WEDNESDAY 11 DECEMBER 2002

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Members present:

Mr David Curry, in the Chair
Mr Michael Jack
Mr David Lepper
Mr Austin Mitchell
Diana Organ
Mrs Gillian Shephard
David Taylor
Paddy Tipping
Mr Bill Wiggin

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Memorandum submitted by Department for Environment, Food and Rural Affairs

Examination of Witnesses

MR ELLIOT MORLEY, a Member of the House, Parliamentary Under Secretary, Fisheries, Water and Nature Protection; MR DANIEL INSTONE, Head of Water Quality Division; and MR STEPHEN REEVES, Water Quality Branch, examined.

Chairman

Minister, welcome to the Committee. We have, for the record, Elliot Morley, who is Parliamentary Under Secretary of the Commons for Fisheries, Water and Nature Protection. I am never quite sure if that is your permanent title or whether your title keeps changing somewhat in light of the function you are performing at any particular moment. Anyhow, for the purposes of this inquiry, that is what it is. Then we have Mr Daniel Instone, Head of Water Quality Division and Mr Stephen Reeves from the Water Quality Branch. One of the things we have discovered in this inquiry is that it is very all-embracing, and yet there is a large number of people who one would have thought would have been pretty well seized of it and beginning to wonder and worry about the implications of it who do not appear to know the Water Framework Directive even exists. The Local Government Association apparently have been wholly baffled by the concept of a Water Framework Directive. Very little evidence has come from people involved in diffuse pollution from urban sources as opposed to agricultural sources. How confident are you that everybody who ought to know that this is a massive and important piece of legislation that is now rolling inexorably forward actually has the faintest idea of its existence?

(Mr Morley) I accept that this is a very complex Directive. The idea of it is, of course, to bring together the various directives that exist and to do it in a much more co-ordinated and joined-up way. I think that is a worthy objective. In terms of what you are saying, we have made a big effort through DEFRA and also the environment agencies to embrace and draw in people who have an interest in this Framework Directive. One of the points which might relate to the fact that some people say they are not quite clear about parts of it is that it is work in progress; it is developing, and of course, it will take place over a number of years. On the diffuse pollution, for example, we are just in the process now of going out to consultation on issues like that, but we have been engaged in seminars and conferences, we have our stakeholder group - and the LGA is involved in that - so people really ought to be aware that this Directive is in process, although it is fair to say, of course, that it is still developing.

If we try and summarise the evidence we have received, nobody has said that this is a thoroughly bad idea. There have been two strains of thought which have come to us. One is to say in that last-minute conciliation process between Parliament and Council, quite a lot of stuff was put into the Directive which makes it quite difficult to live with - certain definitions which do not seem to make sense in either scientific or economic terms - and secondly, there are still an awful lot of unknowns in the Directive. Do you feel that we really do have the certainty of the necessary landmarks, or do you feel there are still areas on which you need clarification from Brussels as to quite what is meant by certain terms?

(Mr Morley) I think we are relatively clear on the landmarks, if I can use that expression. It is true that there is a great deal more work to be done on certainties, and costs, for example, is one of those areas where there is a need to clarify the situation. But in terms of the route that the framework is taking and the key parts of it, I think they are fairly clear in relation to the definitions and how they are being developed.

We will come to some of the questions in the course of the discussion. There is, of course, a timetable attached to this Directive, and clearly some of the people who gave evidence would quite like the Government to be a bit ahead of the game, other people were saying you have the possibility in certain circumstances to defer some of the implementation but the general feeling is that the Government's intention is to defer on the schedule neither before nor later than the schedule. Can you confirm that present intentions are to do it on the date, only the date and nothing but the date?

(Mr Morley) Yes, we are working to the schedule as has been laid out in the Directive, and also in terms of the web programmes that we have made public.

Diana Organ

The Chairman has already said this is complex, difficult, there are lots of unknowns, suggestions that the Government is not terribly prepared because a pilot river basin has not yet been chosen, we are not quite sure of the outcome. Why did the Government sign up to it? What are the benefits of doing this? Why are we going to do it?

(Mr Morley) If I can deal with the first point first, I think there is a range of benefits with this in the sense that it is to everyone's benefit to have water of good ecological quality, good chemical quality, good standards. You are dealing with issues of drinking water, you are dealing with issues of water courses, inland waters, estuaries, river waters. These are desirable objectives for any government to pursue. As I said in my opening remarks, I also think that it is desirable, given the range of directives that there are in place - drinking water directives, bathing water directives - to bring them together within one framework it is also desirable in terms of having effective implementation and also the way that people understand them and how they operate. I might just say on the river basin pilot studies, I can say today, Chairman, that the Environment Agency are going to go ahead with the Ribble basin catchment study, and that will be in its broadest sense. We also know that there are groups in the Mersey basin who are very keen to be involved in the development of such pilots, and the Agency intends to embrace those as well. I thought you might like to know that.

Chairman: Mr Jack is at the bottom end of the Ribble and I am at the top end of the Ribble, so our joy is uncontained!

Diana Organ

If you say there are benefits from the quality of water and the quality of the environment, does that mean that the public does not have good quality drinking water and water bodies in the UK are pretty filthy and therefore there are problems with their bio-diversity and ecology?

(Mr Morley) Absolutely not. In fact, I am very glad to say that the standard of our rivers has consistently increased in recent years in terms of quality standard, as indeed has the quality of drinking water in terms of its safety standards. We have made enormous progress in this country in relation to improving water quality in its broadest sense, but I think that there is a very sound argument for having a Framework Directive of this kind because of the complexity and importance of the whole issue of water policy. We did lay that out, of course, in our strategy, Directing the Flow, which I know that you have seen, and that makes very clear the priorities of future water policy, how we are trying to bring those together, and how the government strategy will fit within the framework approach as well. I think there is a great deal of logic in this approach, though I do not dispute there is also a great deal of work to be done in terms of dealing with some of the issues and clarifying some of the points and pulling together the different strands of it.

Having tried to tease from you why the Government has chosen to sign up to this and the benefits that we might have as a result of it, how different are we going to be by 2012 from how we are now? What are the real reasons why Government has gone down this track?

(Mr Morley) Again, there is a number of reasons, but I particularly like the public participation in the basin approaches. I think that is very important and desirable. I also think there are some quite complex issues that we need to address. Diffuse pollution is one of them. Part of that is the fact that there is still a lot of work to be done. For example, a third of our rivers are still below good quality, even despite the fact that we have made such advances in recent years. So I would not want to be complacent about the work that we have to do and the fact that there are still a lot of potential areas of pollution, there are still a lot of areas we need to control, there are issues of water resource management and issues of new building and issues of run-off from roads, from agriculture, and there are issues about the many different groups who have an interest in high water quality: recreational groups, environmental groups, and the water companies, of course. All these are embraced within the framework and I think that brings a range of benefits.

Mrs Shephard

You have rightly described the implications of the Directive as increasing complexity. What has interested all of us on the Committee as we have worked our way through the groups involved is the question of accountability. This does not seem to be any clearer as we proceed through our questioning. For example, what legal status will river basin management plans have in relation to land use planning? Who will be accountable for those? How will that accountability cross-reference to elected local authority members who are responsible for land use planning? How will it work?

