§ 7.33 p.m.
§ Lord Corbett of Castle Vale
rose to ask Her Majesty's Government what they are doing to improve the regulation of the United Kingdom's rivers, canals and other inland waterways.
The noble Lord said: My Lords, I am grateful for this opportunity to argue the case for the appointment of a waterways regulator to oversee the management and operation of about 3,000 miles of navigable rivers, canals and marinas along our coast. Although most of the network is publicly owned, I believe that there is a lack of co-ordinated and coherent oversight.
About 10 million people make 160 million visits a year to the 2,000 miles of canals and rivers owned and operated on our behalf by British Waterways in England, Wales and Scotland. Millions more use and enjoy the 400 miles of rivers operated by the Environment Agency.
Forty years ago, most of our canals were in decay—the forgotten roads of the industrial revolution. Most of the inland waterway system was under threat of closure. I want to pay a special tribute here to the enthusiasts who were determined that our canals would not die and that they should be restored as part of a priceless environmental leisure and heritage asset. Without their direct action on some occasions, there is good evidence that much of the network would have been lost to the bulldozer.
Perhaps I may make immediately clear that I am not attacking British Waterways. I acknowledge and commend its programme of canal maintenance and improvement, as well as its impressive and continuing role in urban regeneration. For those of your Lordships who are unfamiliar with Birmingham's 42 miles of canals, perhaps I may issue an invitation to take a boat trip from Gas Street Basin in the heart of the city to see how adding a little water can achieve so much.
980 That said, there are issues around what British Waterways, other operators and those who run coastal and river marinas charge for moorings, berths and licences. The complaint, especially in areas of high demand, is that boat owners are being fleeced, that complaints can lead to the loss of a berth or mooring and that there is no adequate appeal route. That is the nub of the case for a waterways regulator. although she or he would have other duties.
I am aware, for example, that British Waterways receives only about £14 million a year from licence and mooring fees. That income rose by about 7 per cent in the past year. But, as the annual report makes clear, average fees were put up by 6 per cent in April last year, and boat licence fees rose by 1.8 per cent in January last year and a further 3 per cent this year.
Out of an income of £192 million from government grants, third-party grants and business activities, including telecoms, water sales and property, the income from boat owners is small beer. But, with an estimated one-third of boat owners known to be on low incomes, there is an issue here. Of course, a senior citizens' boat card might help, and I hope that British Waterways will try to find ways to offer that, as is the case on the railways. However, again, there are wider issues.
The prices charged for moorings and berths by providers reflect demand in the area, location and facilities. But, in areas of high demand, it does mean that the market rate is often set by monopoly or near-monopoly providers. British Waterways is instructed in the 1999 government framework document to,maximise income … by charging the market rate".As I said, it is often in a position to set that market rate, as are private operators in relation to coastal and river marinas.
Perhaps I may illustrate the point in this way. Tim Coghlan, Managing Director of Braunston Marina on the canal near Rugby, says that,for at least the last five years every single canal marina that has been sold … has been … acquired by British Waterways".He claims that British Waterways has acquired 17 marinas, only two of which it has built, as well as Hull marina on the coast and others on rivers.
I can understand the commercial logic of that and welcome the decision by British Waterways to set up a separate company to run the marinas to avoid any charges of cross-subsidy from the government grant and to aid transparency in the way that it sets fees within the marinas. However, that raises the issue of a near-monopoly supplier into which a regulator could inquire, especially as I understand that the marina acquisitions by British Waterways faced no competition.
While a survey in which 5,000 canal boat owners were invited to take part by British Waterways in the 2002 season shows reasonable levels of satisfaction over upkeep, basic facilities, the provision of moorings, and so on—although I have to say that there is scope for the organisation to do far better and I am sure that it acknowledges that—there is a deal of discontent over charges.
