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Part 3 of the Bill contains a power which allows for other consequential amendments to existing legislation to be made. We have included this provision in order to pave the way for unifying floods legislation at the next opportunity. Throughout the course of the Bill, we have strived to work through the concerns of stakeholders and parliamentarians. The Government brought forward several amendments to reflect stakeholder concerns and those of the opposition Benches in the other place. In other cases we have been able to provide assurances off the face of the Bill. Funding is inevitably a key concern. I reiterate that we are fully committed to funding all net new burdens for local authorities that will arise from the Bill. We are establishing a joint implementation review panel with the Local Government Association to keep costs and assumptions under review, and oversee skills and capacity issues to see what more can be done.

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Another significant area of debate has been the continued provision of affordable insurance for those who live in flood risk areas. This is something that both the Government and the insurance industry are committed to maintain, and we continue to work closely with the Association of British Insurers to discuss the future of flood insurance. I know that my colleague in the other place, the honourable Member for Ogmore, has a meeting in place to look further into this issue.

We have met representatives from the Fire Brigades Union on the subject of a statutory duty for the fire and rescue service, and with the Horticultural Trades Association about the code of practice for temporary hosepipe bans during periods of water shortage. We have also been working with representatives from the farming industry and others with reservoir interests, to assure them that the reservoir provisions will not create onerous burdens, especially for small landowners. I hope that this demonstrates to noble Lords our willingness to work through wider concerns related to the Bill outside of this place. I now look forward to working with noble Lords to scrutinise and deliver this Bill to the statute book.

I finish by praising those who have piloted the Bill through its stages in the other place, especially the Secretary of State, and the Minister for the Natural and Marine Environment, Huw Irranca-Davies. It has progressed swiftly but steadily to this House, and in a collaborative manner, which I am sure will continue in our deliberations. I commend the Bill to the House.

4.20 pm

Lord Taylor of Holbeach: My Lords, I should declare my interests before speaking in this Second Reading debate. I am a landowner, farmer and grower working in a family business in the silt lands of south Lincolnshire. We are members of the National Farmers' Union and the Horticultural Trades Association, which, as the Minister mentioned, have both made submissions on the Bill, raising issues to which I shall refer. I am also vice-president of the Association of Drainage Authorities, a body representing engineers and administrators engaged in flood and water management. My nephew, who is also one of my co-directors, is an elected member of the South Holland Drainage Board, which in turn forms part of a consortium of drainage authorities in eastern England called the Water Management Alliance. We are also, as a family business, members of the Holbeach Marsh Irrigation Co-operative, which plans to manage the water supply to some of the country's most productive agriculture. I am sorry to go into some detail, but these interests are relevant to the Bill and I hope that it is not immodest of me to suggest that they may assist me in contributing to the debates that we may have on it.

I thank the Minister for introducing the Bill. It is much needed and we support it, as we have indicated many times before, both in this place and in another place. All sides of the House agree on the importance of reducing the risks of flooding and making changes to our national and local response to incidents of flooding when they occur. We have seen terrible images of flood-hit regions in recent years and the pressing need for legislation on how we deal with flooding has become evident.

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I am sure that all noble Lords are mindful of the devastation wrought by floods in Cumbria before Christmas, when we saw images that we would not normally expect to see in Britain. I was in Cumbria recently and was able to see for myself the devastation in Cockermouth and on surrounding farms. I saw the impact on families, their homes, businesses and communities. Months after those floods there are still businesses closed down, shops unoccupied and hundreds of people waiting to return to their homes. I am sure that a number of noble Lords will have seen last Sunday's "Songs of Praise" from Cockermouth, which vividly portrayed both the devastation and the courage of the local people in trying to clear up the aftermath. I also saw the newly completed flood protection scheme in Carlisle, which potentially saved some 600 homes from flooding, along with a significant part of the commercial area of the city. Engineering and planning can indeed reduce flood risks.

Less than two years ago I was flooded myself-not at home in the Fens but in my holiday house in France, where 20 centimetres of rain in four hours wreaked havoc in my small valley village. I was relatively fortunate, as I was there and could limit the damage, but I directly experienced the overwhelming power of the floodwater as it swept through.

I am mindful, too, of the floods of summer 2007, which may well have been the biggest peacetime emergency since the war, in which 13 people died and more than £3 billion-worth of damage was caused. If, as many fear, climate change leads to more severe and more frequent flooding, it is essential that we have in place the strategic plans to assist with the prevention, management and aftermath of floods.

As the Minister explained, the Bill implements recommendations from the review into the 2007 floods by Sir Michael Pitt. We on these Benches supported those recommendations and we are glad that we finally now have the opportunity to consider the proposals in legislation.