(Mr Morley) The Directive will certainly have a legal basis, and it will also fit in with land use planning.

No. It cannot fit in if it overrides it.

(Mr Morley) It does not exactly override it. It will fit in in the sense that the Framework Directive will have to be included in planning policy guidance which will be issued by the ODPM, both in terms of the PPG approach and also in the regional guidance which is given to local authorities which of course influences their structure plans. It has to be taken account of in relation to land use planning. In that sense, it will be integrated.

Can I just clarify my question yet again? If there should be a clash between the legal status of a river basin management plan and a decision of a planning committee, who wins?

(Mr Morley) The planning committee will have to take into account the legal status of the framework because in relation to consents, run-offs, those kinds of developments, there will have to be applications for consents, and any kind of issue which affects water - as it is now; there is not a huge difference in this. They will have to be part of any planning process and they will have to go through that part of the process in relation to ensuring that the planning application does meet the requirements of the Directive.

Chairman

Does that mean the Government would exercise its powers of call-in in order to ensure conformity?

(Mr Morley) My assumption on that would be that, just like any planning application now, it does have to go through the process, and part of the process will be complying with aspects of the Water Framework Directive. If it is a major planning application, or if there were dispute that it did not meet aspects of the regulations, which it would be expected to in the normal course of its process, then yes, it could be called in. That would be my understanding.

Mrs Shephard

If there were therefore to be an appeal on the part of those making a planning application, to which body would they appeal?

(Mr Morley) The normal appeal process would be through the existing structures of the ODPM. There would be no change on that.

What you are really saying then is that the accountability rests where it is.

(Mr Morley) The structures in relation to planning are unchanged in terms of the chain of accountability, but what I want to emphasise is that there are aspects of the Directive which, if there is an impact on any kind of land use planning, particularly discharge consents, run-off, perhaps water abstraction, will have to be taken into account, as indeed they are now; they do have to comply with the procedures for that.

Can I ask you how you see the structure? You must have in your mind's eye a picture of the structure - a flow chart, if you like - that will, first of all, be designed to avoid duplication of plans involving water? Perhaps you could tell us how many bodies you think will then be involved, for example, and where you have to go for which permissions. Then I would like you to tell us about the flow chart for co-ordinating in government departments.

(Mr Morley) On the first one, the lead agency for this Directive will be the Environment Agency. That will be very clear to all concerned. The Environment Agency, of course, already has its procedures in relation to consultation and its interface with the public and the way that it operates. I do not see any problems in terms of confusion or duplication. The Environment Agency also has structures such as its regional advisory groups, which may have to be looked at in the context of river basin management, for example, and whether there can be a strengthening in relation to involvement and consultation. That is part of the process that we are going through in the consultation that we are having on the Directive. There will also have to be co-ordination between government departments. We have set up a group which is co-ordinating us at the present time in relation to the implementation. Those procedures are in place.

The Environment Agency is not democratically accountable, is it? Who is accountable for it?

(Mr Morley) The Environment Agency is democratically accountable through parliament, through DEFRA. The Environment Agency is part of the DEFRA family, and it is an arm of government, and therefore is democratically accountable through parliament in the same way that any function of government is.

Mr Wiggin

That is not strictly true for the Welsh Environment Agency, is it?

(Mr Morley) The Welsh Environment Agency is also accountable to the Welsh Assembly, which, of course, is part of the democratic accountability.

So my county, which is in England, is not then accountable to parliament. Herefordshire is in England but comes under the Welsh Environment Agency.

(Mr Morley) Yes, that is a very interesting question.

(Mr Instone) Just to be clear, there is one Environment Agency covering England and Wales, so in principle the accountability from the Environment Agency is in relation to parliament here through DEFRA on English matters and to the National Assembly for Wales on Welsh matters.

(Mr Morley) That is right, but the ultimate accountability is the Secretary of State for DEFRA.

Chairman

Would you let us have a note on this. Perhaps it would be helpful. So we would like to know, where we have a river basin management plan which crosses an internal border in the UK, where the lines of accountability lie.

(Mr Morley) There is a complication where you do have that cross-over on the Welsh border, and the reason for that, as we know, is because it is a river basin management which falls within the remit of the Welsh section of the Environment Agency. There is a logic in that, but I must make it absolutely clear that the Environment Agency as a body is an England and Wales body and it is accountable to parliament through the Secretary of State.

Chairman: What we are concerned about, obviously, is how is this actually going to work in practice on a day-to-day basis between the various actors who are going to be bound by its mandate. That is why we are teasing away at this. I am sure a note would be helpful.

Mr Jack

You just whizzed past an interesting phrase. You said "We have set up a co-ordinating group." Who within DEFRA is the lead person who is going to monitor what this myriad of activity is getting up to? Is it Mr Reeves, for example? Is he Mr Water Framework Directive in your Department?

(Mr Instone) I am Head of the Water Quality Division, and I have been chairing the implementation group. I have also been chairing the meetings we have had of our stakeholder forum but as far as the internal implementation by government is concerned, I have been chairing that process, with a very strong input from Mr Reeves and his staff.

The reason I ask that question is, having looked at the Commission's website on the Water Framework Directive, it is a dazzling array of complexity, of groups meeting - for example, I see here that at the Directors of Water Meeting a couple of years ago, they set up a strategic co-ordination group, and I look around and I discover that on topology classification of transitional coastal waters one of the lead countries is the United Kingdom. I want to know, given all the bodies who are involved in this, who is going to sit there and make it their life's work to ensure that this whole lot comes together, and where there are problems, reports to ministers if there are difficulties in all the ways that we are already teasing out. Who is going to do that job?

(Mr Morley) We have a division in DEFRA which is our Water Quality Division, and our officials who advise ministers, who also, of course, co-ordinate with the Environment Agency, who themselves are very much tasked with the implementation on the ground. Within the UK there is a clear line of communication and accountability about how this is going to work.

To come back to my very simple question, who is Mr/Mrs/Ms Water Framework Directive? Who is the person? Is it Mr Instone? Is he the man I should write to if I have a problem, apart from you?

(Mr Morley) In all questions of accountability, you should be writing to me.

Is Mr Instone the man?

(Mr Instone) If you leave aside the question of who you should write to, and ministerial accountability, which obviously rests with the minister, yes, it is one of our key functions - in fact, the major single function - to ensure that our role in implementing this Directive is correctly carried out and to time.

How many people do you have working and reporting to you, bringing you information about this? How big is your resource to do this job?

(Mr Instone) The direct staff I have is a branch of about five people, headed by Stephen Reeves, but we draw on other people outside that branch, for example, our lawyers, our economists, and of course, we are very heavily drawing on the experience and skills not just of the Environment Agency but of other non-departmental public bodies such as English Nature, who also have a role to play here.

Put simply, and respecting the fact that advice to ministers is not for public consumption, are you satisfied that you have sufficient resources to ensure that all the deadlines, milestones, organisational complexity, tasks, challenges, definitions and every other part of this can be done on time at an affordable price?

(Mr Instone) I think we are satisfied on that, yes. Obviously, whatever level of resources one has, it is always nice to have more, but the position is that we are satisfied that we can do the job.

In administrative terms, Minister, what do you estimate the cost is to the United Kingdom of implementing this Directive? That is not the same question as "What is the cost to the United Kingdom?"

