HL Deb 24 June 2003 vol 650 cc229-44

8.44 p.m.

Further consideration of amendments on Report resumed on Schedule 4.

Baroness Byfordmoved Amendment No. 118: Page 134, line 42, at end insert— ( ) the Consumer Council for Water;

The noble Baroness said: My Lords, in moving the amendment I shall speak also to Amendment No. 121. The amendment is supported by the Liberal Democrat Benches. It asks that the consumer council for water should be included in Schedule 4.

Amendment No. 121 deals specifically with the codes and obligations that are to be placed on licensed water suppliers, affecting their conduct. I beg to move.

Baroness Miller of Chilthorne Domer

My Lords, as the noble Baroness said, we have put our names to the amendments so obviously we support them.

Baroness Farrington of Ribbleton

My Lords, Amendment No. 118 would require the Secretary of State or the Assembly to consult the council when proposing to alter the eligibility threshold for competition. The Secretary of State and the Assembly are committed to full consultation on most of the decisions they make. In this case, other than the authority, which has to operate the competition regime, important parties such as the Drinking Water Inspectorate and the Environment Agency, which will be consulted along with the council, are also not listed in the Bill. There is no reason to single out the consumer council for water, especially when the effects of the competition threshold can be just as significant to the interests of the other regulators.

Amendment No. 121 proposes amendments to the clause on standard conditions of water supply licenses. While we agree with the principle that the council should be consulted where appropriate, we do not think the amendment is necessary. If obligations are being imposed, the proposals are likely to be a modification of the standard conditions themselves. Amendment No. 122, which we will be debating next, will ensure that the council is consulted in such cases.

If there were codes to aid or govern the practice of licensed suppliers, we would expect appropriate consultation. In most cases that would involve consultation with the council, but there may be technical issues where consultation with the council would not be required. It would be an unnecessary burden on the council and the authority to insist on inappropriate consultation.

The second part of the amendment would require directors or representatives of the companies that are licensed water suppliers to attend council committee meetings. That is not necessary. The current obligation for undertakers to attend committee meetings is included in the standard appointment condition and is therefore not covered in primary legislation. We would expect a similar licence condition to be applied to licensed water suppliers. That will be consulted on. For those reasons I hope that the noble Baroness, Lady Byford, will not press the amendment.

Baroness O'Cathain

My Lords, before the Minister sits down, I want to tease out why the consumer council for water should not be mentioned in the Bill. The Bill is very technical, but water is a consumer issue. The consumer does not get much say in any of this. The consumer council for water is an important body. The current WaterVoice people are very helpful. They get deeply involved in all the issues of the organisation and they should be consulted.

I should also like an explanation from my noble friend Lady Byford of the use of the word "directors" in the second part of Amendment No. 121.

Baroness Farrington of Ribbleton

My Lords, I could not agree more that the consumer council for water is very important I am sure that the noble Baroness, Lady O'Cathain, would agree that it is also important to recognise the role of the Drinking Water Inspectorate and the Environment Agency. I hope that that answer satisfies the noble Baroness. If not, I would be only too pleased to clarify the position between now and the next stage.

Baroness Byford

My Lords, I am grateful to the noble Baroness, Lady Farrington, for that clarification. We continue to feel that the water council should be defined in the clause. She referred to the Drinking Water Inspectorate and the Environment Agency. If she feels that the consumer council, in having its name in the Bill, would take priority over those two bodies, perhaps the Government should consider adding all three names. In that way, all three bodies could be consulted. The noble Baroness suggested earlier that that was not necessary and that the bodies were already in the Bill.

Baroness Farrington of Ribbleton

My Lords, I believe that I indicated that those bodies were included as appropriate, rather than as a blanket inclusion on every occasion.

Baroness Byford

My Lords, I must reconsider the matter.

The Minister was unhappy about Amendment No. 121, especially paragraph (b), which deals with directors and other representatives. In answer to my noble friend Lady O'Cathain, when we drafted the amendment we had not specified whether the directors were executive or non-executive. That is something that I need to clarify.

