Water Bill

HL Deb 02 May 1989 vol 507 cc9-77

2.58 p.m.

The Minister of State, Department of the Environment (The Earl of Caithness)

My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, That the House do now resolve itself into Committee.—(The Earl of Caithness.)

On Question, Motion agreed to.

House in Committee accordingly.

[The LORD ABERDARE in the Chair.]

Clause 1 [The National Rivers Authority]:

The Earl of Cranbrook moved Amendment No. 1: Page 2, line 8, leave out ("National Rivers") and insert ("Water Protection and Environment").

The noble Earl said: It appears to fall to me to kick off on this interesting Bill, on which no doubt we shall have many and prolonged discussions in Committee. I think it is proper for me to say again, as I said during the Second Reading debate, that I am a non-executive board member of Anglian Water. I was appointed by the Secretary of State for the Environment with special responsibilities for environmental issues and I am now a member of the plc working group of that board.

I welcome this Bill in principle. It is clear from its passage through another place that some changes in the Bill as printed are still needed. I welcome the presence on the Front Bench of my noble friends the Minister Lord Caithness and Lord Hesketh. I am certain that amendments that are proposed will have a fair and courteous response as always.

Clause 1 of the Bill establishes—I quote from the Explanatory Memorandum—an authority: to take over the responsibilities of water authorities in England and Wales in relation to water pollution, water resource management, flood defence, fisheries, recreation and navigation.

The establishment of this authority has been very widely welcomed as an important new instrument in the protection of the aquatic environment and in the management of the natural resource of water. I share the general enthusiasm that has been widely expressed for this new authority.

The amendment that has been proposed by myself and the noble Lord, Lord Bridges, concerns only the name by which this authority is to be known. The amendment carries no implications whatsoever on the powers or functions of this authority and is not intended to do so. The noble Lord, Lord Bridges, most deeply regrets that he has unavoidably been detained and wishes to express his apologies to the Committee for being unable to join me in introducing this amendment. However, I have had many discussions with the noble Lord on the appropriate name of this authority.

It is clear from the Explanatory Memorandum, and indeed from the body of the Bill, that this authority will have responsibility only in England and Wales. As was made clear by myself and the noble Lord, Lord Bridges, during Second Reading, it is not the practice in this country to apply the epithet "national" to a body that relates to only a part of the United Kingdom. In the terms in which we ordinarily speak, this will not be a national authority. I do not believe that it is appropriate that it should be so called.

Secondly, although it will inherit the tasks of the former river authorities among many other duties that it takes on from the present water authorities, it is made clear in the Explanatory Memorandum that it has a remit that is very much wider. It covers the protection of fresh water, including lakes and ground waters, estuarine and coastal waters, flood defence, fisheries, recreation and navigation. Therefore to call it merely a rivers authority is totally inappropriate and fails to indicate to anyone the duties of this authority

It is true that we have very quickly become used to calling it the National Rivers Authority. In the trade, as it were, it has been called immediately the NRA. These letters have begun to slip off the tongue. But it is such a short time since this name was coined that I foresee absolutely no difficulty whatsoever in adapting to another name equally quickly, especially if that other name is more apt and indicates more clearly to the public and to the authority's employees and its management the full range of important functions that this authority will assume if the Bill becomes law.

The noble Lord, Lord Bridges, and I have discussed alternatives and have played around with many combinations of short names that try to encapsulate in them the essence of the functions that this new authority is intended to assume. We propose the name, the Water Protection and Environment Authority. We find no other existing public authority that has an acronym that this calls to mind. We foresee no conflict with any other existing body in that sense. We feel that this name is appropriate because it indicates what the authority has to do. We do not feel that this is a trivial amendment. It has no implication whatsoever for the functions of this authority. Therefore at the opening moment of the Committee on this Bill, in order that the new usage can rapidly become familiar, I beg to move the amendment.

Lord McNair

Perhaps I may make a brief intervention in the form of a question to the noble Earl. Would it not be better if instead of Water Protection and Environment Authority we talked of the Water and Environment Protection Authority? As the amendment stands, it sounds as though this authority is in charge of the entire environment, whereas it is concerned only with that part which has to do with water.

The Earl of Cranbrook

That was indeed one of our candidates. However, the noble Lord, Lord Bridges, who may be a better educated man than I, in the end overrode me because he maintained that the words to which the noble Lord referred just now were not strictly grammatical. One of them would have to be an adjective. There was the additional consideration that the initials are WEPA. We felt that it was a less attractive acronym.

Lord McIntosh of Haringey

The noble Earl made a suggestion along these lines in a debate in this Chamber last year when he was arguing for a more widely based environmental protection agency. As I recall, I was somewhat cool to the idea because I felt that changing names does not change very much. What is important is to change functions. Although I have come round to the view that an environmental protection agency more broadly based is a wise policy, I am nervous about this amendment because of the point in which the noble Earl himself rejoices: that it changes only the name without in any way changing the functions.

Noble Lords who have seen the Marshalled List of amendments will understand that we propose to spend a considerable time in the coming days seeking to change the functions of the National Rivers Authority. I hope that many of the amendments will be acceptable to the noble Earl, with his well-known interest in the environment. I also hope that many will be acceptable to the Government. Even if the noble Earl feels it necessary to withdraw his amendment now, if he feels that sufficient progress has been made on the functions I hope that he will return to his amendment at a later stage. I would not wish to oppose it now. I could wish that it had been accompanied by a comprehensive and searching view of the functions of the National Rivers Authority as proposed. However, if we make real progress in improving the powers and the functions of the National Rivers Authority, it would be a suitable opportunity for the noble Earl to return to his amendment at a later stage.

The Earl of Caithness

The purpose of this amendment is to change the name of what the Bill calls the National Rivers Authority in order to describe more accurately its functions. My noble friend Lord Cranbrook has suggested that the NRA is neither national, because it does not cover either Scotland or Northern Ireland, nor solely a rivers authority, because its writ extends to other inland and coastal waters as well as to flood defence and other functions stretching well beyond the management of rivers.

I have to say that I have considerable sympathy with these points. Both of the shortcomings identified are perfectly correct, and the name National Rivers Authority does not describe the new body's functions with literal accuracy. However, I would pose two questions. First, is the title as it stands likely seriously to mislead anyone? I would suggest that it will not. The word "national" in its title will presumably not worry the Scots, who will simply never encounter it, and it accurately conveys the notion that it operates at national rather than local level, especially to those who regard both England and Wales as nations within a United Kingdom. Nor is the use of the word "national" at all unprecedented. Perhaps I may remind Members of the Committee that, contrary to what my noble friend has just said, both the National Water Council and the National Bus Company were limited to England and Wales.

Nor, I believe, will the brevity of the reference to rivers lead the public to misunderstand its wider role. After all, there are, I am afraid, many bodies where the name does not give a full picture of all its functions. I hope noble Lords will forgive me if I quote as an example the department where I have the honour to serve as a Minister. It is certainly true that the Department of the Environment deals with environmental matters. But the name does not, perhaps, suggest the full range of responsibilities for housing, local government, planning and sports, as well as more obviously environmental issues. However, I suggest that the name Department of the Environment provides an instant and easily remembered reference to its major functions. Similarly, for the new authority to be called a rivers authority identifies its primary responsibilities.

But my second question is whether the title the movers of the amendment suggest would actually be an improvement. My noble friend Lord Cranbrook referred to the acronym "NRA" as "slipping off our tongues". I suggest that is actually a very relevant and accurate remark. By contrast, I suggest that the WPEA—"weepy" or "whipper"—would have to fight its way off the tongue. That is one consideration, and I do not think it is an entirely trivial one. But even as regards accuracy, I am not convinced that it would be a significant improvement. I suggest that the amendment falls foul of the accusation made against our proposed wording. The "water protection" element is acceptable, but the words "and environment" immediately conjure up a very wide environmental role, as the noble Lord, Lord McNair, has just said, whereas the NRA's environmental functions will all be strictly related to water.

I hope that I have demonstrated that my lack of enthusiasm for this amendment does not simply arise from the "not invented here" syndrome, but from a belief that the title already in the Bill is, on balance, the better choice.

There is another point. It is also relevant that this form has become well established. The committee under my noble friend Lord Crickhowell is already known as the National Rivers Authority Advisory Committee and there is every expectation that the body for which it is preparing will be known as the National Rivers Authority. To change its name at this stage would I believe be more likely to confuse than to clarify.

Lord Taylor of Gryfe

This may seem a very frivolous point, but it is real. At present the relationships between Scotland and the national government are a matter of very serious debate in Scotland. To include the word "national" in the title of the authority when it does not apply to Scotland or to Northern Ireland is quite insensitive, and it is wrong. I beg the Minister to look at this again and to seek something more representative of the facts where possible in the title.

Baroness Carnegy of Lour

I should like to endorse what the noble Lord, Lord Taylor, has said. I agree with the Minister that the suggestion in the amendment is probably not the right one. I wonder whether this body cannot continue to be called the National Rivers Authority, but simply with a sub-title "of England and Wales".

The Earl of Caithness

I toss the ball firmly back to the noble Lord, Lord Taylor of Gryfe, and to my noble friend, and I ask why they do not come forward with amendments as indeed might the noble Lord, Lord McIntosh, and my noble friend again and the noble Lord, Lord McNair, so that we can vote on each amendment at Report stage? The one with the largest majority might take the day.

Lord McIntosh of Haringey

I assure the Minister that the Opposition will concentrate on the substance not on the name.

The Earl of Caithness

That is what we want to do, too.

The Earl of Cranbrook

We have heard a variety of opinion round the Floor. As the noble Lord, Lord McIntosh, said, this is not a decisive issue on which the Committee should be divided. I hope that my noble friend will ruminate on this proposal during the course of the Bill and will perhaps change his mind towards the end so that this body can have a name which in my view will better indicate the functions of the authority. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

3.15 p.m.

Lord McIntosh of Haringey moved Amendment No. 2: Page 2, line 10, after ("purpose") insert ("of owning the freehold of land transferred from water authorities and").

The noble Lord said: In moving Amendment No. 2, I should also like to speak to Amendment No. 8 which is the substantive amendment. Amendment No. 2 is necessary because the introductory sentence of the Bill refers only to the functions assigned or transferred to the National Rivers Authority, whereas we are concerend that the National Rivers Authority should have responsibility for the ownership of freehold land, which is not quite the same thing.

All regular attenders in this Chamber will have received a substantial volume of lobbying material—to put it impolitely—of argument from those throughout the country concerned with environmental matters and about the risks to the environment contained in this Water Bill. I want to repeat what I said at Second Reading: the Opposition are not opposed to the establishment of a National Rivers Authority. However, we believe that the protection which is possible under a National Rivers Authority is substantially greater than in the earlier privatisation proposals of this Government in 1986. To that extent we are grateful for the changes that have been made.

It is quite clear from the extremely well-informed pressure coming from bodies whose whole raison d'etre is the preservation of the environment, that the improvement does not go far enough. Some of these bodies are understandably cautious in their approach to the Bill. Bodies such as the National Consumer Council or the Nature Conservancy Council are funded by government. But if one reads between the lines, their evidence combined with the evidence of bodies such as the Consumers Association, the Council for the Preservation of Rural England and Wales and many other bodies, it is clear that their concerns about the environmental risks of the privatisation of water go very deep and are well founded. We have literally dozens of amendments on the Marshalled List to protect particular parts of the environment. They will be debated as we proceed through the Bill.

But there is an opportunity now at the outset of the Bill to pass one amendment, or in this case two, which will go to the heart of the concerns of the environmentalists. At the heart of environmental concerns is the fear that the successor companies, the plcs which will take over from the existing water authorities, will have a different set of priorities and a different kind of pressure on their activities which will lead them to put the protection of the environment lower on their list of priorities than the water authorities do and will put at risk the environment of our country.

The way in which we can cut short a great deal of debate in this Committee is by approving these amendments which keep the ownership of the land now owned by the water authorities in the hands of a public body, the National Rivers Authority, rather than transferring them to the new water supply plcs. It is on that basis that I commend these amendments to the Committee.

The holdings of the water authorities are very much more substantial than had originally been thought. We are talking here about nearly half a million acres of land. Some authorities have small holdings; the Southern Water Authority holds only 9,000 acres. The North West Water Authority, on the other hand, holds 150,000 acres of which 35,000 acres are in the Lake District. A very substantial part of the Peak District is owned by water authorities. Large chunks of central Wales, the Brecon Beacons, the Elan Valley, are owned by water authorities. Throughout the country there are enormous numbers of large and small pieces of land, many of them in natural parks, and a very high proportion in areas of exceptional scientific and environmental interest, which will, under the Bill, be transferred to the new water companies.

The Countryside Commission, a government-funded body, has produced a list of the sites of conservation and recreation value currently in the ownership of water authorities which will be transferred. I do not propose to read out that list; but the cover price of this publication is £10, and we can thereby see that we are talking about a considerable amount of land and a considerable possibility of misuse of land.

I suggest that these amendments seek to protect the amenity land owned by water authorities. The Secretary of State in another place on 4th April rejoiced in the fact that the Water Bill was achieving the privatisation of nearly 500,000 acres of land. I do not believe that that is the basis on which water privatisation is being sold to the public. The argument put forward by this Government and by the Prime Minister is that the Water Bill will privatise the water services in the hope that they and the sewerage services will be more efficient. The Bill has not been put forward as one which will privatise land, particularly land of environmental value.

The transfer of the land to the new water companies is a side issue. Nothing that we are proposing will damage the ability of the water companies to carry out their job efficiently. There is no reduction in the availability of operational land to the water companies. There is no threat to the privatisation proposals. If the amendments are passed, the water companies will be free to concentrate on the job which they are supposed to do—that is, the provision of water and sewerage services. The Government have described them as being the "core activities" of the water companies.

I argue that the amendments protect not only the amenity value of the land but also the water industry. There are subsections in the new clause which protect the long-term interests of the water companies. In other words, if they find that they have a subsequent need for operational land which had not been identified at the outset there is a procedure to make that land available to them. There is also a possibility of an appeal to the Secretary of State if there is disagreement between the authority and the new water companies. They are protected by being able to keep the operational land they need when they need it and not when they do not need it.

I also argue that the amendments have a significant benefit for the Director General of Water Services. As the Bill stands, he will have a package of regulatory duties which include the responsibility for the regulation of the non-operational land required by the water companies. I suggest that that is a distraction from his real purposes and from the basis on which the role of Director General of Water Services has been, or ought to be, set up. The amendments will simplify his task and concentrate his mind, and that of the water companies, on the supply of water.

I suggest to the Committee that the amendments also protect the taxpayer. On Second Reading I referred to the unfortunate case of the Royal Ordnance Factories, which were sold to British Aerospace at a price which was significantly less than the disposal value of only one part of the Royal Ordnance Factories' assets—that is, the un-needed non-operational land. It is clear that in that case the taxpayers lost out and the Government, although not apologising in terms for the error, made it clear that such an error ought not to be allowed again.

The protection provided by the amendments is a protection for the Government and the taxpayer. If they are passed we run no risk of disposing of non-operational land at a knockdown price which can then be recovered many times over by the resale of that non-operational land. Non-operational land which is not required for the water services will remain public property. It will remain subject to the protection of the National Rivers Authority with all of the functions which will be transferred to it. The authority will have the prime object of preserving recreational access and conservation.

It is curious that the Secretary of State did not appear to understand his own Bill when responding to a similar amendment—not such a good amendment—in another place. On 21st March in another place he said: If the hon. Gentleman"—

he meant my honourable friend Dr. Cunningham— wants all the land to be vested in the NRA, what is there to stop the NRA from developing it as it surely should in order to maximise its assets?".—[Official Report, House of Commons: 21/3/89; col. 973.]

The noble Lord, Lord Crickhowell, will confirm that it is not the object of the NRA to maximise its assets. Its object is to provide a regulatory and testing function, protecting the environment, and not to maximise such assets as may have been transferred to it. Even if the Secretary of State had been correct in suggesting that that was the object of the NRA, surely such an object should have been explained more clearly than it has been.

We understand that the NRA is intended to be an environmental protection agency by one name or another—let us not enter into another argument about the name. But if it is to be an effective environmental protection agency, I suggest to the Committee that it must have the responsibility for the land which is not required for operational purposes and which can be maintained for the protection of the public.

I know that a number of my noble friends and noble Lords in other parts of the Committee have received evidence from environmental bodies which they will be presenting in support of these amendments. I wish to make a final comment in support of the amendments. They are not a threat to the privatisation of water. They present a rationalisation of the procedures under which water is to be privatised. They concentrate the minds of the managers of the privatised water industry on what is supposed to be their task; that is, the provision of water services. They take away from them responsibility and concern for matters which should not be part of their concern.

The noble Lord, Lord Nugent of Guildford, and other noble Lords have tabled amendments which will be debated on Thursday. They will replace the plc status of privatised water companies by a statutory water company status. I urge the noble Lord to look sympathetically on my amendments because, while not being in conflict with his amendments, they will go a long way towards giving the kind of result which he seeks to achieve in his amendments. There is no conflict in them. I believe that the noble Lord, Lord Nugent, and I think alike on these matters and, if the amendments are passed, we shall have a water industry concentrating on its business, an environmental agency concentrating on its business, and both acting for the public good. That is not what the Bill provides at the moment. I beg to move.

Lord Ezra

During the Second Reading debate many of the noble Lords who participated drew attention to the public apprehensions which have been created by the Bill. One of the apprehensions was the question of what would happen to the land. The landholdings of the water authorities are substantial; they are approximately 500,000 acres. Those pieces of land have important environmental value. The bulk of the landholdings are in fact required for operational purposes. They are required to safeguard water supplies. In those circumstances and having created the National Rivers Authority—a body which will be concerned with safeguarding the environment and the protection of water supplies—it seems to me that that would be the proper body to own the freehold to that land. It should make sure that it is used for the best purposes as regards the protection and environmental impact of water supplies.

If such pieces of land were to become surplus to requirements then the amendments which we propose will allow for that. A case could be made by a water authority, which would have leased the land which it presently owns, that it should be released from its leasehold obligations and allowed to sell that land. Having made its case, I have no doubt that it could put that land on the open market.

I believe that the amendment proposed would go a long way to alleviating public fears about what may happen to the water authorities' land under the privatisation proposals. Therefore, I very much hope that the Government will look seriously at this amendment, because if there is one aspect of this proposed legislation which achieved virtually unanimous support it is the creation and role of the National Rivers Authority. The purpose of this amendment is to strengthen that role as regards the environment and the protection of water supplies.

3.30 p.m.

Lord Renten

It is quite clear from the figures given to us by the noble Lord, Lord McIntosh, in moving the amendment that a very large amount of land would be covered by its scope. Indeed, it seems to me that if we give the National Rivers Authority that responsibility, it will perhaps become the largest public or private landowner in the country.

Although there are apprehensions as to what may happen to places where we should be protecting the environment under this Bill—and we shall discuss that later—I do not feel that what is proposed is necessarily the best way of protecting the environment. I can understand the noble Lord, Lord McIntosh, moving this amendment because he has a predilection towards public ownership, even of land. However, the amount of land involved will, as I say, not only make the National Rivers Authority the largest landowner in the country—even larger than the defence departments, which still own quite a lot of land—but it will be in effect (and I know it is not intended in this way) a partial nationalisation of land by the back door. Therefore, not merely for doctrinaire reasons or reasons of principle but for practical reasons, I would be against the amendment.

