Cultural and Community Distribution Deregulation Bill [HL]

Lord De Mauley Excerpts

Friday 5th July 2013 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley)]

My Lords, let me begin by thanking my noble friend, to whom I have listened carefully—as I have listened to other noble Lords—for bringing this issue to the attention of your Lordships.

I clearly understand that community events underpin many aspects of what creates the social cohesion of our society, and one should never underestimate how important they are in bringing people together. I strongly support such endeavours. However, my noble friend will understand that my ministerial interest stems from the potential by-product of littering caused by advertising leaflets being dropped in public area. While I agree that local authorities should not unduly interfere with the organisation and promotion of these kinds of community events, it would be wrong of me not to explain why I have some reservations about my noble friend’s proposition.

My noble friend’s Bill seeks to limit the restrictions that local authorities are presently able to impose on the distribution of free printed matter in their areas of responsibility. As your Lordships will be aware, local authorities have a statutory duty to keep their relevant land free of litter and refuse under the Environmental Protection Act 1990. The Clean Neighbourhoods and Environment Act 2005, which the noble Lord, Lord Stevenson, generously admitted was put in place by the previous Administration, subsequently gave local authorities the power to restrict the distribution of free printed matter such as leaflets and flyers in specified areas if the distribution of such material is causing a problem.

The Bill could constrain those same local authorities that previously could utilise this provision in the Clean Neighbourhoods and Environment Act. They could argue that the positive action they have taken to reduce littering will be undone because their resources will have to be diverted once again into dealing with the extra littering that my noble friend’s Bill could inadvertently cause.

On the other hand, and in line with my noble friend’s train of thought, I can say that the Anti-social Behaviour, Crime and Policing Bill, which is currently being considered in the other place, will make some changes to local authority powers in respect of litter which will require us to review our accompanying guidance. I am happy to make an offer to my noble friend that in the course of that review we will also look for opportunities to review the guidance to local authorities on their powers in respect of leafleting in exactly the situation that he contemplates. We are willing to work with the Manifesto Club and others to draw up best-practice guidelines. It would be easy to present the local authority powers as an unnecessary erosion of a citizens’ freedom. This is indeed the argument of the Manifesto Club in its report of last year, Leafleting: A Liberty Lost?, which argues that leaflets cause no more mess than burger wrappers or crisp packets and implies that there are far more compelling reasons for the restriction of leafleting.

Perhaps I may take your Lordships back to the 1990s, when trials of similar powers to limit leafleting were run in London and Newcastle. Westminster City Council had particular littering issues over the distribution of free magazines in the Oxford Street area and, more significantly, with the distribution of free material by language schools. This in turn encouraged a range of other businesses such as tattoo parlours, amusement arcades and nightclubs to do the same. Westminster put up notices to highlight this issue but also hit the problem at source by challenging those language schools that had not registered with Companies House. This approach was welcomed by other residents, businesses and visitors to the area.

The leafleting problem in Newcastle centred on a large build-up of litter in the early hours of the morning, consisting mostly of flyers advertising bars and nightclubs. Since May 2002, Newcastle’s licensing department, in consultation with local trade representatives, has issued consents to enable individuals to distribute flyers within the city, showing what I hope noble Lords will accept is a constructive and helpful approach. These consents undergo regular checks to ensure that individuals adhere to the conditions and, if they do not, distributors risks having their flyers confiscated.

These trials showed that the restriction of leafleting activity in specific problem areas had a marked effect in both reducing litter and helping local authorities to limit their street-cleansing costs. The evidence gathered through these trials led to an efficient piece of drafting as part of the Clean Neighbourhoods and Environment Act. However, that does not mean that we have stood still.

My noble friend’s proposal would undermine local authorities’ ability to address a problem which they already know exists. With the best will in the world, not everyone who is handed a leaflet or flyer wants to keep it, and it is a sad fact that many people still think that it is acceptable simply to drop the unwanted flyer a few paces further down the street. Under current legislation, controls on leafleting can be introduced only where there is evidence of a pre-existing problem with leaflet litter. Without these controls, there is a risk of the level of littering rising again in these areas, thus increasing the costs to local authorities of complying with their statutory duty to keep the streets clean. These costs would come at a time when local authority budgets were already under pressure and so would be likely to have a knock-on effect on the ability of local authorities to deliver other local and community services.

The current arrangements enable local authorities to develop appropriate solutions to local issues. If a problem arises, local authorities have the flexibility to consider and consult on an approach which tackles the specific problem and which does not unreasonably inconvenience law-abiding citizens. I put it to your Lordships that the creation of a further exemption, as proposed by my noble friend, would serve only to reduce the flexibility that local authorities currently have to tailor their response to the problem, and this would be directly contrary to this Government’s commitment to localism.

As my noble friend mentioned, exemptions exist to the Clean Neighbourhoods and Environment Act to protect well understood and fundamental rights. A local authority cannot apply restrictions to leaflets distributed for political purposes or for purposes of religion or belief, or for or on behalf of a charity. Feedback from local authorities is that they welcome clear delineation regarding to whom these provisions apply.

However, my noble friend seeks to extend the proposed definition of the events to which the exemption would apply. My concern with extending the exemption is that it could open the floodgates to commercial operators putting on events that could potentially attract huge audiences from far beyond the local community. While my noble friend paints a picture of community events or performances by local amateur dramatic societies, in some areas there may be numerous events taking place—for example, in city centres—where the number of leaflets frequently being dropped could be significant. This in itself would create a problem for the local authority enforcement officers. There is certainly no way of policing that only 600 people will see the leaflet, especially now that information of this kind is able to go global at the click of a button.

The focus on leafleting within this debate should not distract us from thinking about the overall issue of littering. In 2011-12, local authorities spent a staggering £840 million on street cleansing, and in the coalition we committed to working to reduce littering. Littering is a criminal offence which imposes unnecessary costs on the public purse and on society as a whole. Dealing with this supposedly victimless crime takes away from valuable services money which could otherwise be provided to the people who need them. We do not accept that more legislation is the only answer to the problem of littering, or even the best solution. If we are to tackle this problem effectively, we need to change people’s behaviour.

It would be remiss of me not to join the noble Lord, Lord Stevenson, in drawing noble Lords’ attention to the role of digital technology. Let us remember that leaflets and flyers are not the only method of advertising events. The cultural and arts sector is often at the forefront of the innovative use of technology. We encourage such organisations to make full use of digital technology to promote their offer, and indeed to join forces with other, similar organisations to share marketing costs. Arts Council England has made money available for research and development in digital innovation, which could include promoting events through digital mobile technology. This approach has the additional benefit of reducing paper use, which is inevitably better for the environment.

I am sure that even if my noble friend does not tweet himself, he will have dipped into his own party’s Twitter account and seen at first hand the speed at which a message can be conveyed via a digital platform. Many forward-thinking promoters are increasingly using media such as the quick response, or QR, code, in which interested parties use their smartphones to scan an advertised barcode to gain information about promotions or to book tickets for events. Surely these and other emerging and exciting digital tools are the way forward, and the old-fashioned paper leaflet or flyer will soon become an exhibit on the “Antiques Roadshow”.

My noble friend raised the issue of charging by local authorities. These powers are not about raising money for local authorities or placing barriers in the way of grass-roots arts organisations. The licensing fees that local councils can charge for permission to distribute leaflets must not exceed the cost of administering the licensing scheme. Not all councils charge a fee for a licence to distribute leaflets, and many councils have no restrictions at all. My noble friend mentioned some which, he suggested, were charging quite a lot of money. I am happy to look at those at the upper end of what he mentioned in case they exceed the cost of administering the power. To be clear, they can charge only the reasonable costs of enforcing the powers under Schedule 3A that do not extend to clean-up. Associated with that point, we have made informal soundings of councils across England. Pretty well all of them that responded expressed concern about the extra costs of cleaning up the litter generated and the damage to the environment.

