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Earl Peel: I seek some clarification from the Minister. I am still not absolutely certain about the situation. The Environment Agency document on compensation guidelines, which I think is what the noble Lord is referring to, states that because the Environment Agency operates from the principle of cost recovery, that will mean that the licence charges must cover the costs of compensation. Therefore, it goes further than the present situation, which is an intention that licence fees should cover the administrative costs. Is it the noble Lord's intention that the Environment Agency will seek to cover the full costs from the abstraction licensing system?

Lord Whitty: Yes. In common with the policy on enforcement regimes generally, the total cost of administering those regimes has to be covered.

Earl Peel: My point is whether it is the Government's intention to cover not only the administration costs but also the costs of compensation if a licence is revoked or amended in any way.

Lord Whitty: Yes. The compensation is part of the administrative cost.

Baroness Miller of Chilthorne Domer: Clause 27 uses the words "serious damage", whereas in the Environment Act 1995 the words "significant damage" are used. Obviously the context is not exactly the same. Is the Minister confident that "serious damage" is adequately defined, or would "significant damage" achieve more efficiently the purpose sought of protecting those items that need protection?

Lord Whitty: The definitions of "serious damage" under this clause and elsewhere will be set out in detailed guidance. The assessment would be on that basis. Clearly, if the noble Baroness proposes an amendment, we shall have to deal with it at a later stage. We consider that the reference to "serious" indicates the type of damage of which we are talking, but it would be subject to guidance.

Baroness Byford: I thank the Minister for that. In no way do I propose that those people who deliberately damage the environment should be compensated.

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I hope that the noble Lord accepted that from my remarks. The reason for trying to have a debate on this issue is that the system is currently being changed. I think the Minister will acknowledge that. Therefore, I believe that it was quite right to probe and to ask him to clarify one or two issues.

Clause 27 agreed to.

Baroness Miller of Chilthorne Domer moved Amendment No. 74:

    Before Clause 28, insert the following new clause—

In section 6(2)(b) of the Environment Act 1995 (c. 25), at end insert "in particular the efficient use of water by all abstractors"."

The noble Baroness said: I do not intend to take up much of the Committee's time with a debate about efficiency. The amendment would insert a clause regarding efficiency in a different place in the Bill, as we seek to find the most appropriate place to introduce this duty. For that reason, I beg to move.

Baroness Young of Old Scone: I shall follow the admirable example of the noble Baroness, Lady Miller, and not repeat some of the points made at several significant stages in the Bill about the right place for an efficiency duty. I shall simply say that, for all the reasons already given, efficiency is important and that would seem to be a good place to put in a provision that makes clearer the statutory basis for the promotion of water efficiency within water resources duties as a regulator.

6 p.m.

Lord Whitty: The Environment Agency is already able to apply conditions such as water efficiency to an abstraction licence. It also must take into account other issues of costs and benefits. Any new duty would have to be consistent with that. This may be one of the more sensible places to consider a duty along these lines. The wording in the amendment referring only to "efficient" would not achieve the purpose. However, I am prepared, particularly in view of the commendably short intervention of the noble Baroness, to take the matter away and, before the next stage, to consider whether we can come forward with anything that would achieve that purpose.

Baroness Miller of Chilthorne Domer: I thank the Minister very much for that reply. I look forward to seeing what the Government produce. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 28 [Water resources management schemes: other abstractors]:

The Duke of Montrose moved Amendment No. 75:

    Page 32, leave out lines 40 and 41.

The noble Duke said: This is a probing amendment. There is no reference in the Explanatory Notes to requiring payments. Do the Government have any idea what payments the agency might be required to make; for how much and for how long? Are they likely

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to be or would they be one-off payments? There is such a clause in the Water Resources Act. By putting one in the Bill the Government have opened the door to questions which I suggest should be asked. It is possible that the situations envisaged in 1990-1991, when the Water Resources Act was passing through the House, no longer apply. The clause could be used for all kinds of matters of which this House would not necessarily or readily approve. I beg to move.

Lord Whitty: The clause allows the agency to enter into water resource management arrangements with abstractors other than water undertakers. Abstractors accepting those agreements may incur costs. It is reasonable that the agency should have an ability to cover those costs. The amendment would restrict that ability. It would also put the non-water undertakings abstractors at a disadvantage compared with the water undertakings, to whom compensation can be paid under the provisions referred to by the noble Duke.

If one could not repay those costs, it is unlikely that other abstractors would come forward and take on some management functions as a part of a negotiated agreement with the Environment Agency. Therefore, that would restrict the flexibility of approach to management of water resources as a whole. With that clarification, I hope that the noble Duke will not press the amendment.

The Duke of Montrose: I thank the Minister for that explanation. In the light of it, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 28 agreed to.

Clause 29 agreed to.

Clause 30 [Enforcement notices, and related procedures and offences]:

The Duke of Montrose moved Amendment No. 76:

    Page 35, leave out lines 27 to 31.

The noble Duke said: This subsection deals with securing compliance with an enforcement notice. The clause already contains various remedies. Why should it be necessary to go to the High Court, with all the expense, delay, extra work and so on? Why not take the offender to an ordinary court, or, as provided for under subsection (3), do the work and then bill him for it? Why is it considered necessary to take powers to go to the High Court?

Lord Whitty: This is about the enforcement of enforcement notices with which the company concerned has not complied. It would relate to the most serious cases, which would be appropriate for the High Court. Clearly, less serious cases may not be. Proceedings in the High Court will be in situations where significant damage to the environment is being caused which must be stopped as rapidly as possible. Such cases would be rare. I have no doubt that the High Court would ensure that they were. I therefore

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hope that we would not prevent the Environment Agency taking that course in those extreme circumstances.

The Duke of Montrose: Is it the case, then, that an ordinary court would not have powers to act sufficiently quickly? Is that the problem?

Lord Whitty: I think that that is one of the problems. I shall write to the noble Duke as to why it is the High Court. We are talking about the most serious incidents which require quick action. I think that the High Court procedure is the appropriate procedure, principally because the High Court can grant an injunction whereas the criminal courts cannot.

The Duke of Montrose: I thank the Minister for that reply. In the light of it, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 30 agreed to.

Schedule 1 [The Water Services Regulation Authority]:

Lord Dixon-Smith moved Amendment No. 77:

    Page 121, line 26, leave out "misbehaviour" and insert "inappropriate behaviour"

The noble Lord said: We are a little concerned about the language in both Schedule 1 and Schedule 2. Schedule 1 deals with the appointment of members of the water services regulation authority, and Schedule 2 with the appointment of the consumer council for water. Our specific concern arises in the same place in both schedules where the Secretary of State—or, as the case may be, the Assembly—may remove someone from office. We have no problem with removing someone on the grounds of "incapacity", but we think that a provision to allow their removal because of "misbehaviour" is perhaps a bit too broad.

I must say that I cannot help but wonder why I drew this amendment. My notes say that misbehaviour,

    "conjures up short trousers, birthday parties and pulling little girls' pigtails".

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