LORDS AMENDMENT (Hansard, 6 July 1989)

The Earl of Caithness

My Lords, I beg to move that the House do not insist on their Amendment No. 5, to which the Commons have disagreed, for the Reason numbered 6. With the leave of the House I should also like to speak to Amendments Nos. 7, 8 and 9.

Schedule 18 sets out the powers under which the authority and water and sewerage undertakers are able to lay pipes and carry out associated works. Water authorities are currently generally able to exercise their pipelaying powers after serving reasonable notice on the owner and occupier of the land. As a result of Amendments Nos. 7 and 9 moved by my noble friend Lord Radnor at Third Reading which were accepted by your Lordships, the authority and undertakers would be required generally to seek the consent of tile owner and occupier of the land before exercising the powers. The power to lay pipes after serving reasonable notice should be limited to cases of emergency, cases where the undertaker is complying with a requisition to provide a main or sewer and cases where the Secretary of State determines that it would be exceptionally difficult to obtain the consent of every owner and occupier concerned.

While there may seem to be a superficial reasonableness about these provisions, the overall effect of these amendments would be severely to inhibit the ability of undertakers to meet effectively the requirements placed on them to provide the water and sewerage services that are essential to public health. That is a matter which we discussed only recently. The amendments would impose extremely cumbersome arrangements on the Secretary of State and undertakers, which would to a 1299 large extent defeat the whole object of the pipelaying powers. Far from merely limiting those powers in a sensible way the provisions would in fact undermine them.

The provisions are particularly unreasonable when considered in the context of our EC obligations. If the operational capabilities of water and sewerage undertakers are constrained in the way proposed by there amendments, there is certain to be a considerable deterioration in the pace at which we can expect to see the improvements we all want in the quality of our drinking water and standards of our bathing beaches.

I know that in retaining the existing powers of water authorities to lay pipes on notice, we would be preserving the unique position of the water industry as the only public utility with such powers. The water industry can, however, properly be regarded in a different context from other utilities. It does not generally have the operational advantages of other utilities; the route of water and sewer pipes is often determined by the need for gravitational flows, a restriction that does not apply elsewhere.

I turn to Amendment No. 8. The purpose of this amendment is to meet the concerns expressed by noble Lords from all sides at Third Reading, about the extent of these powers and the scope they offer for inconsiderate behaviour, in a way which does not jeopardise the ability of water and sewerage undertakers to meet their statutory obligations.

The amendment provides that, when exercising their powers in order to lay new pipes, undertakers would be required to give a minimum of three months' notice. A minimum of 42 days' notice would be required in the case of replacement or repair of existing pipes. The only exceptions to these arrangements would be cases of emergency and the exercise of the powers in response to a requisition to provide a main or sewer or a request to provide a service pipe when the undertaker is required to comply within a statutory time limit. These notice periods are intended to ensure that the examples of the exercise of the powers following an unreasonably short period of notice that concerned noble Lords cannot be repeated.

The amendment also contains a further measure designed to ensure reasonable behaviour by undertakers. Clause 156 provides for the director general to direct an undertaker to make a payment to a complainant if he is satisfied that an undertaker has failed to consult the owner or occupier before or during pipelaying, or by acting unreasonably has caused them to suffer loss or damage or to be inconvenienced. The clause currently specifies that the maximum payment that the director general is able to direct an undertaker to make is £1,000. The amendment provides for this sum to be increased to £5,000. This provision will help to ensure that undertakers act reasonably when exercising their powers.

Finally the amendment provides for the Secretary of State to make regulations to provide for advance payment of compensation in respect of the exercise of these powers. I am happy to repeat the 1300 undertaking given by my honourable friend the Minister for Water and Planning in another place that these regulations will be made in time to come into force on transfer date. They will follow the precedent of Section 52 of the Land Compensation Act 1973 and provide for advance payments of 90 per cent. of the agreed amount of compensation or 90 per cent. of the compensation as estimated by the undertaker. The advance payment will be made not later than three months after such a payment is requested. These provisions will meet the concerns expressed at earlier stages about the time taken to settle compensation following the exercise of these powers.

I am well aware of the concerns of your Lordships about the scope that these powers offer for arbitrary behaviour on the part of undertakers. I know that there have been occasions in the past when landowners have suffered from unreasonable actions. I make no apologies for explaining again the significant steps we have taken to protect the interest of landowners.

First, the Bill provides for the powers to be subject to a statutory code of practice to be submitted by the undertakers to the Secretary of State for approval. The code will cover all aspects of the pipelaying process. In particular it will contain provisions requiring undertakers to provide information to owners and occupiers about the works, to plan the works to cause the minimum inconvenience to landowners and to restore the land, once the work is complete, to its original condition. Undertakers will be required to act in a reasonable way at all times.

The second step we have taken is to provide in Clause 156 for the director general to direct an undertaker to make a payment to the complainant, up to a maximum of £1,000, which we propose should be increased to £5,000, if he is satisfied that an undertaker has failed to consult the owner and occupier before or during pipelaying, or by acting unreasonably has caused them to suffer loss or damage or to be inconvenienced. The director general will take into account whether there has been a breach of the code of practice in determining whether to make a direction and the amount of any payment.

Finally, the new clause after Clause 155, which was introduced by the Government in this Chamber at Committee stage places a requirement on undertakers to alter or remove a pipe in response to a reasonable request from a person with an interest in the land were the pipe is installed, or in adjacent land. This will go a long way to ensuring that the presence of undertakers' pipes on private land does not unreasonably hinder any subsequent development of that land.

I know that in accepting the amendments of my noble friend Lord Radnor at Third Reading your Lordships were greatly concerned about the powers that will be available to the water industry and the scope they offer for inconsiderate behaviour. The provisions contained in Commons Amendment No. 8 will I believe fully meet these concerns. These requirements, combined with the provisions of the code of practice and those in Clause 156 for the 1301 director general to direct an undertaker to make a payment, now up to £5,000, in cases where the undertaker has failed to consult a complainant or has acted unreasonably in exercising the powers, will I believe deal extremely effectively with the legitimate concerns of landowners.

I hope that the House will not insist on Amendments Nos. 5, 7 and 9. I commend to your Lordships Commons Amendment No. 8 in lieu of Amendment No. 7. This will improve the protection afforded to landowners while preserving the powers of undertakers to meet their statutory obligations.