I apologise to the House for being somewhat unprepared at the restart. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Baroness Farrington of Ribbletonmoved Amendment No. 119: Page 136, line 19. at end insert— ( ) on the Council;

The noble Baroness said: My Lords, noble Lords from the Opposition Benches have tabled amendments that are broadly similar to Government amendments. We said in Committee that we would consider such amendments alongside the intention to extend the council's remit to monitoring licensed water suppliers. We have considered the matter further and agree that the council needs to be kept informed of new and amended licences.

The government amendments differ from the otherwise identical amendments tabled by both opposition parties, in that we have used the term "Council", which is the shortened name of the consumer council for water throughout the Bill. Given that we all have the same objectives, I hope that noble Lords will withdraw their amendments in favour of the Government's, in those cases where there is a slight difference in drafting or placement. I beg to move.

Baroness Byford

My Lords, I thank the Minister for responding to the long discussions that we had in Committee. Brevity is always an advantage and, although I hate giving way, on this occasion the Government have the edge on us. We are quite happy to accept their amendments referring to the "Council", which obviously means the consumer council for water.

Baroness Miller of Chilthorne Domer

My Lords, we thank the Government for accepting our points.

On Question, amendment agreed to.

[Amendments Nos. 120 and 121 not moved.]

Baroness Farrington of Ribbletonmoved Amendment No. 122: Page 140, line 7, at end insert— ( ) the Council;

On Question, amendment agreed to.

[Amendment No. 123 not moved.]

Baroness Farrington of Ribbletonmoved Amendment No. 124: Page 140, line 46, at end insert— ( ) the Council;

On Question, amendment agreed to.

[Amendment No. 125 not moved.]

Baroness Farrington of Ribbletonmoved Amendment No. 126: Page 143, line 21, at end insert— ( ) the Council;

On Question, amendment agreed to.

[Amendment No. 127 not moved.]

Baroness Farrington of Ribbletonmoved Amendments Nos. 128 and 129: Page 146, line 33, at end insert— ( ) the Council; Page 148. line 23, at end insert— ( ) the Council;

On Question, amendments agreed to.

[Amendment No. 130 not moved.]

Baroness Farrington of Ribbletonmoved Amendment No. 131: Page 150, line 23, at end insert— ( ) the Council;

On Question, amendment agreed to.

[Amendments Nos. 132 to 134 not moved.]

Lord Dixon-Smithmoved Amendment No. 135: Page 160, line 21, after "any" insert "quantifiable

The noble Lord said: My Lords, Amendment No. 135 seeks to insert the word "quantifiable" into the question of costs, which is what this particular part of the Bill deals with—costs as between water suppliers and water companies.

This is a slightly obscure but very important argument. I wish that I could abbreviate it but I regret that I cannot. A water undertaker—that is a major water company—loses a customer to a licensed water supplier who requests the undertaker to lay some pipes through which he will supply the undertaker's water to the undertaker's former customer. The undertaker is obliged to do so and charges the supplier accordingly. He is entitled to do so and that seems absolutely right.

But at that point the supplier can put up an argument to the effect that the charge is not payable as there are balancing items as follows. The customer is planning to expand his operation and the undertaker would have had to lay an additional pipe in any event. Moreover, there would have had to be an increase in water treatment capacity as the undertaker's pipes are all for domestic quality whereas the supplier, because of the nature of the customer, can use pipes of a lower quality and a lower standard because the customer does not need drinking water quality but he has had to have it because that was the only supply he could get.

This may sound like creative accounting gone mad but what we are dealing with is how we assess the nature of real costs. It is a complex question and the water undertaker could be obliged to pay costs which the water supplier could legitimately argue he would have had to undertake anyway. What we have sought to do is to insert a word which might help if one ever finds that kind of an argument arising between a water supplier and a water undertaker.

I am sorry that the matter is so complex; I wish that it were not. But unfortunately I see no way round the matter. I see immense scope for fruitful argument employing all kinds of experts for a long time at some point in the future. I hope very much that the Minister in his response will be able to clarify what: is otherwise a very unclear situation. I beg to move.

