Ian
Pearson: My hon. Friend is exactly right about the
holistic nature of the water framework directive and the importance of
the river basin management planning process. The daughter
directiveas it is often calledon the priority list
proposal fits within the overall architecture of the water framework
directive. It will be possible to reach a political decision on the
issue at the Environment Council meeting on Thursday. The matter will
be subject to qualified majority voting, and all the indications that I
have had from the officials who have been doing the negotiations are
that a qualified majority exists, with or without the UKs
participation. To
support my hon. Friends point, let me stress again that the
costs in the original draft impact assessment, which looked pretty
scary, are coming down significantly, I think. We will determine
exactly what the final costs of implementing the directive will be by
exercising a judgment about proportionality. At the moment, some of the
costs are unknown. As yet, we have not fully decided what might
constitute proportionate costs and we have not reached agreement across
Europe about how the water framework directive will be
implemented.
Mr.
Paice: If we have time, I will return to the drinking
water directive, but I am grateful for the Ministers response.
In his previous answer, he referred to diffuse pollution, which is the
area that I want to address. Much of the paper refers to end-of-pipe
activities, which I assume means, for example,
discharge from sewage works, although I have not been able to find a
definition. However, a lot of the potential pollution will be diffuse
pollution from farmlandpesticides are referred toor
pollution from other sources such as air contamination. In those cases,
how will anyone be able to establish the source, take action to remedy
the breach, and determine costs? In end-of-pipe cases, it is quite
clear who is polluting a watercourse or surface water, but that is not
the case with diffuse pollution. What consideration have the Government
given to
that?
Ian
Pearson: The hon. Gentleman makes a good general point on
diffuse pollution and on the difficulty of identifying sources. The
Government believe in the polluter pays principle, but
sometimes it is very difficult to identify the
polluter. On
end-of-pipe solutions, we are talking really about point-source
pollution, which might come from sewage treatment works if they fail to
meet environmental quality standards, or from industry discharges.
There is now flexibility in the overall proposals that was not there at
the start. Background pollution levels can now be taken into account,
which was not the case at the start of discussions.
Identifying point-source
pollution remains challenging, but we shall need to address it as part
of broader consideration of the water framework directive. We want our
water bodies to attain good ecological status. Achieving that will
require upstream solutions as well as end-of-pipe solutions, and proper
and effective measurement
systems.
Chris
Huhne: May I follow up on a slightly different aspect of
the question that was asked by the hon. Member for South-East
Cambridgeshire? The advent of climate change is causing substantial
variations in water flows in many of our watercourses, and the
discharge that is allowed in one year might not be appropriate for
another. I think particularly of the chalk stream of the Itchen, which
runs through my constituency. Last year, after several years of drought
conditions, there were serious issues about discharges from some of the
waste water plants into the river; with greater flows, such discharges
are easier to handle. What assurance can the Minister give that that
concern is reflected in the directiveboth from an environmental
point of view and also, of course, from a cost point of
view?
Ian
Pearson: That is a very good point. It is one reason why,
in discussions on the directive, it was not regarded as a good idea to
set overall maximum levels for application right across
Europe. I draw two
distinctions in relation to the hon. Gentlemans remarks. The
precautionary approach that is being taken in the directive should
ensure that there is absolutely no risk to human health or to the
environment and should enable progress toward good ecological status
where that does not already exist. The
Environment Agency also applies different consenting regimes for
discharges to the environment. For instance, at times of low water
flows, the consenting regimes are changed by way of an agreement with
the relevant company to reflect the different environmental
circumstances. That issue is already dealt with under the existing
legislative framework.
Mr.
Paice: I am grateful to the Minister for saying earlier
that, in part, there will be a significant reduction in the potential
cost because he does not believe that the use of carbon granules and
things like that will be necessary. I hope that he is
right. What assessment have the Government made of the other costs and
the impact of the measures that are necessary to meet the new
standardsfor example, higher carbon emissions resulting from
massive increases in the energy consumption of treatment works? Aside
from the carbon granule issue, increased energy consumption and carbon
emissions raise the old problem of helping the environment in one way
and spoiling it in another.