We welcome the provisions that give the Environment Agency strategic oversight and spell out in statute that, in most cases, the lead local flood authority with clear responsibility for flood defence will be a unitary authority or county council. I agree that the Environment Agency has a crucial role to play. It is an organisation with a natural breadth of personnel and expertise, but it must work with local authorities. I know that this area was examined by colleagues in another place and we will, I am sure, return to it in Committee here. Local authorities have two considerable merits: they bring to the table local knowledge and they have democratic accountability. Our localism agenda is not for nothing. The more local communities are involved in preparations for flooding, the better prepared they will be. I do not think that the Minister or any other noble Lord would demur from that view. I have been encouraged by conversations that we have had with the Environment Agency in which it has stressed the important role that it feels local authorities have to play. We will examine in Committee ways of ensuring that the Bill reflects that sensible position. I would

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welcome a statement from the Minister on how he sees the new regime working so that local concerns are properly heard.

Given my declaration of interests earlier, noble Lords would expect me to emphasise the key role of internal drainage boards. Where they are responsible, they have been able to engineer out substantial elements of flood risk. They are a unique combination of landowner and local community interests. I hope that we will have the chance in Committee to discuss ways in which their role can be recognised. When flood risk and the consequential plans emerge, they may identify hydraulic catchment areas that can associate with existing nearby boards. Finding ways in which the engineering skills that exist in IDBs can be shared may be an important part of the solution, with flexibility the key. It is worth considering what the situation on the Derwent and the Cocker might have been had an IDB been responsible for flood and water management.

A good working relationship with the Environment Agency can be hugely important in the effective use of designated main rivers. These rivers may be quite small but they still need proper management if they are to be used as part of a drainage system. They are the Environment Agency's responsibility. It is important that they are maintained as water vectors, as IDBs frequently need them as part of their drainage and flood prevention strategy.

When undertaking work that would impact on flooding or coastal erosion, the agency has under Clause 38 the responsibility to balance the different benefits of that work, including nature conservation, preservation of cultural heritage or people's enjoyment of the environment, with the potential harmful consequences. In our view, it is not appropriate for an unelected government agency to have the responsibility for balancing these competing interests and we will ask the Government to look again at this proposal in Committee.

Another area to which we will return is Clause 33 and Schedule 4, on reservoirs, and how best to minimise the costs to individuals-I am grateful for the way in which this matter was introduced by the Minister. I think especially, but not exclusively, of hard-pressed farmers and of the risk assessments that must be carried out on their land. I understand from the Environment Agency that the responsibility of most farmers will end at the point of registration, which is without charge. I hope that the Minister can confirm this. However, if at registration a potential threat to habitation is revealed, extensive costs and procedures could be involved. For example, the Environment Agency estimates that the annual cost of inspecting a reservoir could be as much as £1,000. That is not an inconsiderable sum and we should examine ways to minimise it where possible; indeed, it should be eliminated for those smaller reservoirs that are far from inhabited areas. If what I have been told by the Environment Agency is true, we should make the Bill clear on this matter.

Elsewhere, in Part 2 of the Bill, we broadly support the provisions on infrastructure that require large projects to be open to competition. That has the potential to help to reduce costs to water customers. We are also pleased to see Clause 43, which deals with the problems of charging for surface water drainage, the "rain tax".

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This caused much difficulty for community groups such as scouts and guides and for places of worship, which were faced with unacceptably high bills. The oversight of the regulator still needs to be looked at, but overall this is very welcome. My honourable friends in another place, Nick Herbert and Anne McIntosh, deserve to be given credit for the role that they played in pressuring the Government to give companies the discretion that they need to protect these groups and to ensure that new charges are properly monitored by Ofwat. This will make a big difference to many groups that were facing unaffordable charges. I hope that the Minister will confirm this.

Consumer debt in the water industry is a major problem, which affects poorer families struggling with bills and the major water companies trying to balance their books alike. We cautiously welcome Clause 44, which allows for social tariffs. I say "cautiously" because we will need to be convinced that the clause will achieve what the Government hope it will. I note that the introduction of cross-subsidies goes against the recent efforts by Ofwat to unwind such subsidies. We are concerned that the clause will simply shift the burden of bills from the poor to the slightly less poor. The background work to this measure, carried out by Anna Walker, involved a much larger package of measures and deserves proper consultation and a formal response from the Government. We would prefer that method to the piecemeal one that we have been presented with. I echo calls by my colleagues in another place for a White Paper that could look at all the issues affecting the water industry.

