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Lord Borrie: I wish to speak to the amendments tabled by the noble Baroness, Lady Miller—that is, Amendments Nos. 143 and 144—and to the role that she has suggested for the consumer council.
The consumer council has played an important role in recent years. It is known generally as WaterVoice, is much respected and has done a great deal for consumers in representing their views to companies, in the areas in which they are located and nationally. The Bill gives it a more important role. It is made more independent of Ofwat—which everyone accepts is a good thing—and the Committee wishes it well in the future.
The council has a role in investigating consumer complaints but, as the noble Baroness said, in her view it should have a larger role in passing the buck to the companies or to the authority. It should be able to resolve disputes and, although the noble Baroness did not mention this, it should be able to fine companies up to £5,000.
I disagree with the noble Baroness on the latter part of her argument. It would be quite wrong to confuse the council's roles as a consumer advocate, as a partisan for consumers, and as a representative of consumers, both locally and nationally, with the role of an adjudicator, especially an adjudicator with a power to impose penalties. That is not an appropriate role. It is not appropriate to join together in one body the role of an advocate and the role of a judge or adjudicator, but that is what the noble Baroness seeks. She proposes that the council should be not only a judge, but a judge with the power to impose penalties.
We should stick with what is in the Bill, which states in proposed new Section 29(10):
- XAfter investigating a complaint the Council may make a report to the Authority, the Secretary of State or the Assembly".
That seems to be an appropriate relationship between the bodies involved—especially between the consumer council and the authority. Other clauses, which we have yet to come to, indicate that the authority should have power to impose penalties on companies for various misdoings. I ask the Committee not to accept the noble Baroness's amendments.
Lord Whitty: Very much for the reasons outlined by my noble friend Lord Borrie, Amendments Nos. 143 and 144 are not appropriate. I understand the argument that the consumer council should have teeth, but we should not confuse the duties of a representative with those of an adjudicator and enforcer. There are other ways of giving the consumer council teeth to enable it to resolve disputes resulting in damages. WaterVoice has secured binding mediation agreements with a number of water companies whereby voluntary compensation can be made payable. According to the last report, a total of £600,000 was recovered in compensation or rebates for water customers in that way. We can certainly foresee further development of that approach.
Such an approach would be unprecedented. For example, Energywatch, which was established under the same legal framework as in the Bill, does not have statutory powers to secure compensation for customers who require it. I understand that it is not seeking such powers to do so. It would confuse the role of the consumer council if we were to give it such powers.
As to Amendments Nos. 146 and 147, it would appear that there is some misunderstanding about the purpose of proposed new Section 29(6). Under the Water Industry Act, certain specified technical issues are defined as "disputes"—for example, a request by a non-domestic customer for a water supply, a closure or a restricted use of a public sewer. Those disputes are reserved to the regulator for determination. They are not the same as complaints. The process leads to a binding decision being made and the Bill provides for disputes that are wrongly brought to the consumer council to be transferred to the authority. The need for the consent of complainants is included to give them the opportunity to consider the issue afresh before entering into a detailed disputes procedure.
It is not intended—it would not be sensible—for the council to get involved in technical issues which are properly disputes to be determined by the regulator. So there may be some terminological problems here.
Lord Livsey of Talgarth: I understand the arguments deployed by the noble Lord, Lord Borrie, that the consumer council should not be able to specify amounts of compensation and ensure that they are paid, but surely in the defence of the consumer it should be able to recommend to the regulator that a complaint should be upheld and that compensation should be paid. It would then be up to that body to decide how much should be paid.
At the present time there is an inadequate defence of consumer interests and, although the wording of the amendment may not be precisely in the right mode—
and, as the noble Lord, Lord Borrie, said, the functions may not be as well defined as they ought to be—nevertheless it is very much in order for the consumer council to protect the interests of consumers in this respect.
Lord Whitty: The consumer council can make an assessment of a case and make approaches to the water companies. It can also engage, as has WaterVoice, in setting up a voluntary mediation process. But the amendments would turn the consumer council into an adjudicator and enforcer requiring compensation to be paid. That is a boundary it should not be allowed to cross. Were it to do so, it would distort its relations with the companies and everyone else.
Amendments Nos. 151 and 153 deal with a different issue. The council's power to make a report is discretionary. It will wish to ensure that it targets its report in the most effective way and it can decide whether a report will be of interest both to the authority and to the Government. There is nothing to stop the council sending a report to both bodies but we should not force the council to do so, which is the implication of the amendment.
The Bill requires the council to co-operate and to exchange information with the authority, with the Secretary of State and with the Assembly and to record the arrangements made in a memorandum. That is probably the best way of setting the ground rules between the various bodies involved.
If I understand the noble Baroness correctly as regards Amendment No. 153, I think that I can reassure her that the principle of Section 30 that there should be a proper mechanism for considering complaints is carried into the Bill by Clause 45. The authority must pass complaints to the consumer council. The council is also required to pass over to the authority, with the consent of the complainant—which I said in response to the middle group of amendments—anything which constitutes a dispute which is statutorily required to be determined by the authority. Therefore, there is a mechanism and we do not need Amendment No. 153.
Baroness Miller of Chilthorne Domer: I thank Members of the Committee who spoke in that interesting debate. The noble Lord, Lord Borrie, said that I did not emphasise enough the level of compensation to be paid. I obviously did because he spoke eloquently and at length. However, it strikes me that in other parts of the Bill, the Environment Agency, for example, has multiple roles—as a friend and as an enforcer. But in terms of the consumer council for water, that body is not allowed to have multiple roles.
Therefore, while I would accept what the Minister said, I shall balance it with the role being drawn up for the Environment Agency. I reserve my right to come back on this amendment at a later stage.
Baroness Byford: Before the noble Baroness withdraws the amendment, I should be grateful for the
Minister's observation on her point about the Environment Agency. Constantly through this Bill, we have been questioning the position of the Environment Agency. I am now in a ridiculous position. In some ways, I do not support the noble Baroness's amendments in the way that she would like me to, but she raises a very important question which the Minister has not answered sufficiently. Therefore, I encourage him perhaps to return this: how can there be one set of rules for one authority and one set of rules for another? If that is to be so, the rules should be expressed more clearly than they are in this Bill.So before the noble Baroness withdraws her amendment, I should be glad of further explanation from the Minister. I am not asking for what the noble Baroness is asking for on these particular amendments. But I have raised and will continue to raise throughout this Bill the issue of the very real position that the Environment Agency finds itself in, with greater freedom to be judge and jury of everything and with no comeback to even Parliament. I do not find that satisfactory. I shall listen with interest to what the Minister has to say to my question before the noble Baroness withdraws her amendment.
6.45 p.m.
Lord Whitty: The Environment Agency is not mentioned in any of these sections of the Bill. I am not sure how the Environment Agency got dragged into one of the perhaps limited number of areas in which it does not feature. It is well known that there is a statutory basis for the Environment Agency having a number of different responsibilities, but all that is wrapped up in its own operation. What we are talking about here is a consumer council. We can pursue this issue at another point in the Bill. The noble Baroness may have an objection to a particular power or duty of the Environment Agency but I do not think that that is particularly relevant to these amendments.
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