The noble Earl, Lord Clancarty, asked me to pass on the content of this debate and the Bill to the DCMS. I am happy to say to him that we have certainly been in touch about this debate, and he is quite right that we should do so. The noble Earl also referred to the possibility of more bins being put out to deal with the problem. Through the guidance that we have published for local authorities, we are encouraging them to look at their bin provision and to think about where they might want to provide additional facilities.

Therefore, I assure noble Lords that it is not the aim of the powers in the existing legislation to impose unintentional, unnecessary and burdensome restrictions on the organisation of community and cultural events, which we see as very important. We want to see vibrant, thriving communities with a strong arts and cultural scene, and we would certainly be concerned if we heard that local authorities were using these powers inappropriately or disproportionately.

I hope that my noble friend is pleased by my offer, in the course of the review of local authority guidance in the context of the Anti-social Behaviour, Crime and Policing Bill, to look for opportunities to review guidance to local authorities, specifically on their powers in respect of leafleting, and that he is pleased that we are willing to work with the Manifesto Club and others to draw up best-practice guidelines.

I do not believe that the legislation as it stands places undue restrictions on civil liberties; rather, it enables local authorities to limit their exposure to unnecessary street-cleansing expenses and to develop controls which are appropriate to their local circumstances. I therefore express significant reservations about my noble friend’s Bill, which has the potential both to increase local authority costs and to make existing controls harder to enforce.

[The Earl of Clancarty]

My Lords, in terms of the exemptions, does the Minister believe that artistic expression is not as important as religious and political expression?

[Lord De Mauley]

I hoped I had made my position clear on that point. I see cultural and artistic expression as extremely important.

Flooding: Insurance

Lord De Mauley Excerpts

Wednesday 26th June 2013 Lords Chamber

[Lord Knight of Weymouth]

To ask Her Majesty’s Government what agreement they have reached with the insurance industry to ensure that owners of homes at risk of flooding can obtain affordable home insurance.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley)]

My Lords, we are at an advanced stage in discussions with the insurance industry about the future of flood insurance. We aim to conclude those discussions and announce future measures as soon as possible to ensure that households can continue to access affordable flood insurance in the future.

[Lord Knight of Weymouth]

My Lords, the Secretary of State is currently struggling to agree a fair deal on CAP reform for UK farmers, and his department has one of the worst settlements in Whitehall in today’s CSR. I hope that he does a lot better for 200,000 householders in this negotiation with insurers. This House rises on the deadline for concluding the negotiation. Given the persistent interest from noble Lords on all sides, can the Minister therefore guarantee us an opportunity to question him in here on the conclusion of the negotiations before we break for the Recess?

[Lord De Mauley]

My Lords, I had hoped we might have a constructive debate about this. However, since the noble Lord has raised the common agricultural policy, perhaps I should say that it was Labour’s leadership in the last round of CAP reform that cost us €550 million in disallowance and led us to the disastrous administration of the single farm payment. We, by contrast, are tackling another immensely complex negotiation on flood insurance in a measured and sensible way. We have to balance the interests of those at high risk of flood, wider policyholders and taxpayers, while the ABI is a membership organisation with a lot of interests to represent. The noble Lord asks about an opportunity to debate the eventual outcome. I would be pleased about that; it is not my role to guarantee it, but I am sure that we will have a chance to do that.

[The Earl of Selborne]

My Lords, to bring the question back to flood insurance, has my noble friend looked at the precedent in America, and are there lessons to be learnt as to how to deal with flood insurance from the treatment of vulnerable homeowners in America?

[Lord De Mauley]

My Lords, that is something to which we have given considerable thought. However, international comparisons provide no clear model. The state-backed national disaster insurance system in the US was in debt to the taxpayer by $17 billion even before Hurricane Sandy struck. Emergency legislation was required in January 2013 to increase the fund’s borrowing by $9.7 billion when the scheme was days from running out of money, to enable claims to be paid. So we have considered it, but it has its limitations.

[Lord Dubs]

My Lords, given that previous deadlines have already been missed, as regards bringing the negotiations to a conclusion, what assurance can the Minister give that this will not be announced some time in the middle of August or September, when there is no chance for us to scrutinise the detail? Further, the Question uses the wording “affordable insurance”. Will he comment on the fact that after the Cockermouth floods, my insurance company for my house in Cumbria increased my premium more than sixfold?

[Lord De Mauley]

Yes, my Lords. In answer to the noble Lord’s first question, the ABI, in its letter to which we referred when we last debated this subject a month ago, has expressed confidence that we will be able to conclude this before the end of July, and I have every confidence in that. We need a solution that provides affordable insurance, as the noble Lord said, for those at risk, but that does not place unsustainable costs on wider policyholders or the taxpayer. Obtaining insurance might involve some householders shopping around or going through specialist brokers if flood risks are significant. In terms of help for householders, in July last year, we published a guide to obtaining flood insurance in high-risk areas in collaboration with the National Flood Forum and industry representatives.

[Lord Greaves]

My Lords, I heard this morning a rustling in the undergrowth, and it was not oncoming water: it was a suggestion that an agreement has actually now been reached between the Association of British Insurers and Defra—the Government. I do not know whether the Minister is able to confirm that, because it has perhaps has not been signed, sealed and delivered yet, but the agreement is there. When that news arrives—perhaps tomorrow—will it be given by an Oral Statement? That would then allow the Opposition in this House to have the Statement taken here, which would be the normal procedure, but can happen only if it is an Oral Statement?

[Lord De Mauley]

My Lords, my noble friend is unique among your Lordships in that he seems to have both ears to the ground at the same time. As I said, we are at an advanced stage in discussions with the insurance industry about the future of flood insurance. We aim to announce future measures shortly to ensure that households can continue to access affordable flood insurance.

[Lord Campbell-Savours]

My Lords, why should not all policyholders carry the risk? It would mean a very marginal difference in premiums.

[Lord De Mauley]

Yes, my Lords. We are trying to arrange a system where those at the highest risk who have difficulty affording the insurance effectively have a continued cross-subsidy from wider policyholders. It is a very complicated negotiation, as I think that the noble Lord is effectively pointing out, and we have a lot of interests to keep in mind here.

[Lord Elton]

Would the negotiations be made easier if the Government decided and announced that any agreement to insure flood-risk property would not extend to any property on flood plains for the building of which planning permission had been given after, let us say, today’s date?

[Lord De Mauley]

My noble friend is persistent in raising this issue. The Environment Agency provides advice to local planning authorities on the flood risk associated with new developments, which is used to develop strategic flood-risk assessments. During 2012-13, 99% of planning objections raised by the Environment Agency were amended in line with the advice of the NPPF. Where development is allowed because the risk is low, the proposed development should be designed to ensure that it is safe even in a one-in-1,000-year-scale flood.

Genetically Modified Crops

Lord De Mauley Excerpts

Wednesday 26th June 2013 Lords Chamber

[Lord Taverne]

To ask Her Majesty’s Government what progress they have made in seeking to reform the regulations regarding the commercial cultivation of genetically modified crops.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley)]

My Lords, the EU has robust and comprehensive regulations governing GM crops. These regulations were designed to provide fair and predictable market access for products that have undergone a rigorous, case-by-case safety assessment. In practice, polarised views across EU member states mean that the scientific evidence is often ignored and crops remain stuck in the system. It is therefore difficult to make progress on this issue.

[Lord Taverne]

I should declare an interest as founder of the charity, Sense About Science. Over 14 years ago, several reports from the Royal Society, supported by every single national academy of sciences in the world, concluded that GM crops were no danger and caused no harm to human health or the environment. Since then, the enormous expansion in the cultivation of GM crops outside Europe and especially in emerging countries has strongly reinforced that conclusion. Will my noble friend convey to the Secretary of State congratulations on basing policy on evidence? Will he assure us that the Government will stand firm against the scaremongering of the Daily Mail, our leading anti-science paper, and recognise that its attacks on GM crops have no more evidence to support them than its disgraceful and scandalous campaign against MMR vaccines?