981 The Diglis Forum at Diglis Basin near Worcester claims that fees rose there by 11.7 per cent. A boat owner from Wembley tells me that mooring fees have increased by 30 per cent and adds:British Waterways is ultimately in control of overall charges. You put up your charges, and marinas increase their charges which in turn 'justifies' your charges being increased and so on".It is put this way by a boat owner in Fareham:If I am not happy with the cost of electricity I can switch to a different supplier. Mooring my boat I have no option. British Waterways is the only choice if I wish to keep my boat where it is".There are the same complaints about private marina operators, such as Marina Developments Limited (MDL). A boat owner from Paignton says,Marina Developments Limited (MDL) already have a virtual monopoly in Torbay berthing and it would appear that as a result, year on year, they have been able to increase rentals substantially in excess of inflation".
An owner with a boat in Woolverstone Marina on the river Orwell near Ipswich run by MDL, tells me,Over the years when there have been vacant berths, the prices have gone up to recoup their losses. When the marina is full … the prices go up. It would appear MDL have a 'licence to print money'".My correspondent tells me that berth holders were given vouchers for 15 nights free of charge at any MDL marina. One berth holder went to an MDL marina in the Hamble and presented the vouchers as he was about to leave. He was told that had they known that vouchers were being used he would have been refused a berth when he arrived.
I have been told of boat owners in marinas operated by MDL who are afraid to complain of overcharging or inadequate facilities because of real fears and actual experiences that they would lose berths in areas of high demand, although MDL denies that. But the fact remains that many owners feel they are being priced out of the water and cite a survey carried out by Yachting magazine showing that prices across the Channel can be three or four times lower for comparable facilities. As Sarah Norbury, the then editor of Yachting Monthly told a Carlton West Country news programme,They're able to get away with it because there's no watchdog body, no marina watchdog, no fair rent Act for marinas so no checks or controls at all".It is in no one's interests that boat owners who are customers of British Waterways, MDL or any other operator should feel aggrieved over levels of charges and the way in which they increase. That is why I think this comment from Michael Thompson, Secretary of the Sunderland Berth Holders and Mooring Association, makes the case for an independent waterways regulator.In this country just about everything from Water, Gas, Telecommunications, to the Prison Service have either a regulator or a review body to ensure that high standards are maintained, and the customer receives a value for money product. It is my personal belief Marinas should be inspected on a regular basis, and if proven that the current Marina Management fall short of the required standard they should lose the lease to administer the Marina. The lease should then be offered to other interested parties who will manage these marinas to the required standard".982 That is backed by Sue Burchett, who chairs the National Association of Boat Owners. She says:What is needed is an independent watchdog which can look at restrictive practices, monopoly pricing and unfairness wherever they arise across Britain's waterways. Utility companies, the Post Office, and railways have regulators, such as OFWAT which protect their customers' interests. What about an "OFCUT" for the waterways?Perhaps I should explain that in the parlance of the West Midlands we call the canals, "the cut".
I am aware that the Office of Fair Trading can investigate alleged abuse of market share, monopoly or allegations of excessive prices. But that is a large hammer to use and a difficult and time-consuming job and route. When the National Association of Boat Owners asked the OFT to look into complaints in March of this year that British Waterways' mooring prices were unfair, though sympathetic and saying it was not reaching a final conclusion, the OFT added:However, this does not appear to us to be a matter that is sufficiently promising to warrant the commitment of further resources by the office at this stage".A waterways regulator would have one job: to try to see fair play and encourage transparency and better relations between boat owners and those who enjoy our waterways and those who operate them. For the OFT, this is one job among far too many. Similarly, British Waterways' ombudsman scheme, though I accept absolutely that he is independent, is, I believe, too narrowly complaint-focused.
I believe that the case for a waterways regulator is strong and compelling to ensure a proper balance between providers and users and an informed and independent oversight on all aspects of our inland waterways.
§ 7.45 p.m.
§ Lord Livsey of Talgarth
My Lords, I thank the noble Lord, Lord Corbett, for bringing this mat ter to the attention of the House. The noble Lord has an intimate knowledge of waterways. Being associated with the Birmingham conurbation, where there is a mass of waterways which serve the local population and visitors and where, as the noble Lord said, there are less well off people involved, he makes a powerful case for a waterways regulator.
