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Standing Committee Debates
Water Bill [Lords]

Water Bill [Lords]

Standing Committee D

Tuesday 14 October 2003

[Mr. David Amess in the Chair]

Water Bill [Lords]

Clause 33

Appeals against enforcement orders

4.30 pm

Norman Baker (Lewes): I beg to move amendment No. 208, in

    clause 33, page 37, line 43, at end insert

    'and at the end of paragraph (b) of subsection (1) there is inserted ''or''.'.

The Chairman: With this it will be convenient to discuss the following:

Amendment No. 209, in

    clause 33, page 38, line 3, leave out 'or'.

Amendment No. 210, in

    clause 33, page 38, leave out lines 4 and 5.

Clause stand part.

Norman Baker: I am delighted to see you back after the conference break, Mr. Amess. We left before Brent, East and the party conferences. [Hon. Members: ''Get on with it.''] Within one minute, I am being heckled from both sides, so I must be doing something right.

The Government have tabled an amendment to leave out clause 33. That goes even further than amendments Nos. 208, 209 and 210, which would leave out part of the clause. Our preference is to leave out the entire clause, but we did not think that the Government would buy that, so we tabled the amendments to limit it. We are perfectly happy with the Government's proposal, so I need not speak in great detail. I will leave that to the Minister.

The Chairman: Is the hon. Gentleman continuing to move the amendment? I am a bit confused.

Norman Baker: I am happy not to continue to move the amendment, but I do not want to prevent another hon. Member from making a contribution on clause stand part or the other amendments, so I will seek leave to withdraw it later.

The Chairman: Clearly, we are somewhat rusty after being rudely interrupted in September.

Mr. Bill Wiggin (Leominster): As I know that the hon. Gentleman intends to withdraw the amendment, I will just draw the Minister's attention to the wishes of Water UK, which felt that the clause should be included in the Bill, but perhaps in part 3, which is headed ''Miscellaneous''. It rightly felt that part 1 deals with the Water Resources Act 1991, whereas the clause deals with the Water Industry Act 1991. Water UK feels that it would be sensible to move the clause to the end of part 3. I know that the Minister proposes to withdraw the clause altogether. Although we would not have a problem with moving the clause elsewhere, I hope that the principle behind it will not be lost.

Column Number: 170

The Minister for the Environment (Mr. Elliot Morley): It is nice to see you again, Mr. Amess, and I welcome the Committee back.

We want to remove the clause. It might be useful for the Committee if I explain the problem, which has been touched on by previous speakers. Basically, Conservatives in the Lords mistakenly inserted the clause into part 1. The clause refers to the powers of Ofwat, but because of the error and the position of the clause in the Bill, a number of speakers thought that it created a right to appeal against decisions made by the Environment Agency.

The clause widens the scope for companies to question the validity of enforcement orders issued by Ofwat or the Secretary of State when conditions of appointment or relevant statutory duties have not been met. Subsection (3) might appear to be a major change, but it adds nothing. The company can already appeal if Ofwat makes an order that is not within its powers. That could be due to a mistake either in law or in the application of law to the facts. Therefore, there is no need for the first addition of the grounds of appeal.

With regard to the second addition, that of a reasonableness requirement, that is already implicit, in that the Water Industry Act 1991 gives details of the procedures that must be followed, which include appropriate safeguards. Ofwat is already required to give notice of the terms of a final order and any provisional order that it intends to confirm, and it must consider any representations made. Ofwat is then required to give further notice of its decision and consider further representations, if it decides to issue the final enforcement order or to confirm a provisional order in a different form following the first representations. If the regulator then failed to take account of material representations, it could provide grounds for the company to challenge the enforcement order. The company can rely on the existing grounds of appeal that the safeguards already set out in the Act have not been complied with.

Existing provisions already give Ofwat a discretion not to issue an order if the breach was trivial or if the company had given undertakings to Ofwat to remedy the breach. There are already extensive and transparent safeguards to protect against arbitrary action by the regulator.

I am pleased that the hon. Member for Lewes (Norman Baker) will not press the amendments, because they would not help the situation. In fact, they do not go far enough, as he rightly said.

