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Baroness Hamwee: My Lords, I congratulate the noble Baroness on her steadfastness in pursuing the point at every stage of the Bill. I said at the last stage that she had a point. Since then I have received copies of the correspondence from the Minister for which I am grateful. I regret that, while acknowledging that the noble Baroness has reined back her ambitions on the clause, I understand rather better than I did when listening to the debate why the Government are concerned about the amendment. The Minister will explain it himself.

During the course of the Bill I have had to accept the Government's position on switching between the two types of charging for water. We have had discussions about the position on switching or otherwise between measured and unmeasured charges when a property changes hands. I do not believe that the situation is substantially different.

I will not detain the House, but I understand the arguments that have been made throughout the Bill, some by myself, about the need for stability within the industry for the long-term protection of consumers generally. I look forward to hearing the Minister, but it is only fair to warn the noble Baroness that I am rather inclined to understand the Government's arguments through the correspondence. I congratulate the noble Baroness on her tenacity. She will go down as a hero, if she goes down.

Lord Elton: My Lords, before the noble Baroness sits down, will she share with us anything in the correspondence that effected the change in her mind, or will she rely on the Minister to reveal it and thus save time?

Baroness Hamwee: My Lords, I have checked with the Minister that the points made in the letter will be part of his reply.

Lord Elliott of Morpeth: My Lords, perhaps I may intervene as a past chairman of a water company. I am extremely interested in Clause 6 in that it addresses the difficult relationship between landlord and tenant.

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I wholly agree with my noble friend and with the amendment she put forward today. I believe it will strengthen Clause 6 and the whole Bill if it is accepted.

3.45 p.m.

The Parliamentary Under-Secretary of State, Department of the Environment, Transport and the Regions (Lord Whitty): My Lords, I join in the recognition that the noble Baroness has pursued her case effectively throughout the Bill and has stuck to her guns. I should also record my appreciation of our meeting because it was not only my noble friend and myself who had the GLA Bill following our meeting yesterday. I appreciated the way in which we discussed this matter and corresponded on it. As the noble Baroness, Lady Hamwee, said, the noble Baroness, Lady Miller, has taken on board some of my objections to her previous clause at the earlier stage by restricting the scope of the amendment before us. Nevertheless, the clause as it stands cuts across the central principles of the Bill and I shall take a little of your Lordships' time to explain what I mean by that.

The Bill is about consumers; it gives rights to all consumers. It also attempts to treat all consumers in the same way. That means that landlords who are consumers who pay the bill will gain substantially from the Bill. It also means that compared with the current situation, no landlord will lose rights. Those are the principles. There are also some practical and technical matters which the House should know about before considering pursuing the amendment.

The principle underlying the Bill is to increase the choice for all consumers. By "consumers" we mean the normal meaning of the word and the legal meaning in water legislation. It is the person who pays the bill, irrespective of tenure and irrespective of the way in which they are charged for their water. All have an equal choice on the form of charging in the initial stages and all have an equal right of reversion for 12 months after having had a meter installed, if that is their choice.

The noble Baroness argued that the Bill would give tenants the ability to grant property rights extending beyond the terms of their lease. That is not the case. The Bill does not take away any rights that landlords currently enjoy in relation to water charging. Under current legislation, landlords do not have any right to choose the basis on which they are charged for their water. The present situation is that if a water company wished to impose a meter on a property the landlord, whether or not returning to occupy the property and whether or not covered by the amendment, would have no right to prevent this, regardless of his own wishes, actions or specific provisions he may have made in the lease with his or her tenants.

The arrangements currently in that sense, therefore, already override the landlord-tenant leasing arrangement. All we are doing is to transfer that right from the water company to the consumer, the person who pays the bill. The Bill, therefore, does not in any sense reduce landlords' rights over their property.

We are not dealing with property rights. Rights to determine the basis of water charging are being taken away from the water company, not the landlord. In some

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cases, the consumer who will benefit will be the landlord; in other cases it will be the tenants. Those who are consumers and pay the bill gain substantial rights over the current situation.