(Mr Morley) I understand, and that is a very difficult one to answer. We will try and pull some of this together for you, but we will have to do that in some detail because, of course, the implementation of administration, which I understand you are talking about, does not just fall within the costs of DEFRA, because of course there will be people in the Environment Agency working on this, people in English Nature working on this, there is the office of the regulator, for example, who are working on aspects of this. So in terms of the implementation, the costs are spread across a range of departments and agencies. There is also involvement of NGOs. It is really quite complex in that sense, but we can certainly give you an idea of the administrative costs from DEFRA in relation to our direct costs.

Diana Organ

I want to go back to the letter that the Chairman asked you for about the accountability on the borders. There was a slightly glib response about the Environment Agency covering England and Wales. That is not true of Scotland, and river basins do not fit into the neat lines of administrative areas on the map. What happens about the situation on the border between England and Scotland with rivers that come across that border? I wonder if you could include that in the letter, because if we are having river basin management for the Directive, the upper waters or whatever may be in Scotland, nobody is accountable for them from the Environment Agency's point of view.

(Mr Morley) The English-Scottish border is not quite as complicated as you think.

(Mr Reeves) There are two river basins across the Scotland-England border, and in Wales there are also two river basins, the Severn and the Dee. Therefore, our proposal, made jointly with the National Assembly is, if you take the examples of the Severn and Dee basins, that albeit river basin plans will be drawn up for both of those basins covering the whole of the basin, both the National Assembly and DEFRA are proposing that the Environment Agency are the competent authority, so one body, the Agency, has competent authority to draw up one plan for the basins of the Severn and the Dee, and those basin plans will be jointly approved by the Secretary of State. That is the proposed process.

As the Minister will know, I speak with some feeling, representing an area that is bordered by the Severn on one side and the Wye on the other, and if I have a problem with water or fisheries I never know whether you go to the Welsh Assembly or to the Minister or the Environment Agency. It makes it very confusing for the citizens of that area as to who they should go to with a complaint they have about the rivers.

(Mr Morley) I understand exactly the point you are making. As you say, we have discussed a range of issues in the Severn, but in this case it has been agreed, and there is one agency who are taking the lead in the development of the plans, and I think that is very clear.

Chairman: We would like a little note on that in relation to the Anglo-Welsh border, the Anglo-Scottish border and the border across the two parts of Ireland, with no doubt references to decision trees, which I understand the Permanent Secretary appears to be particularly attached to.

Mr Mitchell

We had some concern expressed by the Chemical Industries Association last week about the conciliation process between the Parliament and the Commission in which various last-minute changes were introduced and decisions were taken which really bore no relationship, they said, to either the overall interpretation of the thing or to the cost implications of the changes. Let me ask you about the conciliation process. Was the one on the Water Framework Directive subject to an unusual degree of last-minute haggling, or was it just a normal conciliation process?

(Mr Morley) I can honestly say I do not know all the details of the conciliation process, because this is an issue between the European Parliament and the Commission. It is always the case, of course, that there are generally some changes to directives as part of the conciliation process because the Parliament sometimes press issues harder than the Commission, and there are sometimes quite violent disagreements between the Parliament and the Commission. I am not aware, however, whether there was any greater percentage of this kind of discussion on this Directive than on others.

Can you just tell us what happens in those conciliation processes. I, rather charmingly, last week characterised the Euro MPs as naive idealists or something like that, and they are liable to be subject to all kinds of pressures on those ideals, like being kind to animals and women and the environment and things like that. What does the British Government do in this kind of situation? Does it tell them "This is what we want out of the Directive"? Does it say what the British view is or are they just left to get on with the naive idealism as they please?

(Mr Morley) As you appreciate, Chairman, I cannot speak for the European Parliament because that is not my accountability. I can certainly explain our relationship with the European Parliament and the Commission.

So we do not tell them anything?

(Mr Morley) Yes. In terms of British Euro MPs, they are provided with a briefing through UCRE, (?) our permanent representation in the European Parliament, which gives a briefing on the government view on issues like this. So we are in contact with Euro MPs so they know our concerns about various aspects of directives, and of course, UCRE (?) do talk to the Commission services and secretariat in relation to what the Commission are proposing and again our views, which are also influenced through the Council of Ministers and the Environment Council. So we have a lot of input into the process, but the actual decision-making process is of course part of the mechanism of the European Parliament and its relationship with the Commission.

But you do give them a starting point to go astray from.

(Mr Morley) Yes, we do.

So what effect did the conciliation process have on the Directive?

(Mr Morley) There were some changes.

(Mr Reeves) In summary, the main issues where the Parliament were looking for changes were in relation to the OSPAR Convention, where they wanted to incorporate the Convention into the Directive, to make the Convention's aspirational targets part of the legally binding objectives of the Directive. The Parliament had concerns about the groundwater provisions in the common position adopted by the Council and wanted to make them stronger. Finally, the Parliament wished to qualify the way objectives were framed in the Directive so that where there was provision for the use of derogations, further steps had to be followed before those derogations could be used, so some explicit steps were added into the Directive before derogations were used. So OSPAR Convention, groundwater and use of derogations were perhaps the main areas.

Were extra cost obligations imposed on the industry at that stage which the Commission had not envisaged in the first place?

(Mr Reeves) These were the Parliament's proposals, so they were not part of the Commission's original proposal and they were not part of the common position, so in that sense they were new factors in the negotiation.

Chairman

This is crucial, is it not? The final conciliation process is between the Parliament, which may well be represented by its President and the leading members of the Committee concerned, and the presidency, so that the other Council members are not present at the conciliation process. There might be a past or a future President as well but it is a derogation, and it is a bit of a zero sum game, because if there is not an agreement reached, then the whole project might well fall. Does the President come back after that conciliation procedure and say, "Look, if we want this Directive, we are going to have to accept those. This is what I have agreed with the President"? Do you get a chance to look at it at that point, and where you have doubts as to whether or not part of that agreement may actually make a lot of sense, for example, a scientific target which people say is meaningless, are you able to put riders in which say "Subject to being able to work this out in detail" or "Subject to this being provable or demonstrable"? How categoric is that final agreement?

(Mr Morley) I think there is a possibility of changing perhaps the detail, if not the substance, within the Council of Ministers in relation to the final agreement that is made, clarification of how things work. I think that is possible, Chairman.

The Chemical Industries Association did tell us a couple of things in it were quite literally unachievable, quite categorically unachievable.

(Mr Morley) I would have to look at what those particular points were.

(Mr Instone) From my understanding of what the Chemical Industry said, they were particularly concerned about the targets or the objectives for mercury.

Yes, mercury is what they were concerned about. They said mercury is naturally occurring and you cannot remove mercury comprehensively.

(Mr Morley) Level is the key issue.

(Mr Instone) But a lot of that is going to be taken forward in the daughter Directive under Article 16 of the Framework Directive, which of course, is still subject to further negotiation.

Mr Wiggin

I am sorry that the Wye was not chosen as the pilot river basin, as this would have revealed some of the cross-border issues. However, obviously from the Chairman's point of view, the Ribble will do fine. Can you tell us what aspects of the Directive will be piloted by the Environment Agency?

