Ian Pearson: The UK has seen below average rainfall for 19 months. In particular, the south-east has been much drier than during the notable drought of1974 to 1976. The Environment Agency believes that the droughtin the south-east has the potential to be the worst for 100 years. Water planning is based on the principle that each water company has a water resource plan looking ahead 25 years. Water companies also have a drought plan setting out how they will continue to meet their duties during a water shortage.
I recognise the public concern about leakage rates. Ofwat, the economic regulator, sets targets for leakage and over the past 10 years, leakage rates have reduced by 30 per cent. However, there is more to be done, particularly by some companies. Since privatisation, water companies have invested £55 billion in water and sewerage assets, and more than £3.5 billion in 2004-05 alone.
As the House will be aware, water companies in the south-east have introduced hosepipe and sprinkler bans to manage the drought situation. The recent decision to approve the Sutton and East Surrey Water drought order application is the next step beyond a hosepipe ban. I am considering the independent inspectors reports following the hearings on the drought order applications made by Southern Water and Mid Kent Water.
Mr. Ainsworth: May I begin by congratulating the hon. Gentleman on his new post and by thanking him for that statement? The Opposition do not blame the Government for the weather, even though some of my colleagues would like us to. Many of us will remember the last Labour Minister for drought, who rapidly became the Minister for floods, so we accept that these things are indeed unpredictable, and we recognise that most of the water supply problems that we face, particularly in the south-east, are mainly the result of below average winter rainfall.
Labour is determined to see significant improvements in the way the water industry serves local people, contributes to its communities and looks after the environment.
Nine years on, that looks like another failed ambition. Many people are bemused and angered by the fact that in Britain in the 21st century they face restrictions on their water use and the threat of standpipes.
Does the Minister agree that the task of urging people to use water wisely is not helped by the fact that the water industry loses more than 3.5 billion litres of water a day in leaks? Is he completely satisfied that all water companies are addressing the pressing issue of renewing our water supply infrastructure with the sense of urgency and the use of technology that people have a right to expect? Does he accept that it is reasonable for people to ask why they should do their bit, if the water companies do not seem to be doing theirs? Is he satisfied that a sufficiently robust sanctions regime is in place to prevent and control leaks, especially given that Thames Water has missed its target for fixing leaks for five years in a row now?
Does the Minister agree with Ken Livingstone, who yesterday said that compulsory metering was inevitable? If so, over what time frame does he think that those meters should be introduced? How does he square that with the statement made before the 1997 general election that
Labour is opposed to forcing people to install water meters?
Is that still Labour policy? If not, and the Government are considering compulsory water metering, what measures is he considering to ensure that poorer families and vulnerable groups are not penalised by a compulsory metering regime?
What is the Governments policy on the construction of new reservoirs in the south-east? Is it not the height of folly, and seriously irresponsible, for the Government to press ahead with plans for millions of new homes in the south-east, an area already suffering from water stress, without having first put in place the infrastructure to support them? We all accept the need for more affordable housing, but nobodyleast of all the people who would move into the new homeswould thank the Government if they were subjected to regular restrictions on their water use. Will the Government therefore support the Bill introduced yesterday by my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), which would require an assessment of the adequacy of water supplies to be made before the construction of new homes or commercial developments?
What plans do the Government have in place to ensure that supply matches demand, if we have another dry winter next year? Do the Government have any plans in that regard? What action do the Government have in mind to support those businesses that are likely to suffer from the consequences of drought orders? What assessment has the Minister made of the number of businesses that may face closure as a result of the restrictions he has sanctioned? What discussions has he had with major sporting venues, such as Wimbledon, Lords, race courses and golf courses about the likely impact on them of the imposition of drought orders?
We do not blame the Government for the weather, but we and the public will certainly hold them to account if they fail to take all action necessary to avert the worst effects of water shortage this year and in the future.
Ian Pearson: I thank the hon. Gentleman for his words of welcome. I do indeed follow an illustrious predecessor in Denis Howell, who was the Member of Parliament for Small Heath. I am also responsible for floods, and if I am as successful in encouraging rainfall as he was, I will be delighted.
I welcome the realism shown by the hon. Member for East Surrey (Mr. Ainsworth). The situation is principally the result of below average rainfall for 19 months, so groundwater levels are very low. Although reservoir levels in the south-east are not that bad, more than70 per cent. of the areas water comes from groundwater, and the Environment Agencys recent report shows those levels to be very low.
The Government recognise that there are too many leaks and we also believe that some water companies need to up their game. However, Sutton and East Surrey Water has met its leakage targets and the headline figures for 2004-05 show a reduction in leakage rates from 2003-04. All but three water companies met their leakage targets.
I note what the hon. Gentleman said about compulsory metering, which is not Government policy but which clearly has environmental benefits. The evidence suggests that it reduces domestic consumption by about 10 per cent., so it is worth serious consideration. All of us have to do our bit, water companies and consumers in the south-east alike. We need to think about the simple things, such as ensuring that the tap is turned off when we brush out teeth and that washing machines are fully loaded. Collectively, simple measures like that can have a major effect.