Perhaps I may invite your Lordships' attention to the terms of subsection (1) of Amendment No. 8 which states: Any land owned by a water authority before the transfer date shall on that date vest in the National Rivers Authority". An ambiguity arises at once because the word "any" in that context might be interpreted as meaning "all"; in other words, all land. I believe that we are entitled to ask the noble Lord, Lord McIntosh, whether it is his intention in moving the amendment that all land owned by the water authorities at present shall at first vest in the National Rivers Authority.

If one then turns to subsection (5) of that amendment, it states: Any question as to whether any interest in land is required by a successor company at the time of transfer under Schedule 2 for the purposes of fulfilling its functions"— that is the statutory water company's functions. It continues: shall be determined by the Director General of Water Services appointed under Section 5". Therefore, it seems that subject to that possibility of a statutory water authority applying for ownership of some of the land and subject to the Director General of Water Services agreeing that that should happen, this land transferred to the National Rivers Authority shall, to that extent, be transferred to those who will really need it for water purposes under the Bill.

The difficulty I fear in this matter is that there will be a duplication and an overlapping of functions in relation to land. I have been trying to fathom how the National Rivers Authority, given that power to own that large amount of land, is to dispose of surplus assets in due course. Also, one wonders what would happen to any land which became surplus to the requirements of the statutory water companies.

We need to bear in mind that at present the water authorities—the largest of them has its headquarters at Huntingdon, only five miles from where I live—own a great deal of urban property. Its own premises are very considerable. That is in distinction from its upland holdings which comprise by far the greater amount of property at present owned by the water authorities. Therefore, that would be affected by this amendment.

However, apart from those difficulties which I hope could be explained by the mover of the amendment, I should have thought that this scheme would not give any public satisfaction. The public are not anxious for public authorities to own more land than they really require for their statutory purposes. There has been a tendency for years on the part of public authorities in general to hoard land when they have it. We do not wish to see that continuing.

Lord Broadbridge

This is a cross-party amendment and I urge noble Lords of whatever party, or no party, to support it.

Broadly, this Bill is as much about land as it is about water. As we have heard, the nub of the matter is to afford real protection against unfortunate disposal of any of the 484,000 acres of land and water held by the 10 water boards, protection which the present Bill does not afford however loud the Minister may protest. We have a growing population. More and more people want first and second homes. Britain is inelastic, so that half a million acres will be more precious with each succeeding year in relative as well as absolute terms.

The Bill's main effort in the direction of protection is in Clause 10, by reference to a code of practice. However, before that, Clauses 8 and 9 seek to give a sort of preamble. Gritty phrases are used, such as the necessity to "have regard to" and "to take into account". However, the guidelines in the draft code of practice are no more stringent. The Bill states that the purpose of the code is to give practical guidance and to, promote what appear to be desirable practices". In a particularly purple passage in Clause 10(2), it states that a contravention of a code of practice shall not give rise to any criminal or civil liability.

The draft code was published on 24th January 1989, together with a press release which, in its ultimate paragraph, stated: In enforcing these duties on the new water plcs the Secretary of State would take into account the extent to which they have followed the terms of statutory codes of practice giving practical guidance in relation to those duties". If the Secretary of State is admitting in the press release summary that he will take into account the extent to which the undertakings have followed the terms of statutory codes of practice, he is admitting that he expects it to be haphazard and seems to have knocked a hole in his own bucket before he even reaches the code of practice itself.

However, the code of practice is wishy-washy and completely lacks the word "must". For example, of the natural environment the code of practice states: Relevant bodies should therefore respond positively", and of the protection of buildings of interest, on page 23 it states: Relevant bodies are required… to have regard to the desirability of protecting buildings". Last month the Countryside Commission published a report called Sites of Conservation and Recreational Value Currently in the Ownership of Water Authorities, in which it said: Some water authorities do not hold accurate information on the extent of their ownership of individual catchments. Others were reluctant to disclose detailed information about their holdings and one authority, Anglian Water, refused to contribute to this study". Well, if a water authority will not now even contribute to a study of what assets are held, I do not get a good gut feel about what authorities might do with them after privatisation.

I said at Second Reading that without capitalisation and with the need to pay realistic dividends from a business growing at only about 1 per cent. per annum there will be great pressure on the new plcs to dispose of assets for cash; indeed, I gave an example of the way in which Thames Water is doing just that at this very moment by seeking to dispose of its Stoke Newington reservoirs and filter beds for a vast building development. There will be pressure too on local authorities to allow such developments—they also need the money—so I do not believe that the omnibus government fall-back position, stated by the Minister in winding up on Second Reading, that the Bill is not about legislating for land disposal and that this will be taken care of by the normal planning procedures, holds (dare I say it?) any water at all.

A recent lobby I attended—almost every national body concerned with nature and the environment was present—universally thought that a coach and horses could be driven through the Bill's provisions designed to protect environmental land and water against disposal. The Royal Institution of Chartered Surveyors states that it, is satisfied that neither the Code nor the Bill as drafted could prevent this happening". The amendment is designed to put some teeth into the Bill's toothless gums by making provisions that are mandatory; to substitute "must" for "having regard to" or "to provide as far as is reasonably practicable", set in a context without loopholes.

Our environment is a diminishing asset. It is melting away like ice in the sun. What we have is what our ancestors left us. We have a duty to protect it. In the political chaos that surrounded the outbreak of the Second World War, a Member in another place uttered an immortal phrase: "Speak for England". I urge the Committee to support this amendment and, in so doing, to do just that. Noble Lords will then earn the grateful applause of their contemporaries and successors.

3.45 p.m.

Baroness Lockwood

I support this Bill——

Noble Lords

Oh!

Baroness Lockwood—as amended in due course in Committee, on Report, and so on. I support the amendment. I was surprised to hear the noble Lord, Lord Renton, say that the public were not interested in public bodies owning more land than is necessary. I suggest that the public are not interested in the sale of the land that surrounds our reservoirs. That seems fairly clear from public opinion polls and from the views of the various organisations opposed to the Bill.

It is obvious from any analysis that water and sewerage are of themselves not the attraction of privatisation. It is the land assets that are likely to lead to a successful flotation. That was made clear at a recent meeting of the Yorkshire Water Authority which has already established itself into three separate parts in anticipation of privatisation: first, the core of the water authority; secondly, administration; and, thirdly, enterprise. The purpose of the enterprise section is to maximise profits; the authority has made no bones about that. The authority says that it is not its intention at the moment to sell off the land within the Yorkshire region; nevertheless, there are other ways in which it can maximise the profit from the land.

Yorkshire Water Authority owns about 75,000 acres, of which only 16,000 acres are operational. Even the 16,000 acres raise doubts in some people's minds as to whether the whole acreage is needed for operational purposes. The remaining acreage is either agricultural or amenity land. Apart from the district of Calderdale, the land is largely in the national parks area and surrounding areas of exceptional beauty. In the Calderdale district, incidentally, about 17,000 acres of land are in the ownership of the Yorkshire Water Authority. That constitutes 19 per cent. of the land within the borough. Obviously that 19 per cent. could cause considerable concern to the Calderdale District Council because it is largely moorland which provides a lung for the workers in the urban area of Halifax and some of the surrounding smaller districts in the conurbation. Therefore, it is an important area that needs protection. The amendment put forward by my noble friend would provide the necessary protection.

I give the Committee three illustrations of the fears that exist at present. The first relates to the Peak Park Authority Joint Planning Board which reports that negotiations on the future management of existing recreational facilities owned by the water industry are proving to be more difficult than expected. The water authority is seeking a greater contribution to costs from the board. It is seeking to alter some of the policies that have already been agreed between the board and the water authority and it is changing some of the developments which were previously agreed—developments such as access. It is now fencing open moorland and proposing the closure of concession paths. That is one area in the Peak District which is already proving to be difficult because of the proposed privatisation and the new developments that might be available to the companies which will be set up.

In the Yorkshire Dales national park there is concern over the Grimworth reservoir which was initially earmarked for quiet recreational facilities such as walking and observing the wildlife of the area. Planning permission was limited to a car park with toilet facilities. Outline planning has now been granted for a major leisure centre on the shores of the reservoir which would change the whole atmosphere of the reservoir. That may be more lucrative for private profit; it would nevertheless be an intrusion into the national park.

The third area of concern is Nidderdale, just outside the Yorkshire Dales national park. The Yorkshire Ramblers' Association has applied for a new footpath. It is meeting with some resistance from the water authority. Here again, the fear is that this is because of what might be allowed if the Bill is enacted and the land privatised. There are some very real fears about what will happen to the land adjoining these reservoirs. It seems that the amendments put forward by my noble friend will not only safeguard the public and the environmental interests but at the same time they will also enable the essential development of the water industry to proceed. I therefore support the amendments.

Lord Nugent of Guildford

The noble Lord, Lord McIntosh, has persuasively invited me to support him. I sympathise with his objective. I understand the very general anxieties that exist all over the country about the development of these; huge areas that run into hundreds of thousands of acres across the land. I believe that it will be too drastic for all the land owned by the regional water authorities to be taken away and moved over to the National Rivers Authority. The greater part of the land will be required by the companies of the future. I believe that the safer and more realistic approach is the one that I have in mind. I hope that I shall be able to persuade the Committee to accept it. We should have the statutory water company model instead of the plc in the Bill. As Members of the Committee have rightly said, the plc has the primary motive of making a profit. It is believed that this will give it the incentive to efficiency for the benefit of all. This is not the moment for me to develop that argument, but I do not believe that is so.

If there is a statutory water company it pays fixed dividends and any surplus made goes to reduce the charges to the consumer the following year. So there is no incentive to develop this land. Occasionally, it will wish to develop a site where there have been some works and it is intended to build new ones to help meet the cost. In a general way it does not have the incentive to do this. Therefore we have the major safeguard in the statutory water company that it will not be moved to make the kind of profit which the plc will see it as its duty to do. For that reason I prefer my solution to the problem because I believe that this land should be left to the companies of the future. Most of it will be wanted. If it was a statutory water company the safeguards would be massive. It will not have the incentive and the planning controls and the other factors will take care of the problem. While I sympathise with the noble Lord, I am sorry that I am unable to accept his persuasive invitation to support him.

Lord Walston

The objectives of the noble Lords, Lord Nugent and Lord McIntosh, are not very far apart. But it is not for us today to discuss the relative merits of the methods they propose in order to achieve those objectives. We have before us a very simple means of achieving that which a large number of us wish. The noble Lord, Lord Renton, will not be surprised to learn that I am not—as he apparently is—a doctrinaire privatiser. I have no objection to private or to nationally owned enterprises. In certain cases one is better than the other. Many years ago, in company with the noble Lord, Lord John-Mackie, I produced a pamphlet in which I argued against the nationalisation of agricultural land. I still adhere very largely to those arguments.

I remind Members of the Committee who do not know that one of the largest landowners in this country is the Crown Estates. That is scarcely a nationalised concern, but it is certainly not a private one. It is run through what some would call a bureaucracy. It is governed by certain well-defined rules. I believe that it is a very efficiently run organisation. I cite that as an example to show that one can have, in some form of public ownership, a large amount of land which can be just as efficiently run as any privately owned land and which can at the same time be devoted in large measure to the welfare of the community as a whole rather than to the enrichment of private individuals or certain shareholders.

If this amendment is adopted, as I hope it will be, two results will follow. One is that the price paid for the privatised water companies will be significantly lower because a great deal of the potential assets would have been removed. If the objective of privatising water was to raise money for the Exchequer so that it can be used for one reason or another, that would be a strong argument against this amendment. But that argument has never been put forward. We are not told that the country needs this money because we are short of cash so this has to be done. We know that we are very far from short of cash, because of Budget surpluses and so on.

The arguments put forward are solely those of the efficiency of the water supply, sewerage facilities, and so on. So the money argument cannot be of any significance to those who are really interested in the objectives of this Bill; namely, the provision of a more effective method of supplying water and taking away sewage. I believe that in the eyes of almost every Member of the Committee the other result will be a very beneficial one. It will safeguard the environment and remove large areas—we have heard of 450,000 or close to half a million acres of land, some of great scenic beauty—from the risk of being exploited by the new owners in order to increase their profit and the dividends of those who have backed them with their investments. It will diminish their returns but it will ensure that the land is not subjected to the desire of its new owners to make profit by development. It will be maintained for the benefit of the whole community for access to the wide open spaces, places of beauty, the habitats of threatened species and species that are not threatened and give a great deal of pleasure to the population of these islands.

I hope that many Members of the Committee have an open mind on this issue. I strongly urge them to weigh up these two benefits and decide which they want to see take place. Do Members of the Committee wish to see the Treasury enriched by a few more millions or possibly billions of pounds and risk the large part of the 450,000 acres being developed in a way which is profitable, but which is not acceptable to most of the people of this country who are concerned about the environment; or do they wish to ensure that the land is protected, as far as one can ensure, in perpetuity for the welfare of all the people who live here?

4 p.m.

The Earl of Onslow

I also wish to be known as someone who is very interested in the environment and who cares passionately about it. I also want my children, grandchildren and great-grandchildren, when I am old and doddery—or just older and more doddery than I am at the moment—to enjoy a proper and sensitive environment. I also support the notion of the privatisation of water. I believe that there is great merit in the idea of my noble friend Lord Nugent, which we shall discuss later, as regards statutory water companies. However, there is no merit in a private water company, a public water authority or a statutory water company sitting on assets and not doing anything with them. It is the duty of any form of water ownership vehicle to maximise the use of its assets. It follows that such maximisation must be heavily policed, and heavily policed for the reasons which I gave at the beginning of my remarks.

The National Rivers Authority must be given more powers and more teeth than it has at the moment. I hope that we shall do that later in Committee. It is illogical that a body whose job it is to control and police the behaviour of the water authority, water plc or water statutory company, whatever its final shape may be, should be a land holder. The National Rivers Authority should be a heavy footed plod. It should go around kicking Roy Watts or his successors to ensure that the water we all need is produced in an environmentally sensitive and clean way. However, we should not let that plod become a landowner. That would be counterproductive.

Lord Ross of Newport

The amendment may not be the ideal solution, but if the Committee passes it, as I trust it will, the Government will certainly have to think again. It is a sad fact that rather late in the day we are having to claw at whatever is available. Therefore the suggestion that the land should be placed in the National Rivers Authority is a late and perhaps a desperate solution. However, if it does not happen in this way and if the water companies are not acceptable to the Government, a great deal of this land, as the noble Lord, Lord Renton, does not seem to appreciate, will be at risk in terms of development. Few Members of the Committee would want to see that happen.

My political career, such as it is, started because of a scandal over an area of the constituency which I used to represent. The land should have been protected. The local authority received undertakings from two councillors of the authority, one of whom used to be a Member of another place, that the area would be protected from speculation. What happened? An application came in to build 260 houses around that harbour. It very nearly went through but was turned down in the end by one vote. To his credit the Secretary of State also turned it down, but there was an enormous fight over it. The public took that out on the sitting Member of Parliament when the next general election came. That is how I came to another place. It is a lesson the Government should take on board.

I cannot believe that the noble Lord, Lord Renton, really wants to see Rutland Water or the Elan Valley put at risk. Much of the land should be returned to the local authorities because it was taken from them in the first place. Admittedly, water authorities have developed some of the land since. Sheffield city council very sensibly, so we are told, kept most of that development out and the central estate at the time supported it. I wish that many other local authorities had done the same thing. I used to be taken up the Elan Valley by my grandmother. She was proud of what Birmingham had done. We do not want to see that put at risk. I have seen the problems caused by speculation. I happen to know that a great many mobile home park developers are looking keenly at the water authority land. One of them wanted to retain me to see what I could do on his behalf but I said that I was not interested. That is what is going on.

I have been given some statistics which no doubt other noble Lords have seen. I ask the Minister when he comes to reply to confirm whether or not they are true. We are told that in 1987–88 nearly 30 per cent. of planning applications in the English national parks which had been refused by an authority were allowed on appeal. In the Lake District the figure was as high as 45 per cent. That is why the public are worried, and that is why we must do something about it.

Lord Harmar-Nicholls

The noble Lord, Lord McIntosh, said that the amendment was not intended to be against the privatisation of water. The noble Lord, Lord Broadbridge, said the same thing. Whether or not the amendment undermines privatisation, it is clear that the arguments they produced in support of the amendment will certainly undermine the successful privatisation of water. If the successor companies are suspected from the start of being antisocial, of not being prepared to do their duty to look after the purity of water and of wanting to go off at a tangent to make money out of the development and sale of land, it would not take a great deal of thought to come to the conclusion that people who may well be worthy successors will not want to enter into it. The noble Lord, Lord Walston, said that no argument had been presented about the money side. It is perfectly true that the Bill seeks to ensure that we have purer water than some people say we have at the moment.

Lord McIntosh of Haringey

Is the noble Lord seriously suggesting that I am putting unworthy thoughts into the minds of the pure souled and high-minded people who are proposing to take over our water authorities, and that it would not have occurred to them otherwise to dispose of their land assets for a profit?

Lord Harmar-Nicholls

The whole burden of the noble Lord's argument was that unless the land is publicly owned, or in large measure publicly owned, by the National Rivers Authority, the successor companies would do unworthy things. Other noble Lords made the same suggestion. I understand their feelings on the matter. I have much more confidence in the powers and the skills of the planning authorities to provide protection than I have in the amendment doing it.

The successful privatisation of the industry could be undermined if the atmosphere is soured. We would not then get the money for it that otherwise we might get. It is not the main purpose of privatisation to get money. The noble Lord is quite right on that.

Noble Lords

No!

Lord Harmar-Nicholls

The noble Lord, Lord McIntosh, is so eager to win the next election that he is willing to decry his own arguments as to the un worthiness of private enterprise to take over some of these facilities. We must not ignore the money that we are likely to get. The official Opposition are the last people in the world to do that. On other privatisation measures the whole burden of their criticism has been that assets have been sold off at too low a price When they want to be critical for party political reasons they are the first to talk about the money received. This amendment would interfere with the price. Amendment No. 8 states: Any land owned by a water authority before the transfer date shall on that date vest in the National Rivers Authority". If we are to ask someone else to take on the full control of providing us with pure water and take away from that body the facilities which the previous owners and controllers had without very good reason, then the very fact that the present authorities have needed the land—because it has been in their possession—is at any rate an argument to show that it really was needed. Therefore if you say to the body which will take over the eventual responsibility of providing pure water that you will take away part of the facilities which the previous operator had that is bound to undermine the general approach of the possible successor companies.

We are all at one on all sides of the Committee in wanting to protect the environment; there is no argument about that fact. We feel it is right that the facilities which the general public now have should not be wilfully taken away from them. That is why over the years—and for a long time some of us have had many long battles with the authorities—we have set up a planning authority with planning powers the job of which is to do just that. Whether it is the successor companies which own the land, or whoever owns it, I am happy to leave the preservation of the environment to the authorities. They will approach the matter in a right and impartial way; that is, in no way interfering, or undermining the ability of the successor companies to go on doing the job, by taking away part of the assets which were previously there. I think that what is proposed would risk doing just that.

Finally, I suggest, at this early stage of the Bill's progress, that if we approach the matter on the basis that no successor companies can have the morality which is necessary to undertake the task, that is likely to interfere with the successful privatisation of this general asset. I do not agree with my noble friend Lord Nugent of Guildford, who we all respect so much and who as we know has much knowledge of, and influence in, the water industry generally. We must not approach the matter, whether by means of the amendment now before us or the amendment which my noble friend has in mind to produce later in the Bill's proceedings, on the basis that all of the moral and all of the decency is only on the side of a nationally-owned property.