I want to concentrate my remarks on different aspects from those referred to by the noble Lord, arid in particular on regulation; indeed, the debate is about regulation. I have looked up some of the existing regulations which apply to inland waterways and canals and the functions of the British Waterways board in relation to those. Many come under the Transport Act 1962. The Secretary of State, for example, can transfer to the board all or part of a navigation authority, which I find interesting. He can transfer assets; promote and oppose Bills and promote research and development. His powers relate to charging. Borrowing limits apply; loans and treasury guarantees can be obtained. His powers relate also to the classification of waterways and, indeed, transport duties on goods and passenger services on the canals.
983 The acquisition of land can occur. There are statutory powers, for example, on limitations on the transfer of water, and carrying powers. British Waterways has wide-ranging powers. The question is whether it is using those powers in a responsible way and to best effect. Certainly, I approve of the fact that there is financial assistance, for example, for moving freight from road to inland waterways. That must be a constructive function. Indeed, I am certainly concerned about non-capital grants, which are available. Indeed, it is important in any schemes promoted by British Waterways that those are related to environmental benefit. If we go along that path, grants to move transport from roads to canals is a constructive step. Of course, that would require investment in freight wharves.
However, the issue in this debate, as the noble Lord, rightly raises, is one of mooring charges, marina operations and the companies involved in them. I shall not repeat what he has said. However, I take strong note of the fact that there are monopolies which do not appear to work in the public interest as far as concerns the users of canals. There seems to be inadequate control in that regard and the proposals of the noble Lord are of great interest.
My knowledge of the canal system, certainly in the area with which I am familiar, relates to the Brecon and Monmouth canal, which is excellent for leisure and tourism, particularly with the construction of a terminal at the new Brecon Theatre. The downside—there is a downside—is that there appears to be a good deal of water extraction from the River Usk. The amount of water flowing down the River Usk that is transferred into the canal causes environmental concern, to say the least. In our area we should like British Waterways to be able to extend that canal down to Newport. In Wales, we would also welcome investment in the Neath Canal, for it to join with Swansea and the operations of the Llangollen Canal.
The real black spot for us is the failure of British Waterways to develop the Montgomeryshire Canal to Newtown. People want its full restoration. We certainly want to know what the hold up is in developing that scheme. Is it the regulations, the lack of funds, or is it planning that is causing the problem? The Montgomeryshire Canal was an economic link, which must be restored to full working order. A good deal of money has already been spent on it.
The balance of environmental considerations with economic opportunities has not always been well balanced. The canal runs out near Newtown. Indeed, there is concern that the Countryside Council for Wales has had some influence so far as concerns SSSIs to the detriment of the development of the canal. I realise that this House does not have direct control over the activities of the Countryside Council for Wales. I hope the Minister will recognise that I acknowledge that. I am merely describing the situation.
I congratulate British Waterways on its document, Waterways for Wales, and on its commitment to sustainable development. But I cannot agree with 984 British Waterways that it does not require or need more regulations; I believe it does. There is a clear need for regulations with regard to moorings and the letting of contracts to marina operators and with regard to the extraction of water from rivers.
The issue of leakages from canals needs far tighter regulation. I have had to deal with some fairly serious cases of water appearing in people's houses due to inadequate maintenance of canals. That I believe is due to a lack of funds and perhaps priorities being skewed in different directions. Certainly, householders have had great problems. That needs to be sorted out.
This debate is also about rivers. I am concerned about the sustainability of the river system and the serious pollution of rivers, whether from industry or agriculture. There is a need for more regulation. Of course in this respect the Environment Agency has responsibilities. Much of this ground was covered in the Water Bill. None the less, I believe that the sustaining of aquatic life, fisheries, bird life, the ecology of the river beds and the necessity of reviewing river navigations all need tightened-up regulations.
Water quality compliance in rivers is particularly important. Regulations, for example, to secure certain pH levels in rivers would be constructive. Priorities for conflict resolution between different river users is very important. For example, the rights of fishermen versus access for canoeists need sorting out. That is a big issue on some rivers, which perhaps could be sorted out by the allocation of time to different aspects.