(Mr Morley) It is worth saying, Chairman, that the Environment Agency have been very heavily involved in some of the development work of this. In fact, you did touch upon it in terms of the UK lead on estuaries; for example, some of the estuary work that has been done, some of the work that has been done in relation to the actual criteria that will be applied. The water classification is one. The whole idea of the pilots is to look at how you implement a lot of what is in the Water Directive, and again, it is also worth saying that we have a very good record in implementation, and I think the Environment Agency felt that it was actually pretty well established in terms of a lot of the work that the pilots are designed to do. However, there is the European Working Group, and of course, we are quite keen to be part of that from the United Kingdom, and it is also the fact that there is a lot of public interest in the idea of the catchment pilots, and I think that is to be encouraged and to be developed. So I welcome the fact that the Agency have agreed to implement this pilot study, and it is an opportunity of looking at ways in which you can bring together the various aspects of regulation we have at the present time, diffuse pollution, abstraction, discharge consents, quality, use, and indeed involvement of public opinion as well. So I think they do provide a range of useful benefits.

When will the pilot study be implemented?

(Mr Morley) I would think it would be as soon as possible, which would be the beginning of next year.

Mr Jack

In paragraph 45 of your evidence to the Committee you say, "One issue which the Government will wish to seek views on in its second consultation paper relates to the seaward limit of river basin districts," and Article 2.7 of the Directive defines coastal waters as extending for a nautical mile from the territorial baseline, and I gather there is a possible variation on that to go to three miles. Given that the study which the Environment Agency did is, if you like, a "pilot pilot" to the river basin analysis, as far a they are concerned, the Ribble stopped somewhere before Preston, which was deeply worrying for my constituents, with the rest of it running through the estuary. What is the current thinking about the coastal extension as far as the pilot river basin study is concerned?

(Mr Morley) May I just clarify that the Ribble basin pilot will include the whole of the estuary.

How far offshore?

(Mr Morley) At the present time, I think it is working on the basis of the one nautical mile which is within the Directive. You are quite right to say that we are considering whether we should extend that to three nautical miles. The Scottish executive have already taken the decision to do this to three nautical miles, therefore there is an issue of harmonisation which would be logical in relation to the way we deal with this in the UK. There are arguments to an extent, particularly on dredging and a range of activities, which can affect water quality in estuaries and can impact on it. I personally think there is a case to consider the extension, and that is being done as part of our consultation.

Can I ask you a question which, if you have been briefed about some of our earlier exchanges, which I am sure you have, you will have heard me read out a long list of organisations and bodies who were involved in implementation of bio-diversity action plans, which affect Lancashire and the Ribble. I did that to illustrate (a) the dearth of progress and (b) the complexity of bringing those bodies together. It does seem to me - and I am aware that there has been some improvement in terms, for example, of the Ribble and the extension of the RAMSAR site, and also the development of a plan for the whole of the Ribble, which RSPB recently wrote to me about, but again, it gives an indication of the complexity of bodies and issues, all of which are going to impact and be ultimately determinant of what will be water quality. Are you going to carry out any kind of overview study to (a) speed up the processes which I have described and (b) genuinely try to integrate this myriad of bodies within the work on river basins? If it does not happen, it does seem to me we are going to have organisations going off this way, that way, all at different speeds, all of whom have an important input to this work.

(Mr Morley) I quite agree with that, but I would argue very strongly that we are very heavily engaged in consultation and in fact there are different aspects of policy work which is under way. You mentioned the bio-diversity strategy. The bio-diversity strategy has a section on water, so it is very much linked in relation to water issues and how it will fit in with the Framework Directive, which was part of that really very extensive consultation. We have the stakeholder groups, which we have representatives of all these various groups on, and of course, that gives you a very wide range of groups and access to that. We have had our consultation papers, of which you will have seen the second, and the third is in preparation for next summer. We are also working on the diffuse pollution consultation, which is under way now. There is also the Food and Farming Commission report, which has been launched today. That also relates to the issue of agricultural pollution. It is true that it is an enormous amount of work involving very large numbers of organisations and people, and some of them are different issues but interconnected in relation to the water framework issue, because there is an overlap there. So we have that in our minds all the time. What we are not doing is having completely parallel consultations that do not have this overlap on water.

You used the word - and understandably so - "consultation" on many occasions. The North West Bio-Diversity Action Plan was agreed about four years ago, and I am struggling to see a great deal of progress in terms of implementing the work that has been undertaken. It does seem to me that what is involved in those bio-diversity action plans does play a central part in the context of the issues that affect the redefinition of water quality under the terms of this Framework Directive. I was hoping we might actually be able to talk about action as opposed to consultation.

(Mr Morley) As you quite rightly said yourself, there has been a lot of movement in relation to implementation of protected area status in those areas that you were talking about, and that stems on from the original consultation. The bio-diversity strategy is a very new one, of course, but that also focuses on what we have to do in terms of developing issues such as bio-diversity. May I also say this extends to the agri-environment strategies that again are being developed as part of the Food and Farming Commission, because they have implications in relation to run-off and diffuse pollution management. So we are trying to link all these in together, and they are part of staged work. It is an enormous job. I do not dispute that. There are huge amounts of work going on in all these areas, but you are seeing measures being progressively put in place, but I do have to say that some of this work is long-term.

David Taylor

In a few months' time in some far-off Committee room of which we know little, fifteen or more parliamentary colleagues will gather together as the Standing Committee on delegated legislation B or something and will listen to you for a while and after a 90-minute desultory debate will give birth to the Water Framework Directive Regulations Order 2004 or whatever it might be, without necessarily subjecting the detail of all this to any great scrutiny or checking on its completeness or its clarity. That is not a very satisfactory way to put on to the British statute book such an important piece of work, is it? Why have the Government said that they want to do it through secondary legislation in that way?

(Mr Morley) It is because we have well-established primary legislation which covers water policy that is in place, well established within England certainly. Therefore, the bulk of the implementation will be by secondary legislation, and it is true that there will be reviews by the European Standing Committee in that sense, but there will be a range of statutory instruments, most of which will be debatable, open to scrutiny, and of course, there is the normal scrutiny of the parliamentary process in terms of how this Directive will develop over time, which will give parliament ample opportunity for discussing the details, as, indeed as part of the process you are having with the Select Committee.

But environmental groups and the water industry in general were not convinced by that argument. They believed that there is a need for primary legislation, did they not?

(Mr Morley) I have to be honest and say I am not convinced by that argument. Primary legislation is a very time-consuming process by its very nature, and if you have the existing legislation in place, I believe that we should be concentrating on the details of the Directive in terms of consultation, discussion and debate, and that is the proper way of scrutiny, and the secondary legislation and implementation I think is entirely satisfactory as long as you have the proper consultation and scrutiny of what you are actually implementing.

Have the stakeholders come round to the idea of implementation by secondary legislation since the first consultation?

(Mr Morley) I can only say that I have not had many representations myself from stakeholders complaining about implementation by secondary legislation.

So silence is consent?

(Mr Morley) In my experience, if people are upset about something, you very soon know about it.

The overall value of the Water Framework Directive could be very considerable. The costs to the water industry, to land owners, to farmers and others might be enormous. Whenever we have asked the various witnesses we have had before us so far, no-one has ever been competent even to give us a range of costs. Surely something as important as this deserves a greater degree of scrutiny, at least in terms of the regulatory framework.

