Memorandum by The Wildlife Trusts (DWB
1.1 The Wildlife Trusts are a unique national
partnership of 46 independent charities, the Urban Wildlife Partnership
and Wildlife Watch, the junior branch.
1.2 At a local level we are working to protect
wildlife and natural places for future generations to enjoy. At
a national level we join forces to influence decision-makers and
put across our message. Together with more than 350,000 members,
we form the largest voluntary group concerned with all aspects
of wildlife conservation and environmental protection.
1.3 Collectively, The Wildlife Trusts manage
approximately 2,250 wetland habitats and 595 river reaches. Outside
of our reserves the Otters and Rivers Project (OARP) deliver advice
and practical expertise to riparian and wetland managers. In the
past 18 months the OARP has carried out over 240 significant habitat
enhancement schemes and visited over 740 landowners to provide
habitat management advice. The Wildlife Trusts are strongly committed
to the Biodiversity Action Plan (BAP) process, acting as a lead
or joint lead partner for 23 Species Action Plans.
1.4 The Wildlife Trusts welcome the publication
of the draft Water Bill and this opportunity to give evidence
to the Select Committee. We will also be submitting a response
to the Government's consultation on the draft Bill. Our comments
focus on five key areas:
the spirit of the draft Bill;
abstraction and impoundment issues;
new regulatory arrangements;
enhanced competition in the water
economic instruments as a mechanism
to protect water resources.
2. THE SPIRIT
2.1 Although the published sections of the
draft Water Bill focus on reforming the existing abstraction licensing
system and financial regulatory structures The Wildlife Trusts
believe that the draft Bill offers a real opportunity to address
the wider aims of sustainable water resource management and holistic
river basin management. These aims are both shared by water companies
and the Environment Agency.
2.2 Recent floods, the uncertainties of
future climate change scenarios, and new European legislation
mean that legislation being drafted now needs to take into account
a wide range of issues and have a long term perspective. The structure
and content of the draft Bill must support and reinforce other
complementary legislation and policy such as the BAP process,
Habitats Regulations and new Countryside and Rights of Way Act
2.3 The Wildlife Trusts believe that the
draft Bill should demonstrate the precautionary principle towards
safeguarding the environment and be aspirational in what it is
setting out to achieve. In other words the draft Bill needs to
be structured in such a way as to encourage and support the enhancement
of wetland habitats, a key requirement of the BAP process and
the Water Framework Directive.
2.4 The draft Bill goes some way towards
addressing some of these concerns but on the whole is a missed
opportunity. In the specific areas of the Bill highlighted below,
the Wildlife Trusts aim to demonstrate how it might be strengthened
to deliver a more integrated approach to water resource management
through better control of abstraction, encouraging demand management
and placing sustainability at the heart of regulation.
3.1 On the whole, The Wildlife Trusts support
the measures introduced in the draft legislation as long overdue.
In particular The Wildlife Trusts welcome the prospect of curtailing
or ending damaging abstractions, particularly those authorised
as "Licences of Right". However, the current wording
gives us great cause for concern. In Clause 17 the draft Bill
removes the right to compensation for varying a licence "to
protect any waters or under ground strata, or any flora and fauna
dependent on them from serious damage". This measure, as
currently drafted does nothing to support the precautionary principle.
Would there have to be a demonstration of "serious damage"
occurring before anything was done? How would serious damage be
defined? The current wording is not acceptable.
3.2 The Wildlife Trusts believe that the
draft Bill should be constructed within the context of The Water
Framework Directive which recognises the unique nature of water
as a resource stating:
"Water is not a commercial product like
any other, but rather, a heritage which must be protected, defended
and treated as such".
The Directive commits the Government to delivering
surface and groundwaters of "Good Water Status", a definition
that includes biological and quality elements. In order to achieve
this aspiration the draft Bill must do more than protect against
"serious damage" but rather deliver real improvements.