We will also seek to look at the automatic right to connect new drainage systems to existing sewerage networks. Sewer flooding is not something that I would wish on anyone and we ought to do what we can to reduce its occurrence. Clause 42 and Schedule 3 refer to the standards that ought to be met by new drainage systems if they are to be permitted to connect and we will seek explanations from the Government about how those conditions will be met and what should happen if they are not.

We welcome the idea of sustainable drainage and believe that developers need to include sustainable urban drainage systems, or SUDS, in their plans at the earliest stages of the process to ensure that these are successfully designed, built and maintained. We are therefore pleased to see that the Bill is taking steps to ensure this. However, we also agree with the EFRA Select Committee report that more work needs to be done to answer some of the issues relating to SUDS, especially with regard to funding and responsibilities.

Another area that has been brought to our attention in preliminary discussions with stakeholders on the Bill is Clause 36, which deals with temporary bans on water usage. That, of course, has a significant impact on gardens, gardeners and the gardening industry. Drought conditions in summer 2006 led to widespread bans on the use of hosepipes to water gardens and wash private cars, particularly in the south and east of England. These bans were introduced by water companies and applied different restrictions in different areas. The lack of consistency of application resulted in widespread confusion among the gardening public and water companies alike.

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The then Environment Minister in another place, the Minister's honourable friend Phil Woolas, announced the Government's response to that consultation in October 2007. As part of the response, he said that the water industry, in conjunction with stakeholders, should produce a code of practice informing people about the new powers. This code should also explain what the priorities for water use are when water is in short supply and how restrictions would typically be implemented. I am pleased that the Minister mentioned that in his introduction. However, although I welcome the increased certainty achieved by Clause 36, which sets out what sort of water uses may be restricted, could the Minister tell your Lordships' House what has become of that proposed code of practice? It has been a long time coming, if we are ever to see it. The Horticultural Trades Association is, I know, very keen to support such a code. Whatever happens, the use of water by commercial nurseries, particularly those raising container plants, needs to be recognised.

I have raised a number of issues that we have with this Bill and to which I have indicated we will return in Committee. I hope that we on these Benches will have the opportunity of working with the Government to deal with them and I reiterate the support of these Benches for what is, in the main, a very welcome Bill.

4.36 pm

Lord Greaves: My Lords, I declare what is, I think, my only interest in this; I am an elected member of Pendle Borough Council. I, too, thank the Minister for his presentation and for going through the contents of the Bill so succinctly. On behalf of the Liberal Democrats, I, too, give a broad and almost enthusiastic welcome to this Bill, which, as the Minister will know, is pretty good going for me.

This is a good Bill; it has had a great deal of scrutiny and been long in the gestation. It really has its origins in the Pitt review after the dreadful floods in 2007, and since then it has been made more topical by the more recent floods in Cumbria. It has had a thorough going-over by the EFRA Committee in the House of Commons, which produced some sensible suggestions, some of which were taken up by the Government. There has also been useful work in the Commons itself, as the Bill has gone through that House, so it seems to me that what we have here is of higher quality than some of the Bills that are occasionally sent to us in this House. Having said that, I do not believe that it does not require-and would not benefit from-further discussion and scrutiny on many of the things that the noble Lord, Lord Taylor of Holbeach, mentioned and on some issues which we would like to raise.

In particular, I congratulate the Government on Clause 44, which covers social tariffs. They worked closely with my honourable friend Martin Horwood in the House of Commons. The noble Lord, Lord Taylor, said that he would now cautiously support that; I am informed that his party did not quite do that in the House of Commons when Martin Horwood first raised the matter. I very much welcome the cautious movement that the noble Lord, Lord Taylor, has made on behalf of the Conservatives. That is a step forward, but if more comprehensive reform is required in future, perhaps some of the provisions that were dropped

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from this Bill because of the shortage of time in this Session would make that further water legislation more comprehensive. As it stands, however, I very much welcome that clause.

There are still some issues to be bottomed. The problem is that we are faced with an impossible timetable, because we all know that the law of the land means that this Parliament has not got much longer to go. There is a lot of press talk about when the general election will be; we all know that, in effect, it has to be by 6 May at the latest. That is in a practical and almost a legal sense, so we are faced with the difficulty that it will be impossible for the Bill to go through this House on the normal sort of timetable. We may therefore have to find some alternative means of discussing the matter with the Minister and his colleagues to see whether there are issues which, at the very least, require further clarification and understanding.

It is our view that, at an absolute minimum, the Bill will require two days in Committee. It ought to have more than that and almost certainly would have three or four days in normal circumstances. If it does not get an absolute minimum of two days in Committee, this House will not be doing the job that it ought to do in scrutinising this legislation, not just in detail but on some of the major strategic issues that exist. The Minister probably cannot give us that commitment today, but I place on record that that is what we think. The Minister has some slight influence in this matter so I hope he will use it. If it comes to the process which is colloquially known as the wash-up-or the washing up, as I call it-we will not obstruct the Bill because we want it passed. However, we hope that will not lead the Government to think that it will get general approval and therefore does not need further scrutiny.

