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Water Bill [HL]


Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    43

 

it considers necessary or expedient of the other conditions included in the

appointment.

     (6)    Before modifying under subsection (4) or (5) the conditions included in such an

appointment, the Authority shall consult the company holding the

appointment.

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     (7)    The powers of the Authority under subsections (4) and (5) may not be exercised

after the end of the period of two years beginning with the commencement of

this section.

     (8)    The Secretary of State may, after consulting the Assembly, give directions to

the Authority for the purpose of securing that sums relating to any of the

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expenses mentioned in subsection (3) are included in the sums payable by

virtue of payment conditions; and the Authority shall comply with any such

direction.

     (9)    If this section comes into force before the coming fully into force of section

39(1), references in this section to the Authority are to be read as including

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references to the Director General of Water Services.

 41    Forward work programmes and annual reports

     (1)    Before section 193 of the WIA there is inserted—

       “192A            Forward work programmes

           (1)           The Authority and the Council shall, before each financial year, each

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publish a document (the “forward work programme”) containing a

general description of the projects, other than those comprising routine

activities in the exercise of its functions, which it plans to undertake

during the year.

           (2)           That description must include the objectives of each project.

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           (3)           The forward work programme for any year shall also include an

estimate of the overall expenditure which the Authority or the Council

expects to incur during the year in the exercise of its functions.

           (4)           Before publishing the forward work programme for any year, the

Authority or the Council shall give notice—

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                  (a)                 containing a draft of the forward work programme; and

                  (b)                 specifying the time within which representations or objections

to the proposals contained in it may be made,

                                       and shall consider any representations or objections which are duly

made and not withdrawn.

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           (5)           The notice under subsection (4) above must be published by the

Authority or the Council in such manner as it considers appropriate for

the purpose of bringing the matters contained in it to the attention of

persons likely to be affected by them.

           (6)           The Authority must send a copy of any notice given by it under

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subsection (4) above to the Council, the Secretary of State and the

Assembly.

 

 

Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    44

 

           (7)           The Council must send a copy of any notice given by it under

subsection (4) above to the Authority, the Secretary of State and the

Assembly.

       192B            Annual and other reports

           (1)           The Authority shall, as soon as practicable after the end of each

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financial year, make to the Secretary of State a report (the “annual

report” for that year) on—

                  (a)                 its activities during that year; and

                  (b)                 the activities of the Competition Commission during that year

in respect of any references made by it.

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           (2)           The annual report for each year shall include—

                  (a)                 a general survey of developments in respect of matters falling

within the scope of the Authority’s functions;

                  (b)                 a report on the progress of the projects described in the forward

work programme for that year;

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                  (c)                 a summary of final and provisional orders made and penalties

imposed by the Authority during the year;

                  (d)                 a report on such matters relating to any relevant undertaker

whose area is wholly or mainly in Wales as the Assembly may

from time to time require; and

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                  (e)                 a report on such other matters as the Secretary of State may

from time to time require.

           (3)           The annual report for each year shall set out any general directions

given by the Secretary of State under section 27(3) above.

           (4)           The Secretary of State or (as the case may be) the Assembly shall consult

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the Authority before exercising the power under subsection (2)(d) or (e)

above in relation to any matter.

           (5)           The Secretary of State shall—

                  (a)                 lay a copy of each annual report before each House of

Parliament; and

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                  (b)                 arrange for the report to be published in such manner as he

considers appropriate.

           (6)           The Authority may also prepare other reports with respect to any

matter falling within the scope of its functions and may arrange for any

such report to be published in such manner as it considers appropriate.

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           (7)           The Authority shall send a copy of each annual or other report under

this section to the Assembly, the Council and the Chief Inspector of

Drinking Water.

           (8)           In making or preparing any report under this section the Authority

shall have regard to the need for excluding, so far as that is practicable,

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any matter which relates to the affairs of a particular individual or body

of persons (corporate or unincorporate), where publication of that

matter would or might, in the opinion of the Authority, seriously and

prejudicially affect the interests of that individual or body.”