3.3 The Countryside and Rights of Way Act
2000 implements a duty on all Government Departments to have regard
to the purpose of conserving biological diversity in accordance
with the Convention of Biological Diversity. The SoS and National
Assembly for Wales must also take steps (and promote the taking
of steps by others, to further the conservation of living organisms
and habitats of principle importance for conserving biodiversity).
The Bill as currently drafted goes against the spirit of this
new piece of legislation if "serious damage" to flora
and fauna must be demonstrated before action is taken. This may
not be the intention, but it is not at all clear.
3.4 The Wildlife Trusts feel strongly that
the Environment Agency must be able to revoke abstractions that
cause ecological damage to wetlands without being inhibited by
concerns over compensation. The draft Bill goes some way to addressing
this but the timescale (which gives 2012 as the cut off point
for revocation of licences without compensation) gives us cause
for concern as outlined below.
3.5 The timescale for the review of consents
affecting sites of international importance (SACs and SPAs) is
to be completed imminently. This could mean that sites that are
identified as being damaged by abstraction as part of the review
process may not have damaging licences revoked until 2012 if the
Agency does not have the resources to compensate the abstractor.
The Wildlife Trusts understand that there are human rights issues
surrounding the revocation of abstraction licences. However, the
draft Bill could no more to facilitate the end of damaging abstractions
through, for example, a duty on OFWAT to ensure it plays an active
and effective part in efforts to manage the demand for water (and
consequently reduce abstraction requirements). The necessary mechanism
to enable it to do this is currently missing from the draft Bill
(see Part 4 New Regulatory Arrangements).
4. NEW REGULATORY
4.1 By 2021 3.8 million new homes are planned
with a projected increase of 20 per cent in per capita consumption
of water. The Wildlife Trusts welcome new duty on water undertakers
to conserve water (Clause 53) but we feel that as currently set
out, the draft Bill is missing a vital opportunity to promote
demand management. The draft Bill needs to take a wider perspective
and set the context (through both regulation and guidance) to
ensure the rising demand for water is properly managed in years
4.2 The draft Bill should introduce a new
objective for OFWAT to secure the effective management of water
demand by water companies (including giving OFWAT the ability
to set mandatory demand management targets). The Wildlife Trusts
agree with the Environment Audit Committee
that " . . . (water) companies do not have significant incentives
to promote water efficiency" and support their conclusion
that "there would be merit in investigating the feasibility
of setting company-specific targets for domestic water use . .
. " We believe that the draft Bill provides an ideal opportunity
to drive this forward through a demand management objective. This
is needed in addition to the new duty on water companies to conserve
water, the provision for guidance on environmental matters from
the SoS and the provision for the setting of standards of performance
for the following reason:
4.3 The Regulatory appraisal (section 3.17)
states "where Government policy calls for intervention with
significant financial implications for consumers or for the regulated
companies, the Government has said that these should be taken
forward by means of new legal provisions rather than seeking to
act through guidance to the regulator". If the water industry
is to fulfil its duty to conserve water, itself and by its customers,
then there will be significant cost implications for the industry.
This being the case, The Wildlife Trusts would support a new statutory
objective for OFWAT as outlined in 4.2. The Wildlife Trusts welcome
the fact that there will be guidance from the SoS on social and
environmental matters. There should be guidance on the duties
for further water conservation (both for companies themselves
and customers) and standards of performance (which should include
environmental standards of performance).
4.4 The AMP 3 process demonstrated that
the environment was a legitimate customer concern and The Wildlife
Trusts believe these concerns were marginalised by OFWAT in the
AMP 3 process. The draft Bill needs to define a specific role
for OFWAT to bring together environmental and consumer concerns.
This view is supported by the Environmental Audit Committee which
recommends that "OFWAT must make further efforts to involve
the full range of stakeholders beyond the quadripartite forum
during the periodic review process".
4.5 The Wildlife Trusts welcome the setting
up of the Water Advisory Panel and Consumer Council for Water
through the draft Bill. It should be recognised that the rights
of consumers extend not only to "value for money" but
also the right to enjoy the nations heritage and environment.
