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Baroness Miller of Chilthorne Domer: For the record, and to inform the noble Baroness, I actually asked for this grouping to be split into at least three groups when I received the draft groupings. That did not happen, and again it did not happen when I asked once more this morning. I then decided to speak to the amendments as one group. Although some of the amendments that I asked to be degrouped were degrouped, these were not.

Baroness Byford: It is my understanding that it is for the House to decide which groups are taken with which. We try to do that in advance for the ease of the usual channels. However, the Committee may find it easier if we divide up the amendments; I, for one, would find it easier. We would not have to remake our speeches—I believe that we can almost guarantee that. The amendments relate to very different issues. However, I am in the hands of the Committee at this stage.

The Deputy Chairman of Committees: The House can deal only with the question that is before it at the moment.

Lord Whitty: Yes, and both noble Baronesses have spoken to the full group. I accept that the amendments are in a big chunk, but they all deal with the powers of the consumer council, so they interrelate.

I shall give my views on Amendments Nos. 77A to 78A and Amendments Nos. 85A to 85D and then try to break up my speech, because we have already had two speeches referring to the whole grouping. Those amendments are all concerned with the consumer council's regional committees, and seek to allocate licensed water suppliers to them in the same way as occurs with allocation of undertakers.

One question was: why are licensees being treated differently from water undertakers in general? There is a consumer dimension to that. With the consumers and water undertakers, there is no ability to switch, subject to the very large consumers and competition provision that we provide later in the Bill. On the other hand, the rights of licensees' customers are defined in contracts, and they can switch. The power for consumer protection is of a different order in relation to the customers of monopoly suppliers.

6.30 p.m.

Baroness Byford: I am grateful to the Minister for giving way. I realise that we are not talking about domestic customers at this stage. In some ways we are, but in some ways we are not. But the new suppliers will be supplying companies, and presumably the consumer council will want to have regard to them as well. I had assumed that, but perhaps I am wrong.

Lord Whitty: As I said, the undertakers will virtually be in a monopoly situation region by region, as they

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are now. Some competition is being introduced by the Bill but, in general, commercial and domestic consumers will be faced with a monopoly supplier. In the case of the licensees, there is not a monopoly situation and therefore, as I said, consumer protection is of a different order. Having said that, I believe that we are in a different position in relation to licensees. Indeed, their relations with their consumers will be contract-based.

However, as the Bill is currently drafted, in principle there is nothing to stop the consumer council from allocating licensed water suppliers to be overseen by a regional committee. Indeed, they may wish to adopt that flexible approach. But I do not believe that it is appropriate to impose that on them because licensed water suppliers will be different from undertakers. Effectively, undertakers are regional companies and their operations relate to their region, whereas, with regard to suppliers, the licensees are not necessarily tied to one part of the country. They may well operate in the supply of water in more than one water company area.

Baroness Miller of Chilthorne Domer: Apart from the fact that consumers who get their water out of their taps must write a cheque or send their credit card details to one company or another, will it make a difference?

Lord Whitty: Yes, it will make a difference. The nature of the relationship is different and the nature of the balance of market power is also different. But I am now making a distinct point. I am saying that the water companies are, in effect, regionally based operations which are confined to the old water regions. There may be some cross-ownership but, effectively, they are water companies within a region and therefore would relate to a regional committee very easily.

Suppliers can operate in more than one region and it is therefore not sensible to force the consumer council to allocate them by regional committee. That is the only point that I make at this stage. I made the more general point that consumer protection is a slightly different issue but this group of amendments seeks to say that the licensees should be categorised by region, and that does not seem to be appropriate. However, in some cases it is open to the consumer council to make such categorisation and, in some cases, they may be single-region companies. But that will not be the case in relation to them all.

Baroness Byford: I was a member of the rural trains committee for the Midlands region and we had different services ranging from Midland Mainline to Central Trains to services for the West Country. However, the committee was there to represent all consumers, and I believe that is the point that between us we are trying to establish. It did not really matter whether a company went through part of our area and into another. Our responsibility—I say this in reference to the council—was to represent the views of everyone who used whatever it happened to be in our

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area. I do not see why there is this "hang up" in the Bill unless there are some things to which I am not privy. I am trying to establish why that has not been included.

Lord Whitty: I do not really follow the noble Baroness's logic. The structure of the consumer council's regional committees is being defined on the basis of the current structure of company areas. As I said, the relationship with the licensees is somewhat different, but theoretically one could also put them into regional areas. However, if one was obliged to do so, that would cut across the fact that a licensee for supply in the Northumbrian region might also have a licence in the Wessex region. Therefore, it would not be sensible to force such a licensee to be overseen by the Northumbrian regional committee simply because that is where it started out.

I believe that we must differentiate the treatment of licensees in certain ways, both for principled reasons, in that they are in a different market position, but also for practical reasons, in that they do not operate in the neat regional structure of the old water system.

Baroness Miller of Chilthorne Domer: As the Minister gives his explanation of each section of amendments, will he say whether his views are also those of WaterVoice and what representations WaterVoice has made to DEFRA about these various issues? After all, it has the greatest expertise in this field at present. Perhaps it knows best how to represent consumers effectively and where the gaps are.

Lord Whitty: I believe that in some areas we disagree with WaterVoice. I do not have its briefing with me in all respects, but obviously we take its views into account. However, I believe that there is a difference in function. I am not sure on which views of WaterVoice the noble Baroness is asking me to say whether I agree or disagree. Perhaps she will clarify that point first.

Baroness Miller of Chilthorne Domer: Obviously, because I do have a briefing from WaterVoice, my understanding is that it believes strongly that licensed suppliers should also be included in this provision. It believes that that is the best way in which consumer interests can be followed. I am still at a loss to understand why the Government are at such variance with the bodies that represent consumers at present.

Lord Whitty: I am not saying that the consumer council should not cover licensees. That is not the point that I am making. I am saying that the role of customers in relation to the licensees is different from that of customers in relation to the water companies. But there is no restriction in the Bill—I go along with WaterVoice to this extent—about the council covering licensees as well.

What I do object to is writing on to the face of the Bill that, in order to cover licensees, we must categorise them by regional committee. That is the only point that I am making at this stage. Most of these amendments relate to the power of the regional committees and simply reflect that. That does not seem

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to me to be a sensible approach. It may be defensible in some cases but, in many cases, it will not be sensible to try to allocate the licensee companies by region.

Baroness Byford: I still do not quite understand. From what he has just said, the Minister is virtually inferring that, under the Bill, some people who are supplied by water suppliers rather than by water companies will not have any recourse directly to the council.

Lord Whitty: I am not saying that. The consumer council can cover licensed suppliers as well. I am saying that the relationship is, by its very nature, different. So far as concerns these amendments, we are only talking about regional structures. It is a practical point; it is not a point of principle.

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