[Lord De Mauley]

My Lords, first, let me say that my noble friend has a great deal of knowledge in the area of science and GM specifically. His science-based approach is very welcome. I agree with what he says. That is why, despite the difficulties, we will work to unblock the situation. As my right honourable friend the Secretary of State says, we are going to need all the tools in the box to feed the rapidly growing world population. As he also says, we want the United Kingdom to have a leading role in feeding the world and increasing the resilience of global food supplies, and not to stand by watching others take the lead and forge ahead. The UK is the natural home for scientific research. We want companies and research providers to know that the UK is the best place for them to carry out their work.

[Lord Winston]

My Lords, I am sure that it will not have escaped the Minister’s attention that a number of Members of your Lordships’ House are genetically modified. When it comes to plants, does he not agree that there is colossal evidence that, given the shortage of water in the world and of food in many countries, the need for genetically modified plants is ever increasing and that this is an important technology to help many people who are starving?

[Lord De Mauley]

Yes, my Lords, yes and yes.

[Lord Walton of Detchant]

My Lords, as the noble Lord, Lord Taverne, has said, there is no shred of scientific evidence to suggest that GM foods carry any risk to human health. All talk in the media of “Frankenstein foods” is nonsense. Many GM crops have been cultivated with improvement in the quality of the crops and in their yields in many countries across the world. Is it not now perverse and misguided for the European Union, for instance, to have imposed a ban on the cultivation of GM crops? Can we do better?

[Lord De Mauley]

The noble Lord makes a really important point. My right honourable friend the Secretary of State and I have discussed this issue with Commissioner Borg in order to emphasise the importance of finding a solution that gets the current system working. The commissioner has signalled that he wants to try to resolve the problems at European level and we look forward to further discussions on this issue.

[Viscount Ridley]

My Lords, can my noble friend explain why, for 20 years, a group of environmental activists has been allowed to deny the British consumer choice in this matter: the choice to buy GM crops if they prefer them because they think they are good for human health and the environment?

[Lord De Mauley]

My noble friend is quite right that there are groups—interests—that have been successful in creating controversy around GM which has devalued the public debate and means that people have not been able to reach a balanced view of the pros and cons. We will strive to change that.

[Baroness Hayman]

My Lords, will the Minister undertake to express to his right honourable friend the Secretary of State the strength of support in this House for the science and evidence-based approach that he is advocating and wish him luck in the European Union in taking that forward? Would it not be truly irresponsible, given the need, as he has said, to cope with a rapidly expanding and often malnourished and starving population, not to take the opportunities offered by GM and by the independent scientific expertise in this country to move forward and save lives, as GM cotton manufacture has saved the lives of agricultural workers across the world?

[Lord De Mauley]

I agree with the noble Baroness. I am extremely grateful to her and other noble Lords who have spoken positively today, and I will certainly take her words and the words of other noble Lords back to my right honourable friend.

[Baroness O’Cathain]

My Lords, in all this euphoria about GM crops—and I think it is wonderful that at last we have some positive news—let us not forget that there are areas in the world that are going to be badly affected by this because the plants do not produce seeds on the same basis as current crops. I suggest that in all discussions that go on about this, particularly with the European Union, steps should be taken to ensure that the people who are going to make a lot of money out of these GM crops, such as seed merchants, do something to help those people in other areas in the world who will not be able to do the usual agriculture they have at the moment. We just cannot lose sight of that. I would like him to make sure that that will happen.

[Lord De Mauley]

My noble friend raises an issue that is known as “terminator technology”; that is, the concept that seeds may not reproduce. Terminator technology is a concept rather than something that is being applied in practice. There are no GM crops in existence, to my knowledge, that produce sterile seed and no plans to market such crops.

Water Industry (Specified Infrastructure Projects) (English Undertakers) Regulations 2013

Lord De Mauley Excerpts

Wednesday 26th June 2013 Lords Chamber

Moved by

[Lord De Mauley]

That the draft Water Industry (Specified Infrastructure Projects) (English Undertakers) Regulations 2013 laid before the House on 15 May be approved.

Relevant documents: 2nd Report from the Joint Committee on Statutory Instruments, 3rd Report from the Secondary Legislation Scrutiny Committee, considered in Grand Committee on 12 June

Motion agreed.

Water Industry (Specified Infrastructure Projects) (English Undertakers) Regulations 2013

Lord De Mauley Excerpts

Wednesday 12th June 2013 Grand Committee

Moved by

[Lord De Mauley]

That the Grand Committee do report to the House that it has considered the Water Industry (Specified Infrastructure Projects) (English Undertakers) Regulations 2013

Relevant documents: 2nd Report from the Joint Committee on Statutory Instruments, 3rd Report from the Secondary Legislation Scrutiny Committee

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley)]

My Lords, the draft regulations before the Committee today are aimed at helping the delivery of necessary, large or complex water or sewerage infrastructure projects. They are designed to help to contain and minimise the risks associated with their delivery to customers of water or sewerage companies, known as undertakers, and also to UK taxpayers. Containing and minimising these risks should correspondingly provide better value for money associated with delivering such projects. It should also help to ensure that undertakers’ customers continue to receive the required or desired level of existing water or sewerage services.

These regulations would enable the Secretary of State or Ofwat to specify by notice an infrastructure project where either is satisfied that two conditions have been met. The first is that the infrastructure project is of a size or complexity that threatens an undertaker’s ability to provide services to its customers. The second condition is that specifying the project would be likely to result in better value for money than if the project was not so specified, taking into account charges to customers and any government financial assistance.

Once specified, an undertaker would then be required to put the specified infrastructure out to tender and a separate Ofwat-regulated infrastructure provider would be designated to finance and deliver the project. These large, complex infrastructure projects raise issues of determining the cost of their financing coupled with a construction risk that is far greater than that normally associated with an undertaker’s typical capital investment.

Enabling an undertaker to tender competitively an infrastructure provider for a large or complex project provides an objective means of testing whether the financing costs of such a project are appropriate or reasonable. Without that tendering process, competitively determining the cost of capital for those types of project would not be possible. The ability to create ring-fenced Ofwat-regulated infrastructure providers between undertakers and large or complex projects would also help to ring-fence their associated higher risks, and should result in more effective risk management for these projects.

--- Later in debate ---

[Lord Knight of Weymouth]

My Lords, the Minister will be relieved to know that on this occasion, unlike a previous one, I will not seek to give contradictory views to represent the views of some of my colleagues on this side of the Committee. This debate comes at an inconvenient time for Thames Water but, therefore, at an opportune time for Parliament. I will make some general comments and then delve a little into some of the specifics of the Thames tideway tunnel project. In making my comments, I am grateful as ever to the Secondary Legislation Scrutiny Committee of your Lordships’ House. Its third report of this Session brings these regulations to the special attention of the Committee on the grounds that they give rise to issues of public policy likely to be of interest to us. I am particularly grateful that the Committee is willing to delegate me to take forward all those public policy issues. It is right that we should reflect on them.

As the committee points out, the Explanatory Memorandum implies that these regulations are generic and apply to all water and sewerage companies and large infrastructure projects that meet the criteria. That was clearly set out by the Minister. However, the only project to which the regulations are expected to apply over the next 10 years is the Thames tideway tunnel. The impact assessment therefore exclusively estimates the impact of the project in relation to these regulations. We have debated the tunnel before, but there are issues I would like to raise as events have moved on.