If I heard him correctly, the noble Lord, Lord Broadbridge, went so far as to suggest that there could be a collaboration between local authorities which wanted land developed for their local authority profit and the successor companies which will eventually be running the industry. That is why the Bill provides for the eventual power of the Secretary of State to prevent any body being able to do just that. Indeed, the noble Lord who used to represent the Isle of Wight, and who has just given us the benefit of his personal experience, gave an example where in point of fact the power of the Secretary of State prevented the very thing happening which he said he did not want to happen in this matter. Therefore that is living proof: the fact that the noble Lord did just that in the Isle of Wight. Indeed, he now sits here as a result of the reputation he earned by carrying out that great task. The planning authority, plus the powers of the Secretary of State, will provide all the prevention that we need to ensure that the environment is not damaged. It must be done in a way which will not devalue the amount of money which we shall eventually receive, and which will not undermine the successful prosecution of the privatisation of this industry.

Lord Ross of Newport

Perhaps I may intervene here for a moment. I must say that the situation was not like that; indeed, it was a whole history of events. In fact, a great battle had to be fought by vast numbers of people in order to achieve that effect at the end of the day. The whole process took nearly a year.

Lord Harmar-Nicholls

I am not suggesting that there will not be many battles of that nature. However, I am saying that the provisions to prevent damage to the environment are already in the Bill. It must be said that whatever happens—great battles or little battles—the experience of the noble Lord proves that such power is there.

4.15 p.m.

Baroness White

The arguments put forward by the noble Lord, Lord Harmar-Nicholls, are touching in their innocence, but hardly convincing. However, I shall not say that about the contribution made by the noble Lord, Lord Nugent of Guildford. If we were absolutely convinced about the amendments put forward by the noble Lord and his supporters, which we shall reach later this week, we should at least be much less worried. I say that because it is true that the pattern which he proposes carries with it an element of social responsibility which is not to be found in the pattern as set out in the Bill which is now before us.

Surely it is to delude oneself entirely not to recognise the fact that there will be intense pressure to maximise short-term profit taking on the land of the water companies. That fact stands out a mile. Indeed, anyone can see that. The industry which is to be privatised—the water industry—is inherently a low-growth-profile industry. No one can change that situation. Therefore those who purchase the stock and shares of the companies will recognise that and say, "The only way that we can really make money is by using our quick-term money spinners". Such money spinners will of course be the land. I do not think that I need say any more on the matter because it must be obvious to everyone.

I shall not press an argument which seems to me to be so obvious that anyone ought to be able to grasp it. I shall just deal with the two proposals for safeguarding the use of any land which may be disposed of. One safeguard is that the Secretary of State, who is a great planner, proposes to issue guidance notes. I have with me—as I think have many other Members of the Committee—the comments on those guidelines from the National Trust. It is not an unduly radical Left-wing body—and I am looking at the noble Lord, Lord Gibson, as I speak. The trust's view on the proposed guidance notes, and the Bill as presently drafted, is that adequate safeguards have not been provided.

It says that, Those which exist are discretionary, unenforceable and would not apply once the land is no longer needed by the water companies… The powers of the proposed National Rivers Authority to police the management of water catchment land are only discretionary. The Secretary of State's enforcement role is subject to the need to give precedence to financial considerations and we believe this seriously weakens that role. The codes of practice proposed to help the new water plcs carry out their environmental duties will not be enforceable, and the Trust believes that this will gravely diminish their effectiveness and ultimate purpose". I shall not labour the point because I think that view, which comes from an authoritative source, gives a very good summary of the efficacy, or lack of it, of the proposed code of practice.

I turn now to the other safeguard which has been suggested. It was stressed by the noble Lord, Lord Harmar-Nicholls. I refer to the planning system. It has been said that we need not worry unduly because the planning authorities will safeguard the use of any land which may be disposed of by the new companies. First, in parts of the Principality of Wales (with which I am familar as Members of the Committee will be aware and where a considerable amount of land is under water authority ownership) other ways of developing land have been explored which may not be possible in the Thames area. For example, there is development through agriculture; through intensive afforestation; and through intensive recreational use where planning authorities will not necessarily be effective. However, I do not wish to detain the Committee too long on that aspect.

I am especially concerned about a matter which I am sure has been drawn to the attention of other Members of the Committee. I have with me a copy of a very well-researched statement made by the Council for the Protection of Rural England. The council has been working with a number of local authorities which have been very helpful in the matter. It reads, "such development"—that is, say, the development of land which has been disposed of by the water companies— will often be subject to planning permission That does not apply, as I say, to all the agricultural, recreational and forestry use. There will be other situations in which developments will be subject to planning permission. Then, the planning system will itself be distorted by the transfer of water authorities into the private sector". I should be grateful if the Minister would deal with that matter when he replies, because at present water authorities are statutory consultees; in other words, if there is a planning application which may affect their interests, they have the right to be consulted. Will the water authorities planning consultative role be transferred to the new water companies? If not, is it to go to the NRA or is it merely to fall into disuse.

The Earl of Onslow

I have tabled an amendment to ensure that the consultation which applies to the water authorities goes not to their successor plc but to the NRA. It is a valid point. It is on the Marshalled List, but it is so far ahead that the noble Baroness may not have seen it.

Baroness White

I am delighted to know that. I hope that the noble Earl will be successful. We have no guarantee that he will be. While those companies are in the private sector they may reasonably be relied upon to offer impartial advice. That will be much more difficult for them when they are in the private sector and when their developments, or other developments, might be at stake, according to the advice that they give in reply to the consultation.

It is pointed out that in relation to planning applications for other developers—after all, this applies not just to the water authorities' own developments but to general developments within their catchment areas—the other developers may be their own shareholders or business associates or they could be their competitors. Of course they will be encouraged to diversify and to go into all kinds of fields. What guarantee do we have that, if the privatised plcs are brought into consultation on planning matters, they will find it possible entirely to disregard their business interests? That seems doubtful, especially when some major developments may be at stake; for example, in the Thames Water area. It will not apply so much to our noble hillsides in Wales because they will not make as much money out of us, whatever they do. It will apply to sites where there is real development value and one is trying to obtain impartial advice on the effect on the water supply or sewerage system of a particular planning application. I hope that the Minister will deal thoroughly with that point, because it will not be a practical safeguard to enforce under the proposals contained in the Bill

The Earl of Caithness

It may be helpful for subsequent speakers if I said a word now. I do not want to shorten the debate in any way but it might be helpful if at this stage I set out our position.

The Bill provides in Schedule 2 for the division of all the property, rights and liabilities of the water authorities between the successor bodies on the basis of their functions. Land required by the NRA for the discharge of its functions will be transferred to the authority. The residue will pass freehold to the successor companies.

The effect of the amendment would be to disturb a sensible division based on the most relevant and practicable criterion—the function that the land serves. In its place it would require that the freehold of all land be vested in the NRA, with such land as is required for the exercise of the companies' functions leased to those bodies but subject to such restrictions and covenants as may be necessary to ensure that any use or development of the land does not harm the environment or amenity.

I shall deal with the detailed arguments put forward for the amendment in a moment, but let me first draw attention to two fundamental, and, if I may say so, extraordinary features of the amendment. The first is this: we are to trust the companies, subject to the full and proper regulation which we shall impose, to provide drinking water and to dispose of sewage—functions of great importance; but we are not, it seems, to trust them with an acre of land. How can that be reasonable?—for just as the provision of water and sewerage services will be regulated, so too will ownership and management of land. It is, and will continue to be, regulated by the planning system. In special cases it is regulated also by national park and AONB designations and other controls, commensurate with its special needs and character. That is the fundamental reason why the amendment is inappropriate and should be rejected.

The second is the potential consequences for the NRA. The freehold of all the land, we are told, should vest in that body. Let us consider the effect of this. The body, which we are are told the Opposition support and are concerned only to make effective; the body which has the important task of controlling pollution, managing the water cycle and enhancing the environment of all rivers and estuaries—that body, if the amendment were carried, could find itself continously distracted from those central tasks by issues of land ownership and land management. I suggest that that would not be helpful, and nor is it necessary. What justification is there for the amendment? The fact is that the proposals in the Bill in respect of land are reasonable and sensible and fully protect the public interest.

So far as the amendment is intended to protect land while it is in the ownership of the successor bodies, it is quite unnecessary. We have provided that, so long as land is in the ownership of the successor bodies and used for their functions, it will be protected by the conservation, landscape and access duties which attach to them in performance of their functions. Those duties are substantial. They are enforceable by the Secretary of State and they are backed up by a code of practice whose content has been widely welcomed. We have in addition tabled an amendment to ensure that the present close co-operation between the water authorities and national park authorities continues after privatisation.

Baroness White

I am sorry to interrupt the Minister. Does he recognise that the national parks are much concerned about the fact that it is consultation only that is guaranteed?

4.30 p.m.

The Earl of Caithness

The noble Baroness is keen to get to her feet. We are always keen to listen to her, but if she would listen to me until I finished that might speed matters up, because I shall deal with the point she has yet again reminded us of.

The water authorities have a good record in conservation and amenity. These provisions will ensure that that continues.

In supporting the amendment, a number of Members of the Committee have placed particular stress on the scale of the land assets in question. I do not deny that at approaching half a million acres they are very substantial. We recognise also that much of that land is of very great environmental significance, most of it in national parks or AONBs. We continue to have the closest regard for that. But the size and quality of the landholdings are not in themselves justification for this amendment. Most of the land in the national parks is, after all in private ownership, and there is no evidence that this leads to undesirable development or inhibits public enjoyment. On the contrary, most existing owners may be different from commercial plcs, but such companies are nevertheless open to public scrutiny of their actions and policies.

Nor are we persuaded by the argument that the water gathering grounds in the highlands and uplands, which constitute the bulk of the holdings, should more naturally pass to the NRA than the companies. I recognise that those lands are used for water resource protection, and water resource protection is a function of the NRA as well as of the companies; but the fact is that those areas are closely related to the reservoirs which they feed and which for water supply reasons are to pass to the undertakers.

It is, I recognise, concern as to the position on subsequent disposal of any of the land which motivates this proposal; but if the land is sold by the plcs, changes of use will still be subject to the planning system, and that is the right mechanism to control what happens to land formerly in operational use by a water and sewerage utility. In many cases those controls will be supplemented, as now, by the special protection of national park and AONB designation.

In any case, much of the land is likely to be needed for operational purposes indefinitely. From time to time of course as in the past, some land may become surplus to the operational requirements of the core water and sewerage business, as a result of new investment, scope for rationalisation or other factors. Of course that will happen. But it is surely right that in these cases the company should be able to dispose of that land for better and more productive use.

There are safeguards provided for in the appointment to ensure that appointed water and sewerage undertakers have sufficient rights over land which is needed for the proper carrying on of their business. So long as they do, there can be no public interest in their sitting on land when it becomes surplus to operational needs which others could put to better use.

There has been some vague speculation in the press and elsewhere about the supposedly enormous development potential of water authority land. My right honourable friends the Secretaries of State for the Environment and for Wales have appointed valuation advisers, and jointly with each of the water authorities they have appointed independent valuers to review the authorities' property holdings. Their work will help ensure that any information on land development prospects that is material to investors' decisions on whether to buy shares will be contained in the prospectuses of the companies.

We cannot freeze the pattern of land use; nor should we try. It makes no sense to give the companies important responsibilities and deny them the freehold land assets that go with them. If we want to make the NRA an effective regulatory body it will not help to require it to assume responsibility for vast acres of land not directly related to its own functions. Most important, nor can I accept the need to vest all water industry land in a public body to ensure proper planning, evironmental and conservation controls. Those controls are already there. They have been effective in the past and they will be so in the future.

We on this side of the Committee have a different philosophy from that of the party of noble Lords opposite. We are concerned with proper regulation and control so that the private sector can thrive. I am sure that all Members of the Committee agree that we have a wealth of beauty in our countryside, most of it man-made or fashioned by those in the private sector. In addition to approximately 80 per cent. of the national parks being privately owned, it is worth remembering that just 27 per cent. of our national nature reserves are owned by the NCC. Similarly, the considerable majority of SSSIs are privately owned.

What is important is that we maintain and exercise the appropriate controls effectively. As my noble friend Lord Renton has reminded us, the Labour Party believes, in contrast, that ownership is more important than regulation and that the only way to proceed is by nationalising what it can—in this case the land. How convenient for the noble Lord, Lord McIntosh of Haringey, to start with this amendment, which is not the end of the story but the beginning of a systematic attack on all private ownership.

I have sought to deal with the main issues raised by this broad—indeed, sweeping—amendment. I have set out the considerations which make it in some respects unnecessary and in other respects undesirable. However, let me return to the question of the land, because it is worth remembering that we are talking of two separate types of land. I do not see the noble Lord, Lord Broadbridge, in his place after he spoke to the amendment, but both he and the noble Lord, Lord McIntosh of Haringey, do not separate in their minds the hill land from land adjacent to developed land. If the latter land becomes, for one reason or another, surplus to operational requirements, what is to become of it under their proposals? Is it to remain as it is for ever more?

The noble Lord, Lord McIntosh, knows—but I wonder whether the noble Lord, Lord Broadbridge, does—the intense demand and pressure for housing land, particularly in the South-East. Five hundred and seventy-five thousand homes will be needed by the end of the century, a mere 11 years away. Are the parties opposite, through this amendment, to deny the opportunity—subject to all the usual planning approvals—to meet some of this need? There can be no doubt that if such land is not to be developed, the new-look Labour Party is forcing pressure for development on agricultural land.

However, in closing, let me respond to one particular argument to which we have listened with sympathy. We believe that we can separate the types of land in question. As I have said, we recognise that the water industry owns some land, principally in highland and upland areas, of quite outstanding beauty and environmental importance. I know that there are concerns in the country which many of your Lordships have expressed today that those particular areas should never be disposed of by the companies in circumstances which could jeopardise their conservation, access and amenity value. The Government have listened and are listening to the Committee on this point. It remains the Government's view that our planning and countryside legislation can deal with the great majority of risks. But we hear the argument that other risks may remain and that they are risks we should not run.

The Government are willing to act on that point. A number of proposals have been made for amendments to Clause 8 and elsewhere in the Bill. In the light of discussion of these alternatives, the Government propose to come forward with amendments at Report stage to secure that those countryside areas of special conservation and amenity value cannot be subsequently disposed of without a suitable measure of protection.

We shall be debating this in more detail later in our proceedings and we shall listen to what your Lordships have to say. For that reason I cannot specify today which of the alternative options we should adopt. However, I can assure the Committee—let me repeat that; I can assure the Committee—that we shall come forward with a special measure of protection for those special areas. Our support for a special and particular measure of this kind cannot however extend to support for the sweeping terms of the amendment.

Baroness White

Before the Minister sits down I fully accept what he says about the further amendments. I have looked at Amendment No. 130 which uses the term "consult", but there may be other amendments on their way. Naturally we shall study them with great interest. However, I do not think that the Minister has dealt with the point about statutory consultation. What happens with the plcs? Will they have the same rights to consultation as the existing water authorities?

The Earl of Caithness

As I understand it, at the moment, yes. But of course that is one of the amendments which we shall discuss. I look forward to debating it and hearing the views of my noble friend Lord Onslow and doubtless those of the noble Baroness too.

Lord Taylor of Gryfe

I welcome the Minister's statement, particularly the assurance which he gave at the conclusion of his speech. I felt that prior to his remarks we were getting off to a Second Reading debate on the quality of the Bill as such. That was emphasised by the noble Lord, Lord Harmar-Nicholls, who felt that the amendment before the Committee was designed to undermine the principle of the Bill. Some of us do not like the Bill, but that is not the purpose of the amendment. We are talking about land that is surplus to the requirements of the authorities which are carrying out——

Noble Lords

No!

Lord Taylor of Gryfe

It is land that is surplus to the requirements of the bodies. That is what we have been talking about. It is surplus to the operational requirements.

The Earl of Caithness

I hope that the noble Lord, Lord McIntosh, will clarify the situation. As I read the amendment, it concerns all land, whether it is surplus to requirement or not.

Lord McIntosh of Haringey

The Minister is quite right. The amendment refers to the freehold of all land. That land which is required at any lime for the operational requirements of the water supply plcs will be leased to the water supply plcs. Therefore they will be at no risk of lack of access to the land they need for their operations.

Lord Taylor of Gryfe

That is the point—it is surplus to the operational requirements of the plcs. Reference has been made to the fact—the noble Lord, Lord Renton, was rather apprehensive about this—that 500,000 acres of land might fall into public hands. Perhaps I may say that I was responsible at one stage for almost 3 million acres operated by the Forestry Commission, in public hands. The commission exercised its authority with due regard for leisure, recreation and the environment. Consequently I should not be particularly apprehensive about a body having control of such a large area.

I only wished to make one point—that we have had recent experience of a privatisation exercise. The exercise which occurs to me is the privatisation of the Royal Ordnance factories without due regard to the importance of land holding in that privatisation. The two sites were transferred to BAe for a net value of £3.5million, which was the basis of the chartered suveyor's estimate. That land is now estimated to have a potential value of £450 million. It is that kind of experience that makes us support the amendment before the Committee. I hope that that will be kept in mind.

We are not discussing the basis of privatisation of the water supply. We are discussing whether sensitive areas and important areas—I welcome the assurance of the Minister in this regard—should be in public hands or transferred to plcs, who may exercise their commercial judgment with the kind of development consequences that have taken place elsewhere.

Lord Brightman

I rise not on a point of principle but on a point of detail. I shall be brief. I am puzzled by the purpose of subsection (4) of Amendment No. 8. This provides: The Authority shall, in respect of any lease or interest in land transferred to it, attach such restrictions as shall prevent the sale or transfer of any such interest to a third party except with the consent of the Authority. The hypothesis therefore is that a lease or other interest in land belongs to the authority because it has been transferred to it.

The subsection apparently seeks to prevent the transfer of any such interest by the authority to a third party without the consent of the authority —that is, without its own consent. What is the point of providing that the authority shall attach restrictions to land that it owns to prevent the authority selling land without its own consent? I wonder whether what is meant is: The authority shall, in respect of any lease or interest in land transferred by it, attach such restrictions as shall prevent the resale or retransfer of any such interest to a third party except with the consent of the Authority. I raise this point for guidance.

Lord McIntosh of Haringey

I am grateful to all noble Lords who have taken part in the discussion on these amendments. May I first deal with one or two points about the wording of the amendments before going to the more fundamental issues with which the Committee is faced. I start with the noble Lord, Lord Renton, who referred to the amendments as partial nationalisation of the land by the back door. This is not nationalisation of any land. The land is at the moment in public ownership. It is in the ownership of the water authorites which are public bodies. Indeed strong arguments are being pursued in the courts at the moment that it is not theirs to dispose of, or not the Government's to dispose of on their behalf. In fact the land was collected together and paid for by the ratepayers of many local authorities and transferred to the water authorities in 1973 on the firm assurance that there would be no disposal without the local authorities' permission. This is not nationalisation; it is retaining a public ownership land that is already publicly owned.

Lord Renton

The noble Lord makes a fair point. One should bear in mind that at present, as he says, the land is owned by the water authorities. However, for the first time, we are to have a national authority, at any rate for England and Wales, which is to become a very big owner of what will be, and the noble Lord intends to be, nationally owned land.

