Memorandum by The British Soft Drinks
Association Ltd (BSDA) (DWB 14)
1. The British Soft Drinks Association (BSDA)
represents the spectrum of soft drinks manufacturers in the UK,
including manufacturers and distributors of Natural Mineral Waters,
Spring Waters and other Bottled Drinking Waters. The UK bottled
water industry produces approximately 900 million litres of the
1,200 million litres of bottled water consumed annually, the remainder
being imported predominantly from France.
2. In addition, the use of Natural Mineral
Water and Spring Water as an ingredient in soft drinks is growing
3. BSDA Members fully support policies and
measures necessary to protect the environment and sustain natural
resources. However, the application of a time-limit to abstraction
licences awarded to companies bottling water and/or using Natural
Mineral Water or Spring Water as a named ingredient in soft drinks
will threaten the viability of these businesses and cost British
jobs, with no obvious environmental benefit. BSDA strongly urges
the Committee to recommend that time limited licences should not
apply to bottled water companies.
4. Bottled water is a fast-growing sector:
the UK market for bottled water is now worth more than £500
million per year, growing at an annual rate of more than 10 per
cent. Consumption has more than doubled in six years and this
rate of growth is expected to continue into the future as the
consumption of bottled water in the UK is well below the EU average.
5. The market is very competitive, with
a very strong presence (26 per cent) from imported brands. At
present, the best-selling and best-known brands in the UK are
The largest companies in Europe are all continental
and are also investing in the future of the UK bottled water industry
British companies are growing but are not yet as large and will
need time and investment to be able to build up in order to match
them. Banks and other investors will not invest in bottled water
companies whose businesses might be arbitrarily curtailed by the
loss of their abstraction licences. This means that the UK industry
will be unable to expand to meet consumer demand and imported
products will take an even larger share. This is a loss for jobs,
the UK economy and consumer choice.
6. If domestic capacity for bottled water
cannot increase, the rising demand will be ceded to imports from
France and elsewhere. Jobs in England and Wales could be put at
risk as foreign companies do not face such restrictions. This
is at odds with the Government's professed desire for "effective
competition in the water industry".
7. Moreover, due to the source of their
raw material, Water Bottlers are located in rural areas, providing
much needed employment and economic activity. The likely result
is diametrically opposed to the statement in the Bill that "the
abstraction system should contribute to sustainable development
... helping the economy to improve".
8. Bottled water is not only supplied through
retail and on-trade outlets but is also relied upon as a strategic
resource. Many mains water companies rely on back-up supplies
of bottled waterthrough contracts with specialist water
bottlersto help them meet their public service obligations
in the event of a disruption to the mains supply. Each year there
are many incidents of mains contamination due to floods, freezes,
drought, chemical spillage, etc. which lead people to resort to
bottled water. One member of BSDA was called upon three times
last year to provide emergency supplies. Maintaining a viable
and adequate domestic bottled water industry, therefore, is an
essential part of an overall public health strategy.
9. All Bottled Water members of BSDA who
have been contacted have arrangements or contracts to supply bottled
water to water companies, local authorities, hospitals, etc in
the event of contamination or disruption of the mains supply.
10. At present, the industry bottles about
900 million litres of water per year. This is roughly equal to
the leakage from the mains system in eight hours, so cutting back
water bottling would have no appreciable effect on the overall
rate of water usage.
11. Furthermore, water bottling is a highly
efficient use of water and cannot become more efficient. If demand
for water exceeds supply in a particular location, other industrial
users of water can institute measures to become more efficient,
or to use water from another location. Water is bottled as it
is sold: the industry cannot use less water to meet the same demand.
12. The restriction of a Bottled Water producer's
licence, for example by time limiting, could have a serious impact
upon his business, an impact out of all proportion with any environmental
13. Finally, Natural Mineral Water and Spring
Water companies are unique in being linked to specific sources
of water. Natural Mineral Water must come from a registered, named,
protected locationit cannot simply substitute its supply.
Therefore restricting the bottling of water would have a far more
profound impact on businesses than would restricting other industrial
uses of water.
14. In view of the serious damage which
is likely to be inflicted on the Bottled Water Industry and its
implications for rural employment, for very little or no benefit
to the Environment, BSDA propose that water bottlers should be
exempted from the time limiting of abstraction licences.