We covered the territory of stages of main rivers and tributaries in the Water Bill. I do not wish to go over that. But tributary maintenance, specifically concerning flooding, is particularly important. Regulations for flood relief schemes would help. There is nothing better than to see a pristine clean river flowing through beautiful countryside. Sadly, that is not always the case, but the situation has improved greatly.
Finally, on inland waterways and lakes, there is a big issue, for example, on the usage of power boats and whether or not they should be allowed on some waters. They need to be subject to greater controls with possibly the ability to remove them. There is no doubt that investment for tourism, the economy and the environment is there, but that better regulation will assist and move it on further.
§ 7.54 p.m.
§ Lord Bradshaw
My Lords, I, too, thank the noble Lord, Lord Corbett, for giving us the opportunity to debate the subject. Like the noble Lord, I reiterate that we are not out, as it were, to get British Waterways, which largely has done a good job, particularly in view of the limited funds made available to it over many years.
The use of boats for leisure is increasing very rapidly. As people get more time and as they live longer we can expect that use to continue to increase. What we seek tonight, as far as I can tell, is that marinas, whether on canals or on estuaries, should not be owned by people seeking to create monopolies or to 985 charge monopoly prices. It is notable that British Waterways has been asked to charge "market prices". The Minister needs to make clear the difference between "market" and "monopoly" prices. That would make an extremely interesting subject for a thesis by some of my students. The definition between the two becomes very fine when the "market" price is pushed up, particularly when there is a shortage of supply.
We also want to make clear that boats are not owned simply by the idle rich. One can go into the Library and read Yachting World and see pictures of boats with scantily clad women draped about all over the place, but that I submit is not typical of the kind of people we are talking about. Many people struggle financially to keep a boat going and high mooring fees are a considerable barrier to increasing boat ownership.
While I am not necessarily in favour of a regulator, I am concerned about bodies such as Marina Developments Limited. It appears to be increasing its hold on scarce resources and extracting monopoly rents. There is a scarcity of space. That area needs attention. I ask the Minister in his summing-up to answer the question: if control of pricing cannot be exercised by the Office of Fair Trading, who is to exercise it in the absence either of a waterways regulator or by extending the powers of another regulator?
I am very familiar with the actions of the Office of Fair Trading in respect of the bus industry. Its actions have been too late. Often people have gone bankrupt before anything has been done. It is too slow. It takes months and months to get around to a subject. Often its rulings are quite perverse in that it makes rulings which are quite contrary to what the general public want. In the case of buses, the general public want cooperation in terms of co-ordination of ticketing and timetables that work. The Office of Fair Trading strikes down all these arrangements as being anti-competitive. But that is a very narrow view of what competition is expected to deliver. I believe that competition is supposed to deliver better service to the public, not a theoretical notion which is adopted by the Office of Fair Trading.
So I ask the Minister to address the issue. If the Office of Fair Trading is incompetent, are we going to abandon boat owners to the monopolist, or are we going to have some kind of regulation, as suggested by the noble Lord, Lord Corbett?
§ 7.59 p.m.
§ Baroness Byford
My Lords, I thank the noble Lord, Lord Corbett, for introducing this interesting debate. His speech slightly threw me because I had taken the subject in a broader sense. His Question asks the Government:what they are doing to improve the regulation of the United Kingdom's rivers, canals and other inland waterways".986 It does not specify mooring charges, although they are a real issue on which I am glad that he has enlarged. I hope that he will not be disappointed that I shall touch on it only briefly before moving to other matters appertaining to regulation.
I shall use my time to consider three issues. The first is that raised by the noble Lord, Lord Corbett, of setting charges, what is a monopoly, what is fair trade and what should be encouraged and what should not. I shall be interested to hear the Minister's response to that. Market pricing is seen as fair by some but not by others. Those setting those charges must obviously set them sensibly so that people can invest in their investment—if I can put it that way. I shall leave that question to the Minister.