Ian
Pearson: I recognise that point fully. The water
industrys carbon footprint is 50 per cent. greater than it was
in 1990. We have seen significant improvements in the quality of our
rivers, lakes and seas around our coasts, but it has come at a cost of
increasing CO 2 emissions. Last year, the water industry
emitted about 4.1 million tonnes of carbon dioxide,
which is a significant amount. As a result of the application of the
article 4 provisions, we will be able to take into account the wider
costs of implementing policy, which will includein my
viewthe cost of carbon in the future. The hon. Gentleman is
right that use of granular activated carbon is a very CO 2
intensive. That must be factored into any future
decisions.
Chris
Huhne: In answer to a previous question, I heard the
Minister describe the remaining processes to go through before the
directive can become EU law. He is correct to point out the possibility
of Second and Third Readings in the European Parliament and so on.
However, my experience suggests that once the Council has reached a
view by qualified majority voting, that is a significant part of the
legislative process. The Council is clearly the senior legislative body
in the two-chamber arrangement of the European Union. I return to the
question that I put to the Minister: can he give us an assurance that
the Council will not adopt a common position before receiving the
revised figures for the cost-benefit analysis and ensuring that they
are published, so that there can be a proper assessment of
proportionality? Such a position will become the bargaining position
with the European Parliament, and the basis of a significant directive.
Will he describe the way in which he could reach a proper assessment of
proportionality without those figures?
Ian
Pearson: I shall try again to explain some of the
difficulties of completing a robust and reliable impact assessment. We
are talking about hundreds of sewage treatment works, thousands of
water bodies and environmental quality standards that, in some cases,
are below the level of detection. The task is hugely complex. It is not
particularly unusual for directives to be agreed without the full
impact assessment having been completed or the full costs being
known
Ian
Pearson: It is not an entirely satisfactory situation. The
water framework directive was passed in 2000 and we are still
discussing how it will be implemented, and those decisions will affect
costs, so I cannot give the hon. Gentleman that assurance. I understand
that there is consensus among other member states that the directive is
in a sufficient state to be passed by the
Council.
Angela
Eagle: Will my hon. Friend not be seduced by the
exclamations of shock from the Liberal Democrat party, since the matter
depends on when and where proportionality tests may
be applied? We have the water framework directive and proportionality
has been there from the beginningit is part of the DNA of an
effective directive. We should conduct proportionality tests when we
can sensibly do so. We should not delay making progress on dealing with
a series of pollutants that adversely affect human health by waiting to
conduct a perfect proportionality test in advance when relevant
information cannot be found. Waiting is a way of ensuring that the UK
does not take part in the agreement that will clearly be reached at the
Environment
Council. Will the
Minister reassure me that I have interpreted the directive correctly?
The proportionality test should take place when results may be best
assessed and when there is sufficient information to enable an
assessment, which was the way things were when I was a Minister. The
proportionality test makes it possible to base an appeal on common
sense and cost when those things can properly be assessed. There is
therefore nothing to worry about, and we should stop tilting at
windmills.
Ian
Pearson: My hon. Friend is entirely right and she makes a
good point. In the future, we will be able to determine what is and is
not proportionate, but we cannot currently make such judgments in all
cases and instances. We have not yet reached the stage with the water
framework directive at which we have an action plan for implementation.
Such decisions are, in some cases, a number of years away. We will be
able to make definitive decisions on the matter only at such a time. I
agree with my hon. Friend. that the Liberal Democrat spokesman needs to
understand thatI suspect that he does, but that he is trying to
make political capital. The measure is not unusual; it is common
practice. I
re-emphasise that the costs will be significantly
lower than was assumed in the draft impact assessment. The Government
will look carefully at how we apply the article 4 provisions of the
water framework directive to ensure that we do not take
disproportionate
action.
Mr.
Paice: The fact remains that there is a tremendous
difference between tens of millions, as the Minister assumed, and the
£1 billion that he has now
dismissed.
Chris
Huhne: It was tens to hundreds of
millions.
Mr.
Paice: Yes, but the cost at the bottom end is tens of
millions. May I take
the debate a stage further to the question of who will pay the costs?
The Minister has referred
several times to the water companiesthey will not be the only
ones affected, but they will be significantly affected. May we assume
that they will be permitted to pass the costs on to their customers?