First, I will make some generic comments. The arguments put for establishing a separate body to manage the finance, delivery and extraordinary risks of major water infrastructure projects are reasonable. The example of the Thames tunnel is helpful. It will cost more than £4 billion and, while Thames Water will carry out associated investment at its own risk, the cost of the main tunnel is a considerable financial risk to put on a company with a turnover of £1.8 billion. Assuming that Thames Water is well regulated and responsible, there is logic in establishing a separate infrastructure provider to construct the tunnel and have Thames Water effectively lease it back.

These regulations then extend the reach of Ofwat to these providers, which is important to ensure that the public interest is protected. The alternatives discussed by the Minister and in the accompanying papers are to leave things as they are or to require that the project be put out to tender by the water company. Defra discounts the former because Ofwat would struggle to regulate the financial arrangements when they are bound in with the rest of the company’s activities. To some extent, I struggle to see how it can effectively regulate the general finances of a company and then the separate finances of a big project, but cannot manage to do it when they are done together. However, I am happy to believe those involved when they tell me that they cannot. I am also happy with the desirability of a separate provider over the complexity of negotiating a new licence, which is the implication of requiring the company to tender a major project. Therefore, I am happy with the regulations as they stand in the generality.

Let me then turn to the specifics of the Thames tideway tunnel and the figures in the impact assessment. I remind the Committee that I rent a flat here in London very close to one of the sites for the construction of the tunnel, so in that respect have an interest. Thames Water has also been to see me to brief—or some would say lobby—me about the project. I accept the basis of the company’s argument. The capital’s Victorian sewerage system has served the capital well, but urgently needs more capacity to meet the needs of modern-day London. The Thames tideway tunnel will ensure that the capital has a sewerage system fit for purpose for at least another century.

The tidal part of the river remains an environmental and public health hazard. It cannot be acceptable to allow the tidal River Thames to be an open sewer. Sewage discharges into the tidal River Thames breach the urban waste water treatment directive and British taxpayers would face the prospect of substantial fines if the tunnel is not built. Other world-leading cities, including Paris, Stockholm, Helsinki and Washington DC, as well as the Rhine/Ruhr conurbation in Germany, are forging ahead with similar schemes. I agree with Thames Water’s briefing that London is in danger of being left behind and facing substantial fines if we do not act.

I am happy to support the project. The benefits to employment in London should be maximised and the impact on residents minimised, and I am pleased on progress in moving more material off the roads and on to the river during the construction phase. However, I also note the recent remarks by the new chair of Ofwat, Jonson Cox. Interestingly, Mr Cox is a water industry insider. He said last week that some unlisted companies have a moral case to answer over allegations, that they,

“use shareholder loans to avoid UK taxation”,

through “complex offshore holding structures”. He said:

“A good number use high-coupon shareholder loans to improve their equity returns … It appears that this reduces tax liability for the benefit of shareholders”.

He went on:

“Tax policy is not for an economic regulator and these structures may be legal and common in private equity. But some aspects are morally questionable in a vital public service”.

Thames Water has published its annual results this week. It appears that the company pays no corporation tax on its £1.8 billion turnover while continuing to pay executives many times more than the Prime Minister. In my view, this is unacceptable—it stinks. Why should the public be reducing the risk to shareholders of Thames Water through the Water Industry Financial Assistance Act 2012, if it then uses every last trick in the book to maximise shareholder return at the expense of the UK taxpayer? Does the Minister agree that these loopholes must be addressed as a matter of urgency? The logic of allowing profit is to reward the risks, particularly of investment, but that is undermined by excessive profit, excessive executive pay and tax avoidance when Parliament and the Government are acting to reduce the risk to Thames Water customers and shareholders.

When we turn to the impact assessment, why should the taxpayer be funding an extra £5 million of regulatory cost of Ofwat in setting up these arrangements? Could we not find a way of billing Thames Water for this expense, given that Thames Water pocketed a £5 million credit from the Treasury in a year when it made £550 million in profits? Given that the chief executive, Martin Baggs, was awarded a pay rise of 5.9%, taking his basic salary to £450,000 plus a bonus of £274,000 as part of a scheme to,

“reward significant improvement in the group’s financial and corporate performance”,

as well as picking up a further £366,000 in shares next month under the company's long-term incentive plan, maybe the £5 million could be found from senior executive salaries alone. Does the Minister agree?

On the narrow question of the regulations, I am content. On the question of Thames Water fulfilling its moral responsibilities and thereby breaching the trust on which the financing of the Thames tideway tunnel is based, I am not.

[Lord De Mauley]

My Lords, this has been an interesting debate on a number of issues relating to the draft regulation and indeed to the Thames tideway tunnel. I thank the noble Lord for his views and his insightful interventions. I thank him for agreeing that the general approach we are taking is reasonable. That is perhaps the most important thing to come out of today, and it is extremely helpful. I will come back to his specific points in a moment.

As I indicated in my introduction, it is important that these regulations should be considered separately from the specific Thames tideway tunnel project in London. In summary, the regulations enable the creation of infrastructure providers regulated by the Water Services Regulation Authority, Ofwat, to finance and deliver large or complex water or sewerage infrastructure projects. They provide for the procuring, licensing and regulating of an infrastructure provider that is separate from a water or sewerage company. They set out how the Secretary of State or Ofwat can specify to which projects the regulations would apply and how they designate the company that is to become an infrastructure provider. The regulations are intended to apply to all such large or complex water or sewerage projects that may be proposed in the future, where their application would be considered to result in better value for money for both customers and taxpayers.

I turn specifically to the Thames tideway tunnel, and I think the noble Lord has already made similar points. Climate change, population growth and higher customer expectations of environmental standards and supply resilience are anticipated to require larger and more complex infrastructure than the existing regulatory regime was designed to provide for. For example, changing rainfall patterns are expected to result in wetter winters and drier summers—who would believe it after last summer?—and to aggravate water scarcity conditions in the south and the east. This may lead to an increased requirement for potentially complex arrangements for transporting water.

Moreover, heavy rainfall events are likely to become more frequent—that we can all believe. In London, these events will further strain an already overtaxed sewerage system, leading to more overflows of untreated wastewater, containing raw sewage, into the Thames. Even after ongoing upgrades to sewage treatment works and the Lee tunnel are completed by the end of 2015, just over 18 million tonnes of wastewater will enter the Thames every year from London’s combined sewer overflows when storm-water capacity is exceeded. These overflows currently occur on average about once a week and have a significant environmental impact on the river. They increase the likelihood of fish kills, create a higher health hazard for the users of the river and damage the aesthetic appeal of the Thames.

EUC Report: EU Sugar Regime

Lord De Mauley Excerpts

Monday 3rd June 2013 Grand Committee

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley)]

My Lords, I am grateful to the noble Lord, Lord Carter, for instigating the debate, to all noble Lords who have spoken today and to the entire committee for its work on this report.

In responding to the noble Lord, Lord Carter, and others, perhaps I may begin with an abject apology for the delay in sending the Government’s response to the committee. My honourable friend David Heath has written to the noble Lord, Lord Carter, and to my noble friend Lord Boswell. However, I would like to make clear that the delay was unsatisfactory and that we need to do better in future. I should also emphasise that this episode in no way reflects on the Government’s appreciation of the committee’s work or of the report. Indeed, I find myself in the happy position of being able to say that the Government agree with the vast majority of the report’s recommendations.

It has, of course, been, as noble Lords have said, some time since the report was published. In the mean time, the common agricultural policy reform negotiations have continued, albeit slowly, and it may help if I recap the main developments.

The Commission’s proposal in October 2011 included very little on sugar. This reflected the intention not to re-enact quotas when they expire under current legislation in 2015. In fact, there was very little discussion on sugar for the first year of the negotiations. When the EU Council of Agriculture Ministers and the European Parliament concluded their separate discussions on the issue in March this year, the focus was very much on the future of beet quotas, and two different visions of the future emerged. As the noble Lord, Lord Carter, said, the Council took the view that quotas should be extended to 2017 but no further. This reflected a compromise between two broad groups. In the main, those member states that currently have a beet quota wanted to retain it, while those without a quota supported the early abolition of quotas. The European Parliament, too, had internal divisions, but eventually concluded that beet quotas should be extended until 2020.