I turn to some of the issues which will benefit from further scrutiny. My noble friend Lord Addington will talk about the concessions for community groups, such as the Scouts and others, under Clause 43, so I will not touch on that further. It probably requires more discussion to get an assurance that these concessions will take place. As the Bill stands, they are voluntary on the part of the water companies. My noble friend Lord Redesdale will talk about an aspect which is absent from the Bill-the role of Ofwat in several important areas.

Some of the issues that should be further discussed include a whole series relating to the relationships between the many bodies involved in flood risk management and dealing with floods when they occur. There is the relationship between the Environment Agency and the lead local authorities, for example in the preparation of local flood risk management strategies. These are vital issues because there are many organisations involved. The key to this legislation working will be whether these organisations have adequate, effective working arrangements. This requires further discussion. How do the regional flood and coastal committees fit in relation to the Environment Agency and local authorities? In two-tier areas, what is the relationship between counties and districts? The Government have made some useful improvements to the Bill on this matter since the draft stage and there is the basis in the Bill for a sensible working arrangement. However, it is

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not exactly clear at the moment how that will work. If left to themselves, some organisations will have excellent relationships and there will be others where it does not work quite as well.

The role of districts and the designation of assets, or features as they are called in Schedule 1, seems to require further teasing out. The contribution to sustainable development is something on which we may want to have further discussions. "Sustainable development" is the great buzz phrase which always appears in legislation. We always try to get the Government to tell us what it means and they always run away and say they cannot put in legislation what it means. However, we all know what it means and all have a slightly different angle on it. In this legislation, however, the Government promise guidance. They will send guidance to local authorities on what is meant by "sustainable development", at least in relation to flood and water management. We will all look for this guidance with great interest. This may be the first time that the Government have had to define what they mean by "sustainable development". We will see.

A further question is that of the relationship between planning applications and the applications for approval of SUDS-an interesting acronym to use with flooding. This again is particularly difficult in a two-tier system where the planning authority is the district and the SUDS authority is the county. There is a real risk that this will cause serious delays and complexities in planning applications unless it is got right. The Local Government Association believes that the planning authority should be responsible for approving SUDS, not the lead flood authority. We will want to discuss these matters further.

On the designation of features-flooding assets-there are concerns among owners of such assets, ranging from farmers to Network Rail. These matters also deserve further discussion, if only to allow the Government to make it absolutely clear on the record how they think the system will work.

There is the question of enforcing SUDS and who will be responsible for enforcement. Again I am talking of two-tier areas-the sort I know best-where the county will perhaps be responsible for enforcement although an enforcement system is already being run by the district planning authorities. They will be enforcing planning misdemeanours. If we are not careful there will be two sets of enforcement staff turning up on successive days. Will they work together? That also needs sorting out.

Then there is the relationship between all these public bodies and the water companies, which is a vital component in the jigsaw. There is the issue of reservoirs, raised by the noble Lord, Lord Taylor. I have been trying to get my mind around what 10,000 cubic metres might look like. It has been suggested to me that it represents one-and-a-half times the size of the Royal Gallery if it were to be filled up to the portrait of William IV. Noble Lords can have a look. I am afraid that William and Mary would be well sunk, along with Alfred the Great and many other dignitaries from the past. I am not quite sure, but it might also represent twice the size of this Chamber. So we are talking about a large body of water, and if the calculations put to me are correct, we have an idea of the size of the bodies of water that we are talking about.

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The LGA, quite rightly, has raised the question of local authority funding, as it always does regarding new legislation. This needs to be absolutely clear, particularly in the present financial climate and what is likely to be the financial climate for local authorities in the next two or three years. If local authorities have substantial new tasks they need adequate funds to carry them out. It is absolutely right that local authorities are in charge of the system at local level, within the overall national system run by the Environment Agency. That seems to be the right way to do it; it came out of the Pitt review and the Government have got it right. The funding has to be right also. Of course no one can guarantee future funding, especially in the present climate, but we ought at least to have a clear idea of what the funding requirements will be and whether they are likely to be met.

The noble Lord, Lord Taylor, mentioned temporary hosepipe bans. This issue has been raised particularly by horticultural interests. The Bill does not necessarily need to be changed, but we need a clear on-the-record statement by the Government of how the issue will work. Perhaps we may find ways of obtaining that, even within our short timetable.

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