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While we are delighted that the water authorities will have to consult the National Parks, there is no requirement for them to take any notice whatever of what the parks say".That is the limit of the safeguard about which the right hon. Gentleman has been boasting. The chairman of the council for the Protection of Rural England, Mr. David Astor, described the decision to leave the consultation over planning and development with private monopoly companies as "incredible". He said that it was
"opening the floodgates for unprecedented abuse and distortion." Mr. Astor was speaking about planning and land development. That is the kind of confusion that the right hon. Gentleman is causing by his proposals for selling much of the national park areas.
Mr. Boswell : Will the hon. Gentleman tell us whether the private water undertakings will be able to take no notice of planning determinations by the national park authority? Secondly, in what respect are the safeguards offered by my right hon. Friend any less effective than those currently available to control the activities of public water undertakings?
Dr. Cunningham : The very fact of passing the undertakings into private monopoly hands is enough to emphasise that point. Of course private water undertakings will not be able to ignore the decisions of planning authorities. I spend much time talking to people who manage national parks because my constituency is in such a park. If the hon. Gentleman talked to such people he would know that the pressure on national parks is huge and in some cases is overwhelming the authorities. They feel that controls and oversight should be strengthened and not weakened as proposed in the Bill.
Mr. David Ashby (Leicestershire, North-West) : Will the hon. Gentleman give way?
Those arguments have been advanced not just by Opposition parties but by influential and well-informed organisations such as the Royal Society for the Protection of Birds, the Council for the Protection of Rural England, the National Trust, the Countryside Commission and the Ramblers Association. They all express concern similar to ours and it has all been contemptuously dismissed by Tory Members who just ploughed on and voted down amendment after amendment. All major attempts to strengthen environmental safeguards and to protect our heritage have been rejected by the Government and their supporters in Committee. Privatisation is at best irrelevant to enhanced environmental protection and at worst positively disastrous and damaging.
The Bill and Conservative intentions are a betrayal of water consumers, of every family and household in England and Wales. The Secretary of State says that consumers will be safeguarded and has been dismissive of statements by chairmen of statutory water companies. The West Kent water company was one of the first in the field with a price increase of 42 per cent. In its statement to consumers it says that half the price increase-- 21p in the pound--was to meet privatisation requirements.
The Eastbourne statutory water company issued a notice on 27 February. The chairman's statement said :
"The year 1988 has been significant for the effect of the Government's Policy of Privatisation' of the Water Industry and the very considerable increase in the work load placed on our staff, together with the considerable additional burden of
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employing consultants, the cost of which is having to be met by our consumers, and which is likely to continue for some time. This additional cost is responsible for at least half of the increase in our charges from 1st January, 1989 and also partially responsible for the very considerable reduction in the surplus for 1988 compared with 1987. What is depressing is that I cannot foresee any worthwhile advantage to our consumers emanating from these Government proposals."This year those consumers face an increase of 43 per cent. in their water charges as a result, in large measure, of the Secretary of State's proposals.
The chairman of the Eastbourne statutory water company continued : "I have never disguised my opinion that Privatisation is completely unsuitable for the Water Industry and I am extremely disillusioned by the Government's disadvantageous treatment of Statutory Water Companies, particularly in preventing them achieving PLC status until well after the Water Authorities. Civil Service and Government protestations of their intention to provide a level playing field' are totally hypocritical. The playing field is just about as level as the North Face of the Eiger."
In December, the people running these organisations were being lauded in the Chamber as examples of the way in which the industry could and should be run.
What of Baroness Oppenheim-Barnes, a former Conservative Minister? Is she to be believed when the chairmen of statutory water companies are no longer to be believed? In a letter to me in February announcing the publication of a National Consumer Council book entitled "In the absence of competition", she said :
"As you will see my Council believes that the proposed regulatory framework for both water and electricity falls short of what is actually required."