The hon. Gentleman asked about new reservoirs. He will know that five new reservoirs are planned for the south-east, and that three others in the area are to be expanded. The regions particular geography means that, traditionally, it has relied on groundwater far more than other parts of the UK. Reservoirs can be part of the solution in the south-east, but they will never be the whole solution and especially not in the short term, as of course the normal planning procedures apply. That is why we have drought orders.
The hon. Gentleman raised an important point to do with new housing developments in the south-east, and I shall explain how the system works. Water companies produce 25-year water resource plans that take account of future housing need, where that is clearly defined, and I am informed that the plans currently take account of 900,000 extra houses in the south-east. The regulator has to agree investment plans with the individual companies, based on the water resource forecasts. Those investment plans have been agreed up to 2010, but the next review of water prices and investment plans begins in 2009 and will take account of all housing development planned up to that year.
Lastly, the hon. Gentleman asked various questions about the impact on businesses and sporting venues. I emphasise that so far we have granted one drought order, and we expect the company concerned to implement it proportionately and sensitively. We do not know how long the present situation will last, but it is in everyones interest to take action now. If there is a message to people in the south-east, it is that they should use water wisely in the current circumstances.
Paddy Tipping (Sherwood) (Lab): This year, water and sewerage charges are up 5.5 per cent on last year. The Minister was reluctant to name poor performers, but will he have discussions with Ofwat about the
performance of Thames Water, and of Severn Trent Water, the company that serves his constituency? Will he ensure that customers, who are paying substantially more this year, get a decent and improved service?
Ian Pearson: I shall certainly meet the regulator regularly, as it is important to ensure that customers get a fair a deal. That is what Ofwat is about. The fact that Thames Water has consistently missed its leakage targets for a long time is a serious problem that I intend to discuss with the company and the regulator.
Chris Huhne (Eastleigh) (LD): As the hon. Member for East Surrey (Mr. Ainsworth) has already said, this is a weather issue so the Opposition would be ill-advised to hold the Government solely account for that. As the Minister said, there have been many monthshe said 19; my information was 17of below average rainfall in the south-east. Has he reached an assessment of whether that involves a change in the trend or is it in the normal run of weather events? The Department is responsible for assessing the impact of climate change, so in the light of possible climate change and of what appears to be a recurring pattern of extremely dry summers in the south-east, is it time to reassess the five extra reservoirs already planned for the area?
The hon. Member for East Surrey quoted from the Labour manifesto of 1997. Is the Minister happy that Ofwat has required adequate investment? In some companies, for example Southern Water, leakage is still running at 27 per cent. after nine years. That is unacceptable and requires rather greater urgency from the Government and the companies than seems so far to have been exhibited.
As many as 20 years ago plans for a national water grid were mooted. Are they being reconsidered in the context of current drought orders, hosepipe bans and water shortages? We know that water metering has a clear impact in reducing use. Not only has Ken Livingstone backed water metering, as the hon. Member for East Surrey mentioned, but a possibly even more authoritative body, the Consumer Council for Water, has backed compulsory metering in affected parts of the south-east. Will the Government consider, not a general plan for metering, but at least a plan for metering in affected areas?
The Minister mentioned the Governments commitment to extra house building in the south-east: 580,000 houses over the next 20 years. Is not it time to recognise that the infrastructural needs of that housing have not been put in place ahead of the new build? We have had new build and we are still suffering not merely water shortages but considerable problems with drainage and sewerage, which are another aspect of the water companies responsibilities. Will the Minister tell us whether the Department will seriously consider putting a block on development in the most affected areas until it is clear that the infrastructure is in place? Finally, does the Minister agree with the Mayor of Londons turning down a planning request for a desalination plant that would ease some of the difficulties in the area?
Ian Pearson: On climate change, I am informed by experts that droughts tend to go in cycles, but I do not think anybody knows what the full impact of climate
change is likely to be on our environment and whether we are likely to see more sudden occurrences of drought or floods. We need to keep the situation under close review.
In the planning framework, water resource plans are based on looking at the worst drought scenario in 1993-94 and assuming that, with hosepipe and non-essential usage bans, a months supply would be left. That equates to a one in a hundred years occurrence. Unfortunately, it seems that there is a prospect of such an occurrence this summer. We all hope that that will not be the case but we cannot guarantee it.
I have already answered the questions about leakage and metering, but I emphasise that more can be done about leakages. There is an economic leakage rate, but it is important that we set leakage targets and that they are met by water companies. Where they are not met we want to know why and, ultimately, the regulator will use the powers at his discretion.
There has been an increase in metering, which covers about 27 per cent. of the total household population. It has been rising in recent years and I expect that trend to continue, but we should not force meters on peoplecertainly not unless there is a water scarcity. There are clear environmental benefits from introducing water metering, and we as a Government need to look at how those benefits can be realised.
