---

Mr. George Robertson (Hamilton): Why must the Government privatise the water industry in England to get private investment, but not in Scotland, where the industry--which is not being privatised--is to raise private money? Why is it impossible to cap price increases in England, when the Secretary of State for Scotland has just capped the increase in water prices for next year at 6 per cent.?

Mr. Gummer: I am interested to hear that, because the price increase cap in England has been reduced from4 per cent. to 1.4 per cent. The hon. Gentleman is wrong: it is perfectly possible for the regulator to reduce the cap for the privatised water companies. Labour is in favour of devolution, which evidently means that Scotland can do

30 Jan 1996 : Column 799

something that England does not and vice versa. It seems perfectly reasonable for Scots to make their own decisions. All I can say is that in England, before privatisation, investment was half what it has been since. The sadness is that Labour thinks that there is something odd about that, although it will not pledge itself to renationalise the industry.

Mr. Burden: Will the Secretary of State give way?

Mr. Gummer: No, I will not give way to thehon. Gentleman.

Mr. Dobson: Will the Secretary of State give way?

Mr. Gummer: I will give way to the hon. Gentleman as he always puts his foot in it.

Mr. Dobson: Will the Secretary of State confirm figures from his Department and from Ofwat showing that, taking public and private ownership together, average investment in the five years of the previous Labour Government was the same as the average investment since this Government have been in power? Will he further confirm that investment under Labour during those five years was higher on average than when the industry was in public ownership under this Government? If he says no, he will be misleading the House. I wish to help him not to do so.

Mr. Gummer: I am interested that the hon. Gentlemen has to mix a period of public ownership with a period of private ownership to make his figures stand up. We are making a clear statement that, under Labour and Conservative Governments, public ownership meant lower investment than private ownership, and that, under a Labour Government, for six months public ownership meant no investment whatever. The Opposition cannot take that; they always have to find a situation in which privatisation can be blamed.

I noticed, for example, that recently the Opposition rushed to say that the privatised water companies in the north-east were responsible for the fact that between 50,000 and 75,000 people were without water because of burst pipes. They did not mention that many more people in Scotland and Northern Ireland, where there are no private water companies, suffered in that way. I am not blaming that on public ownership; I am merely saying that the Opposition will blame everything, including the cold weather, on privatisation.

Sir Michael Grylls (North-West Surrey): Will my right hon. Friend give way?

Mr. Gummer: I must move on, but I will come back to my hon. Friend in a moment.

The hon. Member for Holborn and St. Pancras spoke an awful lot about the water companies, but he did not answer the real questions. Those companies are now not only much more able to obtain investment but are much more efficient than they were. They are not efficient enough, but they are much more efficient than they were--those of us who are Members of Parliament in the Anglian Water region can see that from our postbags.

30 Jan 1996 : Column 800

Since privatisation, the number of complaints about Anglian Water has fallen dramatically. The service is immensely better, and investment is considerably higher.

My constituency waited year after year under Labour and Conservative Governments to have sewage in Felixstowe properly treated. Felixstowe is a major holiday resort and we wanted to do something about our beaches. We now have a major sewage scheme because of privatisation, and we recognise that we pay the cost of that in our bills. We are prepared to do so because we want the quality. In fact, the scheme will not just reach the quality asked of us by the European Union--although we enthusiastically accept that--but that which we need to cater for holiday makers in our area.

We are also pleased that privatisation has been a success story abroad. Britain is now earning considerable wealth throughout the world because of the expertise of our water companies. [Interruption.] The hon. Member for Holborn and St. Pancras obviously thinks that that is very funny as he has given one of his inimitable giggles, but I am talking about hundreds of millions of pounds of money coming back and bringing wealth to this country.

We are now using our expertise in Malaysia, Mexico, Adelaide and Shanghai. Why? Because those countries see that our water companies are doing the job so much better than any others. There are only two countries in the world of which that can be said. The British and French are the only two countries whose water companies can command universal support for the work that they are doing at home, and therefore win contracts abroad. That must be good for the United Kingdom, but as usual the hon. Member for Holborn and St. Pancras and his friends attack the United Kingdom and try to destroy our major companies that are winning orders throughout the world.

It is surprising that the Opposition do that when one sees just how many of their friends invest in those companies. I have mentioned, although I know that it makes them uncomfortable, the position of the sponsoring union of the hon. Member for Holborn and St. Pancras.

Mr. Dobson: It does not make me uncomfortable.

Mr. Gummer: It may not, but it jolly well should. The hypocrisy of the hon. Gentleman would make me very uncomfortable. He says one thing and belongs to a union that is doing the opposite. If I was a Labour Member in Derbyshire, I would want to know what Derbyshire county council is doing and defending.

Mr. Dobson: Derbyshire county council's pensions board.

Mr. Gummer: Oh! The hon. Gentleman says that it is merely its pensions board. The chairman of the pensions board, a Labour councillor, explained that he did it because he thought it was best for the pensioners, and so it was. But the hon. Gentleman said that the company was ripping off the public for the benefit of its shareholders. That is hypocrisy--saying one thing and doing the other.

Mrs. Helen Jackson: Will the Secretary of State give way?

Mr. Gummer: No, I will not give way to thehon. Lady, and I will tell her why. I dissociate her from

30 Jan 1996 : Column 801

the hypocrisy of her Front-Bench colleagues. She is an honourable woman on this matter. I disagree with her, but I have never found her to say one thing and do something else. That is the difference.

Mr. Dobson: Resign.

Mr. Gummer: The hon. Gentleman says that she ought to resign. Evidently, members of the Labour party must resign if they are not hypocritical. Now we understand. The hon. Gentleman has called on the hon. Member for Sheffield, Hillsborough (Mrs. Jackson) to resign for lack of hypocrisy.

Mrs. Jackson: On a point of order, Madam Deputy Speaker. Is it in order for the Secretary of State to make comparisons of that nature in the House in a debate on such an important issue? He said that I am in some way more honourable that my hon. Friends on the Front Bench. That is an extraordinary thing to say.

Madam Deputy Speaker: The occupant of the Chair is not responsible for the utterances of hon. Members. All I would suggest is that the best standards prevail.

Mr. Gummer: Thank you, Madam Deputy Speaker.I am that sorry the hon. Member for Hillsborough took my comments amiss, because I have genuinely accepted--

Mrs. Jackson: Will the Secretary of State give way?

Mr. Gummer: No. I wish to dissociate her from what I have just said and I will give way to her later when we have moved well away from this subject.

Sir Michael Grylls: Will my right hon. Friend give way?

Mr. Gummer: No, I must move on, but I will come back to my hon. Friend, as I have promised.

Privatisation has a number of great advantages for the public. For a start, it ensures that the people who control and police the companies and set targets do not own the companies. When the water companies were nationalised, that is precisely what happened. The Government owned the companies and set the standards, so of course they did not set high standards because they did not have the money to meet them. The Government set the standards that they thought they could meet. Under privatisation, we set up an independent regulator to set standards.

During Environment questions earlier, thehon. Member for Wakefield (Mr. Hinchliffe) was very concerned about drinking water and he highlighted the need for very strict standards. I think that he was surprised to learn that there were no such standards before privatisation. When the companies were privatised, we set those standards and gave powers to the drinking water inspectorate to ensure that the standards were met. We also ensured that the National Rivers Authority had both the expertise and the duty to control those aspects of water production that were in its remit.

---