The book says :
"If the consumer interest is to be protected in the water industry, some kind of national body for water consumers is essential." We moved such an amendment in Committee but it was rejected by Ministers and Government Back Benchers. The book goes on : "The proposals appear to be so complex as to raise serious doubts as to their viability."
The National Consumer Council criticises and condemns the right hon. Gentleman's proposals. The document of his own departmental working group, a copy of which I have here and which is headed "Department of the Environment, 3 March 1989"--the report of the joint privatisation regulation group ; civil servants in the Department of the Environment-- shows what is happening.
Page 2 says that the aim is to provide that the private monopolies "are permitted to earn a reasonable return, the secondary duty to consumers means that lower rather than higher Ks' should always be set."
The secondary duty and not the primary duty is to consumers. That is what the right hon. Gentleman's civil servants area saying in private and it is quite different from what the right hon. Gentleman says in public.
Mr. Nicholas Baker (Dorset, North) : The hon. Gentleman quoted the words of Mr. C. P. G. Turner, the chairman of the Eastbourne statutory water company. From what he read out, I understood Mr. Turner to be saying that he as the chairman of a statutory water company envied privatised water authorities and wanted his company to be in that position. He seemed to be envying the private companies and that is exactly contrary
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to the hon. Gentleman's point. Instead of dealing with the opinions of other people, will the hon. Gentleman tell us the position of the Labour party on this matter?Dr. Cunningham : I will happily send the hon. Member for Dorset, North (Mr. Baker) a copy of the whole statement of the chairman of the Eastbourne water company and he can consider it for himself. On page 3 of the internal document of the Secretary of State's Department, we read :
"On the basis of these figures, a real return for water and sewerage undertakers of the order of 8 per cent. would seem appropriate."
Ministers are preparing to guarantee private monopolies a return of 8 per cent. That contrasts starkly with what the right hon. Gentleman says about local authorities running their direct labour organisations where he recommends a rate of return of 5 per cent. So it is 5 per cent. for local authorities' direct labour organisations while he is planning to arrange for 8 per cent. for private water monopolies. This is an interesting document. It gives a very different picture of events and discussions in private in the Department from what we had in Committee. It goes on to discuss cost pass through. Cost pass through is a little water pipe, a conduit of its own, which bypasses all the controls set to protect the consumer so that the cosseted private enterprise monopoly will be able to cost pass through straight to the consumer.
What does cost pass through mean? It is a euphemism for uncontrolled price increases which consumers will be unable to avoid. That is what is going on behind the scenes. The Secretary of State may deny it, but here is a copy of a document from his Department dated 3 March 1989 and headed : "A framework and procedures for K-setting".
The Minister for Water and Planning (Mr. Michael Howard) : Why is the hon. Gentleman seeking to mislead the House? If he has studied the provisions of the Bill he ought to know that cost pass through is subject to the control of the Director General of Water Services, and that it is designed to deal only with unforeseeable matters, such as new regulatory requirements. Does the hon. Gentleman think that the companies should be in a position to meet the new regulatory requirements or not?
Dr. Cunningham : Of course they ought to be in a position to meet them. They will have to meet them. They will have no choice. At least, that is what the European Commission believes. I am not sure that the Secretary of State believes that from what he has been saying and the way he has been behaving.
What we need to know from the Government and from the Minister for Water and Planning, who will have the opportunity to tell us when he replies to the debate, is exactly how consumers will be protected from cost pass through. There is nothing in the Bill about it. There is no statutory safeguard in the legislation to protect consumers from cost pass through. Cost pass through will be used to cover a multitude of sins to enable private monopolies to load price increases on to consumers. That is what is proposed.