4.45 p.m.

Lord McIntosh of Haringey

I do not think that the issue of whether it is national or involves 10 different water companies is fundamental. The fundamental issue is: what is the remit of the National Rivers Authority; what are the remits of the water authorities now; how do they compare with the purpose and the objectives of the plcs to be established under the Bill?

The noble Lord questioned whether we meant "any" or "all". "Any" means "all", as I confirmed to the Minister later in the debate. As I understand it, and I hesitate before saying anything on the wording of legislation to the noble Lord, "any" is frequently used in legislation to mean the same as "all".

A number of noble Lords asked whether the amendments were sufficiently flexible to ensure that land required for operational purposes by the water supply plcs would always by available to them; whether land that they needed would become available to them; and whether land surplus to their requirements would no longer be available to them. The amendments are certainly intended to have that effect. The leases or other interests would specify that these lands should be transferred to the water supply plcs for such time as they are necessary for operational purposes, and should cease to be transferred when they are no longer necessary.

The question of whether extra land then became necessary for environmental purposes is dealt with in subsections (5) and (6), which ensure that the provision for transfer to the water supply plcs should continue after the original vesting date. Thus, in both these respects, I would argue that the clause is sufficiently flexible. I listened with respect to the point made by the noble and learned Lord, Lord Brightman, about the word "to" rather than the word "by". I suspect that he is right. It was certainly our intention to see to it that when the National Rivers Authority granted a lease or granted an interest in land required for operational purposes such a lease or interest should not become a commercially valuable interest and that if at any time it became unnecessary for operational purposes the lease or interest should go back to the National Rivers Authority. It is something that we ought to look at, although I would argue that our wording can mean that as well as the interpretation that the noble and learned Lord put on it.

However, these are relatively minor matters. The fundamental issue before the Committee is whether we have a sensible division of the land that is now owned by the water authorities as between the National Rivers Authority and the water supply company plcs, and whether, if land surplus to operational requirements is vested in the plcs, there is adequate protection for the public interest. The Minister sought in reply to suggest that there was a sensible division in the allocation of land, but of course the basis of the division proposed by the Bill is that the National Rivers Authority gets only the land that is directly required for its own very limited conservation functions, and the plcs get all the rest of the land whether it is required for operational purposes or not. I suggest to the Committee that this is not the most sensible division because the objectives of the plcs and the objectives of the NRA are necessarily in conflict. That is why they are different organisations.

The Director General of Water Services has the responsibility under Clause 7 of regulating the plcs in such a way as to see that they secure reasonable returns on their capital. That is the fundamental criterion for the existence of the plcs, as the noble Lord, Lord Nugent of Guildford, sees clearly; it is evidenced by his amendments. All other considerations are secondary to that prime requirement. Specifically, the protections in Clause 8, to which the Minister referred, are subject to the prime objective of the plcs to make a profit. This is found in Clause 7. The enforcement powers that the Secretary of State has in Clause 20 are also secondary and subordinate to the fundamental interest of the plcs to make a profit.

The objective of the National Rivers Authority is quite different. As the Minister quite rightly said, the National Rivers Authority is the body which is concerned with conservation and with the maintenance of water quality and all the other environmental aspects of the water business. Surely the objectives of the National Rivers Authority coincide most closely with the objectives of all of us for the half million acres of land which the water authorities now own, and specifically for that land which is not required for operational purposes. It may indeed be an addition to the functions of the National Rivers Authority to hold the freehold in the land, but it is already proposed that the National Rivers Authority should have 6,500 staff and I cannot imagine that the responsibilities as freehold owner will add more than a small proportion to that total.

It is entirely consistent with all the other functions of the National Rivers Authority that it should hold the freehold interest in the land which is not required for operational purposes and which the public is concerned should be maintained for environmental purposes.

I was very worried by something that the noble Earl, Lord Onslow, said, in an otherwise sympathetic speech. He said how awful it would be for a public or a private authority to sit on assets and not do anything with them. What the public want for Haweswater and the Elan Valley and the other local authority land which is not required for operational purposes is that somebody should sit on that land and not do anything with it. That is what the noble Lord, Lord Broadbridge, talked about and that is what I thought the noble Earl, Lord Gnslow, was talking about.

It is required for all of us that that land should be kept in its present state, or perhaps improved in certain ways, for our successors. It is our responsibility to see that that land is kept in that state. It is our responsibility to see that no body which has an objective laid down by statute which is in conflict with that should own the freehold of that land.

Baroness Carnegy of Lour

Does the noble Lord really think that wilderness land, the most beautiful part of the environment, stays beautiful by people doing absolutely nothing about it, paying nobody to attend to it and leaving it alone so that nature may rampage? Does he really think that the land is not managed: I know he lives a long way from that kind of place but I should have thought he would know that from his reading.

Lord McIntosh of Haringey

The noble Baroness knows more from personal experience of the management and conservation of wilderness land than I do. I readily concede that. Of course I do not say that there should not be sensible and effective management and active conservation of wilderness land and other land in water authority ownership. It is entirely consistent with the other objectives of the National Rivers Authority that it should have that responsibility. Indeed, that is what is proposed in the amendments.

The danger is quite otherwise. As my noble friend Lady Lockwood said with very specific examples, the danger is that the land which ought to be conserved for all of us could be developed profitably around the edges, for a few of us. That is what happens, with many commercially oriented leisure centres being built on the edges of the national parks and the fringes of areas of outstanding natural beauty. The specific statutory objective of the water company plcs will be to maximise the return on their assets and to dispose of that land and sacrifice the environment accordingly.

Lord Harmar-Nicholls

Does the noble Lord not admit that the examples he has just given could not arise without the approval of the planning authorities? What is the difference between the powers being vested in the planning authority, which is experienced, and the rivers board, which is not?

Lord McIntosh of Haringey

I may not know very much about the conservation and management of wilderness land but I do know something about our planning laws. I know the inadequacy of our planning laws to deal with cases where applicants for planning permission have the ability to offer sweeteners to local planning authorities. There are far too many examples of planning gain being sold to the detriment of the public interest. That is what happens where there is no ownership and where there are no sanctions. That is what will happen under these circumstances.

The Bill as it stands is simply not adequate to protect the environment. The Minister referred to protections. I listened with great interest to what he said about his forthcoming amendments and I look forward with great interest to seeing them in writing. However, those are amendments to Clause 8, and Clause 8 is constrained by Clause 7, which refers to the reasonable return on capital. Therefore they are secondary and subordinate to the main thrust of the Bill, which must be to create companies which are responsible for making profit. That is the whole object of privatisation, we are told by the Government. If that is not the case there is no point in doing it.

As the Bill stands, a water company plc which wishes to develop land which it does not require for operational purposes and which would otherwise be constrained by Clause 8 or the enforcement powers in Clause 20 has a very simple solution. All it has to do is to transfer ownership of that land to another body, even a completely subsidiary body. That removes it from the constraints of the Bill. There is legal evidence to that effect. If I am wrong I have no doubt that the Minister will be able to show me that I am wrong, but that has not been shown so far. The constraints refer only to the core aspects of the water business. All other parts of the assets which are being transferred to the new water companies are outside these constraints. That is why the assurances given by the Minister are simply not adequate for our purposes.

The Earl of Cranbrook

I thank the noble Lord very much for giving way. Is he aware that we are dealing with a high technology industry which will, given sufficient incentives, develop new processes, new ways of providing clean water, new ways of treating foul water, new means of sewage treatment and new ways of returning foul water to the environment in an acceptable fashion? That will inevitably mean adjustments in the property which is part of the core business. It seems to me that the noble Lord's amendment also captures that land which is available under the terms of the Bill at present to be sold and in this way provides proper incentives for development and giving what I believe the public want, which is a good water supply and first-class water treatment.

Lord McIntosh of Haringey

I agree with the noble Earl about what the public want. My amendment specifically provides for his concerns. It says specifically that all land required for operational purposes shall be leased to the water companies; that any land which they subsequently do not want shall come back to the National Rivers Authority; and any land which they subsequently do want shall be made available to them. What greater flexibility can one have? What further assurances can there be that there is no constraint whatever on the water companies doing their proper job because of ownership of land?

In this amendment we have a sensible division between the National Rivers Authority and the water companies. We have the water companies doing their job, supplying the water, treating the sewage and doing anything which is ancillary to those tasks. We have the National Rivers Authority extending its public interest in conservation and in quality by owning the land which ought in the public interest to be maintained free from speculative development.

The noble Lord, Lord Renton, started by saying that the public are not anxious for public authorities to hoard land. I have paraphrased him slightly but I think that he will accept that I have got it right. The public are extremely anxious about the provisions of this Bill. What they see in this Bill is an opportunity for those who subscribe in the new water company plcs to make money not from producing water more efficiently but from selling off assets which belong to all of us, the public. That is what the amendments are designed to prevent. I commend them to the Committee.

5 p.m.

The Earl of Caithness

Before the noble Lord sits down, perhaps I may say to the Committee that I agree that there is a fundamental difference of philosophy. However, it is worth recording that it is with some considerable disappointment that I noted that the noble Lord discarded my offer of further discussion on this matter with a commitment to bring forward an amendment at a later stage to deal with exactly the sort of points that he now seeks to pre-empt.

Lord McIntosh of Haringey

I certainly did not discard any offer of discussion or further consideration. I said that I looked forward eagerly to seeing the amendments. I shall of course be glad to have discussions about them with the Minister before they are formulated. That does not in any way conflict with the rest of what I say. The noble Earl made it clear that his amendments will be to Clause 8. The fundamental point which must not be ignored is that Clause 8 is subordinate to Clause 7 and that the objective of the new water companies must be to make a profit. Otherwise, why are we spending our time here at all? This is not an environmental Bill; it is a Bill to privatise water based on the argument that the industry will be operated more efficiently in the private sector.

Baroness Blatch

Given that the noble Lord has predominantly talked about national parks, the Elan valley, the Peak District and the Lake District, and taking into account local enactments and the duties on the existing water authorities which are to be transferred to the new water plcs and strengthened and, in addition, the planning controls, is he suggesting that the national parks, the Elan valley, the Lake District and the Peak District are under threat as a result of the Bill? This case attracts some sympathy, but the noble Lord is going rather over the top in this debate.

Lord McIntosh of Haringey

I am not sure whether the noble Baroness asks me a question or seeks to make a point at a rather late stage in the debate. Perhaps I may take her point as it appears to be intended and answer her question. I believe that not only all the organisations concerned with the environment but a large number of people in this country who do not have any specialist knowledge think that the environment will be gravely at risk if land that has been in public ownership through the water authorities, which have constraints laid on them by statute, is transferred to public limited companies whose primary objective is to make a profit. The more I hear of the danger to the privatisation process from any attempt to take non-operational land away from them, the more I believe that privatisation is not about running water more efficiently but about selling off our land assets. If it comes down to that, it is on those grounds that I ask the Committee to take a decision on this matter.

5.3 p.m.

On Question, Whether the said amendment (No. 2) shall be agreed to?

Their Lordships divided: Contents, 127; Not-Contents, 161.

DIVISION NO. 1
CONTENTS
Addington, L.	Fitt, L.
Airedale, L.	Foot, L.
Allen of Abbeydale, L.	Galpern, L.
Amherst, E.	Gladwyn, L.
Ampthill, L.	Graham of Edmonton, L.
Ardwick, L.	Gregson, L.
Aylestone, L.	Grey, E.
Baldwin of Bewdley, E.	Hacking, L.
Birk, B.	Hampton, L.
Blease, L.	Hanworth, V.
Bonham-Carter, L.	Harris of Greenwich, L.
Boston of Faversham, L.	Hatch of Lusby, L.
Bottomley, L.	Hayter, L.
Briginshaw, L.	Headfort, M.
Brimelow, L.	Henderson of Brompton, L.
Broadbridge, L.	Henniker, L.
Brooks of Tremorfa, L.	Hirshfield, L.
Bruce of Donington, L.	Hooson, L.
Callaghan of Cardiff, L.	Hughes, L.
Campbell of Eskan, L.	Hylton, L.
Carmichael of Kelvingrove, L.	Jacques, L.
	Jeger, B.
Carter, L.	Jenkins of Putney, L.
Cledwyn of Penrhos, L.	John-Mackie, L.
Cocks of Hartcliffe, L.	Kennet, L.
Craigavon, V.	Kilmarnock, L.
Cudlipp, L.	Kinloss, Ly.
Dainton, L.	Lawrence, L.
David, B.	Leatherland, L.
Davies, L.	Listowel, E.
Davies of Penrhys, L.	Llewelyn-Davies of Hastoe, B.
Delacourt-Smith of Alteryn, B.
	Lloyd of Kilgerran, L.
Denington, B.	Lockwood, B.
Dormand of Easington, L.	Longford, E.
Elwyn-Jones, L.	Lovell-Davies, L.
Ewart-Biggs, B.	McIntosh of Haringey, L.
Ezra, L.	Mackie of Benshie, L.
Falkender, B.	McNair, L.
Falkland, V.	Mais, L.

Mayhew, L.	Sefton of Garston, L.
Meston, L.	Serota, B.
Milner of Leeds, L.	Shepherd, L.
Monson, L.	Somers, L.
Mountevans, L.	Soper, L.
Mulley, L.	Stallard, L.
Nicol, B.	Stewart of Fulham, L.
Northfield, L.	Stoddart of Swindon, L.
Ogmore, L.	Strabolgi, L.
O'Neill of the Maine, L.	Taylor of Blackburn, L.
Perry of Walton, L.	Taylor of Gryfe, L.
Peston, L.	Taylor of Mansfield, L.
Phillips, B.	Tordoff, L. [Teller.]
Pitt of Hampstead, L.	Turner of Camden, B.
Ponsonby of Shulbrede, L. [Teller.]	Underhill, L.
	Vernon, L.
Prys-Davies, L.	Wallace of Coslany, L.
Rathcreedan, L.	Walston, L.
Robson of Kiddington, B.	Whaddon, L.
Rochester, L.	White, B.
Ross of Newport, L.	Williams of Elvel, L.
Russell, E.	Willis, L.
Sainsbury, L.	Winterbottom, L.
Scanion, L.	Wrenbury, L.
Seear, B.	Young of Dartington, L.
Seebohm, L.

NOT-CONTENTS
Ailesbury, M.	Ferrers, E.
Aldington, L.	Ferner, L.
Alexander of Tunis, E.	Fortescue, E.
Alexander of Weedon, L.	Fraser of Carmyllie, L.
Allenby of Megiddo, V.	Fraser of Kilmorack, L.
Allerton, L.	Glenarthur, L.
Alport, L.	Goold, L.
Annaly, L.	Greenway, L.
Arran, E.	Gridley, L.
Ashbourne, L.	Grimston of Westbury, L.
Bathurst, E.	Hailsham of Saint Marylebone, L.
Bauer, L.
Beloff, L.	Harmar-Nicholls, L.
Belstead, L.	Harvington, L.
Benson, L.	Havers, L.
Bessborough, E.	Henley, L.
Blatch, B.	Hesketh, L.
Bolton, L.	Hives, L.
Boyd-Carpenter, L.	Hood, V.
Brabazon of Tara, L.	Hunter of Newington, L.
Brain, L.	Hylton-Foster, B.
Brookeborough, V.	Jenkin of Roding, L.
Brougham and Vaux, L.	Joseph, L.
Butterworth, L.	Kaberry of Adel, L.
Caithness, E.	Killearn, L.
Campbell of Alloway, L.	Kimball, L.
Campbell of Croy, L.	Lauderdale, E.
Carnegy of Lour, B.	Layton, L.
Carnock, L.	Long, V.
Cathcart, E.	Lucas of Chilworth, L.
Colnbrook, L.	McFadzean, L.
Constantine of Stanmore, L.	Mackay of Clashfem, L.
Cork and Orrery, E.	Macleod of Borve, B.
Cottesloe, L.	Malmesbury, E.
Craigmyle, L.	Manton, L.
Craigton, L.	Margadale, L.
Cranbrook, E.	Marley, L.
Crickhowell, L.	Marshall of Leeds, L.
Cullen of Ashbourne, L.	Massereene and Ferrard, V.
Dacre of Glanton, L.	Maude of Stratford-upon-Avon, L.
Daventry, V.
Davidson, V. [Teller.]	Merrivale, L.
Denham, L. [Teller.]	Mersey, V.
Derwent, L.	Middleton, L.
Dilhorne, V.	Milverton, L.
Dundee, E.	Monk Bretton, L.
Elibank, L.	Monteagle of Brandon, L.
Ellenborough, L.	Moran, L.
Elles, B.	Mountgarret, V.
Elliot of Harwood, B.	Mowbray and Stourton, L.
Elliott of Morpeth, L.	Munster, L.
Erroll of Hale, L.	Murton of Lindisfarne, L.
Faithfull, B.	Nelson, E.

Norfolk, D.	Shannon, E.
Norrie, L.	Sharpies, B.
Nugent of Guildford, L.	Skelmersdale, L.
Onslow, E.	Southborough, L.
Oppenheim-Barnes, B.	Stodart of Leaston, L.
Orkney, E.	Strange, B.
Orr-Ewing, L.	Strathclyde, L.
Oxfuird, V.	Strathspey, L.
Pender, L.	Swansea, L.
Pennock, L.	Swinton, E.
Peyton of Yeovil, L.	Terrington, L.
Porritt, L.	Teviot, L.
Portman, V.	Teynham, L.
Pym, L.	Thomas of Gwydir, L.
Quinton, L.	Thomas of Swynnerton, L.
Radnor, E.	Thurlow, L.
Reay, L.	Todd, L.
Reigate, L.	Trafford, L.
Renton, L.	Trefgarne, L.
Renwick, L.	Trumpington, B.
Rochdale, V.	Tryon, L.
Rodney, L.	Vaux of Harrowden, L.
Romney, E.	Waldegrave, E.
St. Davids, V.	Wigram, L.
St. Germans, E.	Wolfson, L.
Saltoun of Abernethy, Ly.	Wyatt of Weeford, L.
Sanderson of Bowden, L.	Wynford, L.
Savile, L.	Young, B.
Sempill, Ly.

Resolved in the negative, and amendment disagreed to accordingly.

5.12 p.m.

Lord Graham of Edmonton moved Amendment No. 3: Page 2, line 10, after ("of) insert ("reducing pollution and otherwise").

The noble Lord said: I understand that in moving Amendment No. 3 it will be for the convenience of the Committee if we also consider Amendment No. 10. These amendments put some flesh on the principle that he who pollutes our water shall pay to eradicate the pollution.

I say at once to the Minister that the Bill clearly shows the broad agreeement that has evolved over the passage of time that the one who has caused the pollution shall be responsible for clearing it up. The amendments seek to write on the face of the Bill at an appropriate stage words which make it clear that the Government mean business. Bluntly and crudely, the Government must be seen to be in the serious business of making sure that the polluter clears up the mess. Sadly, certain individuals, companies and even public authorities have in the past got away with murder. The amendment is a clear indication that this shall not happen in the future. Amendment No. 3 relates to the responsibilities of the National Rivers Authority. It ensures that besides carrying out the other functions assigned to it, the authority will be in the business of reducing pollution.

The Minister and my noble friend Lord McIntosh have spent a very profitable two hours exposing the broad principle which underlies the purposes of the Bill. I shall return to this point later. There are hundreds of acres of land currently in public ownership which the Government believe can better be used if there were to be a change of ownership of that land. I shall not rehearse the arguments we have heard on that subject.