Lord Whitty

My Lords, I agree with the noble Lord's objectives but I do not think that the amendment is necessary. I understand the situation that he described. There could be all sorts of other complicated situations where one has to net off a cost or otherwise. I agree that only quantifiable benefits can be deducted from the undertaker's charges but they would have to be quantifiable if the regulator is able to identify them and calculate them. He will not be able to make a financial determination unless they are quantifiable. Therefore, the regulator is to a large extent already constrained by ensuring that the financial calculations can be made, so "quantifiable" is unnecessary in terms of determining what sum the regulator comes up with.

As in so many discussions that the noble Lord and I have, it would not do any harm to add what an amendment would add—"quantifiable" in this case—in normal parlance. However, the lawyers will always say, "Don't use more words than you have to", although with a Bill this long he would be justified in challenging whether that was a general precept. Nevertheless, that is the view. If the sums are to be reduced to a financial calculation, clearly they have to be quantifiable in any case.

9 p.m.

Lord Dixon-Smith

My Lords, I am grateful to the Minister for his explanation. I am not sure that it takes us any further forward, as it seems that the argument will be able to go on in all its intricacy and detail for a considerable time in a number of such cases. That said, I am quite prepared to accept that "quantifiable" may not be the right word. It may be that we could find a better one, or a better way of making the point that we want to make. For now, I shall study his explanation with considerable care, think about it and see whether we can do anything at Third Reading. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Dixon-Smithmoved Amendment No. 136: Page 161, line 8, leave out "Secretary of State" and insert 'Chief Inspector of Drinking Water

The noble Lord said: My Lords, the amendment is grouped with Amendments Nos. 137 and 138. They all have the same effect, which is to leave out the Secretary of State. We have no particular wish to do him out of a job, but we think that the chief inspector of drinking water or the chief inspector of drinking water for Wales is more appropriate in this instance.

The amendment arises out of a debate on Amendment No. 168ZF, believe it or not, in Grand Committee on 10th April, as reported at col. GC 75. The Minister explained that the wording to which we had objected was a legislative drafting device to enable the authority to consult the Drinking Water Inspectorate, which reports to the Secretary of State. Clause 38 substitutes a new section in the Water Industry Act that specifically gives the Secretary of State or, as the case may be, the authority the powers and duties covered in that Act as general duties in respect of the water industry. It seems ridiculous to lay down such a general duties clause and then say that the authority cannot consult a department reporting to the Secretary of State without his specific permission.

We think that that is very peculiar. It is a very sophistic argument, and we think that our amendment would lead to a considerably clearer situation in the Bill. It would also leave the Secretary of State secure as a final court of appeal, so that if there were any need for such a thing we could speed up the clarification of complaints. If the Secretary of State were involved at an earlier stage, that would be more difficult. I beg to move.

Lord Whitty

My Lords, I am sorry that the noble Lord viewed the previous explanations as sophistry, but I agree that they are hugely legalistic. The problem is that the Drinking Water Inspectorate does not exist as a legal entity, and therefore cannot of itself have duties.The Secretary of State has duties that are then conferred on the chief inspector of drinking water. Although one can designate in legislation the fact that the Drinking Water Inspectorate could be consulted, that does not impose a duty on it. It is a duty on someone else to consult it. The legal position is that duties cannot be conferred on something which does not have a legal personality. Hence the only way of doing it is to designate the Secretary of State. In commonsense terms, of course, there is a problem in that the Secretary of State can, in certain circumstances, appear later in some of the procedures. But we cannot so designate the Drinking Water Inspectorate under the current structure and conventions.

So while in a sense I accept the logic of the noble Lord's approach, I cannot accept the statutory form in which he is putting it.

Lord Dixon-Smith

My Lords, before the Minister sits down, this is a legislative Chamber and it can establish the precedent that it wishes to establish. If it wants to establish the Drinking Water Inspectorate as a legal entity, surely it can do so. It may be that this amendment is not the appropriate way to do so and that a different amendment is required in order to achieve that, but I ask the Minister why that cannot be done. It seems to me that it would be helpful if it were done.

