do not have any harmful effects are by definition not polluting it. Therefore, it would he difficult to justify making dischargers pay in every case. No other country operates an overall charging system on the use of the environment, and, where such systems exist for discharges to one environmental sector, they cannot be said to he completely satisfactory. The administrative costs involved in introducing a generalised charging scheme are likely to be very high and might well outweigh any possible gains in economic efficiency that might accrue.

The Government endorse the committee's suggestion that greater harmonisation of implementation of PPP in the Community is desirable. But, first, we must have our EC partners on our side—a point made by the noble Lord, Lord Nathan, and my noble friend Lord Mottistone. We have taken a strong line internationally on the question of applying PPP, and have urged and will continue to urge others to do the same.

We need to distinguish, however, between harmonisation of implementation of PPP in the Community and harmonisation of actual regulations across the Community, which is rather a different point. There is little support for the latter. As is well known, the Government's pollution control policy is firmly based on the idea of environmental quality objectives and the belief that the measures taken to achieve such objectives should be in general, tailored to meet the needs of particular environmental conditions. There is no comparison between the North Sea and the Mediterranean—a point made regularly and quite fairly by the Select Committee.

My noble friend Lord Cranbrook has mentioned the activities of the International Water Tribunal. The Government are very much aware of the useful contribution to the environmental debate made by responsible non-governmental organisations pulling together. However, where they do not, it is rather a different story and chaos very often ensues. In this case it is for industry to decide on the extent to which they wish to co-operate. I will be interested to see how this relatively new project develops. Of course, the United Kingdom system of water pollution control is well established. It is based on an environmental quality objective approach operated by the regional water authorities, and we believe that this is the best practical way to deal with the question of water quality.

While I am on the subject of water. in answer to a question by the noble Baroness, Lady Birk, perhaps I should remind the House that, with the demise of the National Water Council, it will be the Water Authorities Association which will take over some of its functions and it will be that association which, of course, will be giving evidence to a committee of inquiry such as the committee which produced the report we are debating today.

I cannot pretend to have been able to do full justice to the committee's report in my reply. Many points have been raised in the debate which I am sure we shall want to ponder over, and I am certain that we shall find that what has been said here today has been of great value, and will be of great value, in pursuing studies that your committee recommended.

However, before I conclude, I should like to add a thought of my own. It is useful in a debate such as this to remind ourselves of the rationale behind our policy on pollution control. It is based on a three-part premise of practicability, confirmed expert advice, and pragmatism. We must make absolutely certain that we do not compromise on these objectives by favouring the next popular theory that comes along. Such horror stories—whether or not, to use the phrase mentioned by the noble Lord, Lord Ashby, they are compounded of expediency and hunch—might sell newspapers but do not make sustainable Government policy.

It is encouraging to note that the committee has endorsed PPP, as do the Government and, as we have heard, industry. There is a paucity of information on certain aspects of PPP, and the committee was right to draw attention to this and suggest ways to improve the situation. The Government are grateful to the committee for its suggestions, which will be followed up in due course. It only remains for me to thank the committee for its work and the noble Lord, Lord Ashby, for initiating this debate.

6.27 p.m.

Lord Ashby

My Lords, noble Lords have a long and important debate to follow. I simply wish, first, to thank the noble Lord, Lord Skelmersdale, for his careful and encouraging reply to this debate and to thank other noble Lords who took part in it. In particular, I should like to thank the noble Baroness, Lady Birk, who drew attention to the importance of noise and the noble Earl, Lord Cranbrook, who put it more securely into its European perspective than I did in my introduction.

I should also like to thank the noble Lord, Lord Nathan, who drew attention to its jurisprudence and its historical elements in a way that will be an enormous help to the committee in the future. I should like, too, to thank the noble Lord, Lord Mottistone, although I assure him that there is nothing pejorative about the word "sink". It has two meanings. One is a technical, scientific one meaning that it is where chemicals go at the end of a reaction; the other is an implement that I frequently have to use to wash dishes, and I regard it with very great respect.

On Question, Motion agreed to.