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Mrs. Jackson: The Secretary of State is being mischievous and misleading. Will he deny the figures printed in Hansard last week, which show that the capacity of the reservoirs in March 1995 fluctuated between 95 and 100 per cent. full? Does he accept that that was not the case in 1976? Yet by the end of August 1995, there was talk of standpipes in Yorkshire. In four months, one company had come to the end of its reserves through mismanagement. Does the Secretary of State accept that those figures show that last year's situation was totally different from that in 1976?
Mr. Gummer: The figures show quite clearly that, in 1976, for up to two months, 1 million people did not have water for 17 hours a day, 40,000 people were taking their water from standpipes and the Government of the day had an answer to the problem, which was to ration water and to cut investment in infrastructure. That is what the figures show. The hon. Lady should not express an attitude that clearly demonstrates that she would support everything that a nationalised company would do--including taking water away from people--but that she does not accept the real facts, which are that, during the whole of last year, no one had to go to a standpipe and there were no rota cuts.
Sir Jim Spicer: Can we again consider what happened in 1976 and re-examine another figure? In the Wessex area, leakages in 1976 were running at about 40 per cent., or probably a little higher than that. Does not that add fuel to what my right hon. Friend has already said about a lack of action? One would think that, if that figure were repeated across the country, the one thing that the rainmaker would concentrate on would be saying, in the following year, "We must do more to stop those leakages."
Mr. Gummer: My hon. Friend is unfair to the then Government. If he remembers, the then Minister responsible for the water industry--now Lord Howell--was able to do a rain dance; that rain dance was done and as a result we had lots of rain. I admit to the House that I do not have that ability, and I am sorry about it. But there is no doubt that the Labour party would do such a dance, because it would not invest in the water industry or be able to solve the problem with technology. Clearly, in the past it resorted to magic.
The fact is that last year, some areas experienced more extreme drought, more extreme temperatures and certainly higher demand from domestic customers than in 1976. But there were no standpipes anywhere and no rota cuts, and restrictions were limited to hosepipe bans and limitations.
Of course, there were areas where water was tankered in last year, but does anyone think that a Labour Government would have been able to provide sufficient funds to do that? They certainly did not do it in 1976.
They could have tankered in water to all those people in Wales and to all those people in the west country, but they did not, would not and could not because they did not have the money or the competence to do so. All they said was, "We shall ration water for more people." But that is what socialists always do. In the end, they always blame the customer and tell the customer that the only way to deal with the problem is to ration the supply.
Mr. Gerry Sutcliffe (Bradford, South):
Will the right hon. Gentleman give way?
Mr. Gummer:
No. I have a little more to say before I give way to the hon. Gentleman, but I shall certainly do so.
We are now contemplating a second difficult, particularly dry year. I only wonder whether anyone seriously suggests that a nationalised industry would be able to match the capital expenditure that water companies currently have in hand. I am talking not about money spent over a long period, but about that which is being invested now. Severn Trent Water is investing£100 million; North West Water, £53 million; Thames Water, £35 million; Yorkshire Water, £171 million; Southern Water, £32 million; South West Water,£20 million; and Welsh Water and Anglian Water are investing £10 million each. More than £400 million is being invested by those companies to be able more effectively to guarantee water supplies. On top of that can be added the extra revenue spent on leakage control.
No one really believes that, today, under any Government, an extra £500 million would be provided for the water industry from the taxpayer's pocket. The hon. Member for Holborn and St. Pancras was naive when he said that, because of a particular amalgamation, he feared that less money might be generated through corporation tax for the taxpayer. The system that the hon. Gentleman prefers would provide no money for the taxpayer, but would demand large sums from him. That money was not forthcoming in the past, which is why all the necessary investment that I listed has had to take place now. No investment was made when the taxpayer was responsible for funding the water companies, and those taxpayers would certainly not provide the extra £500 million mentioned today.
Mr. Dobson:
Will the right hon. Gentleman give way?
Mr. Gummer:
I shall give way, but I just want the hon. Gentleman to comment on yesterday's speech by the water regulator, who said, although I do not think that he was talking directly about the hon. Gentleman:
Mr. Dobson:
I have to say that Ian Byatt, the water regulator, whom I have known for 30 years, is as much part and parcel of the current inadequate system as is the Secretary of State. He does not exactly have an open mind, because he is in favour of the system that he regulates. I quoted him, and he has some explaining to do
The Secretary of State keeps going on about money from the taxpayer, so can he tell us how much the nationalised water industry received from the taxpayer? Does it compare with the £6.5 billion gift from the taxpayer to the new owners at the time of privatisation?
Mr. Gummer:
I have already given the hon. Gentleman the relevant figures on investment in the nationalised water industry. The funds then raised were not sufficient to enable it to carry out the necessary work. Since privatisation, large sums have gone into investment and as a result there has been a significant improvement in the quality of the water delivered.
Mr. Dobson:
Will the right hon. Gentleman give way?
Mr. Gummer:
Just a moment. The hon. Gentleman must tell us something: what would his favourite system have done instead of what has been achieved under the current system? Would he have spent more taxpayers' money on investment in the water industry, or would he have spent it in different ways? Does he think that the companies should not have spent what they did spend or that they should have spent it on something else? What would he have done? Would he have doubled expenditure by the taxpayer if he had been in charge? Unless he can tell us those answers, he cannot start to criticise what has happened since privatisation.
Mr. Dobson:
Did the taxpayer contribute anything to the capital investment programme of the 10 publicly owned water authorities? If so, how much?
Mr. Gummer:
The hon. Gentleman knows perfectly well that, over the years, investment in our infrastructure has been paid for in some cases by the municipal taxpayer, in some cases by the general taxpayer and in others by those who invested--
Mr. Dobson:
He does not know the answer.
Mr. Gummer:
With great respect, if the hon. Gentleman listened to the answer, he would learn more from one sentence than he was able to tell the House in his entire speech. Much of the investment was paid for by the customer, but the only way in which the necessary £400 million investment could have been generated before privatisation was through the taxpayer. The hon. Gentleman knows that perfectly well. He knows perfectly well that no Labour Government would have been able to deliver that. I know that that is true, because his alter ego, the then Minister responsible for the water industry, said in order to explain away the drought problem in the disastrous year of 1976:
"It is fashionable to criticise the water companies for their performance in last summer's drought, but some did well and overall the companies coped better than the water authorities had in comparable situations in the past . . . The water companies have subsequently increased investment and increasingly are getting to grips with leakage. In both cases they are spending more money without any increase in price limits."
"The fact that we were able to survive the drought . . . with no significant effect on industry and employment, though with hardship to some domestic customers and some effect on food prices, is a reasonably satisfactory outcome."
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