     (2)    Sections 193 and 194 of the WIA (which make provision about annual and

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other reports by the Director General of Water Services and customer service

committees) shall cease to have effect.

 

 

Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    45

 

Objectives of regulation of water industry

 42    Objectives and duties under WIA

     (1)    Section 2 of the WIA (general duties with respect to water industry) is

amended as follows.

     (2)    In paragraph (a) of subsection (1), after “relevant undertakers” there is inserted

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“and of licensed water suppliers”.

     (3)    For subsection (2) there is substituted—

           “(2A)              The Secretary of State or, as the case may be, the Authority shall

exercise and perform the powers and duties mentioned in subsection

(1) above in the manner which he or it considers is best calculated—

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                  (a)                 to further the consumer objective;

                  (b)                 to secure that the functions of a water undertaker and of a

sewerage undertaker are properly carried out as respects every

area of England and Wales;

                  (c)                 to secure that companies holding appointments under Chapter

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1 of Part 2 of this Act as relevant undertakers are able (in

particular, by securing reasonable returns on their capital) to

finance the proper carrying out of those functions; and

                  (d)                 to secure that the activities authorised by the licence of a

licensed water supplier and any statutory functions imposed on

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it in consequence of the licence are properly carried out.

           (2B)              The consumer objective mentioned in subsection (2A)(a) above is to

protect the interests of consumers, wherever appropriate by promoting

effective competition between persons engaged in, or in commercial

activities connected with, the provision of water and sewerage services.

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           (2C)              For the purposes of subsection (2A)(a) above the Secretary of State or,

as the case may be, the Authority shall have regard to the interests of—

                  (a)                 individuals who are disabled or chronically sick;

                  (b)                 individuals of pensionable age;

                  (c)                 individuals with low incomes;

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                  (d)                 individuals residing in rural areas; and

                  (e)                 customers, of companies holding an appointment under

Chapter 1 of Part 2 of this Act, whose premises are not eligible

to be supplied by a licensed water supplier,

                                       but that is not to be taken as implying that regard may not be had to the

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interests of other descriptions of consumer.

           (2D)              For the purposes of subsection (2C) above, premises are not eligible to

be supplied by a licensed water supplier if—

                  (a)                 they are household premises (as defined in section 17C below);

or

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                  (b)                 the total quantity of water estimated to be supplied to the

premises annually for the purposes of subsection (2) of section

17D below is less than the quantity specified in that subsection.

           (2E)              The Secretary of State and the Authority may, in exercising any of the

powers and performing any of the duties mentioned in subsection (1)

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above, have regard to—

 

 

Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    46

 

                  (a)                 any interests of consumers in relation to electricity conveyed by

distribution systems (within the meaning of the Electricity Act

1989);

                  (b)                 any interests of consumers in relation to gas conveyed through

pipes (within the meaning of the Gas Act 1986);

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                  (c)                 any interests of consumers in relation to communications

services and electronic communications apparatus (within the

meaning of the Communications Act 2003),

                         which are affected by the exercise of that power or the performance of

that duty.”

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     (4)    For subsections (3) and (4) there is substituted—

           “(3)              Subject to subsection (2A) above, the Secretary of State or, as the case

may be, the Authority shall exercise and perform the powers and duties

mentioned in subsection (1) above in the manner which he or it

considers is best calculated—

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                  (a)                 to promote economy and efficiency on the part of companies

holding an appointment under Chapter 1 of Part 2 of this Act in

the carrying out of the functions of a relevant undertaker;

                  (b)                 to secure that no undue preference is shown, and that there is

no undue discrimination in the fixing by such companies of

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water and drainage charges;

                  (c)                 to secure that consumers are protected as respects benefits that

could be secured for them by the application in a particular

manner of any of the proceeds of any disposal (whenever made)

of any of such a company’s protected land or of an interest or

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right in or over any of that land;

                  (d)                 to ensure that consumers are also protected as respects any

activities of such a company which are not attributable to the

exercise of functions of a relevant undertaker, or as respects any

activities of any person appearing to the Secretary of State or (as

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the case may be) the Authority to be connected with the

company, and in particular by ensuring—

                        (i)                        that any transactions are carried out at arm’s length;

                        (ii)                       that the company, in relation to the exercise of its

functions as a relevant undertaker, maintains and

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presents accounts in a suitable form and manner;

                        (iii)                      that, if the person is a licensed water supplier, its licence

does not authorise it to carry on any activities in the area

of the company;

                  (e)                 to contribute to the achievement of sustainable development.