What is more, the noble Baroness's amendments undermine the important principle that increased choice should apply equally to all consumers. Landlords who fulfil the criterion in her amendment--which I agree is a relatively narrow one--would have full reversion rights not once but for five years as compared with every other form of tenure which is only 12 months. They would have the rights not just once but theoretically at least after each tenant who opts to pay on a measured basis. Those premises and the occupants would thus be in an entirely different and privileged position in relation to all other consumers--tenants, owner-occupiers, other landlords or new landlords or new tenants of the same premises. There would even be differential treatment between different kinds of property and different kinds of landlords since those rights could not apply to public sector landlords or social rented housing or housing which was rented out by property companies. There the landlord could not occupy the property as his principal place of residence.

I accept that the noble Baroness's amendments are more specifically targeted than those we debated at earlier stages of the Bill. There are therefore a significantly smaller number of cases which might be caught by her amendments. Nevertheless, that narrowing raises a number of technical and practical issues which noble Lords should bear in mind when considering the amendment.

First, the amendment introduces a real prospect of indefinite switching between measured and unmeasured charges for a significant number of customers. If that were pursued, it would undermine the stability of the water company's charging regime and those charges would have to be passed on to other customers.

Secondly, to trigger reversion to an unmeasured charge the landlord would need only to state his intent to re-occupy the property as a principal place of residence. How would a water company go about proving that that was the case? It would also need to be clear to the water company that the landlord had evidently and provably not agreed to the installation of the meter in the first place.

In addition to these concerns about how the clause would be interpreted, there are a number of technical defects in the amendment in a legalistic sense. These amendments could not be accepted in their current form, even if we put aside our considerable policy concerns. For example, Amendment No. 1 does not define "lessor". It would appear to grant rights of reversion not just to the direct landlord but to any tenant who sublet a property. Perhaps more importantly, the amendments would significantly change the meaning of "consumer". The word "consumer" has been well established in water legislation at least since the Water Act 1989. They would also change the general proposition that rights and duties attach to the person who pays the bill.

Of course, landlords who are concerned about the possibility of this effect have a relatively easy answer. If this is their main concern they can decide themselves to

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become consumers before they let out a short lease. If the issue of water metering is of sufficient importance to the landlord, all he needs to do is to take on responsibility for paying the bill and, presumably, therefore to include a sum to cover the water charge in the tenant's rent. In those circumstances, no rights accrue to the tenant unless he is the consumer. Landlords are already aware of this. I have had drawn to my attention a copy of a newsletter from the Small Landlords Association which draws attention to this option.

The noble Baroness has argued that this is not a sufficient answer to her point of principle, but I believe that there is a bigger point of principle here. We are concerned about consumer protection, equality of access to choice and equality of treatment for consumers across all housing tenures. Having said all that, the fear of the noble Baroness that we are taking rights away from landlords does not stand up. At the moment, the tenant-landlord arrangement can be overridden by the water company. All we are doing is transferring that to the consumer. Therefore, the position of the landlord does not materially change.

We believe that the policy package that we are implementing through this Bill introduces a major element of increased choice. It may not be as great a choice as the noble Baroness, Lady Hamwee, wants, but it is nevertheless very significant and one that is given equally to all consumers as that word is normally understood. It neither favours nor disadvantages groups of consumers relative to each other. The amendment tabled by the noble Baroness would undermine those important principles and also introduce a new level of complexity which in practice would be extremely difficult to enforce.

By this Bill we have no intention of making life more difficult for landlords. A very large swathe of landlords will benefit considerably from the additional rights and choices that we give them. But I do not believe that the elaborate provisions in this amendment, even given the relatively small number of people to whom it might in practice apply as compared with amendments moved at an earlier stage, justify altering the central principles of this Bill: choice, equality and equal treatment between all forms of tenure. I urge the House to reject this amendment if the noble Baroness is not at this stage convinced of my arguments.

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