The noble Lord, Lord Carter, and my noble friends Lady Parminter and Lady Byford asked about our view on the timing of the end of quotas, as did the noble Lord, Lord Knight, in his final question. The Council mandate is for quotas to end in 2017, and the European Parliament has voted to keep quotas to 2020. Those two dates represent the starting point for the negotiations, and we remain optimistic about which end of the range we will end up at.

The noble Lord, Lord Carter, asked how influential we have been in the negotiations on the CAP. Our support was key in ensuring that the Council reached agreement on a 2017 end date. More widely, we have seen successes in stopping excessive coupled payments and in allowing the four parts of the United Kingdom to make their own decisions on implementing the agreement.

The next step in the process is the so-called trilogue negotiations between the Irish presidency, on behalf of the Council, the European Parliament and the Commission. Those negotiations are ongoing and any agreement between the parties on sugar is now likely to occur in the context of an overall agreement on CAP reform. As the committee heard when the Secretary of State appeared before it on 15 May, much remains to be done to secure that agreement. However, we are still optimistic that, under the able chairmanship of the Irish Agriculture Minister, Simon Coveney, a deal will be struck by the end of June.

For our part, the UK Government have done, and will continue to do, all that we can to promote the liberalisation of the EU sugar regime in respect of both beet and cane, and I thank the committee again for its report as adding weight with the Commission to that argument. We do so for good reason. EU market prices have consistently been at least 50% above world market prices for the past few years, a level of distortion not seen in any other CAP regime. That distortion arises from both production quotas for EU beet and very high tariffs on imports of cane. As a result, wholesale sugar prices for EU food and drink manufacturers have been inflated by around 35%, while EU consumers have suffered a 1% increase in the overall cost of the average food basket. At the same time, producers in many poorer countries find it difficult to market their sugar in Europe, as the noble Lord, Lord Knight, mentioned. That hinders their economic development, and undermines to some extent the EU’s own aid programmes to these countries.

Abolishing beet quotas would be an important step towards removing current market distortions. It is disappointing, therefore, that the Council could not agree with the Commission’s proposal in this respect. We do not wish to see any further delay beyond 2017. However, even more disappointing is that neither the Council nor the European Parliament has addressed the need for additional measures on cane imports. The very high tariffs that apply have an even greater distorting effect on the market than beet quotas. The exemptions from those tariffs for African, Caribbean and Pacific states and less developed countries are valuable, but the supply from those sources is less than was anticipated at the time of the last reform. That has left the market with a shortage of sugar and idle capacity in EU refineries, which is putting their future viability under threat.

The abolition of beet quotas would ease the supply shortage, but would also increase the risks to the viability of the refining sector, as market prices are expected to drop while the cost of their raw material remains high. Losing the refining industry would reduce competition and introduce food security risks to the EU market. It would also lead to job losses, including at the Tate & Lyle factory in London, and threaten the livelihood of growers of cane in developing countries that currently supply EU refineries.

The Government will therefore continue to seek fair treatment for cane refineries as the CAP reform negotiations progress. The focus in the negotiations on beet quotas has also meant that there has been relatively little discussion on inter-professional agreements, or IPAs. As touched on during the debate, IPAs govern the contractual relationship between beet processors and growers and have traditionally been valued by both parties.

The Commission’s proposals contain different wording to that in current legislation and, as indicated in the debate today, this has caused some concern whether the intention is to change the ground rules. We hope that the Commission’s own response to the committee’s report will provide some reassurance that there is no agenda to weaken the negotiating position of growers. However, this is something that we will pay close attention to as detailed rules are drawn up.

I will now answer noble Lords’ questions to the best of my ability. To start with, in response to the noble Lord, Lord Carter, as the Secretary of State explained when he appeared before the committee, a great deal of effort has been put into developing relationships and building alliances. Noble Lords would not expect me to go into detail about our negotiating tactics, but every opportunity is being used to build on that groundwork so as to make the case for further liberalisation while accommodating other views where possible. That approach bore fruit in securing the agreement to a 2017 end date for quotas as part of the council mandate, and we should be defending that agreement very strongly for the remainder of the negotiations.

The noble Lord, Lord Carter, asked how we could achieve 2017 without financial compensation. We have strong support from some in the Council for the end of quotas. We are optimistic that the agreement will stick. We have not seen requests for compensation from other member states, and do not see a case for that. Compensation for less developed countries is another matter, and measures can be considered within the context of the European Development Fund.

The noble Lord, Lord Carter, and my noble friend Lady Parminter asked about work by the competition authorities. As indicated in the Government’s response, the EU competition authorities, supported by the OFT, are undertaking an investigation and we would prefer to see that completed before considering further reviews.

My noble friend Lord Caithness suggested that we have relaxed our demand for an end date for quotas to 2017. We argued strongly for 2015 but there was very little support in Council. In a negotiation with 26 other member states some compromise has to be made and, with Germany, France and others pushing for 2020, an end date of 2017 was a relative negotiation success.

The noble Lord, Lord Carter, asked for an update on the state of play on risk management discussions in the CAP negotiations. The past 18 months have been very challenging for farmers, with some difficult weather conditions such as late snow, even as recently as Easter, as noble Lords will know. The Government are therefore considering how best to support farmers to manage risks. The rural development regulation offers opportunities for supporting risk management. For instance, the proposed risk management toolkit, if used, could provide subsidies for agri-insurance and mutual funds. However, consideration should be given as to whether subsidies in this area are permanent or temporary and to what degree these sorts of products are needed by farmers in the United Kingdom. As the toolkit is in Pillar 2, using it would mean there would be less money available of course for other Pillar 2 activities and priorities.

The UK is opposed to the income stabilisation tool proposed by the Commission. We are concerned that it is unstable and unpredictable. In any case, the countries that use such tools, such as Canada, have them instead of direct payments, not in addition. We should not focus solely on the risk management tools set out in the Commission’s proposals that directly address risk management in the rural development regulation. There are other activities enabled by the rural development regulation that can be used to support farmers to manage their risks, for example by enabling them to make investments in physical assets which help to mitigate some of the risks that they may face. The development of the next English rural development programme is under way and Defra is building an evidence base. We will be considering the objectives and priorities for funding through the next programme based on that evidence and the objectives for rural development set out in the draft EU rural development regulation.

The use of tools available under the rural development regulation is only one of several options. We are working with industry, the financial sector and charities to consider what might be done. We will meet again with their representatives in July to look at the impact of recent bad weather on farming cash flows. There is a frost insurance scheme and a private sector scheme for sugar beet. There is a market for such schemes without public money.

My noble friend Lady Byford asked how the ACP and less developed countries could be helped to stand on their own two feet. There are a number of factors holding less developed countries back, including economies of scale, infrastructure and skills at both farm and processing level. Solutions need to be tailored to the specific national problems, which is being done under the accompanying measures for the last reform, albeit too slowly. My noble friend asked which countries have received assistance and how it is being disbursed. I think the noble Lord, Lord Carter, asked about that too. The main beneficiaries have been Kenya, Mozambique, Ivory Coast, Swaziland and Tanzania. My understanding is that of the £1.2 billion intended for accompanying measures, some £0.95 billion has been awarded, of which £0.5 billion has actually been paid. My colleagues in the Department for International Development are pressing the Commission on that slow disbursement.

My noble friend Lady Byford and the noble Lord, Lord Carter, also asked why, if sugar prices have declined for the producer, consumers are paying more in real terms. Available data suggest that retail prices did not fall in line with the cut in EU prices following the last reform. Sugar users contend that this is attributable to generally rising costs within the supply chain, for example, energy and labour. However, others have questioned the extent to which sugar users have been able to capture the price cuts and not pass them on to consumers. As indicated in the government response, the European Commission authorities are making inquiries into alleged anti-competitive practices, which may throw some light on this area.