Lord Whitty

My Lords, it can, of course, be done, but it would require a definition of the inspectorate as a body with its own identity rather than an amendment in one particular respect. The noble Lord would therefore have to come forward or force the Government to come forward with a large number of substantive amendments. At the moment, the Drinking Water Inspectorate is part of the department and is no different from any other Civil Service branch which cannot be designated as a legal entity—the Secretary of State has to be designated in terms of defining the responsibility of the department.

Baroness Farrington of Ribbleton

My Lords, I was flexible with my noble friend and with the noble Lord, Lord Dixon-Smith. But this is Report stage; once the Minister sits down questions cannot be asked.

Lord Dixon-Smith

My Lords, I accept the noble Baroness's rebuke. She is perfectly correct. But it does seem to me that we have an acknowledged anomaly, in the sense that the existing situation is not perfect, but we do not have the appropriate amendment to rectify it. The only question is, therefore, whether the Opposition have to carry out the task of drafting an appropriate amendment and almost certainly get it wrong, or whether we invite the Minister to tackle the issue and perhaps have cold towels round his drafting clerks for a number of nights, and they might or might not come up with the right answer, or might not be able to do it in the time available.

The only thing that seems certain in this situation is that the right thing for me to do at the moment is to withdraw the amendment. However, I should welcome an opportunity to discuss it with the Minister subsequently. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 137 and 138 not moved.]

Baroness Farrington of Ribbletonmoved Amendments Nos. 139 and 140: Page 164, line 23, leave out "a" and insert "the Page 165, line 13, leave out from "agreement" to end of line 15 and insert "for a supply of water in bulk

On Question, amendments agreed to.

Baroness Byfordmoved Amendment No. 141: Page 166, line 13, at beginning insert "shall lay a copy of the notice in each House of Parliament subject to objection within 40 days,

The noble Baroness said: My Lords, this amendment relates to prohibitions and exemptions. In Committee, we moved a series of amendments designed to probe the meaning of paragraphs 661 to 66K as laid down in Schedule 4. We were unhappy about the prohibition on the ability of water undertakers to prosecute anyone who used their systems to introduce water without permission. We were also unhappy that the Secretary of State could apparently authorise certain people or classes of people to make free of a water system.

The responses that we received were unsatisfactory. It has subsequently been pointed out to me that the negative procedure already exists, but I invite the Minister who will reply to point me to it in the Bill. That would be hugely helpful. I should be glad to have clarification from the Minister. I beg to move.

Baroness Farrington of Ribbleton

My Lords, I fully understand that the noble Baroness, Lady Byford, seeks to ensure that the power to grant, by order, exemptions from the prohibition on persons supplying from or introducing water to the undertaker's supply system is subject to parliamentary scrutiny.

I can confirm that an order under this section is already subject to the negative resolution procedure under subsection (6) of new Section 66L on page 168 of the Bill. I am very pleased to have been able to reassure the noble Baroness. I trust that she will be happy with the reply and feel able to withdraw the amendment.

Baroness Byford

My Lords, I am grateful to the Minister. It is quite difficult to get round the various parts of the Bill. However, with that confirmation, I am happy and beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 8 [Minor and consequential amendments: licensing of water suppliers etc]:

Baroness Farrington of Ribbletonmoved Amendment No. 142: Page 184, line 36, at end insert— ( ) Section 174 of the Water Act 1989 (c. 15) (general restrictions on disclosure of information) is amended as follows. ( ) In paragraph (b) of subsection (2), for "or a sewerage undertaker" there is substituted ", sewerage undertaker or company holding a licence under Chapter IA of Part 2 of the Water Industry Act 1991". ( ) In paragraph (c) of that subsection, for "203(1) or (2)" there is substituted "203(1), (IA), (2) or (2A)". ( ) In subsection (6)(a), after "sewerage undertaker" there is inserted ", or with the carrying on by a company holding a licence under Chapter IA of Part 2 of the Water Industry Act 1991 of activities under its licence,".

On Question, amendment agreed to.

Baroness Byfordmoved Amendment No. 143: Page 187, line 16, leave out sub-paragraph (4).

