Select Committee on Environment, Food and Rural Affairs Minutes of Evidence

Examination of Witnesses(Questions 240-259)



  240. You are, hopefully, going to be a competent authority, are there any other competent authorities required for the implementation of this Directive?
  (Dr Skinner) There are a lot of authorities required. The point we made in our own written evidence and we discussed today is this has not cannot happen without a lot of other people doing their part, planning and other issues, that is what the plan has to integrate. The purpose of the competent authority is to be the steward of that and our experience is that it is not really very easy to do it if there is more than one in that role.

  241. The reason I ask that was that English Nature told us, "We can build on this information base to prepare nature conservation sub plans for River Basin Management Plans, in this respect we expect English Nature will become a competent authority in the regulations transposing the Directive".
  (Dr Skinner) That is a judgment for government to make. Our advice would be that that is not necessary for English Nature to factor their objectives into the River Basin Plans and the example we have is the work we are doing right now with the price review, where we are working extremely closely in the nature of making joint submissions to government on what the requirements and environmental needs are and we are taking the lead in incorporating their views. That is how I would see the Directive working but with more players.

  242. This makes me very nervous if English Nature are coming out with a very clear statement about them being regarded as a competent authority, you are about to be nominated as the competent authority, how many competent authorities are we going to end up?
  (Baroness Young) Perhaps I can help by commenting as an ex chairman of English Nature I can understand why they want to be a competent authority, I would probably have been arguing the same if I was there. I think the important thing for public accountability is there is a clear responsible body that is tasked with bringing in the views and contributions of all of the other players. We know from bitter experience in flood defence, where there are a multiplicity of operating authorities, that the public are extremely confused about who is responsible for flooding in this country and we not want to repeat that mistake.

  243. Is that a clear message of, back in your box, English Nature, take your place in the queue to put your views forward.
  (Baroness Young) They are a very close and valued partner and indeed delivering biodiversity through the Framework Directive has been very, very crucial and I think it is one of the best things that could happen for biodiversity because it brings it much more centre stage than has been the case in the past. Let us do it in a way that does not imply that somehow we do not trust each other. There are specific roles for specific bodies. Our key role, if we are the competent authority, is to make sure that everyone is a firm part of that process. The reality is the Water Framework Directive will not deliver if there is an organisation that does not feel that it is getting its statutory responsibilities discharged through the mechanisms we used.

  244. Have you received categoric and clear assurances from ministers that you will have as an agency and a competent authority all of the necessary powers that you think you will require to help deliver this Directive?
  (Baroness Young) I would hesitate to say we have had assurances from ministers because we are only at the stage of finding out what the powers and responsibilities and indeed funds are that we would require. I note that we have had a slightly entertaining moment in our relationship with our sponsor body in they have very clearly made us aware that the success or failure of the Water Framework Directive will lie at our feet. That is something that I was not too clear about accepting, because I think the success or failure of the Water Framework Directive will depend on our success and the success of a whole range of bodies in delivering this. This is a very long term Directive, it is a Framework Directive which brings together a whole load of pre-existing mechanisms and funding streams and players and I think it would have been pretty rash of ministers to have agreed right at the very beginning that whatever we said was needed in terms of powers or finance would be provided. I hope we will have an effective dialogue with our sponsor body and indeed with local government mechanisms and others about how they can put their tuppence worth in that is necessary to deliver the Directive.

  245. One of our contributors in terms of evidence was a firm of solicitors Taylor Beatty, who are concerned about conflicts of interest between your organisation in terms of its statutory and its administrative responsibilities and relationship with DEFRA. Do you think in terms of judge and jury on some aspects of the current river basin activity there are conflicts of interest in the context of the implementation of the Water Framework Directive and if there are any how do you seek to resolve them?
  (Baroness Young) I am always slightly phased by the conflict of interest issue because it does seem to me that the Environment Agency is given the role by government on behalf of government and indeed the public of delivering a whole range of duties, some of which require quite difficult balancing decisions: Are rivers for fishing? Are they for boating?