A key aspect of the Bill is the quality of the water that we drink and use. These amendments seek to ensure that when people are negligent, zealous, ignorant or in some other way getting away with continuing to run their business while polluting our waters—it might be a nationalised industry, an individual or a company—they shall bear the cost of removing that pollution from water which eventually is used to provide pure drinkng water.

The Committee will be aware that this is the territory of the gamekeeper and the poacher. There is a responsibility to make sure that the water we drink is clean, pure and useful. Pollution cannot be controlled nor can our rivers and other water resources be protected from further pollution or rescued from existing pollution if the financial resources required are not provided.

Noble Lords are often reminded of the question: what about the taxpayers' money? We do not want to waste taxpayers' money. But if the people who cause the pollution do not pay for the mess that they create, at the end of the day this or any other government will have to put the matter right. If those people who are the proper recipients of these measures escape the clauses of the Bill, it will be the taxpayer who pays.

That is the basis on which we want the. Government to accept the amendment. I hope that they will be sensible, that they will not say that there is no evidence to warrant such an amendment and that the people who pollute our rivers and streams will be dealt with. I hope that the Minister will accept the genesis of our argument. It is not for the Minister to tell the Committee that other parts of the Bill take this matter into account. The amendment seeks to have written on the face of the Bill at an early stage—not in a later clause—that one of the prime responsibilities of the rivers authority is to deal with pollution.

We shall also be considering the question of consents, the varying qualities of consents and different types of pollution later in our debates. There is some horrendous evidence of the manner in which polluters have got away literally with murder. They have killed fish and animals—and people, from the point of view of the damage that is done in a range of ways—and we have the evidence for it.

I should like to give the Committee an illustration. It is the current position. The Government do not directly carry the blame for the present state of the water, although they are responsible for ensuring that those agencies which have been charged with certain functions carry them out. There are stretches of rivers in north Derbyshire and south Yorkshire where, it is claimed, discharges of mercury, cadmium and other toxic chemicals have resulted in the river bed becoming extremely toxic for biological life. The water of the River Rother is not suitable, and may not become suitable, for use in the water system in south Yorkshire. Under the new system, who will continue to pay to bring clean water from a distance? The industry that is polluting the River Rother must be made to clean up the river, whether it is in south Yorkshire or elsewhere. We read in the papers of illustrations from all parts of the country where terrible environmental damage is done primarily to wildlife—animals, plants and fish—but it also leads to the gradual decline of the landscape that people have enjoyed.

We are asking the Minister to tell the Committee not only that he believes that pollution should be avoided but that those who cause it should be hit hard. When it is possible to ascertain who has caused the pollution—and I recognise that this is not always easy—we ought not to hesitate to ensure that the polluter has to pay. The southern division of the Yorkshire Water Authority has the highest concentration of polluted rivers in the country, with 1,800 registered discharges over hundreds of miles of river. It has 17 pollution control staff. It seems unlikely that the number of staff covering these issues at the NRA will be any higher. A disturbing piece of research is that over a 10-year period more pollution was ascertained, yet there are now fewer officers in post to deal with it.

My case is this. Not only do we wish to clean up our rivers but we wish to make sure at an early stage that it is written into the Bill that the National Rivers Authority has such responsibility.

Lord Renton

The noble Lord, Lord Graham of Edmonton, has had good reason to move this amendment. Pollution of our rivers has caused great public indignation and anxiety. I am happy to be able to say that since the Control of Pollution Act 1974, most of which is to remain on the statute book, the position has greatly improved. The noble and learned Lord, Lord Elwyn-Jones, and I remember that when some of us were elected to another place the Thames was in an awful state. It was well known that only the most pollution-greedy fish could ever be found in it. It is now a remarkably pure river. It could no doubt be improved still further.

However, I must not wander too far from the more important aspects of this amendment: that the supply of water that we drink should be clean. This is one of the longest Bills in history, with over 380 pages. One does not wish therefore to lengthen it. At first sight, one might ask: what is the harm of these two fairly short amendments? I do not see any harm in Amendment No. 3. I believe that it could be a little misleading because it selects just one of several duties that may be given to the National Rivers Authority, subject to the decisions of the Chamber. It refers to the others by the words "and otherwise". We should normally avoid such terms in statute because they can give the impression that Parliament is interested in only one of several important duties and makes no mention of the others—although they are mentioned elsewhere in the Bill. From that rather narrow point of view, I have a doubt on Amendment No. 3.

However, on Amendment No. 10 my doubts are more serious. Clauses 52 to 60 of the Bill, nine clauses altogether, impose very specific duties upon the new water companies to ensure good water quality. I realise that that is not the only issue about which the noble Lord is worried. He is much more worried about people who pollute water, who may have nothing to do with the water companies. However, that is referred to in the Bill in Clauses 61 to 63, under the heading of contamination, waste and misuse of water.

If we then consider Clause 105, to which reference is made in Amendment No. 10, we find that the Control of Pollution Act 1974 is mentioned. Great strides in preventing water pollution, and punishing water polluters, have been made as a result of that Act. Under the common law of tort, any person who suffers damage or injury to health through water pollution or damage, for example to a processing business—paper processing depends upon a pure supply of water—can receive damages in court. That is one of the matters envisaged in Amendment No. 10. However, my noble friend will have taken stock of the existing law. Whether or not the present law and its remedies are well enforced is another question. We can only make laws; we cannot guarantee their enforcement, any more than we can guarantee their being obeyed. I should have thought that the legal availability of remedies under the present law is pretty massive, in addition to Clauses 52 to 63 inclusive of the Bill. Therefore I seriously doubt whether the amendment is necessary.

I have one further problem on Amendment No. 10. Subsection (2) states: The Secretary of State shall, at the request of the Authority, make regulations for the purposes of achieving the objectives in subsection ( 1 ) above". But any regulations that were made would overlap to a greater extent with the existing law. I should rather have primary legislation dealing with this important matter than regulations made even by the Secretary of State.

5.30 p.m.

The Earl of Halsbury

I want to remind your Lordships of a point made by my noble friend Lord Shannon at Second Reading, which is that the polluter never pays. We should not imagine that he ever pays. He puts it on to the price of the product, and what is being done is the transfer of a measure of purchasing power from the producer of goods to his consumer and then over again to cheapen the price of water. The noble Earl made this point well at Second Reading.

I can see nothing wrong with proposed Amendment No. 3.1 await the judgment of the noble Earl, who may tell me that it is not necessary because it is already provided for in some other clause of the Bill. I am not an expert on draftsmanship and am guided on this by the noble Lord, Lord Renton, who said that the Water Bill is the longest Bill in history. I am reminded of a line of the poet Swinburn that even the weariest river winds somewhere safe to sea.

I shall wait for the noble Earl, Lord Caithness, to tell me, if the noble Lord wishes to press his amendment, whether it is necessary for me to take part.

The Earl of Onslow

As a result of the intervention of the noble Earl, Lord Halsbury, I am tempted to say that even though the polluter passes on his costs to his ultimate client, that is the price that his ultimate client will jolly well have to pay. Under the safety at work legislation, one cannot have unguarded machinery because one can sell a ploughshare cheaper without the safety at work legislation. Both Amendments Nos. 3 and 10 moved from the Benches opposite seem to me to be eminently sensible. I am convinced that my noble friend Lord Caithness has reams of beautifully written Civil Service English to say why the amendments are defective, but the point made is valid. If, as my noble friend Lord Renton says, it is covered in the Bill already, all we want my noble friend to say is that the amendment is unnecessary. If it is unnecessary because it is covered already, we shall all be pleased.

Lord McIntosh of Haringey

I did not intend to intervene either, but I was tempted by the noble Earl, Lord Halsbury. In the sense that the noble Earl, Lord Shannon, said, it is true that the polluter does not pay. On the other hand, if the polluter has to add the cost of remedying the pollution to his prices there is some incentive on him which otherwise does not exist to reduce the pollution. I strongly support the point made by the noble Earl, Lord Onslow. If we did not hold to the principle of making the polluter pay, at least in the first instance, we should be back to Lord Shaftesbury and the employment of children in our factories.

Baroness Oppenheim-Barnes

I had not intended to intervene either, but I should like to put a thought to my noble friend. Whereas it is true to say that it is not the polluter who pays, but the consumer who invariably pays, I believe it is true to say that under the Bill the regulator would not permit the polluter to pass on the cost to the consumer if the pollution was due to negligence.

Lord Addington

If we are considering such a fundamental environmental point as the polluter pays, we should try to get this into perspective. This is a great way of saying that if someone damages the environment—that is, the environment as a whole; not just individuals and not just the pollution of water—and something as valuable to our country as a river ecological system where the whole system may be damaged, there should be some way of ensuring that at the very least those responsible do not profit from the damage. If we can safely say that people who do the damage must at least meet the cost of making the damage good, that would be a sound thing to have in the Bill.

The Earl of Caithness

These two amendments focus upon the role of the NRA in improving the water environment and the means by which this is to be achieved.

Dealing first with Amendment No. 3, its purpose is to make clear, by a reference in Clause 1, that reduction of pollution and hence improvement in water quality is a central purpose of the NRA. That this is to be the NRA's purpose should be amply clear from the terms of the Government's policies and all that they are seeking to achieve through this Bill: from the establishment of the NRA itself; from the substantial increase in investment the Government propose for the improvement of sewage treatment works and from the extension and strengthening of pollution controls in Part III.

But the amendment is rendered unnecessary not only by these considerations. It is made unnecessary by the way in which Chapter I of Part III is structured, which specifically requires the NRA to make the reduction of pollution its guiding purpose.

The fact is that our declared objective of controlling pollution and improving water quality is built in, clearly and inescapably, to the legislation itself. I refer the noble Lord, Lord Graham of Edmonton, to Clause 103. The Secretary of State and the NRA have the duty to exercise their powers under Chapter I so as to achieve the statutory objectives set under Clause 102. In the words of Clause 102(1), these objectives—which will be set after public consulation—will be, for the purpose of maintaining and improving the quality of controlled waters". Thus the objectives are to improve water quality, and all the pollution control powers in the Bill must be used to that end. It will be outside the authority of both the Secretary of State and the NRA to use the powers in the Bill with any other end in view.

Let me confirm to the noble Earl, Lord Halsbury, and to my noble friends Lord Onslow and Lord Renton that the amendment is already fully and firmly secured by the Bill. In these circumstances, I suggest that this amendment adds nothing of substance to the Bill, and that there is accordingly nothing to be gained from it.

Amendment No. 10, which we are also discussing but which is not consequential on but separate from Amendment No. 3, would insert in the Bill a commitment to the principle that the polluter should pay. We accept that principle and I assure the Committee that it is fully informed of the detailed provisions of the Bill, and in particular Chapter III. For this reason we do not believe that the amendment is necessary, but before I set out the reasons in detail let me set out the two general points of introduction.

First, we reiterated recently in our Environment in Trust leaflets that the costs of pollution control must be borne by the polluter so that the true costs of any activity are passed on to those who benefit. It is a fact of economic life that if such costs fall to the consumers, they can take right decisions about consumption in the light of the price they pay. That means that the charges to the customer and to the water consumers will rise to meet the costs of the water authorities of improving effluent discharges from sewage treatment works. But we believe that the Bill and privatisation will work to reduce the increases in cost which are necessary to secure the environmental improvements we seek.

Secondly, let not our reluctance to accept this amendment cast any doubt on our commitment to such improvement. As I have indicated on another amendment, our declared objective of controlling pollution and improving water quality is built in clearly and inescapably to the legislation itself. That is by way of background.

Let me now demonstrate that our proposals for pollution costs and charging in each of the relevant areas fully reflect this principle and make the amendment unnecessary. In the case of effluent discharge consents under Schedule 11, the costs of complying with current standards or achieving new ones when these are tightened will fall directly on the discharger; and after privatisation these will be the sewerage companies through borrowing or charges to customers, rather than the public purse. In the case of precautionary measures under Clauses 107 and 108, such as regulations on storage or controls within protection zones, it will again be the person responsible for the pollution who will have to pay for the measures necessary to prevent it. The only exception we anticipate is nitrate because of its relationship to good agricultural practice and the difficulty of identifying the source of the pollution, but the Committee can consider the merits of that at a later time.

In the case of pollution incidents, actual or anticipated, Clause 111 provides that the costs of all the steps undertaken, including preliminary surveys to locate the outbreak, can be recovered. Where prosecutions are mounted the court will be able to award the NRA its costs in bringing the prosecution. On indictment, unlimited fines can be imposed. Fines are a matter for the court to determine. But the Government's view remains that expressed some two years ago by the then Lord Chancellor when he told the Magistrates' Association that it was important that the level of fines be such as to make clear that water pollution offences did not pay.

Finally—perhaps the noble Lord, Lord Graham of Edmonton, is not aware of this—on 22nd February we issued a consultation paper about the recovery of costs associated with discharge consents and the regular monitoring of effluent quality. Schedule 11, paragraph 9, provides for that. Previously those costs had been paid for by taxpayers or consumers of water services.

Our consultation paper sets out the basis for a new charging scheme based on the principle that the polluter pays for the cost of his activities. In this case, the dischargers are for the most part the water and sewerage undertakings and the industrial dischargers of waste water. A substantial proportion of the NRA's total cost for water quality regulation and pollution control is likely to be recovered through the charging scheme.

I hope that Members of the Committee will agree that this is a formidable array of measures. It gives expression to the "polluter pays" principle in a way that is appropriate in specific concrete cases; not by expression of a general principle which is unnecessary and can be unhelpful, as proposed in the amendment.

I should like to deal with a point raised by the noble Lord, Lord Graham of Edmonton, about river quality. I remind the Committee that 90 per cent. of our rivers are of good or fair quality compared with 75 per cent. of those in Europe. One river alone contributes more than half the pollution entering the North Sea; that is the Rhine. Our position stands well in any comparison but I agree with Members who say that it needs improving. We are acting. My noble friend Lord Renton mentioned some of the work. He referred to the improvement to the estuary and to the River Thames. I take this opportunity to remind the Committee that we have also been tackling other estuaries. For example, the Mersey basin scheme is a 25-year project which will cost billions of pounds.

In inviting the Committee to reject the amendment, I add one qualification. If Members can identify any specific area where our provisions do not properly reflect the polluter pays principle and where its application is not practical and beneficial, I shall listen with care and sympathy.

Baroness White

I am grateful to the Minister for that explanation but I wonder whether he will reflect again on the first of the amendments. I understand his difficulties with regard to the second.

As regards Amendment No. 3, does the Minister not believe that it might be helpful, even though not strictly necessary, to include a reference to pollution at the beginning of the description? If we are ever to reach Clause 103 I believe that it would be helpful to include such a reference. The control of pollution is one of the major functions in the popular mind of the National Rivers Authority, although it will have other functions. Surely if one is considering the impact on public opinion it will do no harm to accept the first of these amendments, even though the Minister may have difficulties with the second.

The Earl of Onslow

Before the Minister sits down I wish to ask a question, although almost certainly he will not know the answer. As a result of deep draining at Horsey Mere, one of the Norfolk Broads, a great deal of nasty iron has surfaced. The water is now the colour of rust instead of being gin clear as it used to be. It is the result of a complicated chemical process which I do not understand. It was caused by the local drainage authority and agreed to by the Anglian Water Authority. Will the NRA be able to do something about such instances? I realise that it is at a different end of the scale to the Thames or Mersey estuaries but it is a matter about which we should take consideration and care. I do not expect the Minister to know the answer but I should be grateful if he will write to me or ask his department to look into the matter.

5.45 p.m.

The Earl of Caithness

In answer to my noble friend, I recently spent a happy day visiting the Norfolk Broads. That problem was not brought to my attention and therefore I do not know the answer. However, if pollution and damage are being caused to the environment or to the river systems, the matter must be taken seriously. I believe that it is within the remit of the NRA to tackle the problem, but I shall make absolutely certain of that.

I disagree with the noble Baroness, Lady White. I believe that Members who are interested in the Bill will reach Clause 103. I hope that the noble Baroness stays with us long enough to discuss that clause: indeed, I hope that she stays with us until we reach the end of the Bill.

I am not against Amendment No. 3 but I believe it is unnecessary. I look towards my noble friend Lord Renton with some fear and trepidation because I have been chastised by him on numerous occasions for including a provision which is unnecessary. We need to keep a Bill—albeit a large Bill—as lean as possible.

Lord Graham of Edmonton

If I have to choose between upsetting the Minister or the noble Lord, Lord Renton, I prefer to upset the noble Lord and have the Minister on my side. He has the power in this matter.

I am more than satisfied that in respect of Amendment No. 10 the Minister has gone a considerable way to assure me and those outside the Committee that where the evidence is found—and that requires enforcement—and where the determination of the Government or the authority with the power to deal with the matter is strong and resolute, the polluter is capable of being made to pay.

At this early stage of the Bill we wish to demonstrate to people outside the Committee that the Government mean business and are serious. The noble Baroness, Lady White, made a powerful point. She said that we wish to write on the face of the Bill as early as possible the fact that pollution, with a capital "P", and the way in which we deal with and eradicate it, is a major element in the Bill. I do not use a stick to beat the Government. Rather defensively, the Minister pointed out that our record of clean rivers bears a comparison with others in Europe; I do not disagree.

I hope that at this early stage the Minister will not say that although he agrees with us there is no form of words which he is willing or able to accept. The Bill contains 380 pages which have been conceived and put together by the Government. In this case those who oppose the Government politically suggest that one-fifth or one-sixth of a page can be added. In that connection, there is not a great deal between us.

I do not dispute the Government's intentions to achieve what is sought in Amendments Nos. 3 and 10, and I shall not repeat many of the arguments. However, we must demonstrate to the public that when evidence is put before the Government of a deliberate act of pollution they will deal with it. I have evidence of industrialists who have deceived the inspector by agreeing to act in a certain way. Authorities have reported to me instances where firms have deceived the inspector as to the true condition. The polluter must be hit hard. The penalty must be punitive and, more important, it must be public. The greatest weapon for any authority is to be able to threaten people who are being deliberately anti-social and anti-environmentalist. When they are caught, the evidence is produced and the tribunal is satisfied they may have to pay enormous sums of money. If everyone knows of that, it will be bad for their business.

In Amendment No. 3 we wish to satisfy a raft of people outside the Committee including the taxpayers, residents, and those who have been a little jaundiced as to whether this and other governments have been serious. The amendment writes on the face of the Bill at an early stage the fact that we are serious not only about water but also about pollution.

There is another reason for tabling the amendment. The Minister told the Committee about the powers which are open to the Secretary of State in other clauses. We want more muscle to be in the hands of the National Rivers Authority. We want it to be able to say, "This is one of our prime responsibilities". In speaking to members of the National Rivers Authority the Minister and his advisers will make that perfectly clear, but we want to strengthen the arm of the authority.

Before I decide whether I intend to press this amendment, I invite the Minister to say that if I withdraw it he will be prepared to think of a suitable form of words acceptable to him which either he or I will move as an amendment at a later stage. I am not asking him to give me a commitment that that is possible but I ask him to enter into discussions.

Lord Renton

Before my noble friend replies to that, perhaps I may reassure the noble Lord, Lord Graham of Edmonton. I have counted the number of pages in the Bill dealing with pollution. As near as possible, there are 19 and a half pages, in addition to the Control of Pollution Act 1974.

Lord McIntosh of Haringey

I hope that the noble Lord, Lord Renton, will remember that the Explanatory and Financial Memorandum to the Bill says that Part III largely replaces Part II of the Control of Pollution Act 1974. Therefore one cannot add the two together.