I have already commented on the infrastructure needs of housing development in the south-east. I believe that that is being taken into account in the 25-year planning process, but I will undertake to look into that again, just to ensure that I am personally assured that those plans adequately reflect new-build commitments. It is important we are joined up as a Government, and I will endeavour to ensure that that happens.
Lastly, the idea of a national water grid has been bandied around for at least 40 years. It is not a very environmentally friendly measure, given that water is a pretty bulky supply and the energy requirements needed to pump water around parts of the country, let alone the excavation costs that would be required, make its use prohibitive and a non-starter, but the idea resurfaces from time to time. I do not get any sense that water companies are planning on that basis, but they have done some significant work over the past 10 years to improve regional grids, so that they can co-operate and share scarce water resources, which has been very beneficial.
Mr. Michael Howard (Folkestone and Hythe) (Con): My constituency is not only subject to a hosepipe ban but is in the process of being subjected to compulsory water metering, so why will the Minister not recognise the facts and accept that the Labour party has now abandoned the pledge in respect of compulsory water metering that it gave prior to the 1997 election? Does he agree that more needs to be done to help those who are least well off to meet their water charges, particularly under a metering regime, both by introducing additional measures and by giving greater publicity to the water efficiency measures that are already in place?
Ian Pearson: I am certainly very aware of the fact that there is compulsory metering in the right hon. and learned Gentlemans constituency, because of the water
scarcity there. Certainly, the water company believes that that is a win-win situation for the consumer: less water will be used overall, because people will be more careful in monitoring their water usage, and that will reduce customers bills in turn as well. That is one way in which water can be more affordable, but a range of Government support measures are available at the moment, and we certainly want to ensure that he encourages his constituents to take advantage of them.
Dr. Phyllis Starkey (Milton Keynes, South-West) (Lab): Could the Minister confirm that new house building accounts for only 1 per cent. of the housing stock and that, although we need to ensure that new houses are water efficient, it is much more effective to concentrate on the existing housing stock and to encourage its increased water efficiency? Will he look again at measures to encourage people to upgrade the water efficiency of their houses? Does he agree that it is perfectly possible to meet housing need in the south-east and still respect the need to improve water efficiency?
Ian Pearson: My hon. Friend makes a very good point. It is absolutely right to say that the vast majority of the housing stock for 2030 is already in place in the United Kingdom and that new-build plans account for only a tiny fraction of the potential additional water usage in the future. We need to focus on water efficiency in households, just as we need to focus more on energy efficiency. There is a range of ways in which consumers can use water more wiselyfor example, with dual-flush toilets. The simple fact is that new house development will be far more water and energy- efficient than the current housing stock. The more that we can do to bring the current housing stock up to the best environmental standards for both health and water efficiency reasons, the better for all concerned.
Mr. Andrew Mackay (Bracknell) (Con): Even so, does the Minister accept that my constituents will find it inconceivable that the water companies can cope with the huge number of extra houses being foisted on the south-east when they cannot cope at all with the current drought? No one will believe him.
Ian Pearson: In that case, I hope that the right hon. Gentleman can explain the situation better to his constituents, because there is a clear difference between a short-term drought and the long-term planning of water resources. We need to ensure that that long-term planning is effective and takes account of new housing development, but we also need to consider water saving measures as well and to use water wisely. His constituents need to use water wisely, but they need not be afraid that new housing development will cause them massive water problems in the future, because I am confident that the planning system can fully take into account future housing needs.
Reports suggest that leakages in Britain are among the worst in Europe, and perhaps only two countries, one of which is Bulgaria, have a worse record. Is that
not simply a consequence of a failure to invest by the water industry over a long period? Is it not a direct consequence of the Tories privatisation of the water sector? Have not the private companies been simply sweatingI use that word advisedlythe assets built up over generations of public investment before they were privatised? Is it not time that the state again took a direct role in water supply, to guarantee sufficient and secure water provision for the future?
Ian Pearson: My hon. Friend and I must agree to disagree on some of that, but we do agree that there have been decades of under-investment in the water industry, stemming back way before privatisation, because the public sector was not that good at investing in long-term infrastructure in the water industry. One of the problems with the public sector is that there are always more pressing investment needswhether schools or hospitalsthan long-term improvements to sewerage pipes and the water supply. The simple fact is that, since privatisation, there has been £55 billion-worth of investment, primarily funded by the water companies, which has led to a major improvement. Most of the water companies have made significant reductions in leakage rates. More can be done, but we must still face the fact that we were one of the first countries in the world to introduce water and sewerage systems, so our system is older than anyone elses and it is still in need of repair and further investment, which will come from the water companies as part of their future investment plans.
Mrs. Jacqui Lait (Beckenham) (Con): Could the Minister confirm that he said that, if the current weather pattern continues, London and the south-east face standpipes in 100 days? In those circumstances, can he tell us what discussions he is already having with the water companies about ensuring that the vulnerable have access to water and that those people who live in the 24-hour economy can get water from standpipes whenever they need it?