  Are they for water supply? Are they for flood defences? Are they for agriculture? Are they for industry? There are always going to be conflicts but government says it wants an agency to take some of these decisions on a fine grain basis within national policy. There is always a conflict of interest for us and that is why we have been set up to look at water and rivers in an integrated way and now under the Framework Directive to look at land and water in an integrated way because some of these decisions do need to be made on the basis of the best balance, taking account of all of the needs round those catchments, and that is what the whole point of the Water Framework Directive is. I think the risk of conflict of interest is if there are a number of bodies who have equal decision-making powers within the Directive and where there is simply impasse and government is forced to make decisions between them on successive occasions, I think that is really bad public administration. We need to make sure that decisions are made at the right level where people can understand them. That I think in itself means there has to be a body that holds the reign in these sort of processes and at the end of the day for good or for bad the ministers can sack us if we get it wrong. We make decisions. We do that day in and day out in terms of our current environmental roles, particularly in our regulatory role with industry.

Diana Organ

  246. The Directive provides for staged implementation with a series of deadlines for Member States but sometimes it might be necessary or helpful or even cost-effective to implement it before. I wonder if you would like to say in what ways it could prove cost-effective to pre-empt deadlines and are there any other reasons why one might want to do this?
  (Dr Skinner) The timetable is quite a tight one so the opportunity in the short-term probably does not arise but certainly the principle is a good one. As we are looking at the water company price review, which is on now, we to see examples where soft water solutions could be taken if we work to current rules rather than rules that we know will be out of place by 2009, and we have drawn those to the attention of government. Another example where timely policy issues could make the Directive easier to implement and less costly on some parties would be in the context of CAP reform. Decisions made now about transfer to pillar two, which have environmental outcomes, will mean when the relevant sectors bite under implementation that we will make some headway. There are issues and opportunities in advance. There are also mechanisms in the Directive for delay. You can have derogations and it might be that the best economic solution cannot be achieved immediately because infrastructure needs to be built or information needs to be gathered to get the best solution. It is possible to build that kind of concept into a River Basin Plan which says, we think we have to go there but we do not know and therefore we are going to set this objective now which will may be in derogation, we will explain that to the Commission, and it will come in later. Although we said these dates are very rigid, and they are, there are these mechanisms for delay and there are opportunities we are already identifying for taking things earlier and we are bringing those forward already.

  247. You talked there about opportunities, some of the organisations have put forward a view that government is not really looking at the Framework Directive as an opportunity but more of a burden and they will therefore try, as lots of governments do when faced with this, to put in the minimum rather than going for the maximum gain, minimum compliance is all they will hope to reach. What could be the real disadvantages to us as a society, as a nation, as environment, if you like, if we take this restricted view?
  (Dr Skinner) That is obviously going to be an issue discussed between us and the department on the budget issue we just mentioned. One of the big issues, and this is where I agree with other witnesses this morning and evidence you received, is the sooner you start doing things the more people understand what is going on and have the chance to raise their understanding and raise their engagement. The biggest disadvantage of running up to the wire is that people post that wire feel uninvolved and uncommitted to the conclusions because there was not enough lead time and that is why there is a need to go for a minimalist approach.

  248. As Baroness Young said, government said to you as an agency you are responsible for this but there is a tension there, is there not, that government may well not really follow it in the spirit but only by the letter. Will you feel you will have been successful if you only followed it by the letter and not the spirit or are you concerned that you, like most times that we have complaints in Britain, gold plate everything and you might be accused of gold plating?
  (Baroness Young) The touchstone for us will be whether the environment gets better or not, it has to be outcome based. The Directive has to start delivering real improvements in the environment. There are opportunities that are not necessarily just simply about government, although obviously government has to play its role, for example the water price review, which is going to be settled by the water regulator in the next two years is the five yearly opportunity for a whacking great slab of money to go into an environment programme if we are as successful as we were the last time round in making sure that we had a well thought through environment programme. That is going to be a contentious thing for the regulators because of course the last time round that could be achieved and still reduce prices, next time round, there is not the capacity for that and we will have to grit our teeth and if we are going to use this price review to help deliver on the Framework Directive early we will have to have a very strenuous public debate about what that means for prices and affordability. We are already with others in the debate about the next price line, taking public opinion about what the public see as affordability in terms of water prices. That decision and the size of the environment programme that ministers instruct the economic regulator to fund will be a pretty crucial one for moving ahead in terms of the improvement of water quality.