Lord Renton

The greater part of that Act is to remain. The parts which are to be repealed are listed in the repeal schedule.

The Earl of Caithness

There is a more conciliatary tone from the Opposition now. I notice that the noble Lord, Lord Graham of Edmonton, says that he does not want a commitment. Of course I shall look at this. I do not oppose Amendment No. 3 and never have done. I merely say that it is unnecessary because of the reason which my noble friend Lord Renton gave. This matter is very much at the forefront of the Government's mind and at the forefront of everything in this Bill. Let us look at the wording between now and another stage to see whether the noble Lord's wording is absolutely right or whether some other form of wording is more appropriate.

Lord Graham of Edmonton

I recognise a gift horse when I see one and I shall not look it in the mouth. I believe that that is as much as I shall get because I remember parliamentary arithmetic of half an hour ago as well. Therefore, in view of what the Minister said, which I agree is not a commitment other than a commitment to look together at the form of words along the lines of Amendment No. 3, for which I am grateful, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord McIntosh of Haringey moved Amendment No. 4: Page 2, line 11, at end insert ("and no such function shall be carried out, whether by contract or otherwise, by any person except in accordance with section (separation of environmental functions etc.) below").

The noble Lord said: The purpose of Amendment No. 4 is to give effect to repeated government statements that they want to separate the poachers from the gamekeepers. I believe that the Government have rightly taken considerable credit for the establishment of the National Rivers Authority, largely on the grounds that it does just that; namely, that it distinguishes those who have the responsibility for conservation, water and river quality from those who have the responsibility for providing water and sewerage services.

The problem with those assurances is that they are not reflected in the Bill. The specific question to which I am referring in Amendment No. 4—and I should also like to speak to Amendment No. 9—is the contracting out of the functions of the National Rivers Authority. I shall not say that we are happy about the extension of contracting out by this Government generally or about the forced extension of contracting out to local authorities in recent legislation. However, I must say straight away that these two amendments are not against the principle of contracting out; far from it. They recognise that the National Rivers Authority, if it is to maintain a relatively slim and tight structure, will have to contract out some services, particularly those involved in collecting samples of water quality.

We do not find acceptable the possibility that the contracting out should be allowed back to the water plcs. The water authorities have been responsible for collecting samples and for analysing them ever since they were established. I am certainly not saying that the people who have carried out that work have not acted in anything other than total good faith and with complete professionalism. However, the fact is that since the water authorities were established, the number of pollution control and inspection officers has declined. Understandably, I suppose, the water authorities have given priority to their operational rather than to their inspection needs. Therefore, the resources devoted to dealing with pollution have not been available in the way in which they should have been.

That stricture also applies to central government. Her Majesty's Inspectorate of Pollution has been understaffed. There have been vacancies there, just as there have been for pollution control officers in water authorities.

The difficulty which I see about contracting back to the water supply plcs the job of dealing with pollution control is that, with their new objective of making a profit as private companies, there is a direct conflict between what their staff would do in fulfilling the contracting out functions and the objectives of the company.

If the contracting out goes back to the water companies, inevitably when pollution is discovered there will be a substantial cost in putting that right and there will be the risk of prosecution. It will no doubt be a requirement of prosecution under Part III of the Bill that the officer who discovered the pollution will be required to give evidence against his own company. That does not mean that anybody will act in anything other than good faith, but it means that there will be a conflict of interests in that person's mind. He will either act less effectively than he would otherwise act as a reporter of infringement, or he will be a less than effective witness for the prosecution, or he will land up unpopular in his own organisation which is responsible for his pay and rations. The result of that is that pollution control in that respect will be an unpopular job in the water companies and will not be a natural road to promotion. It will not be attractive as a career. That is not a very satisfactory situation.

The Government recognise that the NRA has to keep some part of that process in its own hands. Mr. Colin Moynihan, the Parliamentary Secretary, in Standing Committee on 10th January at col. 49 of Hansard, said that the NRA would have to take responsibility for collecting all the samples. That is central to any contracting back to the plcs which may take place. I suggest that that does not go far enough.

As my noble friend Lord Graham said a few moments ago, there are examples of polluters playing off one authority against another. One example came to my notice of a plating company which told the water authority that it was disposing of the waste to a waste disposal site. It told the waste disposal authority that it had the water authority's permission to dispose of the waste down a foul drain. In fact, it was doing neither but was simply dumping it in the yard, with rather serious environmental effects.

In order to achieve an effective regulatory mechanism, we need to have a mechanism which fulfils two functions. First, it must be integrated and cover all forms of pollution; both waste disposal and water quality. Secondly, it must be local. In Amendment No. 9 we specifically suggest that local authorities, who have had many years' experience of environmental protection and have an environmental protection service many of whose activities are widely praised, would be a repository of expertise and suitable for contracting out.

Therefore, the amendment is not against contracting out as such, but against contracting back to the water supply plcs. That is the logical and rational way to deal with what otherwise might become a serious conflict of interests and a serious departure in the text of the Bill from the declared intentions of the Government. I beg to move.

6 p.m.

Lord Ezra

In supporting Amendment No. 4 and the related Amendment No. 9, I, like the noble Lord, Lord McIntosh, remind the Committee that the Government have laid enormous emphasis on the division of responsibilities and functions as between the NRA, on the one hand, and the operating water companies on the other.

On Second Reading the Government spoke up strongly for the existing organisation being preserved under privatisation; namely, the river basin system. However, I think they have persuaded the public in general that the division of responsibilities which is now inherent in the Bill is a more satisfactory way of handling the matter. That being so, however, we feel that this should be stated clearly and without ambiguity; and that is one of the purposes of the amendment.

The other point is that there can be blurred edges in this division of functions. The blurring of the edges can mainly be created by contracting back from the NRA some of the functions which it has taken over as part of this division of responsibility from the operating companies. That is causing a great deal of concern. I know that at one time it was felt that in very large measure the functions which the companies previously undertook and which have been transferred to the NRA would be handed back—at least, that is what I was told on a visit some weeks ago to one of the water companies. I do not know to what extent this contracting back will take place in the mind of the Government, but I should have thought that it could be a very dangerous and confusing practice and that we could end up with a situation which is neither one thing nor the other.

There are others who can perform some of these functions. As the noble Lord, Lord McIntosh, pointed out, local authorities have expertise in this environmental field in the laboratory testing of samples. There are, of course, a number of private institutions and companies which can also carry out these functions. Therefore, I should have thought that there was plenty of choice, even if the NRA does not at its inception have the facilities necessary to do this work itself. It would seem that the Government, in pursuit of their own objectives, should pay particular attention to that aspect and reassure the Committee that it is indeed their intention to divide these functions and not to blur the edges.

Lord McIntosh of Haringey

Before any other noble Lords speak on this amendment, may I first make an apology? There is an error which may have caused confusion. Amendment No. 4 refers to, section (separation of environmental functions etc.). Amendment No. 9, in the side heading, refers to, Preservation of the environment". Amendment No. 9 should have had the side heading, Separation of environmental functions etc.", so that the two amendments related to each other. It is understood that the side headings are not part of the text of the Bill, but I apologise for any confusion which may have been caused by my error.

Lord Harmar-Nicholls

The noble Lord, Lord McIntosh, said that he had no objection to subcontracting and expects it to go on to some extent. However, the wording of Amendment No. 9 suggests that he has no objection to manacling the NRA in arranging its subcontractors. Subsection (4) of the amendment reads, The Authority shall not sub-contract, or otherwise cause or enable to be carried out, any of its functions to any person who is for the time being, or has been in the previous five years, a water or sewerage undertaker within the terms of this section". I agree that it would be wrong to subcontract to anybody who could not, if anything happened, be an impartial witness because of past commitments or who had shown that they were not proper people to carry out the functions, but I should have thought that subsection (4) was going a little too far. One would be ruling out by statute people who might be most excellent in carrying out subcontracting work. I can well accept up to a point that one would not want to subcontract to a person who was currently employed by the previous undertaker but, as I said, to impose a five-year embargo seems to be the deliberate application of manacles.

Surely the NRA, which will be doing the subcontracting, will be able to form a judgment on whether the subcontractors doing the work are the right or the wrong people. To write into the statute that anyone who has been engaged in such work in the previous five years will not be allowed to make use of their expertise—even if the NRA believes them to be suitable—is going too far. I wonder whether the noble Lord wishes that extreme embargo to remain, because it does not fit in with the rest of his argument as I thought I heard it.

The Earl of Onslow

One should certainly support the principle behind this amendment. It would be seriously difficult for the NRA to go, for example, to Anglian, Thames, or whichever are the successor companies and say, "Please can you test your own water to see whether it is dirty?". It puts the man employed by Anglian, Thames, or whoever, in an incredibly difficult, indeed an impossible, position.

Having said that, the point made by my noble friend Lord Harmar-Nicholls is extremely valid. I believe there is nothing to stop one from setting up as a sampling company and nicking all the best scientists from Anglian and Thames. They should be better at doing the work employed by someone else whose job it is to do it. There is a separation of functions. A man can switch allegiance from one company to another with remarkable rapidity. One need only look at how Ministers switch from one department to another and take up the cudgels on behalf of their new department with immaculate ease. There is no difficulty in that. The point made by my noble friend Lord Harmar-Nicholls is perfectly valid and the point raised by the Opposition should be taken closely in hand by the Government.

Lord Hesketh

Amendment No. 4, together with the stipulations in Amendment No. 9 to which it refers, would have the effect, first, of preventing the NRA from contracting any work out to a water or sewerage undertaker and, secondly, of putting local authorities in a privileged position as regards the letting of contracts for any work it did decide to contract out. The first three subsections of Amendment No. 9 do not seem to me to achieve any clear purpose, since the separation of functions between the NRA and the plcs is built solidly into the entire fabric of the Bill already.

Dealing with the substantive effects of these amendments, therefore, I should like to say that as regards the first of them I am of course entirely in sympathy with the underlying aim, which is to preserve the independence of the NRA from bodies which should be at arms' length relationship with it. The role of the NRA is that of regulator and of the plcs is that of those being regulated. But this entirely laudable aim not only cannot in practice be given effect in this way, but in my view simply does not call for a stipulation of this sort.

As regards practicalities, it is clear that some vital computing work, for instance, can only be carried out by the successor plc in the first instance. This is because of the impossibility, in the time available, of unpicking systems which were never designed with a view to the splitting of functions which the Bill will create. Noble Lords opposite may be tempted to argue that in that case the whole reorganisation process should be delayed until a clean break can be organised, but quite apart from the unacceptability of delay the Government simply do not see any real problem in achieving arrangements between the NRA and the plcs which combine independence with practicality and cost-effectiveness.

The NRAAC is satisfied that there are no real problems whether of confidentiality or reliability in the setting up of contracts with the plcs either for computing facilities or for laboratory facilities, which are the specific subject of Amendment No. 391. Most of the NRA's laboratory analysis work will be done in house, but in those cases where a contract with the plc is the most cost-effective solution, we have endorsed a set of safeguards which will ensure three vital requirements.

First, all water samples must be collected by NRA staff or under their direct control. Second, there must be guaranteed anonymity of samples so that the technician does not know where they have come from. That answers the point raised by my noble friend Lord Onslow. Thirdly, there must be proper arrangements for independent audit and cross checking. In cases where there is a possible prosecution of a plc there will be provision for in house facilities in other regions to do the work. Thus the NRA's independence will be assured, and in addition efficiency will be promoted via the comparisons which can be made between the work done in house and that contracted out.

Turning to the second strand of these amendments, the Government see no obvious merit in requiring the NRA always to put local authorities on its tender list for jobs it intends to contract out. A local authority may well have experience and expertise directly relevant to NRA functions, in which case the NRA will no doubt make sure, as a matter of sound management, that it is indeed invited to tender without being directed to do so by statute. I suggest that it would be unseemly to put the authorities in a special position in this respect. In the final analysis, in all cases where contracting back to plcs and others is proposed, this will be allowed only when the NRA and Ministers are fully satisfied that there is no compromise to the independence of the NRA. I hope that the noble Lord, Lord McIntosh, will see fit to withdraw his amendment.

Lord McIntosh of Haringey

I am sorry that the Minister has gone scarcely any further than his honourable friend Colin Moynihan in another place almost two months ago. At that stage he indicated that there would be further safeguards. I believe he gave the impression that they would be effective. What we have proposed now are clearly not effective safeguards and do not meet the substance of the point. If the Minister were to say to me, "Yes, there is a difficulty about computing facilities and if you withdraw the amendment computing facilities in the first 12 months, two years, or whatever, can be exempted", I would gladly do so on the basis that the remainder of it would then be accepted by Government; but I do not hear the Minister saying that to me.

The Earl of Onslow

Before the Minister replies, perhaps I may say that in all honesty his answer was not very satisfactory. Please let us not go through the irritating performance of a Division which we know who will win. The arguments on this occasion are firmly in favour of divorcing the NRA's functions from those of the plcs. The difficulties are highlighted by the noble Lord, Lord McIntosh. Individual staff would have to give evidence against their employers, and that and other factors have not been satisfactorily answered by the Minister.

I accept that there are difficulties concerning computing and administration, but in due course they can be overcome. One can possibly let the issue go for three or four years, because that is not important. The ultimate situation of having people giving evidence against themselves puts employers and employees in an impossible position. It does not save money. It means that someone else will have to set up the system because it will still have to be carried out. It will not necessarily save any money by having it done by the plcs. There is no cost involved. It seems not very pleasant to leave it as it is. I beg my noble friend to have another serious and hard think about it.

6.15 p.m.

Lord Crickhowell

The Committee will understand that I had intended to go through a period of silence for a few days as I am involved in a somewhat embarrassing affair elsewhere, for which I apologise. I have been drawn to my feet on this occasion because I believe it right that, as chairman of the advisory committee, I should make it clear that the position spelt out by the Minister is exactly and directly in line with the advice that the advisory committee has given after the most careful consideration of the practicalities of the issues. We looked at this from the word go. We were concerned with two matters.

The first was that we were in a position to carry out our job, and computers is only one aspect of it. We shall certainly need the plc computers for a time. We spent a great deal of time looking at the laboratory set-up throughout the country and satisfying ourselves as to the most effective way of carrying out our duties. We duly submitted our advice to the Minister. We are a fallible body and our advice may be wrong, but I do not believe that the Committee should be left in any doubt that the advice was perfectly clear and specific and that the whole of my committee, having considered this matter most carefully over a prolonged period, is perfectly happy.

As I said at Second Reading, the arrangements will not in any way compromise our integrity or effectiveness. We believe that there is a perfectly sensible and practical solution to the problem and that we shall be able to carry out our duties. The noble Lord, Lord McIntosh, spoke about the persons who discover the pollution. I believe he slightly implied that we shall be handing over the actual responsibilities for pollution control to the plc. That is not what is proposed. There are certain parts of the operation, such as the actual sampling in the laboratories, which, with the safeguards that have been spelt out, can be done in this way. That is the clear view of the advisory committee.

Baroness White

We have the chairman of the advisory committee with us. I am not sure whether it is in order, but perhaps I may ask him whether he and his colleagues considered what was suggested by my noble friend—that there should be a time limit followed by a review of the situation. There can be real difficulties. The matter has to be seen to be just, as well as being justly administered. There are problems concerning staff loyalty. Not all authorities are able to provide the National Rivers Authority with adequate scientific staff and equipment. I recognise that fully. But should it not be the aim of the National Rivers Authority within a reasonable period to provide itself with adequate facilities? Might we not think in those terms of some modification?

Lord Crickhowell

I do not know whether it is in order for me to rise again. In any event, the National Rivers Authority will review its arrangements from time to time. We have spent a good deal of time in recent weeks discussing the practicalities of the arrangements we propose. If we decided that it was necessary to make a change, that is a matter that the NRA will have to decide. The NRA Advisory Committee has taken the view that the NRA will be the responsible body to decide whether the job is being done effectively and it believes that the arrangements are satisfactory. Of course it will review the position from time to time, and it will no doubt have to answer in Parliament and elsewhere if it is felt that it is not carrying out its duties effectively.

Lord Harmar-Nicholls

It is very helpful for my noble friend to make the contribution that he has. I gather that in effect what he has said is that the answer given by the Minister is absolutely in keeping with the advisory committee's recommendation. But we have in front of us two amendments and we are at the Committee stage. My noble friend can rise again without any problem if he feels inclined. Do the two amendments with which we are dealing at the moment cut across the advice that the advisory committee gave to the Minister and which he has repeated or do they not?

Lord Crickhowell

I have reported to the Committee that the NRA would be faced with some severe practical difficulties, at least in the first year or two in carrying out its functions effectively. Certainly the task and the cost in one or two instances of setting up wholly independent arrangements in the short timescale would be difficult in practical terms.

Lord Harmar-Nicholls

I thank my noble friend very much.

Lord Ross of Newport

I used to have a private water supply. I took a jar of the water to my local water authority. It said that the authority would not test it but that I should go to the environmental health officer. I went to the environmental health officer in South Shropshire and was given a report on the state of my water. Will such practices continue or will the expertise of local authorities be ignored altogether? That seems absolutely daft.

Lord Hesketh

The noble Lord may have misheard me. I did point out that it would be very much a possibility for local authorities to offer their expertise. I said that earlier in my reply.

I am grateful to my noble friend Lord Crickhowell. He has provided recommendations and advice based on practicality. As the noble Lord, Lord McIntosh, will be aware it looks as though with regard to information technology the period will be two years. With regard to the laboratories, I believe that eight out of 10 of the regions are on course to be fully independent. My noble friend pointed out that there are practical factors. Perhaps I may remind the Committee that the NRA has a supremacy in itself. If it is not satisfied it will clearly say so.

Lord Lloyd of Kilgerran

The noble Lord, Lord Crickhowell, indicated his interest and I found his interventions extremely helpful. As I understood them, he said that what the Minister said in his presentation on the matter was exactly as advised by certain organisations with which he is closely associated. I see that the noble Lord is nodding his head in agreement with that statement. However, the statement made by the Minister included a reference to Amendment No. 391, which is not grouped with this amendment.

The noble Lord who presented the case on behalf of the Opposition said, and I agreed with him, that the Minister went no further than the Parliamentary Under-Secretary in another place except in regard to one matter. I understood the Minister to say that he agreed with the text of Amendment No. 391. The speech of the Parliamentary Under-Secretary in another place made no reference to the matter put forward in Amendment No. 391 in the names of my noble friends Lord Addington and Lord Ross of Newport. It says: for the purposes of ensuring that it maintains an independent regulatory function, to direct it as to the extent to which it may or may not contract out, or otherwise delegate, the sampling and analysis of water or effluent". I have not studied the Bill with the amount of care which I normally devote to Bills with which I am associated, but it seemed to me that in his presentation the Minister went a long way towards the main theme and the practicalities of the amendments before the Committee. I understood his reference to Amendment No. 391 to mean that he had some sympathy with it. That would certainly be helpful in coming a little nearer to the amendment proposed by the noble Lord, Lord McIntosh, my noble friend Lord Ezra and the noble Baroness, Lady Stedman. If I am wrong, the noble Lord and other noble Lords will tell me so.

Baroness Phillips

I should like some clarification. I found it rather unusual that a noble Lord who will be involved in the running of a certain authority should make comments which seem to come from his background with another committee with which he is concerned. Surely his advice will be useful when he actually occupies that post. However, at the moment he seems to be influencing the decision in something in which he has a pecuniary interest.