An individuals act of consumption affects others and therefore
decisions regarding consumer rights must take into account wider
public interest including our right of present and future generations
to enjoy a rich, sustainable, wetland environment. Therefore The
Wildlife Trusts believe that both the Advisory Panel and Consumer
Council should have the consideration of environmental and social
issues as their core remit. Consideration should also be given
to the statutory appointment of at least one environmental representative
along the lines of MAFF appointed Regional Flood Defence Committees.
5. ENHANCED COMPETITION
5.1 Competition is classified as "work
in progress" but our key concerns are summarised as follows:
5.2 The Wildlife Trusts support a better
deal for consumers and more efficient use of water resources.
Whilst The Wildlife Trusts do not oppose increased competition
in the water industry, the efficiency savings and innovation sought
must not be achieved at the expense of the environment. There
remains a fundamental concern that the constant focus on driving
down costs does not provide an economic signal to reinforce the
message that water is a precious and limited resource.
5.3 The Wildlife Trusts believe that the
opening up of the water industry to greater competition poses
new threats to the environment including:
a significant increase in abstraction
from under-utilised abstraction rights;
the trading of abstraction rights
across hydrological/hydrogeological boundaries, between industries
with different treatment processes, with different losses and
more inter-regional transfer schemes
increasing energy consumption and
non-domestic cross-border supplies
and effluent disposal changing catchment effluent return patterns.
5.4 The strong environmental safeguards
required to deal with these threats poses a regulatory challenge
that will require new powers and duties for the regulators and,
if the Government's proposed regulatory changes in order to enhance
competition are to contribute to the delivery of sustainable development,
current educational schemes promoting the wise use of water must
be expanded. Demand management programmes must be funded to ensure
real progress in restricting the growth of individual water use
and the adoption of best practice in industry. This can partly
be achieved by regulation and partly by incentive.
5.5 In parts 1-4 of this evidence The Wildlife
Trusts have given our proposals as to how regulation (the draft
water bill) could be framed to guard against some of the damaging
environmental consequences that could result from enhanced competition.
In section 6 below we outline how incentive charging may also
6. ECONOMIC INSTRUMENTS
6.1 Applying economic instruments to water
abstraction has been omitted from the draft Bill and is classified
as "work in progress". The Wildlife Trusts responded
to the Government consultation in April 2000 If measures are introduced
as part of the draft Bill (and we believe they should be) the
Wildlife Trusts outline below how we believe the Bill should be
framed if it is to deliver some of the broader objectives outlined
in part 1 of this memorandum.
6.2 The Wildlife Trusts believe that without
improved financial incentive charging at the point of abstraction,
the Government and OFWAT will find it hard to make the water industry
genuinely water efficient, even with the additional environmental
duties proposed in part 4.2 above.
6.3 The Wildlife Trusts are disappointed
with the Government's decision to maintain a cost recovering charging
scheme as outlined in their consultation April 2000. We strongly
advocate that the costs of raw water should reflect the full environmental
value of water and the sensitivity of the catchment from which
abstraction is taking place. This is the basic tenet of the "polluter
pays principle" that should be central to the regulation
of environmentally damaging activities.
6.4 Revenues raised above cost recovery
would provide a valuable source of hypothecated revenue to fund
a "water trust fund", promoting wise use of water, BAP
driven river and wetland habitat restoration/creation projects
and educational schemes.
6.5 The trading of abstraction licences
could play a very useful role in re-distributing water resources
and ensuring the greatest economic return on the use of a precious
and limited resource. However, the introduction of trading per
se will not protect wetland habitats or contribute to the
delivery of BAP targets unless it is conducted within strict guidelines
and a strong regulatory system. The Wildlife Trusts are concerned
about the reactivation of "sleeper licences" in order
that the abstractor may profit.
13 The Water Framework Directive requires member states
to aim to achieve "Good Water Status" inland waters
within 15 years of implementation. Back
Paragraph 1 of the Water Framework Directive joint text agreed
by conciliation committee. Back
Paragraph 225-Environmental Audit Committee 7th Report-"Water
prices and the Environment". Back
Paragraph 104-ibid. Back