The noble Baroness said: My Lords, in moving Amendment No. 143, I shall speak also to Amendments Nos. 144 and 145. The sub-paragraph in question allows a licensed water supplier to transfer to another company or companies sufficient of its activities to protect a strategic supply. That will be done under a special administration order.

I want to ask the Minister what safeguards there will be to ensure that the company receiving the privilege is worthy of it. Will the water undertaker play any part? The court may hear from the Secretary of' State or the authority in regard to the licensed water supplier, but will the court hear submissions from anyone with regard to the replacement? Surely if a licensed water supplier contravenes regulations or goes out of business, the logical approach is to give hack the right of supply to the water undertaker until a proper application can be dealt with from a new would-be licensed water supplier. That deals with Amendment No. 143.

Amendment No. 144 concerns the ministerial explanation that encapsulates all my doubts about the reasons for this Bill and the way those reasons are being translated into action. At col. GC 82 of Hansard of 10th April the noble Baroness, Lady Farrington, explained that the Bill extends the duty that water undertakers already have to supply water to domestic customers outside their area. It restricts them to competing only through their associated companies and not directly. We discussed that matter earlier today.

We now have a situation where water undertakers will lose their biggest customers to the licensed water suppliers to improve the competitiveness of the industry. Water undertakers will have an extended duty to supply on demand outside their area to non-domestic customers. However, water undertakers will compete outside their area only through their associated companies.

Am I the only person in this House who believes that some convoluted thinking is involved here? Why cannot undertakers compete as themselves? The amendment as tabled is totally inadequate for changing something as profound as this, but I hope that the Minister will address seriously the comments that I have made in proposing the amendment and that she will provide some answers.

I turn to Amendment No. 145. Our concern with this aspect of the Bill is that the water undertaker must pick up where the licensed supplier left off without necessarily being aware that it has left off. It may be possible to incorporate a legal duty on the supplier to inform the undertaker before abandoning the supply, but in some circumstances that one can think of, that would be the last thing that might happen.

There seems to be a presumption that in all cases the supplier will be drawing a continuous, probably steady, stream of water from the undertaker. Will the Minister confirm that in all cases that will be so? Further, will the total supply come from a single undertaker? What is the possible involvement of, for example, the British Waterways Board? What are the chances of pipe supply coming from the Continent? In such an event, who would pick up the duty of continuation after a supplier had pulled out, and how would that duty be notified? I beg to move.

9.15 p.m.

Baroness Miller of Chilthorne Domer

My Lords, I appreciate the tabling of these amendments, which would clarify the situation. I hope that the Minister will give a good explanation because the system appears, as the noble Baroness said, to be very convoluted. It is one of the most impenetrable parts of the Bill.

Baroness Farrington of Ribbleton

My Lords, I feel rather inclined to agree that it is one of the more complex parts of the Bill. Amendment No. 143 deals with strategic supply and special administration as they apply to licensees. Its effect is to leave customers without the protection offered by special administration. The special administration provisions will protect customers from the failure of a licensee where the licensee's introduction of water to the undertaker's network is too large for the undertaker to make up the shortfall. Such significant introductions of water into the network will be designated as strategic supplies. If a licensee were to fail financially or be at risk of losing its licence, Ofwat or the Secretary of State can apply to the High Court to put the licensee into special administration.

The special administrator would aim to continue the strategic input of water and to transfer it as a going concern to another supplier. The special administrator may either sell the contract for the provision of the supply to an undertaker or a licensed water supplier, depending upon who they decide is most suited immediately to take over the running of the strategic supply while providing a return to shareholders and creditors.

The special administrator is appointed by the court. It considers who should be sold the contract for the supply. It could be an undertaker or a licensee with the approval of the Secretary of State or Ofwat. Supplies will be considered strategic only where, without them, the undertaker could not fulfil its obligations to supply customers.

On Amendment No. 144, at present undertakers have a duty to supply customers outside their area for domestic purposes but not non-domestic purposes. We have sought to make the duty consistent for all supplies in that regard. The duty to supply will in the future also apply outside the undertaker's area only to customers who are not eligible for supply by a licensed water supplier. Undertakers will be allowed to compete outside their area only through their associated companies. That ensures that there is a clear boundary between the activities of the regulated undertaker and its associated company.