(Mr Morley) It certainly is important that the costs are scrutinised, and we are pulling together the estimates of what the cost of some of these measures will be. What you have to bear in mind is that a lot of work is already being done in the context of, for example, the current price review in relation to the water regulator. A lot of directives are already in place. We are currently extending the nitrate-vulnerable zones, for example. All these various issues are taking some of the cost and therefore to try and calculate the costs of the measures is difficult, because some of the costs are already being apportioned in relation to the various work that is under way. We accept, of course, that it is important that we try to get a clearer idea on this, and we are doing this, but it is part of the consultation development and preparation which is part of the Directive, which is under way, and is going to give us a clearer idea of what the cost implications are now. At the moment there is still more work to be done on that. We have seen a number of estimates, and we have some broad estimates ourselves, but we think at the present time they are not very accurate, for a variety of reasons, not least because there is still a range of unknowns.

Mr Jack

Going back to Diana Organ's question at the beginning of our session, when she asked about signing up and what were the benefits, it is a bit like going to a menu without prices. It seems to me that not enough work perhaps was done at the beginning to give some order of magnitude of the costs that were involved before people gaily signed up to it and then worried about how they were going to pay for it afterwards. When it was signed up, surely somebody must have done a back-of-the-envelope calculation as to what the order of magnitude of cost was. What was that number?

(Mr Morley) I do not think there was ever a definitive cost or even some kind of cost estimate when the framework was originally proposed. Bearing in mind that, of course, it is bringing together a lot of regulatory work which is being done on water, which itself has been costed, so you can actually take some cost estimates from measures which have been applied or are being applied, such as the Bathing Water Directive, for example, the work on the nitrate-vulnerable zones, and that gives you some idea of what the costs are, but those costs were coming anyway in relation to the work which was under way and the directives which were being implemented, and there is some disagreement, of course, in that there are some groups who claim that some of the costs might be marginal, while there are others who have put forward enormous sums of money. We do need to focus on this a bit more, and we are trying to do this as a Department at the present time

Let us go down to a level of detail. You say you do need to do this a bit more and you need to focus on it. Just describe the mechanisms. The reason I ask this question is that the water industries presented the Committee with a wonderful document entitled The economics of achieving good water standards - a water industry perspective on implementation of the Water Framework Directive, and, as you can see, it is a rather thick document, and it is frightening in the number of potential cost areas that it identifies. Are you building up a matrix of all the possible cost areas and then working through with stakeholders to come to a number? Is that how you are approaching it?

(Mr Morley) Yes, we are building that up, and as part of that, of course, we have had talks with Water UK about those costings, but we have some questions on the methodology that has been applied, and in fact, I understand after meeting with officials from DEFRA that Water UK are taking it away to look again at those costings because there are some that we have doubts about.

Agriculture is clearly worried, because it is one of the major sources of diffuse pollution. Given the perilous state of UK agriculture in terms of its finance, again, have you no idea at this stage what the farming industry is going to let itself in for? We have received evidence, of an interesting parallel in New York, where to clean up some of their waters they could have had an end of pipe solution at $8 billion or, as it turned out, they got something where those who caused pollution had to sort it out at source and in terms of cleaning up their waters, it cost $100 million, so a big order of magnitude difference. What is being done to minimise the impact of cost in the case of the polluter, because of the farming industry's financial position, and/or the water consumer if we end up with end of pipe solutions? What are you aiming for between those two extremes?

(Mr Morley) I should first of all point out that the Water Directive itself does have an element of cost benefit analysis where it does say that if the costs are so enormous in relation to what might be a minor benefit, then it is not worth pursuing those kinds of costs. The Directive is different from some of the earlier directives, which did not have that kind of approach.

Who will adjudicate on that argument? It is a very interesting point because there is a certain latitude as to how national member states are going to implement this. Who is going to decide on this trade-off between an overly expensive benefit and not doing it? Who is going to be the decider?

(Mr Morley) The Commission has the responsibility, because each member state will have to put in place monitoring committees and the Commission will oversee the work that is done on the monitoring committee, so there will be a standard applied. It is not going to be used as an excuse for some people to get out of responsibilities for dealing with the framework. But the other point you are making is that the costs will vary. If you take agriculture for example - and we cannot ignore the fact that agriculture is a big polluter; it accounts for about 70 per cent of nitrate pollution in water courses and a very high proportion of phosphates - I think 30-40 per cent. You cannot ignore that particular issue, but in agriculture itself there are huge regional differences; in some parts of the country there is very little pollution and in other parts there is greater, so you cannot necessarily have a uniform cost. It is going to be different. In terms of agriculture, it does fall within the 'polluter pays' principle and we cannot ignore that. We also cannot ignore the issue of proportionality and the costs on the industry as well as that is all part of conciliation and that we have to take, but in terms of dealing with such things as nitrates, for example, a lot of it is the application of good farming standards of practice. In fact, in the nitrate vulnerable zone cost assessment, the overall assessment per farm was around about £200 a year, which is quite modest, and that is not to say that within that of course there will be greater costs for some farms in some areas and in those cases of course we do have capital grants, for example, in relation to slurry and silage storage, so we are trying to address that as well. I think it is trying to be proportionate in the way that you respond to this, but recognising that there are pollution issues here which do need to be addressed.

Given the work that is going on in this, when do you think there will be agreement amongst all parties as to what the overall cost of implementation would be? Secondly, when do you think some decisions would be able to be seen as to how the costs are going to be allocated amongst those who will have to bear the economic impact of the implementation of the Directive?

(Mr Morley) I think that we will come to a position where we can get an agreement on at least a broad view of costs. I think it is one of these things where it is always going to be very difficult to get the exact costs, but I think it would be possible to have a bit more of an accurate picture than we have at the present time when really a lot of the figures which have been bandied around are a bit of a stab in the dark really.

Can I just remind you of the question I asked which was when?

(Mr Morley) Yes, I was going to come to that and I will actually ask one of my officials here.

(Mr Instone) Clearly producing better costs and indeed better benefits estimates is an iterative process. That is why we published our first regulatory impact assessment last year with our first consultation document, knowing that this would need to be refined, and why we are planning to publish the second document, as we have said, next year and we will be talking to stakeholders before we publish that. It is inherent in the nature of the Directive that because river basin management plans and indeed programmes of measures are only agreed some years down the track, we have to start thinking about developing those reasonably soon. Inevitably the precise costs will be subject to variation and change depending on what the content of those plans is and what the programme of measures eventually agreed is, including participation with stakeholders. Another dimension, just to mention it, is that we talked earlier about the costs to farmers and that is why we are doing our consultation in parallel on what the best measures are to address the issue of agricultural diffuse pollution of water and we hope that the results of that exercise, which is one of the reasons why we want to do it now, will feed into the consideration in river basin management plans about what the most appropriate measures are and, as I said, agreements on those will help to refine what the exact costs are.

Mr Lepper

We have talked earlier about the resources that DEFRA has in relation to the Directive and we have talked also about the role of the Environment Agency. Does the Environment Agency actually have both the resources and the powers which it needs in order fully to carry out its role as competent authority? There have been, as you know, in the course of our sessions some questions raised about the designation of the Environment Agency in that role.