  249. We are concerned about just how much we are going to really do this Framework, how is good status going to be defined by you?
  (Dr Skinner) It is clearly one of the most important drivers because the setting of that good status will make the difference between how much you need to put in, that decision is critical, which is why we put so much effort into the common implementation strategies, and some of my colleagues have spent a great deal of time using the expertise and experience we gained in terms of ecological and biological monitoring to set those thresholds. We are used to having quality based objectives, river quality objectives, largely on the chemical side but we also have biological standards and biological objectives running in parallel, this will bring the two together. That experience has fed through into setting that level. What it does do is that it will be applied according to the nature of the river, so it does enable you to set standards against references. You would not expect a Welsh mountain stream and a East Anglian river to have the same elements, and this system allows us to do that. You are not setting standards across Europe in a brutal way, it is much more sensitive than that, and we should be able to set it on environmental need and the focus our expenditure. What you are setting you then look at the pressures of it and how you go about it in a logical manner, taking the steps necessary to achieve the quality. Some of our rivers will have already achieved it.

  250. Now?
  (Dr Griffiths) Yes.

  251. Could you name me two?
  (Dr Griffiths) Not necessarily whole rivers. If you look at the back of the government consultation paper there are a series of biological maps, colour-coded and they will give you some indication of the areas that need improvements.

  Diana Organ: Is it possible if you can drop us a note about some bits of some rivers, name them and their location that you are saying have achieved it?

  Chairman: And the criteria that determine that outcome.

Mr Drew

  252. Can I pick up one issue on the back of that, we have certainly been advised it is not just how you measure quality but what you measure. I would be interested in your response that we do not measure in phosphorous.
  (Dr Griffiths) I would say that it is untrue. We do a significant amount of phosphate monitoring, both of effluents and of rivers. We have an extensive quality assessment programme on which we report giving phosphorous data. It also informs government decision-making in terms of designating sensitive areas and we have been doing a lot to bring in the Habitats Directive and understanding that. Where we need to do more is in some of the diffuse sources and some understanding of the pathways. We need to know more about some of the specific weapons, habitat directive sites and, some of the fluxes between ground water and surface water, that is another whole science area that we are working on. We certainly have a significant amount of background information. There are certain bits where we will be reviewing our monitoring programmes, not only to bring in some of the focus on chemical monitoring but to readjust to ecological monitoring. There are some areas where we have less information on estuaries and marine and some of the lakes, and we need to do more, but we do have R&D projects that are starting to give us some more information on these matters.

Mr Jack

  253. There are potentially some big costs to the users of water of the improvements that will come from this Directive, how much do you think that the consumers should pay or do you think any of the expenses, because we are dealing with a national asset, should be for the nation collectively to bear the cost of?
  (Baroness Young) The Directive of course does make it clear that the costs need to be spread round the beneficiaries and so the mechanisms by which you achieve that are many and varied. Many of the things that need to happen under the Directive are already funded in particular ways, for example the water price round process is a process whereby it is funded by charge payers for water and there are other processes which are funded directly from public expenditure. There are others where I would anticipate that we would want to see redirection and consider the amount of common agricultural funding in the shape of subsidies to the farmers. It will be a variety of different ways, depending on the nature of the task you are trying to crack and the tradition of how it has been funded in the past and the politics of how we take it forward. There is a need under the Directive to look at how beneficiaries can have the cost of this spread round them.

