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Lord Lucas of Chilworth: I am grateful for my noble friend's response to Amendment No. 209. In drafting the amendment I have not taken into account subsection (10) to which he referred. Since the advice which my noble friend gave to the Committee in response to me is somewhat to the contrary to that which I have, I should like to give further consideration to what has been said. At this stage, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 209A not moved.]

Clause 36 agreed to.

Clause 37 [General duty of the new Agencies to have regard to costs and benefits in exercising powers]:

Viscount Mills moved Amendment No. 210:

Page 31, line 32, after ("shall") insert ("subject to subsection 2(b) below or").

The noble Viscount said: In moving this amendment I shall speak also to Amendments Nos. 212 and 213. I shall take first Amendments Nos. 210 and 212 which deal with costs and benefits not being applicable to enforcement issues.

The purpose of the amendments is to ensure that decisions to enforce and in particular to prosecute under environmental legislation are not thwarted by reason of cost benefit. Without the amendments potential defendants could challenge any decision taken to prosecute on the basis that the prosecution was not the most cost-effective solution.

The costs of taking enforcement action should not be the primary factor used to decide whether to enforce the law and to protect the environment. If costs become paramount, we may reach a situation in which many cases are taken against those who cannot afford to challenge the environmental regulators but fewer cases are taken against industry and large businesses which are able to afford lengthy and expensive legal cases. Will the Minister give me a clear assurance that the agencies' discretion in those matters permits the exclusion of enforcement decisions from cost benefits?

The purpose of Amendment No. 213 is to provide the agency with an essential additional power to obtain information from a third party. That information is needed to comply with the new duty relating to costs and benefits in Clause 37. If the agency is to fulfil that new duty, it must have the necessary powers including the power to obtain the information necessary to make the decisions in the first place.

Any lack of information may inhibit or even prevent the accurate assessment of costs and benefits as directed by government. I received recently a parliamentary brief from the CBI, as I am sure did many Members of the Committee. That brief advised opposition to the amendment on two grounds. The first ground was that the necessary information is already accessible. I wonder how the CBI knows that all the information that

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may be needed for those purposes is accessible. At this point in time, I do not believe that anyone can know that.

The CBI is concerned also that if the amendment is accepted and the regulators' powers extended, that would introduce both unnecessary bureaucracy and complexity of decision making. Again, I ask why that is so. It is in the agencies' own interests to avoid bureaucracy and complex decision making. After all, what is the advantage of the agency doing that?

Further down the same page, the CBI brief states:

    "Business expects that on strategic issues the Agencies should carry out a rigorous appraisal of costs and benefits".

I quite agree with that. On major strategic matters, the agencies may be asked quite rightly to justify their decisions in relation to costs and benefits. But in order to do so, they must first have access to the information on which they need to base their decisions. I believe that the amendment is necessary and I hope it is accepted as such by the Minister. I beg to move.

Lord Jenkin of Roding: I apologise for not having attended the Committee earlier but I have been attending a Select Committee which was considering sustainable development.

I am rather concerned about the first two amendments dealt with by my noble friend Lord Mills; that is, Amendments Nos. 210 and 212. It may be that my noble friend moves the amendment in order to probe the Minister in relation to the questions that he asks. But if the amendments were accepted, it seems to me that the new agencies could be relieved largely of their subsection (1) duty in exercising the general run of their powers. I find it difficult to believe that that is what my noble friend intends.

Among those powers are consenting to discharges to controlled waters, especially those from sewage treatment works, and the licensing of the abstraction and impounding of water. It seems to me that it is rather extreme to have a blanket relief of those powers because those are the very areas in which the quality regulators' requirements might impose on water or sewerage undertakings significant costs without any requirement to justify them as economically efficient.