My noble friend also asked whether the use of the term “inefficient” to describe the production systems in some countries is a reference from a grower’s or a refiner’s viewpoint. It is generally meant to refer to those countries or regions whose growers have the lowest yields.

My noble friend Lord Caithness asked whether the EU study results expected in February have come in yet and what they are. I am afraid that the results of this study have not yet been published. We are as keen as your Lordships to read it and engage with the Commission on how any conclusions can be taken forward. We will ensure that the committee is made aware of the study’s results when they are published.

My noble friend Lord Caithness also asked about mandatory written contracts. The Government are sympathetic to the concerns that he referred to in the context of interprofessional agreements. The issue, as I understand it, is not so much about what is in the Commission’s proposals but about what might be introduced in the detailed rules that will follow. While wishing to see normal competition principles apply as far as possible, the Government are also mindful of the need not to unbalance the legal framework governing the relationship between growers and processors. When it comes to negotiations on the Commission’s detailed rules in due course, the Committee may be assured that we will consult all interested parties to identify whether any issues arise in practice.

My noble friend Lady Parminter asked whether the Government have any plans to look at the role that fiscal incentives can play in shaping positive food choices. We keep all evidence on the impact of taxation on promoting healthier food choices under review. We believe that the voluntary action that we have put in place through the public health responsibility deal is delivering results; 33 companies have signed up to pledge to help the population reduce their calorie consumption. I argue that this is the right way forward, but I emphasise that we are not complacent and we are clear that this is something for all food businesses, not just some. If we do not get continued progress, we will have to consider alternative approaches.

In conclusion, there is much that the Government and the committee can agree upon, including support for genuine CAP reform that removes distortions from the market and delivers real benefit to consumers and producers, a desire to see strong, competitive beet processing and cane refining industries in the United Kingdom and appropriate safeguards for producers, both in the UK and in developing countries. We will continue to make the case for that vision in EU and other international negotiations. The committee’s continued interest and contribution to the debate would be most welcome.

Insurance: Flood Risk Areas

Lord De Mauley Excerpts

Wednesday 22nd May 2013 Lords Chamber

[Lord Dubs]

To ask Her Majesty’s Government what proposals they have to ensure insurance cover for property in flood risk areas, in the light of the reported lack of progress in talks with the insurance industry.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley)]

My Lords, we are at an advanced stage in negotiations with insurers towards a successor to the statement of principles. Insurers have voluntarily agreed to abide by the current agreement until 31 July to allow time for the outstanding issues to be concluded.

[Lord Dubs]

My Lords, will the Minister confirm that there were 500,000 insurance claims for flooding last year and that 2.5 million properties are deemed by the Environment Agency to be at risk of flooding? He will know that the negotiations have gone on for a long time. Does he accept that it is vital that they are brought to a rapid conclusion to safeguard the position of many homes in the country and to ensure that people can sell their houses, which at the moment may prove impossible?

[Lord De Mauley]

My Lords, I broadly agree with the noble Lord that negotiations must be brought to a satisfactory conclusion as soon as possible. That is what we are working on, as I have said. It is worth saying that the Secretary of State has received a letter from the ABI—I have ensured that a copy is in the Library—in which it confirms that its members agree to continue to meet their commitments for a further month to enable the resolution of negotiations. To me this clearly demonstrates its good intentions and its determination to reach an agreement.

[Lord Elton]

My Lords, given the scale of the problem that already exists, will my noble friend make certain that no planning permission is granted to any developments of residential property in flood areas in future, because there are plenty of those bids in place?

[Lord De Mauley]

My Lords, my noble friend makes an important point. He should know that the National Planning Policy Framework seeks to ensure that development is located away from flood risk wherever possible.

[Lord Wigley]

My Lords, the Minister will be aware of the considerable number of floods along the Welsh coastline—Dyffryn Clwyd, the Conwy Valley, Ceredigion —over recent years. Some of these locations have had, twice in recent years, a one in 1,000-year event, making insurance virtually impossible. Can he guarantee that when this agreement has come into force after 31 July, or whenever, none of these households will be unable to obtain the necessary insurance cover?

[Lord De Mauley]

My Lords, my heart, and I am sure the hearts of all noble Lords, goes out to those who have suffered from these events. It really is a horrible thing to happen. It has happened to me, so I sympathise with them. Our view is that action taken to reduce flood risk is the best way of keeping insurance available and affordable, which is why we are spending more than £2.3 billion over four years to tackle flooding and, indeed, coastal erosion risks. I have a lot of sympathy with what the noble Lord says.

[Lord Greaves]

It is very welcome that the ABI has agreed to extend by a month the operation of the statement of principles, but this has been going on now for a long time. It is at least a year since I first asked a Question about it, and Members of this House and of the Commons have been asking questions at almost weekly intervals ever since. We were told that the negotiations were “constructive”, then that they were “arduous and difficult”, then that they were “urgent”. Now we are told that they are “at an advanced stage”. Will the Minister explain to the House, in words of one syllable, just what the problem is?

[Lord De Mauley]

I am not sure about words of one syllable, my Lords. Negotiations, and I know that some noble Lords opposite are very experienced in them, are very complex things, and this is a particularly complicated subject. We are working on it. The letter from the ABI is a good demonstration that we are close to a solution.

[Lord Foulkes of Cumnock]

My Lords, how are the Scottish Government involved in these discussions, since the insurance industry stretches throughout the United Kingdom?

[Lord De Mauley]

I absolutely agree with the noble Lord that this problem affects the whole of the United Kingdom. The devolved Administrations are closely involved in the discussions.

[Lord Roberts of Llandudno]

My Lords, is the Minister having discussions not only in England but in Wales, Scotland and Northern Ireland? As my friend the noble Lord, Lord Wigley, has indicated, we have suffered from serious flooding and that is going to increase as climate change becomes more severe. Is there not a new urgency in this and a necessity to work together to resolve this question?

[Lord De Mauley]

My Lords, I agree with that. To answer my noble friend’s question and to add to my answer to the noble Lord, Lord Foulkes, I should say that we have regular ministerial meetings with Ministers from the devolved Administrations—in fact, I attended one this week—and this subject regularly comes up.

[Lord Campbell-Savours]

My Lords, has the Minister himself been directly involved in these negotiations? If he has, does he know what the obstacle is? What is the problem? What is holding them up?

[Lord De Mauley]

I have to admit to the noble Lord that this is not in my policy area, so I have not. I attend the regular ministerial meetings so I know a certain amount about what is going on. In negotiations, it is very important that the intricate details are kept confidential, and I hope that the noble Lord will understand that, but, as I say, I am confident that we are working towards a solution.

[Lord Knight of Weymouth]

My Lords, the noble Lord, Lord Greaves, is right that the time that it has taken to reach this agreement is unacceptable. Last week we discussed the Defra delays over doing something about plastic bags. This week we return to this question. I declare my interest as someone whose home was flooded last July. Why do we keep having these Defra delays? Is it that Ministers are not showing leadership and providing a sense of urgency, or is it that right now it is impossible for this Government to agree about anything?

[Lord De Mauley]

My Lords, whenever we talk about flood insurance, the noble Lord leads with his chin. I just say this to him, once again: the statement of principles, which his Government put in place, did nothing about affordability. That is what we are seeking to tackle this time.

[Baroness McIntosh of Hudnall]

My Lords, given the information in the press at the weekend showing the vulnerability to flooding in urban areas—I do not know whether the Minister saw that information, but it was really quite alarming and a lot of it was about London—does he agree that many people who are in fact vulnerable to flooding probably do not know that they are, because they do not live near a river or on the coast? They are vulnerable to the breakdown of the infrastructure that allows waste water to be taken away when there are heavy rains. What have the Government been doing to encourage local authorities to prevent people from, for example, tarmacing over their front gardens, which makes the likelihood of flooding in those circumstances much greater?