On the question about the boundary between England and France, I shall write to the noble Baroness. I shall return to the matter in a moment. The non-domestic duty is further qualified; it will not apply if in making that supply and supplying all other customers, the undertaker would incur unreasonable expenditure. I hope that that satisfies the noble Baroness in relation to that amendment.

I turn to Amendment No. 145, which would make the duty on the undertakers to provide an interim supply, under new Section 63AC, conditional on the relevant undertaker being aware that a supply from a licensed water supplier had ceased. The effect of that would be to stop the undertaker being able to charge for water that it had unknowingly supplied. We feel that that would not be equitable. We believe that the amendment was tabled in order to protect undertakers from being obliged to provide a supply, without notice, to customers whose licensed supplier failed them. In fact, the provisions are there for the protection of undertakers and customers as well.

If a licensee fails to supply its customer, water will still continue to flow out of the undertaker's pipes at the customer's premises. This provision ensures that whether or not the undertaker is aware that the licensee had stopped making a supply, it is able to recover charges from a customer for the water supplied; it does not depend on the customer informing him.

The customer is protected because, from the time of the licensee's failure, it has at least three months to make alternative arrangements for supply, either by another licensee or by the undertaker. After this period, the undertaker can choose to serve a disconnection notice if no other arrangements have been made. The undertaker is not required to maintain a standby water supply equivalent to the total supplied by the licensees in its area. It will be required to make an interim supply only for domestic needs, unless it has enough water to supply for other purposes.

I tried, with some difficulty, to bring together three amendments that I am delighted were grouped together. If I have failed to answer any of the questions that have been raised, because, as the noble Baroness, Lady Byford, recognised, the matter is extremely complex, I shall be delighted to write to all noble Lords who have taken part.

Baroness By-ford

My Lords, I am grateful to the Minister. I apologise to the House that I linked the amendments. The House may be grateful that I did, but it was an error. Unfortunately I had not looked at my master list. At this stage of the proceedings I should like to read carefully the response given by the Minister. I am still unsure why associates have to be used, as opposed to their own companies. I would be glad of further clarification. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 144 and 145 not moved.]

Lord Whittymoved Amendment No. 145A: Page 196, line 45, at end insert— In section 72 (contamination of water sources), in subsection (5), after paragraph (b) there is inserted ";and (c) any pipe or conduit of a licensed water supplier."

On Question, amendment agreed to.

The Deputy Speaker (Lord Geddes)

My Lords, before calling Amendment No. 146, 1 must advise the House that there is a mistake on the Marshalled List. It should read: Page 198. line 14, leave out first "or" and insert "and"".

Lord Whittymoved Amendment No. 146: Page 198, line 14, leave out first "or" and insert "and

On Question, amendment agreed to.

Lord Whittymoved Amendments Nos. 147 to 152:

Page 198, line 25, leave out first "or" and insert "and"

Page 200, line 29, at end insert— ( ) Section 162 (works in connection with metering) is amended as follows. ( ) In subsection (1A), in paragraph (a) at the end there is inserted "or". ( ) In that subsection, after paragraph (c) there is inserted "or (d) a licensed water supplier supplies water to those premises using the undertaker's supply system. ( ) After that subsection there is inserted— (1B) In subsection (1A)(d) above, the reference to the supply system of a water undertaker shall be construed in accordance with section 17B(5) above."

Page 200, line 31, at end insert— ( ) Section 174 (offences of interference with works) is amended as follows. ( ) After subsection (1) there is inserted— (1A) Subject to subsection (2) below, if any person without the consent of the licensed water supplier—

