Examination of Witnesses (Questions 320
- 332)
WEDNESDAY 19 MAY 2004
BARONESS YOUNG
OF OLD
SCONE, DR
DAVID KING
AND MR
IAN BARKER
Q320 Chairman: The fact is it is
an issue. What surprised me in this glossy was that there was
not even one line of mention to say to the public, the people
who pay for their water supplies, that the company had to take
these factors into account, because part of conditioning people,
whether they be taxpayers or customers, is to acquaint them with
the fact that the cost of getting water and disposing of waste
is going to cost everybody more. I would have expected to see
something in there.
Baroness Young of Old Scone: We
have two processes running alongside each other. One is the water
resource plans which are much, much longer term and therefore
we do expect them to take account of climate change. The other
is the five year price settlement, which probably does not quite
get them up to the point where there is major spend on climate
change issues.
Q321 Chairman: If there is to be
change in this five year rolling programme, what should it be?
Baroness Young of Old Scone: One
of the biggest issues for United Utilities is water quality rather
than water quantity. It is about bathing beach quality and shellfish
water quality rather than about water quantity. I suspect that
is why they have soft pedalled it.
Q322 Chairman: I am not being unnecessarily
hard but if companies are going to have to deal with these issues
they need to flag it up. What is the advice to water companies
about which scenario of climate change they ought to adopt in
working out their plans?
Mr Barker: We ask companies to
look at the range of scenarios and to consider the implications
for their particular business and the way they operate their systems.
Then, where they have concern, to do a more detailed analysis.
Q323 Chairman: It is up to them?
Mr Barker: Yes.
Q324 Chairman: In terms of getting
the right balance between over expenditure, over provision and
other measures that they could take to deal with the types of
issue we have been discussing, is any advice forthcoming from
you on that?
Mr Barker: The impact of climate
change over the 25 year horizon which we ask companies to plan
over is less than the other uncertainties around, not least demand
from their customers. We ask companies to take account of climate
change once they have considered demand but the key thing is that
companies think hard about how they can help their customers to
manage that demand. It is disappointing that very few companies
are putting the message over that water is a scarce and potentially
an increasingly scarce resource and it is beholden on all of us
to use it wisely. The amount of effort undertaken by companies
in engaging their customers to help them use water wisely is minimal.
Q325 Chairman: The Minister has now
joined us so he can hear this from you at first hand. What is
your advice to Government and indeed to the regulator as to the
kind of time period over which companies should submit their plans?
Does the five year period for planning now have to be replaced
by a longer one or do you need a twin track period: five years
for the continuing sustaining of the existing networks and another
time period for some of these longer, big ticket items?
Baroness Young of Old Scone: We
ask water companies to look further forward than five years for
the water resource issues because things like creating new resources
are much longer term issues. We would ideally also like to see
a lengthening of the period for the setting of water prices. Apart
from anything, it is a horrendous process that causes a huge amount
of heat and steam and the less often we need to do it the better.
Apart from that, the ability of the companies to plan their businesses
sensibly against a five year time horizon is not high. There are
lots of reasons why stretching that period would be useful. We
also have to think about the Water Framework Directive and how
that fits in. It is going to have a kind of six plus six timescale
so that we have really a 12 year time cycle on things like looking
at abstractions and reviewing abstractions and consents. There
are lots of reasons why we would want, as soon as we are out of
the mire of this price round which we are not yet, to talk to
the economic regulator and to government about trying to get a
process that would last a bit longer.
Q326 Mr Lepper: Can we look at urban
and sewer flooding? I am worried. I represent a constituency,
the centre of which is largely Georgian and Victorian. It has
old sewers. It is Brighton. It has a problem on the edge of town
as well with run off from the Downs. The Foresight project says,
"Towns and cities will be subject to localised flooding caused
by the sewer and drainage systems being overwhelmed by sudden
localised downpours . . . much more work needs to be done to quantify
the potential problem." Water UK talks about the need for
investment in sewers and for drainage systems in new developments
to be designed with climate change in mind. In terms of older
locations with older systems and design of new systems in new
developments, how much work has been done to predict the problems
that we might expect in our urban areas?