It is true that those decisions are subject to appeal to the Secretary of State. But that is no substitute for the duty which Clause 37 is intended to impose on the agencies. It may be that my noble friend on the Front Bench will be able to relieve my anxieties and make it clear that the amendments are unacceptable. It may be that my noble friend Lord Mills had not appreciated their impact on what is a rather important core function. However, I hope that when the Committee considers the arguments, it will not succumb to the blandishments of my noble friend Lord Mills.

Lord Elton: My noble friend has made a very powerful point, which I shall not repeat. I agree with him. It seems absurd to have an agency and then make the performance of its powers purely voluntary.

But I am puzzled by the use of the language in the amendment. One does not enforce powers; one enforces requirements. A power is used to enforce regulations

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and so on. Therefore, I should like to know more precisely what is intended and how it is proposed that it will work. Which of the functions which we are expecting the agency to carry out will it be at liberty not to do? Some are duties and some are powers. I do not wish to go through the Bill picking them out, but I hope that those drafting the amendment have done so.

Lord Carmichael of Kelvingrove: Amendment No. 211, which stands in my name, is also in this group of amendments. The purpose of the amendment is to restate what the Bill is all about—the environmental and human effects of the Bill. I can see that in some circumstances, it may leave the SEPA open to incurring very high charges but I am sure that common sense will overcome that. The decisions as to necessary work by the SEPA should be made on environmental and cost grounds. There should be a marrying of them both. The agency must be conscious that its first duty is to the environment, but it must use its money in the best possible way to look after the environmental and human factors involved. I believe that my amendment creates the right balance.

Lord Wade of Chorlton: I hope that my noble friend will strongly resist any of the amendments to Clause 37. As I said on Second Reading, I believe that it is a very important part of the Bill. It helps those whom it will affect to accept it and to make sure that it works in a proper and effective way.

As has emerged clearly from a number of debates on amendments in that regard, environmental measures now affect the lives of us all and they affect business. If that is so, we must remember that the environment is not the only matter which business must take into account. Business is also about wealth creation and achieving what is possible in society to benefit a whole range of people. If we expect—and it is quite right that we should—that everything is done in a proper and effective environmental way, similarly, we must impose the regulations in such a way that they do not put undue costs and restrictions on the ability of business to create wealth and employ people and also add to the other responsibilities with which those concerned have to deal.

In my view it is extremely important—and I know that I have the support of all the major organisations in this respect—that Clause 37 should stay on the face of the Bill unchanged. Like my noble friend Lord Jenkin, I hope that my noble friend the Minister will ensure that that happens.

5.30 p.m.

The Earl of Lytton: I rise to speak briefly to Amendment No. 211A which is tabled in my name. I should explain that the intention behind the amendment is, it is to be hoped, to tease out from the Minister a comment that he made on Second Reading; namely, that third party costs and environmental benefits would be taken into account.

The purpose of the amendment is merely to probe. We are not just talking about the costs and benefits of the agency itself; we are talking about the economic costs and benefits to the agency, to third parties and to

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the environment. I should be most grateful if the Minister could confirm that that is indeed what is intended. While noting the comments made by the noble Lord, Lord Wade, I hope that my proposal will also be in line with his intentions.

Lord Moran: I should perhaps say a few words about Amendment No. 214 which is also included in the grouping and tabled in my name. One of the crucial tests by which the new agencies will be judged is whether they deliver effective enforcement of environmental regulations and rigorous and effective prosecution policies for those committing offences. In that, the NRA has, I believe, been notably successful.

One of my main concerns about Clause 37 as it stands is that the agencies should not always be looking over their shoulder wondering whether they can enforce proper environmental regulations or prosecute environmental offences, or, indeed, whether their assessment of costs and benefits has gone far enough to allow such proper enforcement.

We do not want the new agencies to be inhibited in carrying out their proper enforcement duties. Ideas of costs and benefits are, I believe, already a proper general consideration in deciding whether to bring prosecutions, as set out in the guidelines of the Attorney-General. However, that is expressed in a very general way. We need to be very clear that the clause does not stand in the way of effective enforcement. I hope that the Minister will be able to reassure me on that point.

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