  1. (a) intentionally or recklessly interferes with any pipe or any structure, installation or apparatus which—
    1. (i) is vested in any licensed water supplier (in the case of a pipe) or belongs to any such supplier (in any other case); and
    2. (ii) is used in connection with the carrying on by the supplier of the activities authorised by its licence; or
    241
  2. (b) by any act or omission negligently interferes with any such pipe or with any such structure, installation or apparatus so as to damage it or so as to have an effect on its use or operation,
that person shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding level 3 on the standard scale. In subsection (2)—
  1. (a) after "subsection (1)" there is inserted "or (1A)"; and
  2. (b) in paragraph (b)—
    1. (i) after "water undertaker" there is inserted "or licensed water supplier"; and
    2. (ii) in sub-paragraph (ii), for the words from "the stopcock was" to the end there is substituted "subsection (2A) below applies".
 ( ) After that subsection there is inserted— (2A) This subsection applies—
  1. (a) in the case of a stopcock belonging to a water undertaker, if the stopcock was closed otherwise than by the undertaker;
  2. (b) in the case of a stopcock belonging to a licensed water supplier—
    1. (i) if the stopcock was closed otherwise than by the supplier; or
    2. (ii) if the stopcock was closed by the supplier and the person in question for the purposes of subject: on (2) above is the water undertaker whose supply system is used for the purpose of the supply made by the supplier,
 and in this subsection the reference to the supply system of a water undertaker shall be construed in accordance with section 17B(5) above. ( ) In subsection (3), in paragraph (c), for "section" there is substituted "subsection". ( ) After that subsection there is inserted— (3A) Any person who, without the consent of the licensed water supplier—
  1. (a) attaches any pipe or apparatus to any pipe which is—
    1. (i) vested in a licensed water supplier; and
    2. (ii) used in connection with the carrying on by the supplier of the activities authorised by its licence;
  2. (b) attaches any pipe or apparatus to any service pipe which does not belong to such a supplier or a water undertaker but which is a pipe by means of which water is supplied by such a supplier to any premises;
  3. (c) makes any alteration in a service pipe by means of which water is so supplied, or in any apparatus attached to any such pipe; or
  4. (d) subject to subsection (4) below, uses any pipe or apparatus which has been attached or altered in contravention of this subsection,
shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding level 3 on the standard scale. In subsection (4)—
  1. (a) after "subsection (3) above" there is:inserted "or paragraph (d) of subsection (3A) above", and
  2. (b) for "that subsection" there is substituted "subsection (3) or (3A) above (as the case may require)".
 ( ) After subsection (5) there is inserted— (5A) If any person wilfully or negligently injures or suffers to be injured any water fitting which—
  1. (a) belongs to a licensed water supplier; and
  2. (b) is used in connection with the carrying on by the supplier of the activities authorised by its licence,
he shall be guilty of an offence and liable, on summary conviction, to a fine not exceeding level I on the standard scale. ( ) After subsection (8) there is inserted— (8A) In this section "consumer"—
  1. (a) in relation to a supply of water provided by a water undertaker to any premises, means a person who is for the time being the person on whom liability to pay charges to the undertaker in respect of that supply of water would fall;
  2. (b) in relation to a supply of water provided by a licensed water supplier to any premises, means a person who is for the time being the person on whom liability to pay charges to the supplier in respect of that supply of water would fall."
 ( ) In subsection (9), for ""consumer" and "water fitting" have the same meanings" there is substituted ""water fitting" has the same meaning". Page 200, line 31, at end insert— ( ) Section 175 (offence of tampering with meter) is amended as follows. ( ) In subsection (1)(a), after "undertaker" there is inserted "or licensed water supplier". ( ) In subsection (2), for the words from "consent" to the end there is substituted "appropriate consent". ( ) After that subsection there is inserted— (3) In subsection (2) above, the "appropriate consent" means—
  1. (a) if the meter is used by one relevant undertaker, the consent of that undertaker;
  2. (b) if the meter is used by one licensed water supplier, the consent of that supplier;
  3. (c) if the meter is used by two or more of the following persons—
    1. (i) a relevant undertaker;
    2. (ii) a licensed water supplier,
 the consent of each of those persons. (4) In subsection (3) above, references to the consent of a relevant undertaker are references to consent under section 176 below."

Page 203, line 11, at end insert— ( ) In that subsection, in paragraph (c), for "203(1) or (2)" there is substituted "203(1), (1A), (2) or (2A)".