(Mr Morley) Well, we are very confident that the Environment Agency does have the powers to carry out this role and we are of course discussing it with the Environment Agency. In terms of the resources to implement the Directive, within its baseline budget, resources were made available in the Spending Review for implementation. There is of course always an issue of resources for any body and the Environment Agency is no different. They also are taking on a lot of extra work which is not related to the Water Framework Directive, but of course there are cost implications to the Environment Agency, and we have been meeting with the Agency to talk this through with them. I should point out that their budget is increasing quite substantially, although I would not want to dismiss the increasing demands made upon them. It is an issue for them and we have explored with the Agency the whole issue, just in relation to the Water Framework Directive, of its implementation and their resources and they are certainly in a position to take forward the implementation because, as I say, the initial funding is available and that has also covered the pilot study. As far as further financial resources are concerned, that is an issue that we are discussing with them.

You will appreciate the concern because Michael Jack has asked about some aspects of the costs to a whole range of consumers, for instance, and I think one of the things which does perturb us about the Directive is, and you have used the word "diffuse" in relation to the environment, but the very diffuse nature in a way of the Directive itself and the difficulty of actually getting a hold perhaps of everything that might need to be done in relation to properly implementing it. There is that concern that we do not want at some future date to find that there are aspects of the Directive, excellent and worthy though they are and we would all sign up to them, but the resources simply are not there to carry through the implementation.

(Mr Morley) I quite agree with you in that I come back to the point that this is the biggest and most complex environmental Directive which has been brought forward by the European Union. It is very demanding, but it does bring together a lot of existing work, a lot of existing Directives and we have to bear that in mind. It can have the potential of actually having a clearer framework than where we are at the present time, but I do not underestimate the difficulties and the potential risks on this and that also includes the costs of enforcement and implementation. These are all considerations that we must make and this is why we are having this really quite detailed consultation process to ensure that we do cover all of these points and that the very important aspects that you have touched upon are taken into account so that we do not miss these issues for the future and we do not find ourselves with some very expensive liabilities which have not been taken into account. I do believe that the process we have embarked on will make sure that we do not miss those.

One of the other issues which concerns us and has been expressed to us about the Environment Agency is about the possible conflict of roles. Its purpose in one respect is to advise on a range of environmental issues and now it will also become the enforcer in relation to those same issues. For instance, on the river basin management plans, as I understand it, the Environment Agency will both help to draw up the plans and will also presumably, as competent authority, further down the line make decisions about the effectiveness of them.

(Mr Morley) Yes.

Are you troubled at all about that possible conflict of roles?

(Mr Morley) Not really because of course that applies now in a range of issues, such as the work it does on advising on water quality, water management, abstraction and discharge, where it provides advice to a range of people, but it is also the regulatory body as well and provides regulation and, on occasion, enforces it too, so there is nothing different in that respect about how the Agency works and I think that works reasonably well at the present time, so I see no reason why it should not work in relation to the implementation of the Directive.

A concern that Severn Trent in particular expressed in their written evidence to us related to that was this: they say, "We believe strongly that the Environment Agency should not be involved in taking decisions which are of a political and economic nature. While they are clearly experts in the environmental field and are thus well placed to support the Government in the implementation of the Water Framework Directive, their role cannot extend into areas for which they have no democratic mandate". Now, that was the view of Severn Trent. I know you have explained to us earlier the sense in which there is a democratic accountability, if not mandate, but could you comment on that?

(Mr Morley) Yes, I am a bit puzzled about some of those claims because the Environment Agency does not take political decisions. The Environment Agency's job is to work within the agreed framework laid down by Parliament within the Acts of Parliament and European Directives, so in that sense what the Agency does is work within the framework which is set democratically and is democratically accountable. Of course the Agency itself does consult very closely with the various stakeholders, with ourselves in relation to DEFRA, and there is a very close interchange. It does not work in a vacuum or in isolation and its job is to work within the framework set out by Parliament.

Mrs Shephard

Could I just bring you back to what David Lepper suggested and that was that there might be a conflict between the roles of adviser and enforcer on the part of the Environment Agency and can you not see the practical implications of this, for example, for a farmer who might well invite somebody on to his farm to give advice and then finds that he is jumped on from a great height because the same office, not necessarily the same officer, has had reported to it a situation on the farm which deserves some sort of punitive action? Do you not see that as a practical application?

(Mr Morley) I can see the point that you are making, but it is not unique, is it? If you take the farming example, the SVS is there to advise and support, but on occasion the SVS will bring a prosecution in terms of enforcement.

Well, perhaps I could draw your attention to another analogy which I think might work better and that is the case of OFSTED. OFSTED has the task of analysing problems, but not the task of advising how to put them right - that is delegated to local authorities - and that works much better and there is no reason why you should not have that model if you want to have trust and actually cooperation from agriculture. What you are saying is that this is working fine as it is. Well, maybe it is, but we are also talking about a new ball game in terms of the Directive. Do you not think you ought to look at a different model which already exists?

(Mr Morley) It is a new ball game in the sense of the range of the Directive, but I think the logic of what you are saying is that there would have to be some new kind of organisation, and I think what we also have to be a bit wary of is duplication of bureaucracy and structures, having parallel organisations, having more committees, which are not giving you very much in relation to added value, but just increasing costs and bureaucracy. That has to be a consideration as well and I am not saying that we should not look at structures because I think it is quite right and proper that we do address questions such as those that the Committee are raising, but I just think in terms of what you are saying in relation to the Water Framework Directive, it is an extension really of the way that the Environment Agency operates at the present time and I am not myself convinced that there will be a great deal to be gained by having some kind of new parallel organisation which will be involved in the implementation.

Well, I think that you should look at this again. If you want this thing to work and if you want people's cooperation, as you constantly say that you do and we do hear the word "partnership" quite often ----

(Mr Morley) Yes.

---- then it seems to me that you should listen to the concerns of at least one group of people who are going to be key in all of this.

(Mr Morley) Sure.

You also just said that agriculture is key in terms of pollution. May I suggest that you look at this, that you look at the way, say, OFSTED works. You do not need vast committees, endless partnerships and all the rest of it and you have advisory groups in place. There are a number of imaginative ways in which this could be solved, some of which was suggested to us by the NFU last week, for example, and I think if you are really looking at genuine partnership, then it might be an idea to look at an alternative way of making this work. I think you might well be surprised by the degree of warm cooperation you would get from the NFU in getting suggestions from them about how it might work.

(Mr Morley) The NFU are part of our stakeholder group and at this stage in terms of the developments and implementation of the Directive, we are going through the consultation procedures and, therefore, we are open to ideas and we are open to suggestions and we will give them careful consideration. I would just say that in terms of my own views, I also know from talking to the NFU that they are not very keen on duplicating lots of structures and bureaucracy and it is always an issue which they raise with us, so we have to take that into account as well, but in terms of suggestions of structures, we will always look at those.

Paddy Tipping

I would just like to stick with agriculture for a bit because you told us that agriculture is a big polluter and you were kind of half saying to us that good farming practices make a difference. Is there not a bit of resistance to change within the farming community and how are you going to make sure that these good farming practices actually take place?

