§ Mr. Ridley
[pursuant to the reply, 23 March 1989, c. 782]: I am pleased to announce that the first Director General of Water Services will be Ian Byatt, currently deputy chief economic adviser at the Treasury.
The establishment of a new independent regulator for the water industry is a key component of our plans for the industry. The new water plcs will be regional monopolies and the regulator's function will be to ensure that neither the newly privatised nor the existing water companies can unfairly exploit this. The Director General of Water Services will protect consumers of all the companies, compare the performance of the different companies and ensure that each company has clear incentives to improve its efficiency.
The director general will ensure that the companies carry out their functions effectively and that they can raise 156W the finance they need to do so. He will be responsible for ensuring that companies comply with the conditions of their appointments.
Consumer protection will be a central part of the new director general's functions. His responsibilities will include:
- —regulation of charges by setting a ceiling for price increases;
- —monitoring of service standards, and enforcement of higher standards where necessary;
- —establishment of customer service committees to investigate complaints and provide a forum for consumers to make known their views; and
- —encouraging greater efficiency by promoting competition within the industry so that all may aspire to the standards of service delivery and cost-effectiveness of the best.
The director general will take up these duties once companies have been appointed as water and sewerage undertakers in September, under the proposals in the Water Bill currently being considered by Parliament. In the meantime Ian Byatt will be preparing for his new responsibilities. We shall be liaising closely with him to ensure a smooth transition to the new regime, and he will be a source of advice to me in setting up the regulatory framework for the companies on their appointment in September.