What advice will the Department give to the regulator about the
measures?
Ian
Pearson: Let me be clear: the figures of tens to hundreds
of millions are based on preliminary and new estimates. I believe that
they are on the pessimistic side and that likely future costs will be
toward the lower end of the range. I do not wish to mislead the
Committee, because some of the costs are currently genuinely
unknowable, for the reasons given by my hon. Friend the Member for
Wallasey. On who pays,
the general assumption for the water framework directive is that we
will work to determine what cost-effective measures can and should be
implemented as part of the next price review process. The intention is
that PR09periodic review 2009will include a figure in
water companies capital programmes for the implementation of
the provisions in the directive. It is not currently possible to say
what that figure will be or what will be appropriate, but it is clear
that when it comes to implementing the directive overall, there will be
costs. We need to have a long hard look at those costs and ensure that
we make measured progress towards the good ecological status that is
the requirement of the water framework
directive.
Chris
Huhne: I am a little surprised that the hon. Member for
Wallasey takes the view that she does in this matter. I hesitate to
believe that she applies that view when she goes shopping, for example,
but I think that it would be quite normal for one of her constituents
to ask the price of something before deciding whether to buy it. It is
only reasonable that we ask the Minister for his best estimate of the
price of something before we as a legislature proceed to buy it. I
understand that that is the commitment that the Government have made
and that the Prime Minister-to-be, come Wednesday, has been extremely
keen on evidence based policy making and on taking account of costs,
benefits and regulatory impact assessments.
It seems to me to be a matter
of some concern that the Minister is, as I understand it, saying that
there will be a decision made under qualified majority voting later
this week, whether we like it or not and without our having been
informed of the revised estimate of costs and benefits. Will the
Minister explain what the qualified majority is likely to be, and
whether there is any prospect of gathering a blocking minority to delay
the decision, at least, until we have the reasonable evidence on which
to
proceed?
Ian
Pearson: The hon. Gentleman is barking up the wrong
treeif not barking. When I go shopping I do not wait to
calculate my food bill for the next 20 to 25 years before I make a
decision. Implementing the water framework directive is a bit like
that. Decisions on its implementation will have to be taken before all
the costs over that lengthy period can be calculated or even reliably
estimated. I ask the hon. Gentleman to understand and accept that. He
is an economist by training and he understands how impact assessments
of the type in question are produced. He knows about what reliance is
given to certain things, and the sensitivities involved in producing
such figures. There are other points in the proposals before us today
about the directive on which we could comment more
usefully.
Mr.
Paice: The Minister referred a few minutes ago,
pre-empting a question that I am about to ask, to the fact that some of
the proposed levels are below detectable levels. That raised the
obvious question of what the point is.
Linked to that question, I want
to ask about pesticides and some other chemicals that are, according to
the schedule, approved for some uses in this country. The concern has
been expressed to me that users, whether in agriculture or in
conventional industry, who have permission to use a chemical for some
purposethe Pesticides Safety Directorate having approved it for
that purpose, with its potential for residues and water
run-offcould be in breach of the directive because of a lack of
the necessary tie-up between the current approvals and the EQSs in the
directive. That is an issue of joined-up governmentmaking sure
that in complying with one regulation, people are not in breach of
another. Can the Minister assure us that a debate is taking place with
a view to ensuring that people will not inadvertently breach the
directive?
Ian
Pearson: I can assure the hon. Gentleman that officials
are well aware of the issue. I understand that only three of the
original 10 pesticides are still licensed in the UK. Those are
obviously what he is concerned about. We need to ensure that we take
those issues fully into
account. On the point
about setting EQSs below the current level of detection, we in the UK
do not think that that makes a great deal of sense. It seems strange to
have a test if we do not know whether we have passed or failed.
However, we did not see any appetite among other member states for
moving away from over-precautionary EQSs, and the issue must be
returned to at a later
point.
Mr.
Paice: Let me take the particular example of cadmium. I
understand that some of the new EQSs for it will be up to 63 times more
stringent than current rules. That prompts the question whether
agricultural fertilisers in particular will be in breach. I was not
aware of this before, but I understand that they contain a tiny amount
of cadmium. Has the Minister or anybody else examined that matter? I
know that it has been raised with his
officials.
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