Mr. Howard : I know that the hon. Gentleman could not attend the Committee frequently. Has he heard of the Director General of Water Services? If he had heard of the Director General of Water Services he would know that
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the cost pass through provisions are subject to regulation by the Director General of Water Services. Will the hon. Gentleman accept that?Dr. Cunningham : I do not accept that. It is indicative of the depths to which the Minister stoops when he is in trouble. He knows that I attended the overwhelming majority of Committee sittings. He also knows that his right hon. Friend had not got the guts to go on the Committee at all. If we are trading attendances and attention to these matters, I can tell the Minister that his right hon. Friend the Secretary of State is nowhere in that argument because he did not even go on to the Committee. If that is the kind of argument that the Minister wants to have over the Dispatch Box, he is welcome to it. There was not a single attendance at the Committee by the Secretary of State.
Mr. Howard : He was not a member.
Dr. Cunningham : That is right ; he was not a member. He refused to put himself up to be cross-examined about the mess. That is the record of the Secretary of State.
Mr. Ridley rose --
Dr. Cunningham : In view of all this, it is a pity that the Secretary of State has not departed, as I understood he was to do, from these proceedings to attend the christening of his grandson, which certainly I would have understood. His performance and that of the Minister of Water and Planning have not done much to enlighten the House or the public about this mess of legislation.
Mr. Ridley : I just wish to ask the hon. Gentleman if he would kindly reply to my hon. and learned Friend's question about whether he understood that the Director General of Water Services is enabled to deny cost pass through if he thinks that it is not justified. Will the hon. Gentleman withdraw his failure to understand the Bill, because he has got it wrong?
Dr. Cunningham : I do not withdraw anything. I do not accept that as the legislation stands, consumers will be adequately protected from cost pass through, and neither do Baroness Oppenheim-Barnes and many other people who are interested in the protection of consumers, as has been made abundantly clear over the last few weeks. Major differences of opinion between the Government and the European Commission also remain over exemption from pollution law, water quality standards, timetables for essential investment and the scale of such investment. It is in Britain that the confused, inefficient and dogmatic Tory proposals will be rejected, if not in their Lordships' House or in the City, ultimately at elections. Obdurate Tory insistence on making water supply and sewage disposal an issue of private profit is anathema to the majority of British people.
Samuel Johnson, the 18th century satirist, had a very apt description for the Government and for Tory Back Benchers in his work, "The Vanity of Human Wishes" :
"How rarely reason guides the stubborn choice, rules the bold hand, or prompts the suppliant voice ; How nations sink, by darling schemes oppressed."
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This idea is one of the Prime Minister's darling schemes and the British people will certainly be oppressed by it. The Government will ultimately sink and these proposals will sink with them.I have been asked about our position and a leak in The Times which was news to me and was not the matter that I have been involved in discussing. I do not believe the quoted leak in The Times. I reiterate what I have said throughout the proceedings : water is the country's largest national and natural monopoly. It is the people's most fundamental resource, on which their health and well-being depend. We in the Labour party believe that this natural resource and the assets of the water industry should be publicly owned and controlled. They should be managed openly and efficiently in the public interest, and management should be democratically accountable at regional and national level. Unlike the Tories, we do not believe that an essential resource such as water should be managed and sold for private gain. For us, public health and hygiene are not matters which can be dealt with by market forces. We know that the overwhelming majority of the British people share our values and views in this matter. That is why we will vote against the Bill. Several hon. Members rose--
Mr. Speaker : Order. In view of the large number of right hon. and hon. Members who wish to participate in the debate, I ask for brief contributions.
6.59 pm
Mr. Cranley Onslow (Woking) : I will do my utmost to obey your injunction, Mr. Speaker. That excuses me from saying very much about the speech made by the hon. Member for Copeland (Dr. Cunningham) except to make two points. First, in my experience in the House or in Committee, bad temper is not a substitute for good argument. Secondly, it does not appear to me to follow, although it may follow for the hon. Member for Copeland, that there must be public ownership for public control. The hon. Gentleman should think a little more about the subject before he outlines Labour party policy on such matters in future.