I now turn directly to British Waterways. It is aware of some of the issues raised by the noble Lord, Lord Corbett—perhaps in common with others, I have received correspondence from it. It recognises that some customers have raised concerns about aspects of its process—dialogue and accountability in particular. I do not know whether the noble Lord has read it, but it produced a consultation document in July 2003, to which it is asking for responses by 17th October, and to which it will respond in turn in late November or December. So to an extent his point has already been taken up in that process. We ought to put that on record. It is aware that there is a need to ensure openness and accountability—it was criticised for their absence in the past. It is sometimes tempting to set up something new when what we already have may work but not be working well enough. I hope that we shall wait to see what happens before we jump to conclusions.
I turn to the suggestion that there should be an ombudsman scheme: that someone should be put forward to deal with the regulator. I understand that the Inland Waterways Association, which goes wider than British Waterways, is not in favour of that. Perhaps the Minister will explain why when he responds to the debate. I do not know—and it is an obvious question—what are the pros and cons of the suggestion. I should be interested to hear about that.
I then decided to consider the matter in a slightly wider context, because there other important issues to raise in the time I have been allotted, which I shall try not to overrun. The noble Lord, Lord Livsey, touched on them. To me, regulation is most necessary when we have flooding. It seems silly to talk about flooding when we are all so dry at the moment and wishing for rain and rain again, but flooding from our rivers and canals has become a fairly regular problem that has caused human misery and damage.
Following the most recent flooding disasters, there was talk of closer working between waterway authorities, local government and the Environment Agency. Was some formal regulation set up, or is it still an informal, ad hoc system? If so, who is the lead authority? We need to address that situation.
Is the Minister satisfied that when rain eventually comes, flooding will not occur as it did last time? He will remember that it is not clean water about which 987 people get so anxious; it is used, dirty, sewage water that causes such distress. Was there any outcome—whether regulatory or not—to the whole question of insurance for those people who were struck not just once by floods of sewage and soil in their homes? Will he clarify that, because so far as I am aware, it has not been clarified?
I turn to another point touched on by the noble Lord, Lord Corbett. Birmingham is not far from Leicester. We have canals in the country areas near Leicester and some good ones in Leicester city. As in Birmingham, one exciting development, which the noble Lord, Lord Whitty, and I have discussed previously, has been the redevelopment of waste land around our canals; it is hugely important and brings life back to an inner city. The site that I mentioned then was a former scrap metal yard. It cost the government—we were in government then—about £7 million to purchase the site and about £8 million to clean it before we could do anything with it.
My question is slightly obtuse: does the Waterways Authority have any input into planning? If so, is there any spin-off concerning the water, or is that a totally separate issue? I am not sure: again, it comes down to regulation and where one buck ends and another responsibility takes over.
Other noble Lords have touched on the increase in leisure facilities. Is that not good? It is wonderful to see people enjoying not just walking or riding their bikes along the towpath but using longboats or sailing boats. A great interest in sailing has developed. I should like to raise the question of safety. I have a little place in Southwold in Suffolk. We have boats coming in and out: there is quite a busy, little, slightly informal marina. I know that the Southwold authorities were approached some years ago to find out whether they would allow a big marina to be established. Wisely, the burghers of Southwold said, "No, we like our marina as it is: slightly old-fashioned", and it has stayed that way.
However, one recent cause of death has been jet skiing. I do not know if that occurs on canals, but it certainly does around our coastal waters and on our inner waterways. Can the Minister tell us whether the Government have any regulatory systems in being, or whether, recognising the risk, they may be addressing that in future?
Again on regulation, can the Minister clarify for us tonight the role that runs between the Environment Agency, the inland drainage boards, the flood defence committees, the riparian owners, anglers—there are lots of them along our rivers—businesses, which the noble Lord rightly raised, and those who use our estuaries? They are all very important issues. Once or twice, when discussing such matters previously, we have found that the buck gets passed, and there is no clear definition of where responsibility lies, and how it is organised.
I shall now return to the Water Bill. The noble Lord, Lord Livsey, did not wish to go over ground covered previously; nor shall I. Since the Bill left the House, 988 British Waterways has written to me—and, I suspect, my colleagues at the other end—raising some regulatory matters. I replied that it was a pity that it did not let us know about the matters when we were debating the Bill in the first place. However, the following points are important. The Minister may be aware of them.