[Lord De Mauley]

On the noble Baroness’s specific question, it is one of a panoply of issues that need to be addressed. I will write to her further on that. She specifically mentioned London. London is a very important component of this. The Environment Agency has a plan to tackle the issue, called the Thames Estuary 2100 Plan. A key strength of the plan is its adaptability, which allows us to deploy different options to manage flood risk as new climate change guidance emerges.

[Lord Phillips of Sudbury]

What assumptions about global warming underlie the negotiations?

[Lord De Mauley]

That is a subject for a longer debate.

[Lord Elton]

My Lords, could my noble friend throw a little light on his answer to my earlier question, which I interpret as meaning that permission to develop residential property in a flood plain would be denied wherever possible? Can he tell us in what circumstance it might be impossible to deny such permission?

[Lord De Mauley]

My Lords, development in areas of flood risk is permitted only exceptionally, where there are wider sustainability considerations. In all cases, it must be safe and not increase flood risk elsewhere. And, where possible, overall flood risk should be reduced.

Reservoirs Act 1975 (Exemptions, Appeals and Inspections) (England) Regulations 2013

Lord De Mauley Excerpts

Wednesday 22nd May 2013 Lords Chamber

Moved by

[Lord De Mauley]

That the draft regulations laid before the House on 26 March be approved.

Relevant document: 23rd Report from the Joint Committee on Statutory Instruments, Session 2012-13, considered in Grand Committee on 20 May.

Motion agreed.

Reservoirs Act 1975 (Exemptions, Appeals and Inspections) (England) Regulations 2013

Lord De Mauley Excerpts

Monday 20th May 2013 Grand Committee

Moved By

[Lord De Mauley]

That the Grand Committee do report to the House that it has considered the Reservoirs Act 1975 (Exemptions, Appeals and Inspections) (England) Regulations 2013.

Relevant document: 23rd Report from the Joint Committee on Statutory Instruments, Session 2012-13.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley)]

The amendments to the Reservoirs Act 1975 by Schedule 4 to the Flood and Water Management Act 2010 introduce a more risk-based approach to the management of large raised reservoirs, and these regulations are a key component of this process. The regulations are required to be brought into force as soon as the substantive provisions amending the 1975 Act are commenced.

By way of background to the Reservoirs Act 1975, while it is rare for a large raised reservoir to fail, the impact of such failure on life and property could be considerable. During the 2007 summer floods, there was a near-miss incident at Ulley reservoir where a complete reservoir failure was averted only by emergency action. In his review of the 2007 floods, Sir Michael Pitt made recommendations for improvements to reservoir safety. These recommendations were addressed through amendments to the 1975 Act made by Schedule 4 to the Flood and Water Management Act 2010.

Regulation-making powers inserted into the 1975 Act by the 2010 Act include the allowance of specific exemptions from the 1975 Act, the introduction of appeal rights and clarity on the timing of inspections. The regulations relating to exemptions specify what are not to be treated as large raised reservoirs for the purposes of the 1975 Act. Exemptions from the 1975 Act include tips that are covered by mines and quarries legislation and canals and inland navigations, and these exemptions are maintained. Due to the new definition of a large raised reservoir as a result of the 2010 Act, other bodies of water potentially fall within the scope of the 1975 Act. This has led to a new exemption for road and rail embankments with drains that have not been artificially blocked, such as with gates. Where a road or rail embankment effectively acts as a flood storage reservoir, it should be recognised as such and managed accordingly.

The regulations also provide undertakers of large raised reservoirs with the right to an appeal. An undertaker may appeal against the designation of a large raised reservoir as high risk and against notices given by the Environment Agency either to appoint an engineer or to carry out a recommendation of an engineer in the interests of safety. The regulations provide that the First-tier Tribunal will hear all appeals under the amended 1975 Act. To maintain the credibility of the 1975 Act and the efficacy of the designation regime, it is important that the appeals mechanism is independent, efficient and comprehensive and is a fair and cost-effective way of adjudicating any disputes. The process for bringing an appeal is governed both by these regulations and by the Tribunal Procedure (First-tier Tribunal) (General Regulatory Chamber) Rules 2009.

The regulations also set out the timings of inspections. Previously, under the 1975 Act, all large raised reservoirs had to be supervised and inspected, whereas the 2010 Act amends this to include only those large raised reservoirs designated as high risk. Transitional arrangements will be in place to ensure the smooth introduction of these requirements. The regulations also require the Secretary of State to review the operation and effect of these regulations and to publish a report within five years after they come into force. The powers to make these regulations are contained in the amendments made by Schedule 4, which were commenced in October 2011. The substantive provisions introducing a more risk-based approach to reservoir management cannot be implemented without these regulations.

The amendments to the Reservoirs Act 1975 introduce a more risk-based approach to the management of large raised reservoirs and these regulations are a key component of that process. They are a necessary and appropriate statutory obligation and I therefore commend them to the Committee.

[Lord Knight of Weymouth]

My Lords, anyone observing this debate might think that, based on attendance, there is little interest in these regulations. However, I think that this is one of those circumstances where attendance signifies consent, and lack of attendance signifies positive consent. I think the fact that more noble Lords have not attended the debate simply demonstrates the extent to which the regulations are not contentious.

I remember well the floods of 2007 and how perilously close we came to real disaster when emergency action averted the failure of Ulley reservoir. That was why the previous Government, of whom I was a member, asked Sir Michael Pitt to carry out the review, and the Pitt report recommended these improvements to reservoir safety legislation and, in particular, this risk-based approach. It would be extremely churlish of me to be anything but supportive of these regulations given that they reflect the work that was done following the Pitt review. It merely remains for me to ask two or three questions that arise from the regulations.

The first, which might sound slightly oppositional, is straightforward. Why has it taken so long to bring forward the regulations given that Sir Michael Pitt carried out his review some time ago? They are dealing with significant matters of risk in respect of flooding and we have had a lot of flooding activity in the past 12 months. Everyone has noticed the nature of the weather during that time and the flooding that goes with it, so it would be helpful to know whether more could have been done to bring these forward sooner.

The second question is on Regulation 3 and those items not treated as being large raised reservoirs. As the Minister said in his opening comments, certain items such as tips, which have been exempted as large raised reservoirs, and other items are being added here. Assuming that some of those items might have some high risk attached to them on a risk-based approach, how is that risk being assessed? Who is inspecting them and how is the risk then being raised and dealt with by the owners of those bodies of water? If none is of high risk because of its very nature—such as its embankments or drains—then to ask whether the risk-based approach would not have dealt with it without this piece of legislation is perhaps rather a pedantic, subsequential question to that.

Finally, Regulation 4 deals with the right to appeal first against designation and Regulation 5 with the right to appeal against a notice. The basis of that appeal is to be able to go to a First-tier Tribunal. Can the Minister update us on how much capacity the Tribunals Service has to deal with these appeals? What is his expectation regarding the volume of appeals? As we refer more things to the Tribunals Service, there is a general concern that the service’s funding is not growing. I am quite confident in saying that. I suspect that it might be shrinking, and yet we are asking it to do more work. In these matters of public safety, which is what these regulations are dealing with, we would certainly not want appeals to be delayed because of a backlog at the Tribunals Service due to its lack of capacity.

That is probably my most significant question. The Minister has been assiduous in writing to me when things do not initially seem as forthcoming as they could be, and any information that he could give us about the Government’s assessment of the Tribunals Service’s capacity would be very helpful. Incidentally, if an appeal is unreasonably delayed in the Tribunals Service and an incident then occurred, where would the liability fall? Would it fall with the owner of the reservoir or with the Government because they did not have sufficient capacity in the Tribunals Service?