I support the Bill, and I believe that most of my constituents do the same. My constituents have been fortunate enough over a great many years to draw their drinking water from private suppliers and I have never had any complaints about that. Given that the much vaunted percentage increases about which we have heard so much this evening will still keep the average household's water cost to about the same as the cost of a national daily newspaper each day, keeping things in proportion, I do not believe that there will be as many complaints about costs as we have been led to believe, particularly in view of the powers to control prices in future which are rightly embodied in the Bill.
I confess that I have received complaints about the drains, as have many of my colleagues. In my constituency complaints are directed against the Thames water authority, which is not a privately owned body. That authority is currently polluting the River Wey in my constituency in a most deplorable way. The local angling association shares my view about that.
In general I have no doubt that the fight against pollution will be made easier and more effective by the Bill. The duty to fight pollution will unmistakably be present,
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as will the money. The Treasury will not be able to stop that money, there will be no unseemly wrangles in the Star Chamber and the IMF will be unable to prevent the necessary investment in water quality as it did during the days of the late unlamented Labour Government. That is an important distinction which we should not cease to emphasise. The plcs will be able to raise the funds that they need and in a few years we stand the excellent chance of having many more rivers to be proud of once again. That would not have happened if the Government had not introduced this Bill.We must never forget human frailty, and we can never forecast it. It will remain possible, under this Bill or under any other legislation, for accidents, neglect or greed to create pollution in future just as they have done in the past. That means that the powers of inspection and enforcement which will be invested in the NRA will be absolutely vital. In its use of those powers, the NRA will have the support and active co-operation of anglers throughout the country, who, after all, spend more time than anyone else on river banks and are much the best inspectors of water quality in our rivers. I am also glad to know that the public right to prosecute will remain in law. If that right is to be used properly, the law must be effective and help the public enforce their rights in addition to enforcement by the NRA.
My hon. and learned Friend the Minister for Water and Planning felt that my amendment No. 86 to clause 143 was unnecessary. He has written to several of my hon. Friends explaining his views. In his letter he states :
"The Bill as drafted already meets the requirements"
which the amendment seeks to achieve because--and I do not deny this--
"it will be open to anyone to bring a prosecution over the pollution of controlled waters' including prosecutions for breaches of the conditions attached to consents granted by the National Rivers Authority for the discharge of trade and sewage effluent
Second, the NRA as the body statutorily responsible for effluent discharge consents will have to use its powers under the clauses to enter premises and sample effluent discharges in a systematic manner to ensure that the conditions of the consents are being met. Where a sample suggests that a consent requirement is being breached in a manner which could give grounds for prosecution, we would normally expect the NRA to start taking formal samples in accordance with Clause 143. But since the circumstances of each case will vary, it would be inappropriate to deny the Authority discretion as to whether this is appropriate in a particular case, and as to the number of occasions on which the taking of a formal sample is necessary. For that reason we could not support the particular amendment But the Authority will have a clear obligation to take such number of formal samples as permits full and effective enforcement of the legislation, and the Secretary of State will have the power ... to direct the Authority on how to discharge this obligation."
So far, so good. However, in my capacity as a member of the council of the Angler's Co-operative Association which has initiated several prosecutions in this area, I must say that we are by no means convinced that my hon. Friend the Minister is right.
Under the Control of Pollution Act 1974, provision was made to establish public registers of discharge analyses. The relevant section of that Act was implemented in July 1985, as my hon. Friend the Minister no doubt remembers. Since then, the Angler's Co-operative Association has used information from the registers to prosecute water authorities on three occasions. The authorities concerned were Thames and Anglian. On one of the occasions the
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Thames water authority was prosecuted on eight separate charges, to which it pleaded guilty, and on each of which it was fined £1,000. The outcome of the other cases was much the same.At the moment, the ACA would like to take a similar action against a fish farmer on the Hampshire Avon. I believe the proprietors are the Radnor estates and the farm is in the constituency of my hon. Friend the Member for Salisbury (Mr. Key). I hope I will have his support when I make this point.
