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Lord Boyd-Carpenter: My Lords, I thank my noble friend for that kindly personal reminiscence, but will he follow my example and repent of a great many of his decisions?

Lord Mackay of Ardbrecknish: My Lords, I have no intention of repenting of any of my decisions, and I do not think that it is my place to repent on behalf of any of my noble friends.

Lord Eatwell: My Lords, does the Minister agree that with the introduction of self-assessment in the income tax system, it is highly desirable that the disinterested advice of Inland Revenue officers should be readily and easily available? In the light of those changes, are not the proposed locations of the tax offices highly inefficient and most undesirable?

Lord Mackay of Ardbrecknish: My Lords, I am most surprised that the noble Lord seems to be taking the view that governments should not disperse jobs to those areas of the country where they are most needed.

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Perhaps I may advise him that, by using modern information technology methods of communication and so forth, the tax inquiry centres which I mentioned earlier are well able to deal with people making personal inquiries. Indeed, many of them are directly linked by computer to the place where an individual's tax affairs are handled, which means that the taxpayer's records can be called up on screen so that the taxpayer can be given advice. I should have thought that that was perfectly sensible.

Lord Bruce of Donington: My Lords, is the noble Lord aware that the views expressed by his noble friend Lord Boyd-Carpenter are widely shared among Inland Revenue staff, and that the Inland Revenue has always made it clear that personal contact and negotiation between its staff and taxpayers frequently make inquiries much shorter and produce much more satisfactory results than does protracted correspondence?

Lord Mackay of Ardbrecknish: My Lords, I think that I have made the point that the tax inquiry centres enable people to have direct contact if they want it, but I suspect that the majority of people conduct most of their tax business by correspondence. I repeat that I think that the dispersion of jobs from London and the south east has been a sensible government policy. I am surprised to have two critics of that policy from the Labour Party. I do not think that living and working in Glasgow or Cardiff is too much of an encumbrance for those concerned, given that conditions are perhaps less crowded than here in London.

Lord Gisborough: My Lords, does my noble friend accept that it is extremely important for towns in the north, such as Glasgow, Leeds and Middlesbrough, that the policy of the dispersion of government departments should continue, and that that policy should not be changed?

Lord Mackay of Ardbrecknish: My Lords, I am grateful for my noble friend's support. As he rightly mentioned, areas such as Middlesbrough and Sunderland in the north gain from the jobs being dispersed. Indeed, there has been a similar gain with the announcement this morning of Toyota's development of 1,000 new jobs in Derbyshire.

Lord Eatwell: My Lords, is the Minister aware that the Question has nothing to do with the dispersion of offices and that the majority of taxpayers in this country live outside London? The Question relates to whether taxpayers can readily gain advice. Given that the Government are introducing self-assessment, would it not be more consistent if the Government provided that advice in the localities where taxpayers live, whether in London or elsewhere?

Lord Mackay of Ardbrecknish: My Lords, the logic of that position is that we take jobs away from those areas to which they have been relocated over many years and return them to London and the south east—

Noble Lords: No!

Lord Mackay of Ardbrecknish: Yes, that is the logic of the position. If the noble Lord does not like it,

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he had better think out the logic of the question that he has asked. As I have said, there are tax inquiry centres throughout the country. For my own part, my tax affairs are dealt with by the taxman in Cardiff—and I have no complaints at all about that.

Viscount Mountgarret: My Lords, is my noble friend aware—from the remarks that he made earlier, it is obvious that he is not—that although a great many people may wish to deal with their tax affairs by letter, an enormous number of people cannot or do not want to do so? It is most important to give those people the facility to attend a local tax office.

Lord Mackay of Ardbrecknish: My Lords, I have already explained to the House—and I do so again to my noble friend—that there is a national network of tax inquiry centres, many of which have computer facilities which allow staff to call up on screen the individual tax records of those who attend the centre, thus enabling them to discuss the matter with the full records before them.

Water Debt

3.25 p.m.

Lord Williams of Elvel asked Her Majesty's Government:

    Whether they agree with the conclusions of the report by the Policy Studies Institute entitled Water Debt and Disconnection and published on 14th March, that the number of households in water debt has gone up by nine times since the industry was privatised in 1989, and what proposals they have to mitigate the effect on low income households.

Viscount Ullswater: My Lords, PSI questioned fewer than 2,000 households in the whole of Great Britain. Despite the perception of increased water debt in England and Wales since 1989, the real issue is how those who have difficulty in meeting their charges are treated. Disconnections are falling, and water companies have put into effect procedures to provide the earliest possible assistance to customers through the availability of optional instalment arrangements and budget plans.

Lord Williams of Elvel: My Lords, I thank the Minister for his Answer. Can he tell me whether he agrees, as the Question asks, with the PSI conclusion? He did not answer the Question.

Viscount Ullswater: My Lords, I indicated in my Answer that PSI had questioned fewer than 2,000 households. The problem is that in arriving at its estimate of 2 million households in arrears in 1994, PSI asked people:

    "over the past 12 months, have you been behind with your payments or owed money for your water?"

They were considered to have difficulties if they answered yes.

Lord Williams of Elvel: My Lords, I still cannot get an answer from the Government. Do they or do they not agree? Will the noble Viscount please answer that question yes or no? If they do agree, will they accept

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that the people who cannot pay and who find difficulty in paying come from lower income households and that disconnection is normally the answer? That is simply another example of how this Government ignore the poor in favour of the rich.

Viscount Ullswater: My Lords, I tried to indicate why the Government do not believe that PSI is giving a true perspective on the matter. In answer to the second part of the noble Lord's question, the legislation provides that in virtually all cases a water company must obtain a court order for the repayment of arrears before disconnection can be undertaken. The Government believe that that offers the best protection to customers to ensure that only those who can pay, but will not, face the prospect of disconnection.

Lord Hailsham of Saint Marylebone: My Lords, is it not correct (in my noble friend's opinion) that whenever we hear that a question demands to be answered yes or no, in at least 90 per cent. of the cases the question is unfair?

Viscount Ullswater: My Lords, sometimes my noble and learned friend is right, but on some occasions he may be wrong.

Baroness Fisher of Rednal: My Lords, does the Minister accept that I think it unfair to cut off the water supply of many of our deprived families, as can happen before a case is brought to court? Is it right and proper that people in that category should be brought before the courts and fined for being unable to pay their water bills, and then be subject to a prison sentence because they cannot pay their fine?

Viscount Ullswater: My Lords, I would start from the other side. I believe that it is right to expect bills to be paid and to take action against those who can pay but will not. The same report indicated that 66 per cent. of those who were disconnected were connected again, having paid, within 48 hours.

Lord Pearson of Rannoch: My Lords, can my noble friend say how much the price of water has increased thanks to the £9,000 million which we have spent, or are committed to spend, on two European water directives—the urban waste water treatment directive and the bathing water directive—much of which, in the opinion of Ofwat, was unnecessary and may therefore have been wasted? Will Her Majesty's Government do all that they can therefore to resist the proposed new drinking water directive and the proposed new bathing water directive which are likely to cost very much more?

Viscount Ullswater: My Lords, I cannot agree with my noble friend that all those directives are not required. We need higher environmental standards in this country. The new price limits allow for an enormous sum of capital expenditure, something which was not done when water distribution was in the public sector. The level of investment since privatisation has been far

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higher, and the director general has allowed expenditure of some £6 billion to implement the urban waste water treatment directive.

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