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           (4)              In exercising any of the powers or performing any of the duties

mentioned in subsection (1) above in accordance with the preceding

provisions of this section, the Secretary of State and the Authority shall

have regard to the principles of best regulatory practice (including the

principles under which regulatory activities should be transparent,

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accountable, proportionate, consistent and targeted only at cases in

which action is needed).”

     (5)    After subsection (5) there is inserted—

           “(5A)              In this section—

                                  “consumers” includes both existing and future consumers; and

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Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    47

 

                                  “the interests of consumers” means the interests of consumers in

relation to—

                        (a)                        the supply of water by means of a water undertaker’s

supply system to premises either by water undertakers

or licensed water suppliers acting in their capacity as

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such; and

                        (b)                        the provision of sewerage services by sewerage

undertakers.”

     (6)    In subsection (6), for paragraphs (a) and (b) there is substituted—

                  “(a)                    subject to subsection (6A) below, the reference in subsection (1)

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above to the provisions of this Act relating to the regulation of

relevant undertakers and of licensed water suppliers is a

reference to the provisions contained in Part 2 of this Act (except

section 27A, and Schedule 3A), or in any of sections 37A to 38,

39, 39B, 39C, 66B, 66D, 66F to 66H, 66K, 66L, 95, 96, 153, 181, 182,

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192A, 192B, 195, 195A and 201 to 203 below;

                  (b)                    the reference in that subsection to the provisions relating to the

financial conditions of requisitions is a reference to the

provisions contained in sections 42, 43, 43A, 48, 51C, 99, 100 and

100A below; and”.

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     (7)    In subsection (6A), for “Subsections (2) to (4) above” there is substituted

“Subsections (2A) to (3) above and section 2A below”.

     (8)    In subsection (6B), for “subsections (2) to (4) above” there is substituted

“subsections (2A) to (3) above and section 2A below”.

     (9)    After subsection (6B) there is added—

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           “(7)              The duties imposed by subsections (2A) to (3) above and section 2A

below do not affect the obligation of the Authority or, as the case may

be, the Secretary of State to perform or comply with any other duty or

requirement (whether arising under this Act or another enactment, by

virtue of any Community obligation or otherwise).”

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 43    Guidance to Authority on social and environmental matters

After section 2 of the WIA there is inserted—

       “2A            Guidance on social and environmental matters

           (1)           Guidance may be issued from time to time—

                  (a)                 by the Assembly, with respect to appointment areas which are

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wholly or mainly in Wales; and

                  (b)                 by the Secretary of State, with respect to other appointment

areas,

                                       about the making by the Authority of a contribution towards the

attainment of any social or environmental policies set out or referred to

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in the guidance.

           (2)                         In formulating guidance, the Secretary of State and the Assembly shall,

where practicable, have regard to the costs and benefits which may be

expected to result from the guidance.

 

 

Water Bill [HL]
Part 2 — New regulatory arrangements, etc

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           (3)           The Authority shall, in exercising and performing the powers and

duties mentioned in section 2(1) above (subject to section 2(6) above),

have regard to any guidance issued under this section.

           (4)           Before issuing guidance under this section the Secretary of State and the

Assembly shall consult—

5

                  (a)                 the Authority;

                  (b)                 the Council;

                  (c)                 in the case of the Secretary of State, the Assembly and vice versa;

                  (d)                 relevant undertakers;

                  (e)                 licensed water suppliers; and

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                  (f)                 such other persons as the Secretary of State or the Assembly

considers it appropriate to consult in relation to the guidance.

           (5)           A draft of any guidance proposed to be issued by the Secretary of State

under this section shall be laid before each House of Parliament.