(Mr Morley) Well, we already produce codes of guidance on soil and water, for example, and there has been a big change in, for example, the use of fertilisers and pesticides. It is not in the farmers' interest to over-apply. It is not in their interest; these are costly inputs and of course farmers are seeking to use them in the most efficient way possible to minimise the use and of course that is also very good practice in relation to minimising pollution, but there are very basic issues of codes of standards, for example, as to when you apply, the kind of weather you apply in, how you apply, and this is generally well understood by farmers. There is also new technology in relation to applicators which minimise the applications and in fact the very latest technology is based on GPS and can actually apply different parts of inputs in different levels in the one field according to the soil quality and the need. These are all very desirable developments which are also very efficient in relation to agricultural practice, but there are some basics which, if they are followed, do minimise the risks of pollution and run-off and they are encapsulated in the codes which we make available free of charge to the agricultural sector. Also, as part of the implementation of the Food and Farming Commission, there is the idea of setting up demonstration farms which can demonstrate a range of techniques, and I always think that is very useful in terms of practical, first-hand experience as farmers do like to go and see what other farmers are doing and they do like to see it being demonstrated in a practical way, so I think the demonstration farm process is a good one. There is also the possibility of the way that we use our own environment programmes in relation to reducing inputs as well. Therefore, I think there is a range of tools available to us in relation to reducing agricultural run-off, many of which should not be terribly burdensome on farmers. Now, it is going to be different in different places and different conditions and we do accept that, but, nevertheless, it is an issue that we cannot ignore given the dominance of agriculture in some aspects of pollution run-off.

I would agree with all of that, I agree with the codes and I think the demonstration farms are a good idea, but there will be in some situations some resistance to change. How are we going to make that step change because you have already told us that the NFU were not keen on other inspection methods, so how are we going to police this?

(Mr Morley) Well, it is costs and the implementation which the NFU are understandably concerned about in relation to its members, but there will have to be policing. The Environment Agency will have the principal responsibility for that and they will apply inspections on a risk-based system which I think is the right way of doing that. It is a question of also trying to convince people about the kind of changes which need to be taken and also the various ways that pollution can be minimised by good practice and that is underway at the present time. In my experience, there is a lot of interest in this. It is probably a very small minority who are unwilling to cooperate in these issues and it is like all things in that where you have a small minority who are unwilling or just obstructive, then of course you do on occasions need regulations to enforce measures and they are in place as well.

In a sense, when you talked about agri-environment schemes, you were half hinting, I think, that there could be some kind of fiscal instruments here. The entry-level scheme is yet to be designed and rolled out, there is a review of agri-environment schemes going on at the moment, but all this in effect implies a switching of funding from agriculture or, as they say in the trade, from Pillar 1 to Pillar 2.

(Mr Morley) That is right, yes.

Is CAP reform and further modulation inevitable if we are going to get this Directive in place?

(Mr Morley) Well, we are committed ourselves to modulation and we are currently the only country which is doing so, though it is likely that Germany will implement a modulation scheme. Under the proposals of the Curry Commission, he is recommending that we move from a rising modulation of 4.5 per cent maximum to 10 per cent and that will of course give us considerably more funds to put into the Pillar 2 approach to agriculture. I think what is clear is that is the way that agricultural support is going to go and that there are going to be less funds for production support and subsidy and there are going to be more resources for environmental management and rural development. I think that is in the interests of agriculture both in this country and in Europe, but it will also give us a lot more flexibility in terms of implementing schemes which might address particular problems of diffuse pollution, so it is desirable in terms of the range of tools which are available and the range of support that we can give to farmers.

Are you confident that within the Commission there is an awareness that agricultural policies and environmental policies to link with the Directive are properly joined together?

(Mr Morley) I am absolutely convinced that the Commission are well aware of this and they believe that it is the way to go not only in terms of providing opportunities for doing what we are talking about today in relation to pollution and management of water quality, but they also see it as essential in relation to future world trade objectives and I have no doubt whatsoever that Franz Fischler is entirely signed up to this approach.

Just a quickie on diffuse pollution from other sources, cars are big polluters, so how will we tackle that?

(Mr Morley) Yes, we are going to have to look at the issue of pollution from roads and motorways, for example, because there is a range of sources of diffuse pollution of which agriculture is one, and we acknowledge that, and that is part of the consultation that we have just launched.

What are the solutions?

(Mr Morley) Well, that will be looked at as part of the consultation process, but there are solutions to highway run-off in the way that they are dealt with. Some of those solutions are not always put in place of course.

And who is going to pay?

(Mr Morley) Well, certainly in relation to new developments, these measures should be built in from the very beginning as part of the planning process. In terms of existing developments, what we need to do is look at the impact they are having, the nature of the pollution and the kind of steps that can be taken with a proper cost-benefit analysis.

Mr Lepper

There is great emphasis placed on public participation in developing the Directive and its implementation and we have touched on that quite a bit in the discussions this morning. Did DEFRA look at any models of public participation in other parts of the European Community in relation to the Water Framework Directive and consider the extent to which they might or might not be appropriate in this case?

(Mr Morley) Yes, we did look at that. I know that there are different models of consultation in different parts of the European Union, but what we have to do of course is to look at what is appropriate to us and also to look at the structures we have in place. Again it does not help, I do not think, if you are duplicating existing structures of consultation which would not give you a great deal of additional benefit, but additional cost and in some cases you could cause confusion by having additional structures, so we did look at that, but we have encouraged public participation and we believe that we are involving a wide range of participants and of course the Environment Agency is very much in the lead on this and they are very well experienced at public participation, both local and regional and indeed, speaking as someone who has often shared platforms at Environment Agency meetings, talking to people, so they are very well experienced with this.

You talked about the stakeholder groups and we touched earlier on local government involvement which you suggested was through their membership of the stakeholder groups. We have had no representations, so far as I am aware, to this Committee from local authorities or from organisations representing planners, yet clearly the Directive is going to impinge very heavily on the work of those agencies and authorities. It may be that they feel that the stakeholder groups and any representation they have got there is quite sufficient for them, but certainly a theme which has run through many of the evidence sessions we have had is that whilst some of the major organisations, the NFU, the RSPB, et cetera, the Country Landowners' Association, are aware of the implications of the Directive and have a willingness and a desire to become involved in participation, its impact on other consumers, water consumers, the general public, for instance, and its implications for them perhaps has not been particularly great at the moment. Do you feel that DEFRA or indeed the Environment Agency could be doing more in relation to that multitude of consumers out there in making them aware of what is happening or involving the ordinary consumers in some way in this exercise of public participation?

(Mr Morley) I absolutely accept what you are saying. There is always an issue of how you involve the ordinary consumer, if you want to use that expression, because that is quite challenging. Of course it is always a lot easier to deal with representative organisations because of course what you are doing then is you are disseminating information and you have a two-way process which goes backwards and forwards, but we are engaging with organisations. Water Voice is one, which is a consumer organisation. There is the Stakeholder Forum of which Water Voice is a part. As part of our work across government, we talk about planning and local authorities, and local authorities do have a key role in relation to planning, but local authorities work within the guidance which is laid down by the Office of the Deputy Prime Minister through the planning policy guidelines, so, therefore, what we are doing is making sure that the planning policy guidelines give the planners the framework in which to operate with the information that they have and of course there is an interchange of views within ODPM in terms of its own consultation process with its own stakeholders, and local government is one of the principal ones. Also there has been a range of seminars and conferences which have been open for local authorities and they have been very active participants in that. Going back to the pilot river basin schemes, I really see one of the strengths of that is an opportunity to involve the wider public and to actually give people more understanding of what the implications of the framework are and how it will be of direct benefit of course to the general public in relation to improving water quality at every level which is of interest to us all.