British Waterways seeks clarification of the term "navigable rivers". It also asks what would happen if it were to provide for the transfer from,inland waters connected only to a water system or reservoir of the authority's",to,the same water system or reservoir".That raises very important issues.
The Bill uses the word "connected". Ministers have agreed that, as a basic principle, transfers from the supply reservoirs that are only connected to a navigation authority's water system shall not be licensable. In all earlier discussions between British Waterways and Defra, and in the consultation draft Bill, the word "connected" has been used. Will the Minister explain why the word "discharge" is now used and whether it has any different connotations?
If the Minister cannot answer my next point today, I am happy for him to write to me. Clause 8 substitutes a new regime for small abstractors. A consequential amendment is the repeal of Section 62(2)(a) of the Water Resources Act 1991 by Schedule 7, Part 1, paragraph 6 in the Bill. British Waterways states:The net effect is that there will be no control of small abstractors from the BW waters under water resource legislation. This could have a significant detrimental effect on BW's ability to fulfil its statutory navigation obligations, particularly in dry periods when the likelihood of such abstractions is at its highest".It is a very relevant issue on which there will have to be regulations.
There are other issues, but I do not wish to go down that line. The points highlight the debates that we had during the passage of the Water Bill about where one jurisdiction starts and another one ends. Although, under the Bill, the Environment Agency is the body in total control—if my memory serves me correctly—there are outstanding issues that will no doubt be dealt with while the Bill is in another place. Perhaps it will be returned to us for approval, because such changes would alter the Bill as we debated it when it went through. However, those are all regulatory matters.
I am grateful to the noble Lord for raising his Question. I hope that he will forgive me for having made mine wider, but I think that tonight was an opportunity to do so. I know that the Minister will answer the noble Lord's specific problems, but, again. I thank him for raising the issue.
§ 8.11 p.m.
§ Lord Whitty
My Lords, I thank my noble friend Lord Corbett for initiating the debate, which got wider as it went on. In view of the indications that I was given of the noble Lord's concerns, most of my remarks will relate to the regulation of charging. I will try to respond, now or in writing, to the other issues raised.
989 My noble friend and the noble Lords, Lord Livsey and Lord Bradshaw, referred to the vital significance of our inland waterways network for regeneration, recreation and environmental purposes. They also referred to the exemplary role of British Waterways in delivering on all fronts over the past few years, including some aspects that present it with serious conflicts.
One of the few unadulterated pleasures of being a Minister—there are not all that many, apart from attendance in your Lordships' House—were the four years in which I was responsible for waterways. I had a very good relationship with British Waterways, the Environment Agency and the navigation authorities generally. It is the combination of meeting different objectives, bringing together economic and social regeneration, creating environmental benefit and providing leisure and heritage pleasure to hundreds of thousands of people that makes waterways particularly important.
There is a question about how the waterways are regulated. The noble Baroness is right in saying that there is a history of regulatory complexity as regards the number of people involved, and the terms of what regulations apply. Perhaps one day a government will be brave enough to look at the totality of waterways regulation and to bring it all together. The main themes and responsibilities are clear.
However, we are dealing with a very diverse situation. About three quarters of the national system of inland waterways is run by public sector hoards such as British Waterways, the Environment Agency and the Broads Authority.
Marinas are the responsibility of a wide variety of bodies in the private and voluntary sectors. My noble friend Lord Corbett of Castle Vale also extended that to coastal marinas which are not included in those figures.
Each navigation authority tends to calculate its mooring charges in a way that is appropriate to their location on a commercial basis. The noble Lord, Lord Bradshaw, tempts me to move from what are market forces to what are monopoly forces. It is possible to move a boat, so market forces operate. On the other hand, if one were looking for a mooring for that night, it could be said to be a monopoly position. I do not think that that is the situation, but we must examine whether the regulations are appropriate. I recognise that there have been a number of complaints about mooring charges in British Waterways and others and in the private sector coastal marinas as well.