The public register shows that that fish farm is at times in breach of conditions. However, the Wessex water authority declines to prosecute the polluter. The ACA cannot prosecute because the samples taken by the water authority are only for monitoring purposes. Therefore, for that purpose, the register is not worth the paper that it is written on. We cannot launch a common law action because it would be necessary to trespass to obtain formal samples.
The Government claim that the right of private individuals to prosecute will remain. However, that right must be effective. In future, samples will be taken by the NRA and their validity may be challenged. However, more to the point, the NRA may lack the will to prosecute, as has been the case with the Wessex water authority.
Mr. Robert Key (Salisbury) : My right hon. Friend knows that for many years we have both been keen to ensure the quality of the Hampshire Avon. If we look at this question very carefully, it seems to me that under the new arrangements the vital difference is that the evidence under the formal NRA sampling exercise can be subpoenaed by a third party. In those circumstances, the Angler's Co-operative Association could undertake a private prosecution under this Bill.
Mr. Onslow : I hope that my hon. Friend the Minister can confirm that my hon. Friend is right. However, the important point is to take the samples. That is the necessary step towards a successful prosecution. My amendment sought to place a duty on the authority to take the samples.
The situation is one where the anglers have their doubts about such matters. Lawyers, no doubt, see everything with greater certainty. However, the people who will be taking the samples will be the same people as today, and there is to our minds little guarantee, given that the NRA will have a discretion, that we can necessarily rely on getting samples of quality and type necessary for a successful prosecution. Whatever view other people may take of the chances of success at law, the ACA is not in the business of frivolous litigation and goes to court only when it has the evidence which will make it possible to win and it is confident that it will win. I should be grateful if my hon. Friend would touch on that point in his reply.
The Central Council for Physical Recreation also has reservations, and I expect my hon. Friend will have seen a letter sent to his hon. Friend the Member for Lewisham, East (Mr. Moynihan) by the CCPR on 22 March about the code of practice. Without going into that at length, I hope that my hon. Friend will be able to give the House some assurance on how the Secretary of State intends to ensure that water undertakers comply with the code of practice and the maintenance of existing recreations, which some people fear may be at risk. Of course, if we cannot get assurances tonight because of lack of time, there will be an
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opportunity to return to these matters in another place, and perhaps then the Government will explain why they found my amendment No. 80 so unattractive the other night.I find it difficult to believe that the NRA does not want to be responsive or flexible and is not prepared to have the opportunity to delegate some of its powers, and I find it odd that there should be resistance to this from the Department without our necessarily being told what the view of the NRA is. In this legislation we are creating an important body, and we should spell out the duties we expect it to perform in this area, and on the question of abstraction, which also causes concern.
I am anxious, as I said, to be brief, and I have little more to say except to question the realism of the statements made by the hon. Member for Copeland about the assets of the water authorities and the extent to which they might be turned to private profit. I do not believe there is a prospect of mass asset-stripping or great areas of land being sold at a profit. However, I believe there is one asset nobody has so far identified which is capable of being exploited and which we should all wish to see exploited, and that is the physical access this industry enjoys to every property which it serves. That access does not, it seems to me, have to be used either to pipe water in or to pipe sewage out.
There is little doubt in my mind that an asset of that kind could be used in other ways of profit and value to the community. It is not impossible that it could be used in such a way as to provide competition in information business technology with British Telecom, and I think we might very well see new owners, enterprising people, taking an opportunity which has been available to our own companies for far too long without being noticed--though I suspect the French have noticed it. I hope entrepreneurs in our own country will take it up and that it will be used to the value of the customers of the water industry.
I have no doubt that this is a necessary Bill, and I believe that it should have the support of the House and of the country. 7.15 pm
Mr. Livsey : The Water Bill is the ultimate folly of a Government hell-bent on imposing their dogmatic will on a long-suffering British public. The time has long since passed when we can appeal with any sense of reason to members of the Government, whose misuse of their parliamentary majority is now virtually complete.