           (6)           Guidance shall not be issued by the Secretary of State under this section

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until after the period of forty days beginning with—

                  (a)                 the day on which the draft is laid before each House of

Parliament; or

                  (b)                 if the draft is laid before the House of Lords on one day and the

House of Commons on another, the later of those two days.

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           (7)           If, before the end of that period, either House resolves that the guidance

should not be issued, the Secretary of State must not issue it.

           (8)           In reckoning any period of forty days for the purposes of subsection (6)

or (7) above, no account shall be taken of any time during which—

                  (a)                 Parliament is dissolved or prorogued; or

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                  (b)                 both Houses are adjourned for more than four days.

           (9)           The Secretary of State and the Assembly shall arrange for any guidance

issued by him or it under this section to be published in such manner

as he or it considers appropriate.

           (10)          In this section, an “appointment area” is an area for which an

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appointment is held under Chapter 1 of Part 2 of this Act.”

 44    Standards of performance in relation to water supply

     (1)    Section 39 of the WIA (procedure for making regulations relating to

performance standards in connection with water supply) is amended as

follows.

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     (2)    Before subsection (1) there is inserted—

           “(A1)              The Secretary of State may make regulations under section 38 above—

                  (a)                 on an application by the Authority, in accordance with

subsections (1) to (3) below; or

                  (b)                 otherwise than on such an application, in accordance with

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subsections (4) to (8) below.”

     (3)    In subsection (1)—

           (a)           for the words preceding paragraph (a), and paragraph (a), there is

substituted “Where the Authority has made to the Secretary of State a

 

 

Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    49

 

written application complying with subsection (2) below, the Secretary

of State may make regulations under section 38 above if—”,

           (b)           in paragraph (b), the “and” at the end of sub-paragraph (i) is omitted,

and after sub-paragraph (ii) there is inserted—

                               “(iii)                                 on the Council; and

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                               (iv)                                 on such other persons or bodies as the Secretary

of State may consider appropriate;”,

           (c)           in paragraph (c)(ii), for “(b)(ii)” there is substituted “(b)”.

     (4)    In subsection (2)—

           (a)           in paragraph (a), for “draft provisions proposed by the Director for

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inclusion in” there is substituted “the Authority’s proposals for the

making of”,

           (b)           in paragraph (b), for “those provisions” there is substituted “the

regulations”.

     (5)    In subsection (3)—

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           (a)           for “under section 38 above” there is substituted “on an application by

the Authority under this section”,

           (b)           in paragraph (a), for “the provisions proposed by the Director in his

application or those provisions” there is substituted “those which in the

opinion of the Secretary of State give effect to the proposals set out in

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the Authority’s application or to those proposals”,

           (c)           in paragraph (b), the “and” at the end of sub-paragraph (i) is omitted,

and after sub-paragraph (ii) there is inserted “and

                               (iii)                                 to any person or body on whom a copy of the

Authority’s application was served under

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subsection (1)(b) above.”

     (6)    After subsection (3) there is added—

           “(4)              Where no such application as is mentioned in subsection (1) above has

been made, the Secretary of State may make regulations under section

38 above only if he considers—

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                  (a)                 that the regulations will contribute towards the attainment of

policies relating to public health or the environment; or

                  (b)                 (if he does not consider that they will so contribute) that there

are exceptional reasons why it is otherwise in the public interest

that the regulations should be made.

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           (5)              Before making regulations under section 38 above by virtue of

subsection (4) above, the Secretary of State shall—

                  (a)                 give notice of his proposals;

                  (b)                 consider the results of the research carried out in accordance

with subsection (7) below; and

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                  (c)                 consider every representation or objection with respect to the

proposals which has been duly made and not withdrawn.

           (6)              A notice under subsection (5)(a) above must—

                  (a)                 summarise the Secretary of State’s reasons for his proposals;

                  (b)                 specify the water undertaker or undertakers in relation to which

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it is proposed the regulations should apply; and

                  (c)                 specify the period within which objections or representations

with respect to the proposals may be made.

 

 

 
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