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Mrs. Helen Jackson: Will my hon. Friend give way on that point?
Mrs. Jackson: I am grateful to my hon. Friend. Before she leaves the question of leakages, does she agree that a 10 per cent. reduction in the leakage of 100 million gallons a day would have prevented the problems that were experienced in Yorkshire this summer?
Mrs. Mahon: Absolutely. My hon. Friend is right, but because of time I shall not repeat the points that she made earlier. That is a good point. The truth is that Yorkshire Water is at the top of the national league for wasting water supplies--103 million gallons a day are lost through leaks. That is gross incompetence and mismanagement.
Yorkshire Water sacked half its work force--the people who understand about managing the industry. It is not accountable to anybody. It still has a leakage detection team, but only just. Before the crisis, Yorkshire Water had proposed bringing in a scheme called Operation 2000, which was to be implemented in October, which would have abolished the leakage detection teams. Yorkshire Water was going to sack the people who do all the valuable work up on the moors. Those people find out where the leaks are occurring and then gangs of locally employed people go along to mend them. Now we have wastage on the moors. Reservoirs are silted up from30 ft to 100 ft. Often, the reservoir keepers are now
responsible not just for one reservoir but for 10. Two years ago, Yorkshire Water also considered replacing all its skilled workers with Securicor employees. That is the level of neglect that we have had from Yorkshire Water. Never again should it be allowed to bring the health and well-being of people in my constituency and in West Yorkshire to the point that it did. Sir Gordon Jones is going, but others should follow him.
As for Labour councils and the RMT buying shares, I wish that they could buy the lot and then we would have some public accountability. I do not think that the Government really appreciate the anger in West Yorkshire. If we have cut-offs, I think that there would be a public order problem, because people blame Yorkshire Water and detest it for its actions. The fact that it is funding and setting up its own inquiry will not do; we want an independent public inquiry, as myhon. Friend said.
Yorkshire Water said that it will invest another£100 million in pipes. We should look carefully at what that investment means. It means going to the already depleted rivers and taking even more water out of them. That will lead to a disaster in the environment. There should be a massive investment programme now, perhaps to get water from Kielder water. It is possible to go across deserts, so I do not want any nonsense about having to go up hills and down dales; it should not be beyond comprehension to do that now.
Sir Giles Shaw (Pudsey):
I am grateful for the fact that the Opposition included the privatised water industries as a subject for debate. I must declare that I was, until March 1995, a non-executive director of Yorkshire Water. Since then, I have been a consultant on corporate and marketing affairs. I have lodged details in the Register of Members' Interests. I must also take great care that I do not operate in the debate as an advocate for Yorkshire Water, as that is clearly against the spirit of the debate. Having heard the generality of comments, including those of thehon. Member for Halifax (Mrs. Mahon), I suspect that even my courage will fail in the task of advocacy, because clearly Yorkshire Water is the spectre at this feast that the Opposition are quite enjoying.
If ever there were an annus horribilis for Yorkshire Water, it was 1995. When I left in March, the reservoirs were full, it was a bright spring and there was not a cloud in the sky--but the falling percentage of rainfall led to an exceptional drought. It is not for me to go through the history of the matter, as that has been well established.I understand and most deeply regret the way in which Yorkshire Water managed to achieve, through a range of public relations propositions, letters to industry or other public observations, a series of gaffes which thoroughly damaged its credibility with its customers and, indeed, with others.
Mrs. Helen Jackson:
Will the hon. Gentleman give way?
Sir Giles Shaw:
Forgive me, but, because of the time, I must press on.
Added to that was the increasing public backlash against private utilities as a whole--which the Opposition have so well developed--aided and abetted by the media campaign about fat cats. I note that the media are somewhat shy about their own salary structures. No doubt they are seeking to protect their own sources, as is their wont. Yorkshire Water was vilified or satirised in the press--despised by some of its public and ostracised by most. That is not a welcome position for a public limited company to be in only six years after privatisation.
Nevertheless, as my hon. Friend the Member for Calder Valley (Sir D. Thompson) said, and as the hon. Member for Halifax just recognised, the fact is that, after all the trauma, not a house, hospital, retirement home, school, small firm or large firm was disconnected from supply or suffered a serious shortage of water. One of the reasons was that the area that was affected was extremely small, although the Yorkshire region is vast and the company has responsibility for distribution in the whole region. The area is crucial but very small in relation to total Yorkshire demand and provision.
As my hon. Friend made clear, it was geographically and historically separated from the rest of the arrangements. Yorkshire has had grids for many years. The main grid, which runs from rivers in the north and east of Yorkshire, particularly the River Derwent, and across to Sheffield, was put in subsequently. Sheffield takes water from Ladybower reservoir. With a massive effort, the staff ensured, by working night and day, that everything was finally put in place. It moved resources by pipe transfer or road tanker and managed to maintain supply.