Lord Crickhowell

That is not so. I am chairman of a public body set up by the Secretary of State to give advice. It has been open throughout about the advice it has given. What I have told the Committee this afternoon is no more than I have told a large number of organisations to which I have spoken over the past six months. The NRA Advisory Committee has been open about the advice which has been submitted to the Government. It would have been a rather odd position if this Committee was not as fully informed as the large number of organisations in the water industry which have heard the chairman of the NRA Advisory Committee setting out its position in recent weeks and months.

Both the noble Lord, Lord Mason, who is a member of the committee, and I spoke at Second Reading and spelt out what we felt was right. We said that this Committee should know about the views of the advisory committee. I have been careful not to speak of my own views. Indeed I decided not to speak during the Committee stage about my views. I felt that it might be helpful if, on a point of clarification about the advice given by a public body which has been made public, the Committee should be made aware of that advice.

Lord Hesketh

I fear that I may be guilty of confusing or misleading the Committee and the noble Lord, Lord Lloyd of Kilgerran. I was under the impression that Amendment No. 391 was still grouped with Amendments Nos. 4 and 9. That is no longer the case and therefore I have served him a red herring for which I apologise.

Lord Lloyd of Kilgerran

I am grateful to the Minister for talking about the red herrings he has produced in the course of his presentation. I agree that Amendment No. 391 is not grouped with these amendments. However, having listened to the noble Earl, Lord Onslow, and having regard also to the helpful intervention of the noble Lord, Lord Crickhowell, in his capacity as chairman of the NRA Advisory Committee, I should have thought that the Minister would at least take back the amendment and think about it without necessarily committing himself to anything very drastic. This is a matter of considerable importance. There has been support for the amendment from all sides of the Committee. The Government would earn a good deal of credit if they gave an assurance that it would be carefully considered for the next stage. I do not know whether I am intervening too much in the province of the noble Lord, Lord McIntosh of Haringey, but I believe that some steps should be taken by the Government to deal with the matter more fully than they have done.

Lord Nugent of Guildford

Perhaps I may say a few words about sampling and laboratory testing. I confirm what my noble friend Lord Crickhowell has said. The job of taking samples and testing for all the rivers in the country is an immense one. The regional water authorities are doing it at the moment as the bodies responsible for river quality and for checking what is coming out of their own and other treatment works. This is a matter of physical necessity. For the NRA to set up an organisation to do that, so to speak, overnight would be clearly impossible.

I have always thought that it would be desirable to have some contracting out to the water companies of the future because all the apparatus of monitoring and testing is there. This would avoid massive duplication, which would cost tens of millions if not hundreds of millions of pounds a year. I wonder whether it would be possible to meet the point in the minds of noble Lords opposite that the monitoring and sample taking should be absolutely reliable. Moreover, when laboratory testing is done it should be done in a way that is completely reliable in terms of the NRA's functions. Perhaps the amendment could be modified so as to stipulate that where the NRA wants to set up schemes of contracting out to the water companies of the future it must first obtain the approval of the Minister to such schemes. This would ensure that the Secretary of State was satisfied that such schemes were reasonably water-tight.

For instance, I should have thought that the monitoring could well be done by the water companies. In my view it is essential that the NRA has at least some laboratories of its own from the start for testing so as to make absolutely certain that such testing is independently done. However, I doubt whether such laboratories would need to cover the whole field. There is a practical problem here. I felt, being familiar with what goes on in this field, that it would be helpful to point out that it could be met in such a way.

6.30 p.m.

Lord McIntosh of Haringey

As the noble Lord, Lord Nugent, knows, there are certainly practical problems here. They are, it seems to me, of two kinds. The first is an ongoing problem which relates to the need, as the noble Lord, Lord Harmar-Nicholls, said, for impartial witnesses in any case. A great deal of money can be involved in the enforcement of provisions to protect water quality. We must therefore be absolutely certain that the effect of Part III of the Control of Pollution Act 1974, and the implementation and enforcement of these provisions, are not in any way damaged by the risk of partiality on the part of those taking the tests.

The second ongoing problem was raised by the noble Earl, Lord Onslow. He did not like the idea—or perhaps it was the noble Lord, Lord Harmar-Nicholls—of the period being "the previous five years". I think that there is some misunderstanding. The noble Earl and the noble Lord were assuming that a "person" is an individual who has been employed by a water undertaking. Of course, in legislation a person can mean an individual; but in this case it is much more likely to mean an organisation or company. An individual who had left a water company in order to set up in the testing or sampling business would in no way be disqualified by subsection (4) of Amendment No. 9. Therefore I do not think that that difficulty is a very real one.

Lord Harmar-Nicholls

I must point out that the amendment does not state a company; it reads, "to any person". As the wording stands, it means that the person could be vetoed from taking office.

Lord McIntosh of Haringey

I think not. It would have to be a company or organisation in order to carry out the work; it could not be carried out by a private individual. A "person" in this sense means a company or organisation which is an undertaking. In my view that is a common occurrence in legislation. Therefore I do not think that the long-term objections to our amendments have a great deal of strength.

However, the transitional objections seem to me to have some strength. I fully take the point that computing facilities would have to be available from the water authorities over a period. I suggested a period of a year or two and the noble Lord, Lord Hesketh, confirmed that it would in fact be two years. I concede that at the outset laboratory services would have to be provided by the new water companies.

If the Minister can assure me that such arrangements are intended to be transitional and that it is the Government's intention to move as soon as possible to what we all want—that is, the separation of function between the regulator and the operator—then I shall gladly withdraw the amendment.

Lord Hesketh

I fear that I shall not be able to go quite so far as the noble Lord, Lord McIntosh, would wish. Perhaps I may just draw upon two points. First, my noble friend Lord Crickhowell referred to practicality. There is of course an element of practicality in the matter. The connection about which we are talking in no way compromises the independence of the NRA in terms of it deciding whether it is happy, or not happy, with the arrangements.

The second point is the one made by my noble friend Lord Nugent; that is, to go blindly ahead incurring a vast amount of extra cost because of the huge investment required, when there is a satisfactory and practical alternative available, may also not be entirely satisfactory.

Lord McIntosh of Haringey

That is a most disappointing answer. I offered the Minister an opportunity to give further assurances. I said that I would deal with the practical points of computing and laboratory services in the early stages of the Bill's proceedings by withdrawing the amendment and bringing forward another at a later stage. The Bill as it stands does not provide for a separation of functions between the regulator and the operator. The Minister's refusal to go any further by way of assurances means that we shall land up, when the transitional period is over, with the operator exercising those contracted-out functions on the part of the regulator.

I listened most carefully to what the Minister said about the assurances; I also listened carefully to the remarks of the noble Lord, Lord Crickhowell. I do no doubt that the NRA advisory committee was satisfied with the situation. However, the separation of functions is not required by the NRA advisory committee; it is required by the public. The public is the ultimate decider of what is right and what is wrong. The Minister has given no indication —despite pointing out the practical difficulties-that'he appreciates the fundamental point which is being made; namely, that you cannot contract out the regulation back to the operators. It cannot be done in the long term.

The amendment I have moved may be defective in the short term; but it reflects a wider principle which has received support from all sides of the Committee. Indeed, the noble Lord, Lord Harmar-Nicholls, and the noble Earl, Lord Onslow, with reservations, agreed that it was right. I pause momentarily in the hope that the Minister will go a little further than he has thus far and indicate that it is not the long-term intention of the Government to allow contracting out to the new water companies. Unfortunately, due to the absence of any response to my request, I have no alternative but to seek the opinion of the Committee.

6.37 p.m.

On Question, Whether the said amendment (No. 4) shall be agreed to?

Their Lordships divided: Contents, 85; Not-Contents, 134.

DIVISION NO. 2
CONTENTS
Addington, L.	Donoughue, L.
Airedale, L.	Dormand of Easington, L.
Amherst, E.	Elwyn-Jones, L.
Ardwick, L.	Ewart-Biggs, B.
Aylestone, L.	Ezra, L.
Baldwin of Bewdley, E.	Falkland, V.
Birk, B.	Fitt, L.
Blease, L.	Foot, L.
Brooks of Tremorfa, L.	Galpern, L.
Callaghan of Cardiff, L.	Glenamara, L.
Carmichael of Kelvingrove, L.	Graham of Edmonton, L.
	Grey, E.
Carter, L.	Grimond, L.
Chorley, L.	Hacking, L.
Cledwyn of Penrhos, L.	Hampton, L.
Cocks of Hartcliffe, L.	Hanworth, V.
David, B.	Hooson, L.
Davies of Penrhys, L.	Houghton of Sowerby, L.

Jeger, B.	Rea, L.
Jenkins of Putney, L.	Robson of Kiddington, B.
John-Mackie, L.	Rochester, L.
Listowel, E.	Ross of Newport, L.
Llewelyn-Davies of Hastoe, B.	Russell, E.
	Sainsbury, L.
Lloyd of Kilgerran, L.	Seear, B.
Lockwood, B.	Sefton of Garston, L.
Lovell-Davis, L.	Serota, B.
McGregor of Durris, L.	Shepherd, L.
McIntosh of Haringey, L.	Stewart of Fulham, L.
McNair, L.	Stoddart of Swindon, L.
Mayhew, L.	Strabolgi, L.
Meston, L.	Taylor of Blackburn, L.
Milner of Leeds, L.	Taylor of Gryfe, L.
Monson, L.	Taylor of Mansfield, L.
Mountevans, L.	Tordoff, L. [Teller.]
Nicol, B.	Turner of Camden, B.
Northfield, L.	Underhill, L.
O'Neill of the Maine, L.	Vernon, L.
Peston, L.	Walston, L.
Phillips, B.	Wedderburn of Charlton,. L.
Pitt of Hampstead, L.	Whaddon, L.
Ponsonby of Shulbrede, L. [Teller.]	White, B.
	Williams of Elvel, L.
Prys-Davies, L.	Winterbottom, L.

NOT-CONTENTS
Ailesbury, M.	Harmar-Nicholls, L.
Airey of Abingdon, B.	Harris of High Cross, L.
Arran, E.	Harvington, L.
Ashbourne, L.	Havers, L.
Bathurst, E.	Henley, L.
Bauer, L.	Hesketh, L.
Beloff, L.	Hives, L.
Belstead, L.	Hood, V.
Blatch, B.	Hylton-Foster, B.
Blyth, L.	Jenkin of Roding, L.
Bolton, L.	Joseph, L.
Boyd-Carpenter, L.	Kimball, L.
Brabazon of Tara, L.	Kinloss, Ly.
Brain, L.	Knutsford, V.
Brookeborough, V.	Lauderdale, E.
Brougham and Vaux, L.	Layton, L.
Butterworth, L.	Long, V.
Caithness, E.	Lucas of Chilworth, L.
Campbell of Croy, L.	Lyell, L.
Carnegy of Lour, B.	McFadzean, L.
Carnock, L.	Macleod of Borve, B.
Colnbrook, L.	Malmesbury, E.
Colwyn, L.	Mancroft, L.
Constantine of Stanmore, L.	Margadale, L.
Cork and Orrery, E.	Marley, L.
Comwallis, L.	Marshall of Leeds, L.
Cottesloe, L	Massereene and Ferrard, V.
Craigmyle, L.	Maude of Stratford-upon-Avon, L.
Craigton, L.
Cranbrook, E.	Merrivale, L.
Crickhowell, L.	Mersey, V.
Dacre of Glanton, L.	Middleton, L.
Daventry, V.	Monk Bretton, L.
Davidson, V. [Teller.]	Monteagle of Brandon, L.
Denham, L. [Teller.]	Moran, L.
Dilhorne, V.	Mottistone, L.
Dundee, E.	Mountgarret, V.
Elles, B.	Mowbray and Stourton, L.
Elliot of Harwood, B.	Munster, L.
Elliott of Morpeth, L.	Murton of Lindisfarne, L.
Fanshawe of Richmond, L.	Nelson, E.
Ferrers, E.	Norfolk, D.
Ferner, L.	Norrie, L.
Fortescue, E.	Nugent of Guildford, L.
Fraser of Carmyllie, L.	Orkney, E.
Glenarthur, L.	Oxfuird, V.
Goold, L.	Pender, L.
Greenway, L.	Peyton of Yeovil, L.
Gridley, L.	Pym, L.
Grimston of Westbury, L.	Quinton, L.
Hailsham of Saint Marylebone, L.	Radnor, E.
	Renton, L.
Halsbury, E.	Renwick, L.

Rochdale, V.	Strathclyde, L.
Romney, E.	Swinton, E.
Saint Albans, D.	Teviot, L.
St. John of Bletso, L.	Teynham, L.
Saltoun of Abernethy, Ly.	Thomas of Gwydir, L.
Sanderson of Bowden, L.	Thomas of Swynnerton, L.
Savile, L.	Trafford, L.
Selborne, E.	Trefgame, L.
Sempill, Ly.	Trumpington, B
Shannon, E.	Tryon, L.
Sharpies, B.	Vaux of Harrowden, L.
Skelmersdale, L.	Wigram, L.
Stanley of Alderley, L.	Wyatt of Weeford, L.
Stodart of Leaston, L.	Wynford, L.
Strange, B.	Young, B.

Resolved in the negative, and amendment disagreed to accordingly.

6.46 p.m.

Lord Graham of Edmonton moved Amendment No. 5: Page 2, line 12, leave out from first ("than") to end of line 15 and insert ("fourteen nor more than eighteen members of whom—

1. (a) two shall be appointed by the Minister; and
2. (b) the others shall be appointed by the Secretary of State as follows:

(i) one quarter from persons nominated by the Local Authority Associations; (ii) one quarter from persons nominated by such organisations as appear to the Secretary of State to be concerned with:

1. (a) the preservation and improvement of the physical environment;
2. (b) the promotion of leisure, recreational and sporting activities; and
3. (c) the protection and promotion of the interests of consumers.

(iii) one quarter from among persons who have experience of and have shown capacity in some matter relevant to the functions of the authority; and (iv) one quarter from person nominated by organisations representative of employees of water or sewerage undertakers.").

The noble Lord said: I understand that it will be for the convenience of the Committee if I speak also to Amendments Nos. 6 and 7. The argument is contained in those amendments. We have been discussing some of the functions of the NRA and the advisory committees. We now turn to the composition of the authority. There is no doubt that the NRA can be, and, I hope will be, a powerful body. We should be concerned not just with its duties but with its composition.

Clause 1(2) provides: The Authority shall consist of not less than eight nor more than fifteen members of whom—

1. (a) two shall be appointed by the Minister; and
2. (b) the others shall be appointed by the Secretary of State".

When he replies, the Minister should tell us why the Government's differentiation in size and representation is laid down in that way.

There is a further subsection to which I should like to draw the Committee's attention. Subsection (4) states: In appointing a person to be a member of the Authority, the Secretary of State or, as the case may be, the Minister shall have regard to the desirability of appointing a person who has experience of, and has shown capacity in, some matter relevant to the functions of the Authority.

We all believe that we know people who would be the best people to sit upon committees. This is not the time to say that the Minister may have it wrong. Subsection (4) deals with people to be appointed to the NRA. They must have shown capacity in some matter relevant to the function of the authority.

In Amendment No. 5 we set out what we consider to be the sensible composition of the authority. The points speak for themselves.

I wish to say a word or two about why we believe that groupings of the kind contained in Amendment No. 5 need to be written on the face of the Bill. First, a quarter of the members should be nominated by the local authority associations. Other appointments appear in later amendments but I believe that local authorities have an overwhelming case for having direct representation on the body. After all, the assets that will be managed were at one time substantially owned by the local authorities or by local people. They were owned by and ceded to the existing water authorities with premises which, as the noble Lord, Lord Rippon has reminded the Committee more than once, have been very badly damaged by the passage of time. The undertakings were local, in the main municipal and basically they belonged to the people. The argument that we wish to advance is that, if the case is made that the only people who are entitled to represent the public are Members of Parliament, then it is offensive to suggest that other local people such as councillors of any or all political persuasions are not able to represent the views of local people.

Besides ensuring that there are people who know all about the City, flotations and the values of land, about doing deals and development, the Government must also include on the body representatives who know all about people. That is the case for local authority representation. Achieving it may be tricky. A number of bodies represent local people: the Association of Metropolitan Authorities, the Association of District Councils, the Association of County Councils, the Association of London Auhorities and other organisations might have a case. But among the group of people who will manage this powerful organisation should be local people.

We beg the Government to take on board the goodwill that could exist and go a very long way if the Secretary of State shows sympathy for the raison d'être of the amendments. We suggest that one quarter of the people involved should represent and relate to the preservation and the improvement of the environment. That will be a major part of the responsibilities of the National Rivers Authority. We have already had a canter over the course in regard to the assets and how they will be used. Noble Lords on this side of the House and people in the country believe that where those assets are currently being used for the enjoyment of the public in one form or another that use should continue.

There are the environmental groups: the Royal Society for the Protection of Birds, the Council for the Protection of Rural England—and rural Wales. There are even some bodies which exist for the preservation of Wales in a different form. We are not being too specific about the bodies that should be represented, but many people outside think that if the body which will manage the resources does not include people with specific interests it will be defective in one way or another.

The other important matter is that the people will be nominated by the bodies and not invited by the Secretary of State to represent those bodies. The Government must get out of the habit of believing that they are the only body competent to or capable of inviting groups of people to nominate a representative. The Secretary of State knows many people and through his office he has access to lists of the great and the good. But why not trust the environmental bodies and the local authorities to come up with individuals of the right kind?

Then we mention people representing the promotion of leisure, recreational and sporting activities—a great wedge of activities in which millions of people take part. There are many people closer to those pursuits than I—the literally millions of anglers, ramblers and people who enjoy the countryside. Some means must be found of giving them a slice of the action; they should not just be invited to have one of their people nominated by the Secretary of State. They should be able to do it themselves.

Then there is, the protection and promotion of the interests of consumers".

I imagine that in that phrase the pre-eminent bodies are the National Consumer Council and the Consumers' Association, but there may be others as well. Those are the main bodies but other groups of people are included here, such as the representatives of employees of the water or sewerage undertakers. The Government make great play of the fact that they are providing workers with the right to buy into the financial action of their companies. I am sure that play will be made of the fact that those employees of bodies which will be privatised will have a mechanism which allows the workers to become shareholders in the business. We all know the value of shareholdings but we are suggesting that, in addition to the value of the shareholdings, there should be a place at the top table. The employees should have some representatives—we are not specific about numbers—who represent the workers. How do we do it? I am not talking about trade unions but representatives of the employees chosen through a mechanism which will need to be worked out.

As with everything else, the Government can kid themselves that all the interests which I have mentioned will be well looked after by the men and women whom the Minister already has in mind. We are asking, "Why not go out to the people whose interests the Government say they look after and invite them to nominate the men and women whom they trust and with whom they work?"

The other category of people whom I think I ought to mention and who we believe should have a place at the top table among what I call "the authorities" is: persons who have experience of and have shown capacity in some matter relevant to the functions of the authority".

Here the Minister is perfectly entitled to say that there are men and women who know how to run a business and take big decisions. I am not saying that that is not necessary; of course it is. But I hope that the Minister will look kindly upon these bodies. He should be quite clear that many critics could be silenced if there were somebody whom they themselves had chosen to represent their interests at the top table. That is the genesis of Amendment No. 5.

