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Baroness Young of Old Scone: Perhaps I can offer some examples which might cast light on why the reduction from seven to four years is sensible. I very much take account of the needs of the agriculture industry, in particular the horticulture industry, pointed out by noble Lords. I am sure that there is no intention to get in the way of legitimate agricultural rotation, which would simply be nonsensical. However, there are other water users who apply for licences but subsequently do not use them. They may, for example, be new entrants to the water market, particularly as water competition increases. They may even be speculative water users who set off in the direction of creating a business enterprise but then discover that they cannot quite pull it off. Although they may not need their water licence at that point,

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they may, under the provision of seven-year licences, hang on to it and thereby deny other water users the ability to get at that water supply.

The catchment abstraction management process reviews all users or abstractors around a catchment area on a six-year basis. If a seven-year licence were unused for seven years, then the whole period of the catchment abstraction management plan would be working under the assumption that the licence could be used but that, effectively, water would be denied to the process of review when it could be reallocated to a user who was in need of the licence and the abstraction right.

I hope that noble Lords can be persuaded that this provision is not intended to hit the agriculture industry. Indeed, it is intended to ensure that water is available for other users, some of whom will be farmers, at the time that they need it rather than being frozen in licences which are simply speculative and unused.

7.15 p.m.

The Duke of Montrose: It may help the Committee as much as it would help me if we could be told exactly what is meant by the words,

    "does not carry out any such abstraction as would have been authorised".

Let us suppose that someone had been authorised to use a large volume of water. If for a period of four years he used only 50 per cent of that water, would that be considered as not using what had been authorised? Perhaps he had used only 5 per cent of the water. Would that count as not being authorised? It seems possible to me that if an agricultural enterprise felt that it would lose its licence, it could turn on the pump for a day and pump the 20 cubic metres, or whatever amount had been authorised. Would that then mean that it had used its licence within the four-year period? What will trigger whether the licence has been used?

Lord Whitty: This part of the Bill deals with protected rights. It does not deal with other issues which may appear to be similar, such as sleeper licences or the reduction of the period over which compensation would be paid. As I tried to explain previously, protected rights have come about as a result of trying to protect people's positions under previous legislation.

The non-use of those rights could, in certain circumstances, deny other legitimate abstractors access to the water. Therefore, the intention of this part of the Bill is that, if the protected rights are not used over an extended period, the granting of a licence to someone who needs the water should not be obstructed.

The fact that the protected right has gone does not necessarily mean that the abstraction is not lawful. Therefore, I believe that we are considering the wrong target here. Protected rights, which are grandfather rights, are a legitimate part of the system but they are not the key issue concerning how abstraction licences will work.

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If failure to use protected rights over a period of time prevents the Environment Agency considering the possibility of a neighbouring farm or a neighbouring business having access to that water, then there must be a cut-off period. In our judgment, the previous seven-year period was too long and we can reduce that to four years. But the provision will not affect people who are already using their abstraction licences and doing so on a rotational basis.

Some of those issues arise later in the Bill, as the noble Baroness said, but here we are talking about protected rights. I hope that that attempt at clarification will mean that we do not pursue this dimension of the argument, although we shall return to some of the points later.

Baroness Byford: I thank the Minister. Obviously he will not be surprised if I say that I am not satisfied. I understand what he is saying, but I believe that he of all people, because he is the Minister responsible for food and farming, knows very well the tremendous pressure that the farming community is under at present.

I believe that we shall be seeking changes. At present, some of those changes relate to matters that the farming community does not have control over. As the Minister knows, we are waiting for the CAP reform to come into fruition this summer. We are also waiting for the WTO talks to take place and are awaiting the outcome of the review of the way that DEFRA works by the noble Lord, Lord Haskins. We are also awaiting the report of the Curry commission. The fact that all those things are coming together at the same time is bringing huge uncertainty to an industry that has been struggling enormously over the past few years.

One thing clearly recommended by Curry, and which the Government are encouraging, is that the agriculture industry should consider ways of using land other than for food production. It is being encouraged, for example, to consider the possibility of non-food energy crops. I know that this Government have at last—that seems ungracious; I do not mean it in that way—accepted that such crops can play an important role.

Therefore, if we are to move away from a system that has been in place for many years to a new system which is still unknown, I believe that it would be even more unfortunate if, at this stage, the Government withdrew the seven-year protected right and put in its place a four-year protected right. I am sure that the noble Lord understands my argument, even though he probably cannot agree to it. I accept that. However, I believe that there are very good reasons why, at present, these proposals are unfortunate at the least and, at the most, unacceptable.

At this stage, I shall withdraw the amendment. I suspect that it is a matter to which we shall return because of the very uncertain current situation in which the industry finds itself. It is aware of the difficulties that it faces. I would hate to think that some of the new ideas and new possibilities that may come up over the next year or 18 months would be closed to

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the industry because we reduced the time period. However, at this stage, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 17 agreed to.

Clause 18 [Register of certain protected rights]:

Baroness Miller of Chilthorne Domer moved Amendment No. 52:

    Page 21, line 20, at end insert—

"(f) details of how the existence of a register will be made known to potential registrees."

The noble Baroness said: In moving this amendment, I simply seek to discover from the Government how potential registrees will know about the existence of the register. In Clause 18(2)(d), the Government talk about,

    "the procedure for applying for a protected right to be included in the register, including any information which is to accompany the application".

But it is not at all clear how that will work, apart from the fact that the Government say that the register will be available for inspection by members of the public. Can the Minister tell us how people will know that the register exists if they are not already on it? How will new entrants know about its existence?

I believe that if competition for abstraction rights is likely to increase, it will be very important for people to decide at what volume they should enter the register. Will a person apply for an abstraction licence with a usage of more than 20 cubic metres or will he apply for it with a usage of less than 20 cubic metres? People will not only need to know, and see, who else is on the register; they will also need to know of its very existence. I beg to move.

Lord Whitty: First, clearly the Environment Agency will start the system with a record of former licence holders who now no longer need a licence because the threshold has fallen. Secondly, I draw the noble Baroness's attention to Schedule 6, which provides a procedure for the setting up of the register. That will require us to bring in an order, which we propose to do, to establish a register and for the register to be advertised in the local press. That mechanism will be required of the agency and will provide access both to those who should be on the register and to those who are seeking to find out what rights already exist. Therefore, I believe that that point is already covered in the procedures in the schedule.

Baroness Miller of Chilthorne Domer: I thank the Minister for his reassurance and I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 18 agreed to.

Clause 19 [Form, contents and effect of licences]:

Baroness Byford moved Amendment No. 53:

    Page 22, line 19, at end insert "which shall not be less than 25 years after the date on which it takes effect"

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The noble Baroness said: I want to speak again briefly to Amendment No. 53 because the Minister did not answer the two questions that I asked him when I spoke to it earlier. I asked him what other countries might be using this initiative and whether they had considered seeking any derogation for horticulture. I beg to move.

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