There is a problem in respect of whether the clause should be inserted elsewhere in the Bill, because subsection (4) would allow the High Court to vary an enforcement order if a complaint is upheld. That would include parts of the order that had not even been the subject of the company's application, which would not be appropriate. The court already has the power, wholly or partially, to quash an order because it is unlawful, but it would be unusual to ask the court to substitute its own interpretation of the technical issues involved in the contravention, especially if they were not the subjects of the application in the first place. That is one of the problems the clause, apart from the fact that it was inserted in the wrong part of

Column Number: 171

the Bill. With that in mind, I invite the Committee to disagree to the clause and ensure that the issue is dealt with properly.

Mr. Wiggin: My noble Friends did a good job in including this part of the Bill, because it allows a judicial review, which deals only with procedure and not with substance, and clause 33 creates the possibility of an appeal on the substance of the case. I accept the Minister's reservations about the elements that are not included in the application to the court being a problem, but I hope he will take on board the possibility that an appeal should be based on the substance of the case.

As for it being in an inappropriate part of the Bill, I suggest that the fluoridation debate is also in an inappropriate partówe will deal with that in due course. If the Minister will take note of the possibility of an appeal on the substance of the case, we will be delighted if he can find a way of including it later in the Bill.

Norman Baker: The Minister's contribution was terribly well read out and awfully convincing. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 33 disagreed to.

Clause 37

Water Services Regulation Authority

Question proposed, That the clause stand part of the Bill.

Mr. Wiggin: There is a little anomaly here that I should like to have clarified. The clause states that the Water Services Regulation Authority shall be known as that, but when it comes to the Welsh version is states that the authority ''may be known as''. I wonder why we cannot have the same application for the same name.

Mr. Morley: The clause adds a new section to the Water Industry Act 1991 and repeals section 1 and schedule 1 of that Act. It establishes a new corporate body to be known as the Water Services Regulation Authority. The office of the director general of water services is abolished. It is possible that the new authority will still be commonly known as Ofwat. There is nothing to stop that. That is not a problem. The Government believe that having a regulatory board will reduce the chance of shifts of policy or approach resulting from the changeover of individual directors general and will encourage consistent and transparent regulation. The Better Regulation Task Force reached the same conclusion in its report on the economic regulators in 2001. In Wales, both the English and the Welsh versions will be used. I hope that that answers the hon. Gentleman.

Mr. Wiggin: I am grateful to the Minister. I hoped that he might attempt to pronounce the Welsh, but seeing as I did not dare to do so myself, I am grateful for that explanation.

Column Number: 172

Mr. George Osborne (Tatton): The Minister did not answer my hon. Friend's very pertinent question. The clause says that in England the body will be known as the Water Services Regulation Authority, whereas the Welsh language version is merely optional, as it states:

    ''In Welsh the Authority may be known as''ó

I will not attempt to read out the Welsh name.

Mr. Wiggin: To speak in defence of the Minister, which I am not likely to do again, he gave the bilingual option as an alternative.

Mr. Simon Thomas (Ceredigion): There are some words that dare not speak their name here. Hon. Members are trying to comment on the Awdurdod Rheoleiddio Gwasanaethau Dwr. I accept the point that has been raised by the hon. Gentleman. The answer lies with the Welsh Language Act 1993, rather than this Bill. It will be vital that the organisation in Wales not only has a Welsh name but provides services in Welsh to consumers who so choose.

There is another point on clause 37 that I should like the Minister to address. The body, whether one calls it the awdurdod or the authority, will have members appointed by the Secretary of State in consultation with the National Assembly. I should like to know a little more about the phrase ''in consultation''. Later in the Bill we transfer significant functions relating to reservoirs, for example, to the National Assembly, which we would all welcome. In that context, one would expect the National Assembly to have quite a significant role in the work of the authority, andó

The Chairman: Order. I am sorry. The hon. Gentleman is talking about something that is not relevant to the clause. It is in schedule 1. If he could be a little patient, we will come to that shortly.


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