The other amendment, Amendment No. 6, says: Before making any appointment under this section, the Secretary of State shall consult such individuals and organisations representative of local authorities, or as appear to him, or to the Minister, to be concerned".

So we do not just want them there; we also want them to be consulted.

Accountability in these matters is very important. If the Minister is looking for ways in which the passage of the Bill can be eased, I seriously suggest to him—not that it is my job to ease the passage of the Bill—that it will be easier if people outside who will be deeply affected by the Bill in all the categories I have mentioned have an opportunity to have access to the top table. I beg to move.

7 p.m.

Lord Ross of Newport

I rise in order briefly to support everything said by the noble Lord, Lord Graham. Frankly, I believe that this part of the Bill is vague, although I suspect that we are trying to keep open a gate which is already virtually closed, Most of the appointments have been made or are in draft. I should, however, like to support the view that certainly the statutory and voluntary bodies in the conservation sector ought to be represented, and that that ought to be spelt out.

I suspect that when the Minister replies he will say, "We don't want to have too big a management body. We want to keep it down to a reasonable size". I have some sympathy with that. We are, after all, asking in this amendment to increase those numbers, but perhaps we could have some variation on these numbers. If the noble Lord is going to say that there will be difficulty in getting the voluntary bodies to nominate, all I can say is that I have the honour to chair a body called Wildlife Link, which, as a small umbrella group, covers something like 50 bodies involved with conservation, and there will be no difficulty at all.

I think his own colleague, the Minister responsible for this Bill, Mr. Michael Howard, will confirm the expertise of the small group that I took to see him, and particularly the chap representing Friends of the Earth. The Minister accepted quite frankly that he put forward some excellent suggestions. There will not be any difficulty about that.

Of course the local authorities ought to be supported, although the Government do not really believe in local government, and I do not know why they do not abolish it altogether. However, while we have local government it ought to be on the NRA, and I believe that most of the unions should be represented too. It would alleviate some of the concern, particularly in the conservation movement. I think the NCC should be represented, or at least the Countryside Commission, or one or the other. If these things are done then I say to the Minister that he is going some way to alleviating the concern.

We are going to get a lot of amendments dealing with the regional and other bodies and representation on them. I think the noble Lord will confirm that the work that has been done on some of these bodies in a slightly different form has been first rate and much appreciated. Therefore surely it is only right that some of them at least with the expertise should be on the main body of the National Rivers Authority. I beg to support this amendment.

Lord Renton

I hope that my noble friends will not accept this amendment. The first question is whether it is right to have a board so large as 18 members. We all have experience of committees and bodies of various kinds. My experience is that the larger the body, the less the responsibility, or share of responsibility, taken by each individual member of it other than the chairman. Really, 18 seems to me to be far too numerous.

Further, if we are going to have it as a representative body, about which I have some doubt, we can perfectly well get it within the Minister's number of 14; that is to say, we would have two appointed by the Minister; two from local authorities, or it might be three; two from the environment—and there should be two. But then for the promotion of leisure, etc., I think we could well have only one. I do not think that that is as important as the environment or the interests of consumers. Let the interests of consumers have two; people with experience of the industry, two; employees, two. All that adds up to 14, which is what the Government propose as a maximum. Therefore, the Government can have their cake and eat it. To go to 18 is quite excessive.

Lord Harmar-Nicholls

I am surprised that my noble friend, whom I usually find so sound in the advice he gives to us, seems to be accepting the principle behind the amendment.

Lord Renton

Would my noble friend allow me? I cannot have made myself plain. I said that I had grave doubts as to whether we should have a representative body, but if we had to then we could perfectly well achieve it within the Government's 14.

Lord Harmar-Nicholls

That is a little better. However, it is inconceivable to me that the National Rivers Authority, which is going to have the power that this body is going to have, should in a way be subservient to somebody outside who appointed it. If, for example, one-quarter had to be persons nominated by the local authority associations, the knowledge that it is the local authority associations which have asked them to sit in this sort of judicial capacity will mean that there is a partiality towards the people who appointed them. You cannot avoid that.

It is a similar situation with the promotion of leisure: "It is the promotion of leisure. Therefore, I have to concentrate on the promotion of leisure". It is like saying that the bench of magistrates should be appointed by the local licensed victualler's association because they do a fair amount of business in the courts; or that the chamber of trade should be the ones who say who should be the magistrates.

When people are appointed members of this board, while I hope that some of them will come from some of the sources outlined in the amendment, that some of them will be from local authorities and some will be people known to be interested in leisure and things of that sort, the appointments should be because overall they can be judicial, they can be impartial, and they are sensible. The Government's way of appointing them covers just that. They want them to take into account all the ingredients that will have to be covered. But to say that appointments are going to be in the hands of these outside bodies is wrong, as they may well be at some time in conflict with the National Rivers Authority.

I can well see the local authority associations having a number of punch-ups with the National Rivers Authority. If a quarter of the members have been appointed by them, what sort of judicial impartiality are you going to get there? While I prefer the amended version of what my noble friend said—although he did not go really far enough—on commonsense grounds, if you want the National Rivers Authority to do the job that this Bill envisages, this amendment in principle must not be considered for one second.

Lord Trafford

I wonder whether it would be possible to put to the mover of the amendment the point that it is certainly appropriate to have a representative committee, which is really what he is talking about, for certain functions. But—and I feel that he did not answer this question—is it appropriate for this type of function? I have nothing against having local authority representatives on this body or the others, but I have some experience of running committees that are supposed to be independent of any particular interest.

What my noble friend Lord Harmar-Nicholls said is quite right. When you get specifically appointed members of representative interests, then naturally they follow those interests. That is what they are there for, and that is what you expect them to do. As I understand it, this is not a body where you want that type of thing to happen.

Looking around the Committee at the moment I do not think that there is anybody present who served with me on the Norfolk and Suffolk Broads Bill. I apologise; I see that somebody is present. It may be of some point to say that one of the great problems at that time was that nothing had happened for so long because of the conflict of interest in representation between many of the bodies of the type that the noble Lord, Lord Graham, referred to. One would not want this type of situation to arise on the National Rivers Authority.

These would be my objections to this amendment. It is nothing to do with the quality of the person. It is nothing to do—as the noble Lord, Lord Ross of Newport, was talking about—with making environmentalists and all the rest happy. There may well be a place and function for them to perform, but I query, bearing in mind the type of function that you require this body to perform and the type of people you want to have performing it, whether this is the proper committee.

I am not against the people whom the noble Lord, Lord Graham, mentioned. I am not against local authority representation on committees on principle. What I am against is setting up at this stage on the face of the Bill what could well be the totally wrong committee to operate this particular function.

Lord Stoddart of Swindon

I am surprised that there should be such opposition to this small, mild amendment. One would imagine, to hear the opponents of the amendment, that local authorities had never been involved in river conservation, or indeed, judging by the Second Reading debate, that local authorities had never been involved in the supply and distribution of water.

The local authorities have been managing rivers since 1973 and managing water supplies and water distribution over many years. They have done it very successfully indeed. I was a member of a water committee and helped to set up the Reading and Berkshire water authority which ran the water industry in that area with considerable success. It had to run it with considerable success because the people who were responsible were members of the local authority and were liable to be elected or not elected depending on the job they did for the people in the locality. Therefore, when we look at the river boards and the local authority water undertakings we see that they have been run very successfully on behalf of local people.

I can assure the noble Lord, Lord Crickhowell, that in my experience they were run very well on behalf of the local people. Indeed, the Thames Conservancy, which included many local authority representatives, looked after the Thames very successfully and brought about many improvements to that river. It started the clean-up of that river.

Therefore when Members opposite suggest that local authority elected representatives cannot do the job and are not necessary, I think they are barking up the wrong tree. Noble Lords opposite shake their heads but their speeches made it quite clear that they do not believe that local authority representation has any future in relation to this Bill and in particular in relation to this clause. I believe that they are very much mistaken. There is and should be a continuing role for local authorities in river management and in the supply of water. I know that that is not what this Bill is about; it is about the very reverse. At least I believe that at this stage of the Bill the value of local authority representation on the rivers authority, and at later stages on other authorities, should be considered. I support my noble friend's amendment.

The Earl of Caithness

Before the noble Lord sits down I think that it is worth making one point for the sake of the record. The noble Lord referred to my noble friend Lord Crickhowell: for the record, my noble friend is not in the Chamber.

Viscount Massereene and Ferrard

I should like to tell the noble Lord, Lord Graham, that I once owned a factory. Everyone was very happy there. I suggested to one of the workers on the shopfloor, who was extremely popular with all the other men, that he might like to sit on the board. He said that he would and I put him on the board. He came to me about four or five weeks afterwards and said that he would like to resign. I asked him why and he said, "Hardly any of the workers on the shopfloor will now speak to me". Therefore I think that one has to be very careful when appointing people who have no relevant experience.

Baroness Carnegy of Lour

It is very important to appreciate what kind of body this will be. It is to be a pragmatic body which has a set of objectives and duties which it has to fulfil. It has to concentrate on those duties and act as efficiently, promptly and effectively as possible. It should certainly consist of people who understand the subject. I believe that Clause 1(4) ensures that the people who are appointed will have relevant experience and will have a track record in those matters.

As my noble friend Lord Trafford said, anyone who has had experience of running that kind of body will know that, in a body whose representatives have been nominated by various interest groups, much of the time is spent discussing their conflicting interests and every decision tends to be a compromise. It is a perfectly good body, and I have been chairman of such a body. I have also been chairman of the other kind of body. The type of body depends on the task. This particular body has a very clear task which is set out in the Bill. The authority has to get on with that task. It seems to be that the right way to approach that kind of body is in the way that is proposed in the Bill.

As to the involvement of local authorities, they will be enormously involved. They are involved in environmental protection, planning and roads and in very many aspects of what the body will discuss. They will be consulted constantly, as doubtless will the various environmental interest groups and the like. I do not think that local authorities should feel that this is a deliberate attempt to exclude them from the management of water which they undertook some time ago. It is simply that this body has a particular response and is designed for that and no other purpose.

7.15 p.m.

Lord Hesketh

The main purpose of these amendments is to require consultation with environmental, local authority and other interests before appointments are made to the NRA and to provide additional members on the board of the NRA to represent particular interests.

Amendment No. 5 proposes that the NRA board should have 14 to 18 members, of whom two would be appointed by the Minister of Agriculture and the remainder by the Secretary of State: one quarter from nominations by local authority associations, one quarter from nominations by environmental, recreational or consumer organisations, one quarter from people with relevant knowledge or expertise and one quarter from nominations by employee organisations in the water industry.

Amendment No. 6 would require the Secretary of State before making board appointments, to consult individuals and organisations representative of local authorities. Amendment No. 7 would delete the requirement on the Secretary of State or Minister to have regard to the desirability of appointing to the board people who have relevant experience.

The Government's intentions for the NRA, as a non-departmental public body with members appointed by Ministers, were set out in the policy document on the NRA published in December 1987. We made clear in that policy document that board members of the NRA would be appointed by the Secretary of State for the Environment, and two members would be specifically appointed by the Minister of Agriculture, Fisheries and Food and one by the Secretary of State for Wales. We also made clear the the intention will be to appoint members with knowledge relevant to the functions of the NRA.

These policy proposals are carried forward into the Bill in Clause 1, with one small change. In December 1987, we said that the board should have up to 12 members. In the Bill we have allowed for a board of up to 15 members. This is not because we necessarily want as many as 15 members on the NRA board but because we recognise that the range of interests that need to be represented on the NRA may require a board of more than 12 and that a statutory maximum of 15 would be more appropriate. A board of this size will ensure that the NRA has the stature appropriate to a major national body, provided its members have relevant expertise and are able to command respect among all those who depend either for their livelihood or their recreation on our river system.

What these amendments propose is that there should be a formal consultation with all those who might wish to nominate members of the NRA. This is something we would strongly oppose. It would have the effect that when members were appointed to the NRA they would necessarily feel that they were there to represent a specific interest. This is not what we intend at all. Our aim is to have a small effective board where all members feel that they are able to speak and take an interest in all matters that will affect the NRA. Although individual members may have a particular expertise we should certainly not want them to feel that they were mandated to represent a particular interest. If the board of the NRA is to work as a team, all members must take a broader interest than any specific expertise or background that may have led to their appointment to the board. Any formal consultation with outside bodies would be incompatible with the sort of team work that we consider will be needed from the board of the NRA.

I must also say that we would be opposed to the suggestion that interested organisations should make direct appointments to the board. That would be quite inappropriate for a major national non-departmental public body which must be accountable through Ministers to Parliament. That accountability to Parliament through Ministers would be seriously jeopardised if outside bodies were able to make appointments direct to the board of the NRA.

In closing, I should say that, in the light of the arguments deployed which resulted in the last Division, I was slightly surprised by sub-paragraph (iv), which refers to a proposal that one quarter of the persons appointed shall be nominated by organisations representative of employees of water or sewerage undertakers". I hope that noble Lords will feel unable to accept these amendments.

Lord Graham of Edmonton

I am deeply disappointed with both the response of the Minister and with the remarks made from behind him. I note that the noble Lord, Lord Renton, considers that a body with major decisions to make, which comprised 18 members, would be unwieldly and unable to agree. I see that the Cabinet numbers 22 members; I imagine that it would have some difficulty in coming to its decisions unless a certain person in the Cabinet room appointed the people who sit around the table. I believe that that happens in the Cabinet room.

In this case, there will be a body of up to 15 people who will have been appointed by one man—the Minister or the Secretary of State. Their reappointment will depend on the manner in which they satisfy the Secretary of State. The Minister says that it is preferable to be accountable to the Secretary of State than to the local authorities or to the employees. That is a concept that we on this side of the House totally reject, although the Government and the Minister have made no bones about it. The Secretary of State says—this applies particularly to sub-paragraph (iv)—that he wants the people who will sit on that non-departmental government body (in other words, the men and women who will be chosen by him) to be vetted in the light of what he considers to be the appropriateness of their ability to serve.

That is one point of view. We happen to believe that managing the nation's water calls for something different. The Minister tries to tell the House that the management of water is no different from the management of fish, shoes or plastics. However, we believe that it is different. We believe that the case for looking at the management, control and accountability to the public of water is different. We are giving the Minister the means to bring that about. I take the point made by the noble Lord, Lord Renton, that we may have the numbers wrong. I believe that I heard him say that he did not agree with the concept but, if there was to be representation, it might be in a different form.

I had hoped that the Minister might say to the House that he was prepared to look at the amendment, take it away and come back. However, quite frankly, his concept of the kind of body about which we are talking and of how such a body should be set up and the belief that it should be wholly in his gift and not accountable to the people is incompatible with our concept. That is where we part company. I intend to press the amendment to a Division.

7.24 p.m.

On Question, Whether the said amendment (No. 5) shall be agreed to?

Their Lordships divided: Contents, 56; Not-Contents, 111.

DIVISION NO. 3
CONTENTS
Addington, L.	McIntosh of Haringey, L.
Airedale, L.	Mackie of Benshie, L.
Ardwick, L.	McNair, L.
Barnett, L.	Monson, L.
Birk, B.	Nicol, B.
Carmichael of Kelvingrove, L.	O'Neill of the Maine, L.
	Peston, L.
Carter, L.	Phillips, B.
Cledwyn of Penrhos, L.	Ponsonby of Shulbrede, L. [Teller.]
Cocks of Hartcliffe, L.
David, B.	Rea, L.
Donoughue, L.	Robson of Kiddington, B.
Dormand of Easington, L.	Ross of Newport, L.
Elwyn-Jones, L.	Russell, E.
Ewart-Biggs, B.	Seear, B.
Ezra, L.	Shepherd, L.
Falkland, V.	Stewart of Fulham, L.
Galpern, L.	Stoddart of Swindon, L.
Glenamara, L.	Strabolgi, L.
Graham of Edmonton, L.	Taylor of Blackburn, L.
Hampton, L.	Taylor of Gryfe, L.
Hanworth, V.	Taylor of Mansfield, L.
Hooson, L.	Tordoff, L. [Teller.]
Houghton of Sowerby, L.	Turner of Camden, B.
Jeger, B.	Underhill, L.
John-Mackie, L.	Walston, L.
Kilmarnock, L.	White, B.
Llewelyn-Davies of Hastoe, B.	Williams of Elvel, L.
	Winstanley, L.
Lockwood, B.

NOT-CONTENTS
Ailesbury, M.	Goold, L.
Alport, L.	Greenway, L.
Arran, E.	Gridley, L.
Bathurst, E.	Grimston of Westbury, L.
Beloff, L.	Hailsham of Saint
Belstead, L.	Marylebone, L.
Blatch, B.	Halsbury, E.
Bolton, L.	Harmar-Nicholls, L.
Boyd-Carpenter, L.	Harvington, L.
Brabazon of Tara, L.	Havers, L.
Brain, L.	Henley, L.
Brookeborough, V.	Hesketh, L.
Brougham and Vaux, L.	Hives, L.
Butterworth, L.	Hylton-Foster, B.
Caithness, E.	Jenkin of Roding, L.
Carnegy of Lour, B.	Joseph, L.
Carnock, L.	Kimball, L.
Colwyn, L.	Kinloss, Ly.
Constantine of Stanmore, L.	Knutsford, V.
Cork and Orrery, E.	Lauderdale, E.
Craigmyle, L.	Layton, L.
Cranbrook, E.	Long, V.
Dacre of Glanton, L.	Lucas of Chilworth, L.
Daventry, V.	Lyell, L.
Davidson, V. [Teller.]	McFadzean, L.
Denham, L. [Teller.]	Macleod of Borve, B.
Dundee, E.	Mancroft, L.
Elles, B.	Margadale, L.
Elliott of Morpeth, L.	Marley, L.
Fanshawe of Richmond, L.	Marshall of Leeds, L.
Ferrers, E.	Massereene and Ferrard, V.
Fortescue, E.	Maude of Stratford-upon-Avon, L.
Fraser of Carmyllie, L.
Glenarthur, L.	Mersey, V.

Middleton, L.	Sanderson of Bowden, L.
Monk Bretton, L.	Savile, L.
Monteagle of Brandon, L.	Selborne, E.
Moran, L.	Sempill, Ly.
Mottistone, L.	Sharpies, B.
Mountevans, L.	Skelmersdale, L.
Mowbray and Stourton, L.	Stanley of Alderley, L.
Munster, E.	Stodart of Leaston, L.
Murton of Lindisfarne, L.	Strathclyde, L.
Nelson, E.	Swinton, E.
Norrie, L.	Teviot, L.
Nugent of Guildford, L.	Thomas of Gwydir, L.
Onslow, E.	Trafford, L.
Orkney, E.	Trefgarne, L.
Oxfuird, V.	Trumpington, B.
Pender, L.	Truro, Bp.
Radnor, E.	Tryon, L.
Renton, L.	Vaux of Harrowden, L.
Rochdale, V.	Wigram, L.
Romney, E.	Wyatt of Weeford, L.
Russell of Liverpool, L.	Wynford, L.
St. John of Bletso, L.	Young, B.
Saltoun of Abernethy, Ly.

Resolved in the negative, and amendment disagreed to accordingly.

7.32 p.m.

[Amendments Nos. 6 and 7 not moved.]

Clause 1 agreed to.

[Amendments Nos. 8 to 10 not moved.]

The Earl of Arran

I hope that the Committee will agree that this is a suitable moment at which to break for dinner. I suggest that we do not return to the Committee stage of the Bill before 8.35 p.m. I beg to move that the House do now resume.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.