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Mr. Dafis: Before I deal with the amendment, I should like to say a word about amendment No. 157, which defines the maritime boundary of Wales. Will the Minister comment on the implications of that definition and on the Assembly's powers vis-a-vis the effects of pollution arising from oil and gas exploration and extraction both

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inside and beyond the area defined as being within Welsh territorial waters? Does he agree that, despite its limited powers in that area, the Assembly will need to develop a comprehensive energy strategy for Wales, and that it will have a lively interest in oil and gas exploration in the seas off Wales? It may prefer alternative developments, such as the large-scale offshore wind technology advocated by Greenpeace.

The Department of Trade and Industry, which licenses oil and gas exploration and exploitation, will have to listen seriously to the Assembly's opinion and have regard to its views about an appropriate energy strategy for Wales and its concerns about the environment.

Mr. Rogers: The hon. Gentleman just referred to Welsh territorial waters. The Bill talks about territorial waters "adjacent to Wales"--in other words, British territorial waters. Is he suggesting that the Assembly should be responsible for all the acts relating to those territorial waters?

Mr. Dafis: I am sure that the hon. Gentleman has derived some kind of pleasure from picking up on a small point of definition. The people of Wales regard the seas off the Welsh coasts as being a part of Wales that impinges on their welfare and interests. As I understand it, the amendment is about defining where Wales comes to an end in the sea. [Laughter.] Indeed. I hope that the Minister will address the issues that I have raised on energy and the development of energy policy.

In respect of Lords amendment No. 170, the concern is that the Assembly would be constrained in its ability to ensure the implementation of what might be described as a sustainable water strategy for Wales. Surely it will need to consider that because water is important for environmental policy and vital for economic development policy, both of which come within a sustainable development policy.

Wales is richly endowed with invaluable water resources. I do not need to tell hon. Members that water is becoming increasingly important in the United Kingdom and globally. We know that there is an impending significant, and perhaps serious, water shortage in certain parts of the United Kingdom arising from the increasing use of water in development and in agriculture as well as in industry. Demand and consumption are rising, and there is the whole question of climate change.

I emphasise that thought is currently being given to the large-scale transfer of water resources from various parts of the United Kingdom to areas that will suffer water shortages. That certainly includes Wales, so new reservoirs and impounding water will be on the agenda within the next 10 to 15 years. The availability of water is also relevant to the location of economic activity, and to where it is appropriate to locate certain industries and to grow certain agricultural crops. Wales should be able to benefit from its plentiful supply of water and, rather than exporting water as a raw material, value would be added to water in Wales.

We need to get the matter clear now and hear the Minister's view: would the Assembly have to approve any transfer of water, which there might have to be in certain circumstances? Surely the Assembly would have to approve such a transfer. It simply would not be acceptable

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for the Secretary of State to be able to override it on the grounds in Lords amendment No. 170 and especially paragraph 6(1) of the new schedule.

The Minister referred to the Secretary of State's letter to my right hon. Friend the Member for Caernarfon (Mr. Wigley) on this matter. The Secretary of State said:


However, the amendment refers not to the Water Industries Act 1991, but to the Water Resources Act 1991, part VII of which applies to compulsory purchase in respect of the laying of pipes. That is relevant to reservoirs and water transfers, and I should like to hear what the Minister has to say about it.

There seems to be confusion between the two 1991 Acts. Part II of the Water Resources Act 1991 concerns abstraction licences, although I do not know whether subsequent legislation and amendment means that the provisions have been shifted to other parts of that Act. The hon. Member for West Dorset (Mr. Letwin) shakes his head, which is a great comfort to me--a great discomfort, I should say. We need satisfactory clarification of these matters. If we do not receive it, we shall be obliged to divide the House.

Mr. Richard Livsey (Brecon and Radnorshire): Let me take up some of the points made by the hon. Member for Ceredigion (Mr. Dafis). One of his simpler points involved Lords amendment No. 157, and its definition of Wales as including


We welcome that definition, but it would not allow the Assembly to influence decisions on oil explorations more than 12 miles offshore.

We all know of the grid in the Irish sea where there are possibilities of drilling--and, as the hon. Gentleman pointed out, opportunities for pollution, which we would be unable to prevent. The Assembly could debate such an issue under the general provisions of the Bill, but it could not have a formal say in regard to, for example, a planning application for oil exploration just 13 miles off the Welsh coast. That is worrying, and I should like to know how the Government propose to deal with it.

Paragraph 4 of the new schedule proposed in Lords amendment No. 170 provides for the Assembly to be consulted about the abandonment of oil and gas installations--a very topical subject--but not about new explorations. Many members of the Assembly would not consider that right.

4.30 pm

Perhaps the most worrying aspect of the new schedule is the provision in paragraph 6 that allows the Secretary of State to overrule the Assembly on matters of water supply and quality if the exercise of a function in that regard might have a "serious adverse impact" in England. We consider that far too wide-ranging. It would allow the Secretary of State to go against the Assembly's opinion and to allow, for example, water extraction from Welsh rivers for use in England.

There is clearly a need for effective water management between England and Wales, and there may be a need for the transfer of water from Wales to some parts of England

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that have less water, but we think it essential for that to take place with the permission of the Assembly, rather than at the will of the Secretary of State.

As a constituency Member, I am particularly interested in that aspect. The River Wye and the River Usk flow through my constituency, and there is a huge issue of compensatory flow at times of water shortage. Moreover, Welsh Water is putting many more boreholes in both river valleys so that water can be extracted for public consumption. The problem is that that lowers the river levels, and has a grave ecological effect on the rivers. If we are to be asked for more abstraction for England without the Assembly's being able to have an impact on decisions, we shall be in considerable trouble.

The question has arisen in the past of the supply of water from the Elan valley, and the agreement that was struck between Welsh Water and Severn Trent plc for the supply of water to the midlands. That was achieved, but it was controversial at the time. I have in my house plans made 100 years ago--which I have discussed with a neighbour--for a water grid to supply southern England, which is now being talked about again. The plans are very sophisticated, even by today's standards. They allow for the damming of the River Irfon, just above Builth Wells, for piped water to go into Llangors lake, near where I live, for the level of the lake to be raised considerably and for water to flow down the Usk and into the Thames system down to Staines. It is all there on paper, and I am sure that it could be resuscitated.

It would be a disgrace if the Welsh Assembly could not influence such activity, but it could happen within the next 10 years. We must have safeguards, enabling the Assembly to influence water abstraction from Wales for use elsewhere. I feel very strongly about the matter.

Mr. Rogers: What aspect would the Assembly want to influence--the engineering side, the projects side or just the costs side?

Mr. Livsey: I do not think that the House would want me to go into a treatise on construction. Matters of principle must be considered, such as the issue of a way-leave for pipes that may cross land but from which no one in Wales would benefit.

We welcome the fact that the Assembly has a role in the development of the Welsh language and culture within and outside Wales. During the referendum campaign, I discovered that there are 400,000 Welsh speakers in England and 500,000 in Wales. That is a fascinating statistic. The Assembly should provide an excellent opportunity for the Welsh language and culture to be given appropriate priority, and I am sure that they will flourish in the future.

The other provisions of the new schedule, especially those that provide clarification, are welcome. However, the possibility of the Secretary of State overruling the Assembly on water issues is a very serious matter.


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