Page 205, line 38, at end insert— ( ) The WRA is amended as follows. ( ) In section 203 (exchange of information with respect to pollution incidents etc)—

  1. (a) after subsection (1) there is inserted—
  2. (b) after subsection (2) there is inserted—
    3. 243
  3. (c) for subsection (3) there is substituted—
    1. (d) in subsection (4)—
    2. (i) for "subsection (1) or (2)" there is inserted "subsection (1), (1A), (2) or (2A)"; and
    3. (ii) after "undertaker" there is inserted ", to a licensed water supplier";
  4. (e) in subsection (5), for "a water undertaker under subsection (2) above shall" there is substituted—
    1. "(a) a water undertaker under subsection (2) above; or
    2. (b) a licensed water supplier under subsection (2A) above,
  5. (f) after subsection (7) there is inserted—
    1. (a) in paragraph (b) of subsection (2), for "or sewerage undertaker" there is substituted ", sewerage undertaker or company holding a licence under Chapter 1A of Part 2 of the Water Industry Act 1991";
    2. (b) in paragraph (c) of that subsection, for "203(1) or (2)" there is substituted "203(1), (1A), (2) or (2A)"; and
    3. (c) in subsection (4)(a), after "sewerage undertaker" there is inserted ", or with the carrying on by a company holding a licence under Chapter 1A of Part 2 of the Water Industry Act 1991 of activities under its licence,"."

Page 206, leave out lines 14 and 15 and insert— "(aa) a qualifying licensed water supplier within the meaning of subsection (6) of section 23 of the Water Industry Act 1991 (meaning and effect of special administration order),

On Question, amendments agreed to.

Clause 59 [Water resources management plans]:

Baroness Farrington of Ribbletonmoved Amendment No. 153: Page 74, line 32, leave out "and

The noble Baroness said: My Lords, in moving Amendment No. 153, I shall also speak to Amendments Nos. 154, 161, 162, 164, 166, 173, 174, 177, 181, 182, 184 and 186. Amendments Nos. 153 and 154 respond to Amendment No. 171AA moved by the noble Lord, Lord Dixon-Smith, in Grand Committee, where he sought to ensure that water companies consult planning authorities for the purposes of preparing their water resources management plans.

The amendments give the Secretary of State the power to prescribe the parties to whom an undertaker must send a copy of its draft water resources management plan. We will ensure that these regulations specify the planning authorities appropriate to the undertaker's area of supply.

Amendment No. 161 is identical to Amendment No. 179A moved by the noble Earl, Lord Peel, in Grand Committee. It limits use of the direction-making power for the preparation of flood plans to those reservoirs subject to the 1975 Act's safety regime.

Amendment No. 162 in Clause 73 enables the Secretary of State to serve a notice on reservoir undertakers requiring them not to publish flood plans or to publish them only as specified. This power would be exercised only if the national security climate required it. The amendment makes clear that the provision applies to all reservoirs and not just the large raised reservoirs.

Amendment No. 164 provides the sanction for the requirement that relevant water mains and service pipes must be vested in a water undertaker if they are to be connected to the public water supply system. We consider that there needs to be a sanction to ensure undertakers comply with the requirement. The most appropriate way of doing this is to make the provision enforceable by the authority under Section 18 of the Water Industry Act 1991.

The remaining amendments are technical, tidy words, avoid ambiguity and deal with consequential issues. If the House wishes, I could go through them in detail. If not, I beg to move.

Lord Dixon-Smith

My Lords, I have no wish to debate the amendments. I want merely to express my gratitude to the Government and to the Minister for her explanation, particularly with regard to consultation and planning. I also thank my noble friend Lord Peel for his suggestion as regards reservoirs. We are grateful that the Government have made these amendments.

On Question, amendment agreed to.

Baroness Farrington of Ribbletonmoved Amendment No. 154: Page 74, line 39, at end insert "; and

  1. (c) send a copy of the published draft plan and accompanying statement to such persons (if any) as may be prescribed."

On Question, amendment agreed to.

Baroness Miller of Chilthorne Domermoved Amendment No. 155: After Clause 59, insert the following new clause—

"Water conservation