British Waterways have, as my noble friend pointed out, an instruction to charge commercial rates wherever they can and they have operated that policy, which is now a clearer policy. The Environment Agency has fewer actual moorings and I am not aware of whether they have been the subject of similar complaints—nor have the Broads—but there have been some complaints about private operators. I will return to the subject of coastal marinas later because they are dealt with by a different structure of legislation, which largely relates to ports and harbours.
990 My noble friend called for a regulator—presumably similar to Ofgem. When we use a regulator—in the strict sense of the word—it tends to be in relation to privatised utilities. Waterways are run partly by a nationalised corporation (British Waterways), partly by an agency of government (the Environment Agency), partly by a different form of NDPB (the Broads, which is more or less a national park) and partly by the private sector. So it is actually quite difficult to see how the concept of Ofcom or Ofgem could apply in this area. In that sense the situation is not a monopoly nor is it what was once a total public responsibility.
As I said, British Waterways is charging commercial prices. I know that the claim is that it is using its dominant position in the market to charge those prices. However, it is also true that British Waterways needs to cover its costs. It receives a grant from the Government of roughly £60 million a year at the moment, mainly to deal with the backlog mentioned by the noble Lord, Lord Livsey of Talgarth, which relates to underfunding for two to three decades, which it is gradually getting rid of. British Waterways says that it costs about £200 million to run and maintain the waterways. The contribution of moorings towards that cost is only 2 per cent of its total revenue. Boat licences are another 5 per cent—a total of £14 million. That is not a huge contribution, but it is reasonable that those who use the waterways on a consistent basis make some such contribution. In one sense, one could argue that the boat owners were quite substantially subsidised by both the Government and other users of the waterways.
Mooring charges vary considerably. In Birmingham, which my noble friend Lord Corbett knows very well, charges to moor a narrow boat can vary from around £700 a year to £1,200 for the glory of Birmingham. That is not a bad price for having a pied-á-terre in the middle of Birmingham. In London it costs a few bob more. Costs could go up to £4,000. However, even that is not bad for a mooring on the Thames or the inland waterways of the London area. We are talking about what are, broadly speaking, reasonable charges. Although there have been higher than usual increases recently, they have been in single figures. We are not talking about huge hikes in figures. The average increase in 2003 was 5.6 per cent., for example.
In terms of the monopoly position for British Waterways, it owns only around a quarter of the moorings on its own system, which could hardly be called a dominant market position. It is an important market operator but it is not right to say that British Waterways has artificially created market forces by increasing rents charged to private operators. In any case, the rents that private operators pay to British Waterways are only a small part of the private operators and marinas' costs—they do not directly affect their charges. Indeed, the rents can be revised only at five-yearly intervals. There is a not unreasonable system working, although it is clear that some people feel aggrieved by the levels and increase in charges.
991 We do not tell British Waterways how to make its charges; that is a matter for the board. However, we expect it to charge in a way that is consistent with the benefits received, rather than charging what the market will bear. The framework agreement refers to commercial charges.
I think that the noble Lord, Lord Bradshaw, said—or implied—that the Office of Fair Trading did not operate in that area. In fact, the OFT could intervene, and cases could be referred to it involving excessive or anti-competitive pricing in any market without a dedicated regulator. The OFT is the main port of call, and it has a powerful range of sanctions.
There is also the waterways ombudsman, who deals specifically with British Waterways. It is a slightly anomalous position, but it provides an appeal against maladministration by British Waterways only. The ombudsman can deal with complaints about the method of determining a market rate, about inadequate consultation and about the way in which new rates are introduced. So, there is an independent system.
There are concerns about how independent the ombudsman is. As the noble Baroness said, we are now engaging in a consultation on whether we should change the situation. The options are not as radical as creating a regulator, as my noble friend Lord Corbett of Castle Vale suggested. As the noble Baroness, Lady Byford, said, the main user group—the Inland Waterways Association—was not in favour of that, but it is in favour of a more effective appeals system, which is what we are consulting on. The closing date is 17th October. The views expressed in the debate and, even more so, those expressed in writing will be gratefully received by my right honourable friend Alun Michael, who is now in charge of waterways.