What does this Bill do? Part II replaces the 10 public monopolies in England and Wales with 10 private monopolies, the plcs, and they will indeed be ring-fenced in their own areas ; in part I of the Bill a National Rivers Authority will be created, which will remain in the public sector. That is the basis of the Bill. The water so essential for life itself will not remain a public utility, even though the Government's Victorian predecessors thought that was right. Indeed, it was the Government's predecessors in my party who put the water industry into the public sector in the first place. Water, indeed, is essential for life itself, which makes it a natural public utility, yet it is not to remain a public utility.
Mr. John Marshall (Hendon, South) : The hon. Gentleman implies that public ownership of water is
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necessary for the health of the nation and many other factors. Can he explain how people in other countries survive and prosper with private sector water?Mr. Livsey : Taking the example of France, the price of water is four times higher in some parts of France than in others, and I cannot see that the people there entirely benefit from that situation.
Of course, the reasons why water should clearly remain in the public sector involve the health and social conditions of the people of this country. They should have clean, wholesome and affordable drinking water. Surely these are the basic objectives. The only tenable fallback position, if one could justify it, is the model of the current statutory water companies which presently operate in 25 per cent. of the water industry. They are closely controlled in the public interest and produce affordable water through ploughing back profits to help keep consumers' bills down.
Mr. Ashby rose --
Mr. Livsey : However, the Government have chosen to dismember them and to turn them into plcs instead, already with pre-privatisation increases of 30 to 50 per cent. in the price of water.
The environmental impact of privatisation will affect clean drinking water standards, the disposal of sewage, the cleanliness of beaches and continued access to the half million acres which the present water authorities own.
The Government's reasons for privatising water seem to rest on the following ideological formula. They say that the NRA will control pollution and improve standards ; that private investment will bring more money into the industry to clean up drinking water and sewage disposal ; that the industry will be freed ; that more people will own shares ; that the City wishes to invest in the industry, and that the industry will be better regulated.
The facts are that the NRA could be involved just as well as an environmental protection agency if water remained in the public sector. The problem is that the NRA will be under-funded. Indeed, a privatised water industry will only be attractive to the City and to investors if it is made financially attractive, and the only way of doing that is to make consumers pay more for their water than if the industry remained in the public sector. The soundest estimates indicate the price of water will double by 1992.
The other part of the equation is that valuable public assets, such as land, will have to be sold and access charged for. The taxpayer and the consumer will, of course, pay for this. Even if this is done, the City is unlikely to find water an attractive investment, because up to £6 billion will be required to clean up the industry ; the maximum sale price is unlikely to be more than £10 billion, so what kind of deal is that for the City? The argument that the industry will be freed by disposing of its debt could equally apply if the water authorities' debts were written off now while the industry remained in the public sector. Our water bills would be a lot cheaper if that were done.
A Director General of Water Services, for regulation purposes, could just as easily have been installed if the industry remained in the public sector, so that argument is demolished too. The thesis that more people will own shares does not reflect recent experience, where it has been shown that most shares still tend to end up in the hands of relatively few people.
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The Government have turned water privatisation on its head. They have decided, come what may, to privatise water and have then dug up convenient reasons to try to justify the unjustifiable.Mr. Nicholas Baker : The hon. Gentleman made the interesting point that it was not necessary to privatise the water companies and he implied that it was perfectly possible for NRA to police water authorities maintained in the public sector. Has that proposition any basis in fact? Can the hon. Gentleman name any other area in our society where public bodies can adequately police each other? Is it not a fact that such bodies in the public sector get together cosily and the customer suffers in the end?
Mr. Livsey : The present pollution inspectorate of the water industry would fill the niche that the hon. Gentleman is describing. The Secretary of State for Wales has said that he would like to see Welsh people owning Welsh Water shares. We would like to see that too. However, there is no sign that that will happen. On 21 March a grand three- helicopter tour of Wales was undertaken by
representatives of such well-known Welsh banking forms as Smith Newcourt, Kleinwort Benson, Salamon Brothers, Alexander Lang and Scrimgeour, Cazenove and Company, Citicorp, County NatWest, Shrive Lehman and Company, Phillips and Drew and, just to sweeten the pill, the Cardiff stockbroking firm of Lyddon and Company.