Baroness Young of Old Scone: One
of the problems we have is that there is not really a long term,
integrated process of looking at the planning of sewerage services
that takes account of what is likely to happen in terms of demand,
in terms of development, the climate change issues, the links
with flood defence which are often quite heavily integrated. Though
companies produce a number of plans for their sewerage networks,
at the moment, there is not that integrated, longer term look.
We are pressing for the water industry to have long term plans
for sewerage, as they have long term plans for water. I think
that would be a major step forward. There has been a load of work
done in the shorter term, both by us and with the ODPM, on sustainable
urban drainage systems and how, in new development, those systems
can be made sustainable so that we do not create some of the storm
overload problems that we have with the drainage system at the
moment and so that we can also prevent fast water run off that
contributes to the flooding problem. There are issues with sustainable
drainage techniques that we need to resolve, particularly getting
a more statutory basis for sustainable drainage in both planning
and building regulations, and also getting clarity about who is
going to maintain and manage sustainable drainage systems for
the future. You see these nice little ponds in developments which
look lovely for the first couple of years but after a few dead
dogs and a pram have ended up in them and a kid has nearly drowned
they begin to silt up and become polluted. The big question is
whose job is it to maintain them. That is an issue we need to
resolve.
Dr King: Flood risk in a built
up area can only really be managed effectively if there is a clear
understanding of the overall drainage. At the moment, there is
no comprehensive information available and therefore the integrated
approach that Barbara has just described is what we need. If we
have that integrated, holistic view, there is a much bigger opportunity
for us to tackle the source and that is about using the sustainable
urban drainage. The other element is the design standard. Currently,
the design standard for sewage is one in 30 years and that may
need to be factored in as we move forward.
Baroness Young of Old Scone: There
has been some very useful joint work done between us, the ODPM
and Defra and a number of others, including Water UK and the Local
Government Association, which we hope will result in guidance
to both developers and local authorities on sustainable drainage.
That will be coming out shortly.
Q327 Mr Lepper: You have answered
my next question. Is that joint work going on between the two
Government departments and yourselves?
Baroness Young of Old Scone: Yes,
and it also includes the Department of Transport because quite
a lot of the drainage run off issues that we have, both in quality
and quantity, come from road development.
Q328 Mr Lepper: It is not one of
these situations, is it, where lack of clarity about which is
the lead department in Government is likely to cause us problems?
There is genuine cooperation and coordination over this?
Baroness Young of Old Scone: At
national level we are all talking. At local level, there still
remains the unresolved problem of how you get someone to adopt
them as part of the development proposal.
Q329 Alan Simpson: For the areas
which are currently overwhelmed by flash flooding, are we not
talking about management of new dam development compared to what
we do with existing drainage systems? I can understand that water
companies find new dams much more sexy than new drains. Given
that we are talking about big figures either way, have you done
any evaluative work on, for instance, the environmental gain out
of the per pound or per million or billion investment in new drains
versus new dams? Have you looked at whether we have any real choices
in the immediate term other than to engage in the re-engineering
of our drainage systems and have you factored in anything along
the lines of the over-engineering which are the benefits we have
inherited from the original plans for the drainage systems most
of us currently rely on?
Baroness Young of Old Scone: I
am sure David will want to talk about sewers and flooding but
all of the schemes that are proposed for the next environment
and improvement programme under the water price round have to
stand up to rigorous assessment on whether they are value for
money and whether they will deliver the environmental outcomes
that they are proposing to. It is quite difficult to make a judgment
between investment in issues that are about water supply versus
issues that are about sewerage, water quality and avoidance of
flooding, because they are dealing with different issues. Each
company has to make a judgment about what it needs to deliver
as part of this plan in order to fulfil some of the statutory
requirements coming from Europe and the UK. To give you a feel
for it, on the latest look at water companies' plans, we are talking
about probably more being spent on things like sewer flooding,
sewer quality and sewer maintenance than being spent on water
supply security. It is a big issue because it does have major
impacts on the delivery of some of the European directives in
terms of water quality.
