§ Sir John StanleyTo ask the Secretary of State for the Environment what steps he will be taking to ensure that the privatised water authorities will not be able to increase the charges being imposed on their customers in order to maximise their market capitalisations when facing takeover bids from other companies.
§ Mr. HowardIn appointing water and sewerage undertakers under the Water Bill, my right hon. Friend the Secretary of State will make it a condition of appointment that charges do not increase by more than specified amounts above the general rate of inflation. These limits will be subject to review by the Director General of Water298W Services. Companies will not therefore be able to increase charges above the limits set either by the Secretary of State or the director general in order to defend themselves against takeover bids, nor more generally to compensate for inefficient management.