The trauma was substantial for the company, for the people who were affected and, indeed, for the people in Yorkshire as a whole. It is very important that lessons are learned and not just in Yorkshire itself. I am happy to be able to reassure the hon. Lady that the emergency investment that is now taking place, where some£100 million is being spent to connect 10 pumping stations so that the grid can deliver 300,000 cu m of water a day into Leeds, Bradford, Calderdale and Kirklees, will make a huge difference to the problem. That is a short-term arrangement. Arrangements for the longer term depends on a review of resources and on longer-term decisions which have yet to be made.
I now come to the lessons for the industry as a whole, as that is equally important. If the water industry is no longer to plan for events that are expected to occur once in 100 years, and ignores events that are expected to occur only once in 200 or 250 years, as occurred in relation to the extreme water shortage in the portion of the Pennine catchment to which the hon. Member for Halifax and my hon. Friend the Member for Calder Valley referred, there will be a very major shift in what water companies must do to maintain supply.
My right hon. Friend the Secretary of State--who, unfortunately, is not present now--has said that no eventuality, however rare, should result in a shortage of public water supply, and certain other hon. Members have said the same. The structure of water resource management must therefore shift markedly. The present industry--as defined in relation to what may occur once in 100 years--is not structured to meet such change.
There must be a public debate about whether we should create more water resources. For instance, should we construct further reservoirs? That might involve problems in a beautiful region such as Yorkshire. Should there be more reservoirs in the dales, or in the Lake district? Should there be more reservoirs on Dartmoor? None of those propositions seems feasible, but they must be considered.
Alternatively, should we take more powers to abstract from rivers or to move volumes of water through the river system? The hon. Member for Sheffield, Hillsborough (Mrs. Jackson) was anxious about abstraction, but we currently waste huge amounts of water through our river system. If we are to ensure that the public have priority in terms of supply, we ought to be able to act at certain times of the year. We should never go beyond the permitted amount of abstraction, and never infringe low levels of supply, but there is a case for saying that, with Yorkshire's massive rivers--largely located in the east of the region--abstraction could serve as a useful way of saving water.
Another option is to require less control on the maintaining of river flows by releasing reservoir waters. Yorkshire Water already has to take such action in drought conditions. Again--this idea is no doubt dear to the hearts of Opposition Members--we could try to reduce leakage rates. I feel that that should definitely be tried during what ought to be an attempt to recover economic costs. In fact, the reason why leakage has never posed a serious threat to the viability of water supply is the astronomical cost of recovery, which has been estimated at approximately £400 million for a 1 per cent. leakage reduction. If such a figure must be contemplated, there will be major repercussions in the industry.
Leakages are prevalent in areas containing many miles of piping. Yorkshire contains more than 30,000 km, going in and out of huge Pennine ranges, distributed up hill and down dale; heavy pumping is used in an attempt to enable the water to reach its destination.
Finally, perhaps we should accept that 1995 is symptomatic of a pattern of climate change that will permanently alter the rainfall conditions that we may expect in the future. It may be a little early to take that view, but it must be taken into account.
All those are big issues, affecting not just the structure of the industry but the terms under which it was privatised, and the terms under which the regulator ensures that certain standards of supply, abstraction and discharge are imposed on the 10 water companies. Water supply currently costs an average of 29p or 30p a day in my area, perhaps a little more; but, quite apart from that cost, we may have to look again at the general question of how the supply is to be costed and paid for. That will lead to numerous questions. Essential fuels such as gas and electricity carry an understandably high price when delivered to the consumer, as opposed to the cost of water, which can be measured in pence. The high price of energy, and the fact that fuels carry a safety hazard, make it essential for closed systems to supply households by means of meters.
Water metering, however, is a vexed issue among the public, although it is the regulator's preferred option.I believe that Yorkshire Water conducted a substantial public consultation exercise, as a result of which it accepted the public's view that imposed metering was not
acceptable but that metering should remain an alternative. It must be accepted that the industry should have proper regard for consumer wishes, and the lessons of 1995 clearly suggest that the idea of wholesale metering should be abandoned. I do not think that it is acceptable to consumers.
Unlike gas and electricity, the water industry is responsible for the maintenance of a huge slice of our natural environment--hence the heavy legislative load on discharges from sewage works, and the gradual improvement of rivers under the obligations laid down by the National Rivers Authority as well as the EU. I am delighted to learn that, during the past week, a salmon was found way up the River Don, having apparently succeeded not only in travelling so far upstream but in spawning. There have been genuine improvements in our aquatic environment.
Supporting access to reservoirs and catchment areas imposes an entirely different responsibility, which does not relate to the commercial supply of potable water. Water companies must recognise such obligations, which play an important part in establishing relationships with the public in the regions.
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