My final question also relates to the Tribunals Service. There was some mention either in the impact assessment or the Explanatory Notes of discussions that are still going on with the Tribunals Service about how it will deal with technical matters as opposed to legal matters when appeals are being heard. If the Minister has any update to put on the record about those discussions that would obviously be very helpful.

To summarise, we on this side are extremely happy to see the Government coming forward with these regulations, although we would have liked them to have happened a little quicker. There are one or two issues of concern in terms of the tribunal arrangements for appeals, but it is right that people should be able to appeal and it is right that it should be done in the context of the Tribunals Service. I therefore do not have any substantial argument with the way in which this is going forward. On that basis, I hope that I have given the Minister enough time, by talking a little longer, for him to give us some answers.

--- Later in debate ---

[Lord De Mauley]

My Lords, I thank the noble Lord for his comments and questions: I will do my best to answer them. As he kindly said, if there is anything that I am unable to answer now I will of course write to him.

The noble Lord's first question was why in the broadest terms it has taken this long to get to where we are today. I acknowledge that phase 1 has taken longer than I would have liked. He was kind enough to acknowledge, and he is right, that resources have to be prioritised. It has been, as everyone knows, important to deal with ongoing, relatively widespread instances of flood emergency. That simply has to take priority and I think that everyone would acknowledge that life and property must take first place.

The noble Lord also asked about the prioritisation of reservoirs, and if reservoirs are excluded from this regulation then how the risk is encompassed. Tips and so forth are covered by the mines and quarries legislation, save for other extant arrangements there, and the Health and Safety Executive leads on that. I hope that that is adequately helpful to him. Canals are managed using risk-based management approaches.

The noble Lord asked about the right to appeal under Regulation 4 and he was specifically concerned about the capacity of the Tribunals Service. We are in discussion with the service about the likely workload and the resources needed at the moment and I cannot at this stage go further. However, he has pinpointed the right question. We agree with him and are investigating how we will deal with it.

On that basis, I hope that noble Lords will agree that the Grand Committee has considered the regulations.

Motion agreed.

Environment: Plastic Bags

Lord De Mauley Excerpts

Tuesday 14th May 2013 Lords Chamber

[Baroness Parminter]

To ask Her Majesty’s Government whether they are considering a levy on single-use plastic bags in England.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord De Mauley)]

My Lords, we are monitoring the charging scheme in Wales, data from the first year of which will not be available until the summer. The Northern Ireland scheme began last month. The Scottish consultation response on the charge is expected in due course. We are considering these schemes and the available evidence carefully so that we can make a fully informed decision on a possible charge for England.

[Baroness Parminter]

I thank my noble friend for that response. Are the Government aware of the substantial hidden costs that English consumers bear from retailers buying and storing and local authorities disposing of plastic bags? Will the Government therefore introduce a small levy to cut those costs and, crucially, to protect our environment and wildlife?

--- Later in debate ---

[Lord De Mauley]

My Lords, my noble friend works tirelessly on this subject. I acknowledge the thrust of her question, although I am not aware of any evidence from Wales that any such savings are being passed on to consumers through lower prices, but we will continue to monitor the situation there. Retailers operate in a competitive environment, and consumers can choose to shop around. Indeed, evidence shows this is a growing trend.

[Lord Anderson of Swansea]

My Lords, the pilot scheme in Wales has lasted for several years. Will the Minister spell out very clearly the objections to the implementation of the scheme in England?

[Lord De Mauley]

My Lords, as I just said, we are monitoring the charging scheme in Wales and data from the first year will not be available until the summer. I understand that unintended consequences in the Republic of Ireland included an increase in sales of bin liners because consumers no longer used free carrier bags to line their bins. The production of bin liners has a bigger environmental impact than single-use carrier bags. In addition, following the introduction of the charge in Wales there was an increase in sales of bags for life. As the aim of a charge is to reduce use, it could result in a worse environmental outcome if they are used only once or twice, because they need to be used at least four times to have a lower carbon footprint than single-use carrier bags. We need to consider all the impacts in the round, and we will consider very carefully instituting a charge.

[Lord Wigley]

My Lords, does the Minister accept that the evidence from Wales suggests an indicative reduction in the use of bags of up to 90%, that there is a benefit for good causes from the 5p charge, which provides worthwhile sums, and that there has been a noticeable reduction in the number of bags lodged in hedgerows around Wales? Does this not add up to a very convincing case?

[Lord De Mauley]

My Lords, I acknowledge what the noble Lord says. As I have said, we are watching closely. There is a lot of evidence coming in, and we will make a decision in due course.

[Baroness Trumpington]

My Lords, may I put in a good word for single-use plastic bags? How else am I going to get the loose grapes I have bought home without ruining my clothes and a few other things? Equally, how would I get rid of all the weeds that I pick up as I go around my garden with a little plastic bag that I can then transfer to a big bag? Will the Minister support me in my hour of need?

[Lord De Mauley]

My Lords, I will always do my best to support my noble friend. There is no question of a ban. What I think noble Lords on all sides are suggesting is a charge, so my noble friend will be able to pay a modest sum for her bag if a charge does eventuate.

[Baroness Butler-Sloss]

My Lords, I recycle food waste in a recyclable bag which East Devon provides. Why can we not move into recyclable bags in the supermarkets?

--- Later in debate ---

[Lord De Mauley]

The noble and learned Baroness raises an important question. It is one that we are considering. At the moment, we have not been able to find a bag that is of sufficient strength to do the job, but it is a very important subject and we are looking at it closely.

[Lord Knight of Weymouth]

My Lords, the noble Lord said that it will take until the middle of this year before he gets the data for the first year’s operation of the scheme in Wales. Will he give us a timeline for how long it will take him to assess that data so we know when he will make a decision? Will it take him a year?

[Lord De Mauley]

My Lords, we will get on with this expeditiously. There is a lot of action already. I understand that retailers including Marks & Spencer, WHSmith and Lidl have instituted voluntary charges. Sainsbury, Asda, Tesco, Morrisons, Waitrose and Co-operative Food have put carrier bag recycling facilities at the front of their stores. We are providing funding for various projects in the marine environment, where the problem is often at its starkest. Keep Britain Tidy operates the Love Where You Live education and information programme. As I said, we are actively considering a charge on carrier bags based on the experience in the devolved Administrations.

[The Earl of Courtown]

My Lords, will the Minister tell the House what is happening on the other side of the channel in Europe? I know that a number of countries have banned single-use plastic bags, but I wonder whether any other country is using a form of levy.

[Lord De Mauley]

My Lords, I am aware that there is action in countries on the other side of the channel such as France, Spain and Italy. It is worth saying that in 2011 the Commission consulted on a number of possible options for reducing the use of plastic carrier bags. We responded to the consultation and encouraged the Commission to undertake a full cost-benefit analysis as part of the development of options. It has published a response to the consultation and is currently considering its options.

[Baroness Golding]

Is the Minister aware that in some parts of Wales the charge for a plastic bag is 10p, in other parts 5p and in other parts 3p—and that if you know the shopkeeper, it is nothing? Is he also aware that the charge is supposed to be for charity, but I often see the money going into the shop’s till? Is he aware that this is happening in Wales?

[Lord De Mauley]

The noble Baroness points out an extremely good reason why we should look very carefully at what is happening in Wales before we act. I thank her for that.

[Lord Kilclooney]

Will the Minister confirm that paper bags will not be included?

[Lord De Mauley]

My Lords, as I said, we are considering options. As yet there is no proposal on the table. Paper as a material does not lend itself readily to reuse unless combined with other materials, which makes its recycling very difficult. All bags have an environmental impact. While paper bags are derived from a renewable resource, they are heavier than plastic bags and it can take more energy to produce and transport them.