The proposals are to establish a more streamlined and responsive complaints procedure; create an enhanced role for the waterways ombudsman that is transparently independent from British Waterways and can meet the standards of independence set by the professional body, the British and Irish Ombudsman Association; set up a new national consultative framework, representing all significant groups and bodies with an interest in waterways; and improve procedures for consultation in line with the relevant Cabinet Office code of practice.
Having said all that, I must say that the British Waterways network and the private networks and marinas cost a significant amount to run, and somebody will always complain about the cost. However, the new procedures should, subject to the consultation, provide an enhanced method of ensuring fair play. There is also the fall-back of the OFT.
The coastal marinas—my noble friend Lord Corbett of Castle Vale referred to MDL—are subject to different sorts of legislation. Again, contrary to what, I think, the noble Lord, Lord Bradshaw, implied, they are subject to OFT rules. People may choose to go into one harbour or marina or another. If they are looking for a short stay and it is late at night, 992 Torbay may be the only place that they can go. It is important that such places are seen as commercial operators and not really part of the public sector, but they should operate reasonable procedures. The OFT can control unfair, excessive or anti-competitive practices, as it can on inland waterways.
There is a lot of regulation on waterways of all sorts, and some of it—outside of pricing—was touched on by the noble Baroness, Lady Byford. There is or is about to be reasonable control of abuse of the market position by British Waterways, other navigation authorities, marina operators and so forth.
Some non-pricing issues were raised. The noble Lord, Lord Livsey, referred to the Montgomeryshire Canal. I am straying into the territory of the Welsh authorities, who deal with British Waterways on that issue. I understand that they work with the local authorities and the restoration trust. There is a money issue and an environmental issue. It will cost tens of millions of pounds to restore the Montgomeryshire Canal. Some of that money will need to be raised outside British Waterways own resources; for example, a possible grant from the Heritage Lottery Fund, which has done so much to help improve waterways elsewhere in the system. In addition, there are some conflicts with other environmental considerations, which will need to be borne in mind.
The noble Baroness, Lady Byford, asked about the position as regards flood defence. Co-operation between the Environment Agency and British Waterways is very close, but the Environment Agency is the lead authority for flood defence on all rivers and is responsible for bringing all organisations together. Therefore, the Environment Agency works closely with British Waterways and other navigation authorities.
The noble Baroness also asked about the role of British Waterways in relation to planning. In many regeneration issues, the fact that British Waterways owns the land is the catalyst for a regeneration project. It is partners with the private sector and the local authority in dealing with that, but the whole package is subject to planning. British Waterways would be a statutory consultee in that planning process, as would the Environment Agency.
Slightly further off-beam, the noble Baroness, Lady Byford, referred to jet-skis. I am unaware of a significant problem on the canals, although they are probably banned in most canal situations. In estuary and coastal areas, there is a problem, but navigation, estuary and ports authorities can make their own bylaws in relation to jet-skis.
However, that is part of the wider problem of injuries and deaths. An awful lot of people are injured and drowned in our waterways system. Jurisdiction in that area is somewhat confused. Reverting back to my previous hat as health and safety Minister, the Health and Safety Executive undertook an assessment of all the different responsibilities for water safety within the country, for which it brought in a number of different authorities.
993 I have spoken for as long as is allowed. There are a number of issues relating to the Water Bill, on which I shall write to the noble Baroness because it is conceivable that it will come back to us. There were rather specific references, which neither I nor my officials could immediately take on board tonight. Perhaps we can discuss at another time; I shall read the noble Baroness's speech in Hansard if I need any clarification. However, I undertake to answer her questions on the Water Bill in writing.
Subject to that, my thanks to my noble friend for raising the debate. I hope that he has been, at least to some degree, reassured. We all recognise the need to ensure that the waterways operate fairly for all users and all beneficiaries.
§ 8.28 p.m.
§ Baroness Farrington of Ribbleton
My Lords, I beg to move that the House do now adjourn during pleasure until 8.33 p.m.—(Baroness Farrington of Ribbleten.)
§ Moved accordingly, and, on Question, Motion agreed to.
§ [The Sitting was suspended from 8.28 to 8.33 p.m.]