I am sure you are right about that final point. There does seem to have been a reluctance on the part of the UK Government to get involved in a pilot study. I welcome the fact that that has now changed, but it does seem quite a dramatic change since we began our evidence sessions just a few weeks ago and I am sure it has nothing to do with the views which have been expressed to this Committee over that period of time.

(Mr Morley) You will know, Chairman, that we always value the views of this Committee very highly.

Mr Lepper: It did have something to do with it!

Chairman: At least it provoked a potential sharp change in the London wholesale markets at any rate!

Mr Jack

Could I just ask you, Minister, to put your hat on as Minister responsible for policy concerned with flooding and how you see that area of policy integrating and being involved with this Water Framework Directive because up to now the focus of our inquiry has been on pollutants and how we can control them because we can identify them?

(Mr Morley) That is correct.

But when a flood occurs, the situation is out of control, so are you going to integrate policy in that area into the implementation strategy for this Directive?

(Mr Morley) Yes, we are and we are already giving thought about how we can do that and although the Directive does not, as far as I am aware, focus on flooding as a heading, you cannot ignore the policy implications there, for example, with sewers and that is an issue that we need to address and it is an issue I have been discussing with the regulator in relation to the current price review and investment strategies of the sewage companies. There is how you can apply soft defences, for example, and the benefits you can get from that, salt marsh, shingle, sand and how that fits into your water basin strategy. There are upland water catchment areas, there is run-off, there is the role of drainage, canonisation of watercourses, and also the implications of developments and increased run-off as well which both increases the volumes going through river systems and watercourses and also potential pollutants with the run-offs too, so that also has a read-across into sustainable urban drainage, the development of the role of natural features in flood control and water management. We do have the advantage of course of having this all in one Department now and one responsibility and that does make it easier for us actually to think about these in an integrated way, and all these policy aspects come within my own portfolio.

Are you going to produce a document in due course that shows how that area of policy on flooding is integrated?

(Mr Morley) It will be part of the policy papers that we are developing and in fact it also did feature in Directing the Flow as well.

Chairman

Minister, we talked at the beginning about the timetable for all of this. If one of the major instruments for dealing with diffuse pollution is going to be the entry-level scheme for farmers and then one of the major instruments for dealing with diffuse pollution from the urban environment is going to be planning policy, then you are, by definition, going to be rolling out the environmental schemes way ahead of the deadlines in this and I cannot see any reason why the planning policy guidance should not be issued well in advance. After all, if we are going to minimise costs by hitting it at the source and if this is a good thing in its own right, because those planning guidelines involve quite a long process of issuing and consultation and the finalisation of planning policy, should that not be getting underway now?

(Mr Morley) Well, planning policy guidelines already address a lot of these issues because of course the issues of water control and pollution control are important aspects of planning and they are subject to their normal revision and they are being revised now to take into account the impact and the requirements of the Directive, so that is underway now and so that work is in process.

So one of DEFRA's officials is working with the Office of the Deputy Prime Minister actually on the process of drawing up guidance on it?

(Mr Morley) That is correct and it is also part of the coordinated committee which we have as well across government departments, so there is cooperation between our own officials in DEFRA and also planning officials in ODPM, so that work is underway. I think there is a second point which you mentioned as well, the planning and?

The second point was the entry-level schemes.

(Mr Morley) I would not want to over-emphasise the role of the entry-level schemes in relation to pollution control. I do not think they are a major answer to the issue of pollution run-off from agriculture, but they could have a benefit. For example, it is under development at the present time and we are going to have some trials, some pilot schemes, but as an example you could have some uncultivated areas around watercourses, for example, as part of an entry-level scheme. The whole idea of the entry-level scheme is that it is not a very prescriptive scheme in relation to what it does.

I am aware of that, but I was just following the questioning that Paddy made.

(Mr Morley) But it could have a role, I quite agree.

But you said it might have a major role, so which is the bit which does?

(Mr Morley) No, it is agri-environment schemes which could have a major role because you could within the agri-environment schemes actually tailor some stewardship schemes to address the whole issue of pollution run-off. That is not the same as the entry-level scheme because the entry-level scheme will not be very prescriptive and it will not have a lot of restraints on the individual farmer as the concept of it, but then the concept is that you would have the entry level and then you would have higher tiers of stewardship which you could opt to go into. Now, some of those higher tiers could certainly be tailored with a number of objectives, but one of the objectives could possibly deal with pollution.

I think we should be cautious before the trials are going to tell us much. A two-year trial will demonstrate whether they can be done administratively, but it is not going to achieve anything ecologically, to be absolutely honest about it, is it?

(Mr Morley) Well, I personally believe they will have benefits, but I would not want to overplay it, Chairman, and I would not want to say to the Committee that the entry-level schemes are going to have a huge impact in relation to that.

Are you confident that if things do come out in the wash, as it were, like this little niggle about the requirement to eliminate the presence of mercury, that there are mechanisms within the consultation procedures which can actually enable governments to navigate requirements which need to be interpreted as sort of commonsense objectives rather than absolute?

(Mr Morley) Yes, there is, I think to use the word "discretion" is perhaps not the right word, but there is certainly some flexibility about how we approach this.

Finally, you mentioned European passant earlier on that DEFRA's response to the Food and Farming Commission was being launched today. Did I hear that correctly?

(Mr Morley) Tomorrow.

That preempts my question because I was wondering why we were going to have a major debate tomorrow if you were going to launch that today.

(Mr Morley) That is absolutely right.

Well, I am delighted that we can end on that note of consensus. Is there anything you want to say in a final burst?

(Mr Morley) I would just make the point that this really is a major Directive and of course it is very complex because of the whole aspects of it. I believe that the scrutiny that the Committee is giving this is actually very helpful as part of the process because it is identifying areas that we need to address and areas that we need to work on and I just want to assure you, Chairman, that we will respond positively in relation to the input that the Committee is having because it is part of that process. The final point I would make is that I do believe that this framework will provide a range of really very desirable benefits in relation to water quality and water management and it does fit in with the work we have been doing on strategy and Directing the Flow, biodiversity, planning, sustainable urban drainage. It does bring it all together and I think in that sense it is very desirable, but of course I do recognise that it is important we get it right and it is important we address a lot of the issues that you have raised today.

Well, thank you for that. Without preempting the report, I think we are likely to want to focus on where we think there are practical questions, firstly, in the process, but also which need to be answered so that the various stakeholders can actually deliver, so your attention to those would be very welcome and we can maintain a dialogue on something, the whole thrust of which, I think everybody probably agrees, is something which is desirable. We will see and thank you very much for being with us today. I hope you have not caught pneumonia!

(Mr Morley) Thank you, Chairman. The discussion was warmer than the room, I must say!