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The Deputy Chairman of Committees: I note that there is a Division in the Chamber.

[The Sitting was suspended for a Division in the House from 3.57 to 4.7 p.m.]

Baroness Byford: Before the Sitting was suspended, I put three questions to the Minister. Provided that he is happy that he has understood them, I am happy to await his response.

Lord Whitty: The response is normally given by the mover of the amendment, but I shall attempt to answer.

Baroness Byford: Perhaps the Minister will forgive me. I thought that I had asked three questions to which he had not responded when the Division Bell sounded. I assumed that he would answer those before I did so.

Lord Whitty: One of the questions related to provisions in other legislation. The provision in the Utilities Act 2000 is virtually the same—apart from the last group; namely,

Xcustomers . . . whose premises are not eligible to be supplied by a licensed water supplier".

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On the issue of the inter-relationship of those groups and those in debt, as I said, we have been in discussion with the water companies. One of the reasons why this matter is not easy to deal with in legislation is that the pattern of debt is very different for each water company. Therefore, we are conducting some research and discussion with the companies about how to deal with that.

Although much of the focus of the discussion has been on debt, these groups are not designated only because they are the most likely to fall into debt—some are not in debt. Disabled consumers, for example, have special service needs; rural consumers have connection and distance problems, and probably service problems as well. So it is not primarily for reasons of debt that these groups are listed here, although the issue is relevant. I believe that I have dealt, at least in part, with the three questions put by the noble Baroness.

Baroness O'Cathain: What else would the reason be, if not debt? The provision of water is automatic—water is water, is water, which is provided. Looking at the clause again, I cannot quite understand the Minister's point. The words are:

Xthe Authority shall have regard to the interests of".

Surely those interests relate to paying for water rather than to anything else.

Lord Whitty: Yes, but the questions of connection, of how much is paid for the services and of how the service charges are raised—and, therefore, the amount of money required from consumers—are not necessarily related to the propensity of those consumers to get into debt. They relate to the totality of the charging system and to the way in which the service providers operate, to make sure that they do not discriminate against these groups.

Baroness Miller of Chilthorne Domer: Are there not effectively two categories? There are those who are presently classed as "vulnerable groups", and those who have to spend more than 3 per cent of their income on their water bills. Those are the two relevant groups.

I cannot quite understand why "individuals of pensionable age" in paragraph (b)—I do not quite have to declare an interest yet!—should be in a special category unless they have difficulty paying their bills; otherwise, why is there no category for those who are perfectly well off?

Baroness Byford: Before the Minister responds, perhaps I may ask him to clarify the point I raised with regard to those who are considered to be struggling to pay their bills. My question before the Sitting was suspended related to the fact that most of those people will be on some form of benefit; therefore, their needs will be covered by the benefits system. The Minister did not address that point in his reply.

Lord Whitty: Their income may be supplemented by the benefits system for certain services, but problems caused by the water companies may not be covered. The benefits system helps families which meet certain terms. But a family with a certain number of children

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or with a certain degree of disability may be in a different situation from another family as far as concerns its water requirements and the way in which the water companies supply the water. You cannot rely on the benefits system to remove the requirement for the authorities to pay attention to these groups.

Pensioners often have difficulties in meeting bills, in making complaints and in accessing the service companies. It seems sensible to include pensioners in the Bill, as is the case for other utilities. Not all pensioners, rural dwellers and people on low incomes will be vulnerable in relation to water. Clearly there is an overlap in the provisions, as there is in regard to fuel poverty.

It is important to stress that although the alleviation of fuel poverty as an objective is contained in government statements and government legislation, a definition of fuel poverty is not required by the legislation. Equally, we do not define water in the Bill in the way suggested by the noble Baroness in the previous amendment. But we do designate those groups to which authorities, councils and so on have to pay attention in relation to various aspects of their work.

Baroness Byford: I thank the Minister for that explanation. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 93 not moved.]

Baroness Byford moved Amendment No. 94:

Page 42, line 45, leave out "that power or the performance of that duty" and insert "those powers or the performance of those duties"

The noble Baroness said: Amendment No 94 seeks an explanation of why the multiple powers and duties at the beginning of new subsection (2E) become singular at the end of the subsection. Do the Government envisage that any of the interests mentioned in paragraphs (a), (b) and (c) will have an impact only upon a single duty mentioned in subsection (1)? I would be grateful if the Minister could clarify the point. I beg to move.

Lord Whitty: When the Secretary of State or the authority exercise powers or perform duties under this section they may have regard to certain interests affected by that power or that duty. To amend it to the plural would imply something entirely different. It could imply that when the Secretary of State or the authority exercise any of the powers or perform any of the duties under Section 2(1) of the Water Industry Act, they may have regard to interests affected by any of the other powers or duties. That clearly would be wrong. It is only when exercising one of those powers that they have to deal with the people affected by that power.

Baroness Byford: I am grateful for that clarification. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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4.15 p.m.

Baroness Byford moved Amendment No. 95:

Page 42, line 46, at end insert—

"(2F) In performing the duty under subsection (2A)(c) above the Secretary of State or, as the case may be, the Authority shall—
(a) act in accordance with the current direction issued under section 5A(6) below;
(b) have regard to the long term interests of consumers;
(c) without prejudice to the generality of the foregoing, ensure that appointed companies are able to fund on reasonable terms all required investment programmes and the long term maintenance of their assets;
(d) apply to all appointed companies all determinations and conclusions of the Competition Commission (including all methodologies adopted by the Commission) which relate to any such company."

The noble Baroness said: In moving Amendment No. 95, I shall speak also to Amendment No. 99. The amendments relate to two important issues. Amendment No. 95 concerns the long-term interests of consumers. We discussed in earlier debates the cost of long-term maintenance. Proposed new subsection (2F)(b) and (c) speaks for itself in that regard. Paragraph (d) is particularly important as it requires that the methodology adopted by the commission should apply to all appointed companies. The amendment seeks to clarify the situation. I understand that the Enterprise Bill removes possible political influence. Once agreed, methodology is established.

Amendment No. 99 deals with the same issue and seeks reasonableness and proportionality. Proposed new subsection (1A) states:

XThe Secretary of State may not exercise his power under subsection (1) above so as to increase the cost that may have to be met by any relevant undertaker or by any consumer".

That is proportionate and should be targeted. I beg to move.

Baroness O'Cathain: I thank my noble friend for introducing the amendment, to which I have attached my name. The background behind the amendment is that, in determining the prices to be charged, a methodology is given to all companies by which they produce their final figures. The amendment requires that the methodology should be agreed by the authorities and all the companies before they go on to do the "number crunching".

The appeal process should apply not only to companies which have appealed against the methodology but to all companies. That is very important. Otherwise the same situation will arise as the last time there were appeals from the water companies to Ofwat, when some companies were involved but it was not a general appeal. If an appeal is made and a condition is agreed through the appeals process, particularly in regard to the methodology, it should apply to all companies and there should be no further appeal.

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