Given the Secretary of State's penchant for public relations, it is strange that such an exercise by Welsh Water was not the subject of headlines in the Welsh media. Perhaps the subject was just a little too sensitive at that time since the Bill was being debated in the House at that moment. I hope that the bankers enjoyed the scenery--97, 000 acres represents quite a lot of Wales and quite a lot of Welsh real estate. We know, too, that computers in Scottish banks are already programmed to print Water plc shares. What kind of pre-emption is that? The Bill has not yet completed its progress through the House.
The Government want the Bill to be a truimph of dogma over common sense. We know that water will become unaffordable for many of the poorest in society after privatisation. There is no way that the Government can deny that. There were 9,000 disconnections last year and there will surely be more in the future.
According to the opinion polls, water privatisation is opposed by 75 per cent. or more of the British people, including many Conservative supporters. Make no mistake about it, water privatisation will damage our health. Water privatisation will annexe public assets and give the taxpayers' investment to the wealthy. It will produce a private monopoly with no competition--inexcusable even by Tory standards.
Water privatisation will damage the environment and double the price of consumers' water, hitting the poorest in society. It will cost £842 million just to privatise water and the British people will pay that bill. It will be a poor investment because of its liabilities. Water privatisation will remove the last vestiges of local government democratic representation in the water industry. There will be no public accountability.
Water privatisation is a rotten measure by a Government who have gone several privatisations too far.
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They will surely pay the political price in the ballot box. God gave the water to the people and the Government are taking it away from them.7.24 pm
Sir Giles Shaw (Pudsey) : I do not want to follow the example of the Eisteddfod contribution of the hon. Member for Brecon and Radnor (Mr. Livsey), but I am prepared to tell my hon. and learned Friend the Minister for Water and Planning that I support the Bill and I have five reasons for doing so.
First, I must pay tribute to the history of the water industry through its many years of municipal undertaking. That is a proud heritage for those of us who represent northern seats where the fine reservoirs produced on the back of the woollen industry are still some of the greatest architectrural achievements of the 19th century. Municipal leadership was a fine contributor to the effectiveness of the British water industry for the first 50 or so years of this century.
There has been a dramatic change, because local authorities and local government have changed. The disappearance of the many utilities in favour of the mega-utilities and local government reorganisation made a fundamental difference to the municipal contact between water supply and the authorities. With that came high-pressure politics of a different kind and a substantial period of neglect for the water utilities. Water had to take its place among municipal priorities, and it was a pretty lowly place as one sees from the total neglect of the reassessment and renewal of assets. With the development of local government reorganisation came the reorganisation of the water authorities as we have them today. I confess that I remain firmly of the view that the scale of the water authorities as presently constituted is a perfectly effective way of managing water resources. They have the geographical spread to enable the supplies to be most effectively managed. They measure the water cycle as their base. They provide services way beyond the reach of a local authority, even a large one. It is no use in Yorkshire looking back to municipalising the water industry on the basis of the three-county structure and the fourth county of Humberside and a little bit of Cleveland--all of which are within the catchment of the Yorkshire water authority. Municipalisation is not available as an alternative for discussion in the House, although it has played a major part in the handling of the water industry.
Water authorities are within the responsibility of the Department of the Environment, and the Secretary of State has powers to determine their capital allowances, pricing policies and most of the strategies and priorities that the individual authorities would wish to adopt. But we must never forget that they are 10 very different authorities. They are different geographically. They have different resource problems and resource management. They have a different pattern of demand and very different problems of foul water and sewage treatment. They have different demands and patterns of drainage.
That means that they inevitably have different capital demands. They have different priorities and rates of development. All depend on the whim of Government expenditure and Government control. It is that single fact which brings me to my first reason for believing that the
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