Q330 Alan Simpson: When you say "more",
can you give us some sort of proportionate idea?
Baroness Young of Old Scone: I
would hesitate to do that because we have only just literally
seen, about ten days ago, the water company plans and at the moment
they raise more questions than they answer. I am nervous about
quoting figures in case they get stuck in concrete.
Dr King: When we are progressing
flood defence schemes, we have overlaid the flood defence scheme
on the requirements in terms of drainage, and we have progressed
them in parallel so we have a more cost effective solution both
to the Agency and water companies. For example, in areas like
Shrewsbury and Bewdley where we have recently put in multi million
pound defence schemes, at the same time the flooding from sewers
and drains was tackled. Both of those were progressed together.
Q331 Alan Simpson: Have you done
anything where you are talking just about the urban flooding as
a result of an overwhelming of the current drainage and sewer
capacity?
Baroness Young of Old Scone: As
part of the price round, there is a significant slab of investment
being proposed by water companies to reduce the risk of sewer
flooding, which is different from surface water flooding, because
of the amenity issue associated with it. It is not driven necessarily
by a European driver but quite frankly it is a pretty nasty thing
to happen. We were in agreement with the water companies that
that ought to be a priority. In terms of strategic, integrated
planning of drainage generally, we do need these longer term plans
that we believe the water companies should be asked to provide
in the future.
Q332 Joan Ruddock: My concern as
a London MP is with the situation we have in London which seems
to me to have all the worst elements of all the things that are
flagged up in this evidence. I was particularly concerned by what
you said about Thames Water leakages increasing because when we
heard evidence it was that water companies were pretty much at
the end of the road in terms of addressing leakage. That is why
there had to be consideration for reservoirs. There was no sense
that that did not hold for London as well. Clearly, with our Victorian
drains, we also have the immense problem of inadequacies of the
sewers and we have seen sewer flooding in London quite recently.
Given that a population the size of the city of Sheffield is,
in the foreseeable future, to join this capital city, I am particularly
exercised. We are at the end of our evidence session but is Thames
Water unique in having this increase and what are the excuses
that they are making?
Baroness Young of Old Scone: Thames
certainly has the biggest issue at the moment. We are very disappointed
that we are seeing an increase. Indeed, in their proposals for
the next price round there is a planned increase in leakage. They
have a particularly difficult problem in that they have a long
history of water mains that are very old. London clay is particularly
unforgiving and drought makes it shrink and mains crack. I believe—and
I know that the Minister is also exercised—that Thames did
not get its act together soon enough. It is now beginning to grip
the problem but that will mean that there needs to be substantial
investment in pipe replacement. We believe they could also do
more in terms of getting onto leaks faster. They are not best
in class by any means in tracking down leaks quickly. We know
that they have a difficult circumstance where trying to dig up
the roads in London is a difficult issue but there are other water
companies providing services in London—Three Valleys, for
example—who also are subject to the same constraints and
who, quite frankly, have a better performance level. I am a Thames
Water customer, as many MPs will be during the week. Every time
I get a water bill that has written in bold letters across the
top "the cheapest water in Britain" I take exception
to it because I think the legacy of under-investment in Thames
is unacceptable. We are very keen to press them as hard as we
possibly can to get their act together even more than they are.
They are making progress but they need to make a lot more.
Chairman: It will be very interesting
when their glossy arrives to see what they say in the light of
those challenges. Can I thank you all very much indeed for your
contribution? If there is anything that occurs to you that you
think the Committee should have your views amplified upon, as
always, we are very happy to receive further written submissions
before our report is produced. Thank you very much.
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