  254. Can I pick up on the language used, the beneficiaries, who are the beneficiaries?
  (Baroness Young) There are a whole variety of beneficiaries, obviously the selling job I tried to do at the beginning of the Water Framework Directive, which was a combination of how clean water and improved habitat benefits a whole range of things, fishermen, industry, regenerators, people who just enjoy the river—

  255. Would you say we are all going to be beneficiaries of this? In other words, everyone who lives in the United Kingdom will be a beneficiary in some way?
  (Baroness Young) In some way and to a varying extent. If all you do is drink water and get rid of your sewage and eat food you are only benefiting from some elements of it, but if you are a fisherman or a canoeist or a developer who wanted a nice riverside frontage in order to be able to regenerate a rundown inner city or if you are a deprived kid who has some sort of river recreation experience that gets you out of teenage crime, there are a whole load of beneficiaries. At the moment we have a number of funding streams that are traditionally pooling money in different ways. I suspect it is better to build on those rather than think of funding in a central fashion.

  256. I could interpret what you said that there could be a whole menu of charges, for example being a member of a river cruising club I might be expected to pay some more for the benefits of the enhancement of the river estuary, where I might occasionally get my boat into, because you said that people with water frontage might get an added benefit. I am intrigued to know what work you have done about recovery mechanisms because so far in the evidence we have seen the range of costs is enormous. What is potentially quite frightening is that once this stuff is clicked into by the popular press they will simply take the biggest number, divide it by all of the water users and say water users face gigantic increases in costs notwithstanding regulatory activity. In paragraph 37 of your evidence you say, "The Directive allows for the achievement of good status to be delayed if costs can be shown to be disproportionate and work has begun to assess how such judgments might be made in a consistent manner". That has all kinds of connotations. I remember in the south west when there were water quality issues and there were huge bills that had to be paid and suddenly everyone starts back-peddling. What does this all mean for the implementation of this Directive, because it seems to me on the one hand you can challenge it on the grounds of disproportionate costs and on the other hand you are saying perhaps we better develop some new pricing mechanisms to recover the costs. Guide us on thinking in this area?
  (Dr Skinner) We are not doing any work and I do not believe DEFRA are on new costing charge recovery mechanisms. As Barbara said it seems it will be the traditional ones that will apply. The first issue is to make sure that the costs are attributed to the sources so that damage to the environment which is attributable to the way agriculture is managing land does not find its way into the bills of water company consumers in extra costs on the treatment of sewage. We are already doing that kind of work in the way we go through the water company price reviews. It is easier when you are only looking at the water companies and at the end of pipes they are producing but as we go forward and look at catchments we have to integrate the whole thing. There are two issues that arise from your question, one is, have we got the mechanisms to make sure those are fairly identified and to the extent that when costs are calculated in relation to benefits and a view can be taken they are disproportionate how is that implemented and how are disproportionate tests applied to water companies and to farmers who are very different people, with very different income streams, with very different institutional arrangements and whose costs impact on the rest of us in different ways. We do not know the answer to that but we realised a long time ago delivery was going to be a big issue, which is why in your constituency we did the exercise on the river estuary and we produced the Report referred to in our evidence. That is not the end of the story because we now have to start teasing out some of the issues and demonstrating there are quite complicated trade-offs even amongst agriculture. There are different scenarios for agriculture managers that would lead to different ways of doing it, a combination of incentives, of subsidy and they all have different outcomes.

  257. You very eloquently described the problem, and I do not disagree with your analysis, coming back to the question I asked earlier about the grand management plan, you described problems that need to be solved, when do you plan to solve them?
  (Dr Skinner) The point I would want to make first is that River Basin Plan and the actions that comes from it are the way in which that issue is debated and some degree of consensus is achieved. There are complicated trade-offs here, that is why I think not everyone would be happy. The first point is that for the first time the kind of issue I am debating would be done in a more transparent way than we currently do. We as the competent authority would have to use the levers that are provided to us and there again we must look to government, to DEFRA, to provide some of those frameworks. DEFRA have committed themselves to doing a reevaluation of the costs in the current consultation document—to answer your first point—such as we do not have numbers that we do not believe being attributed to this Directive. We need to distinguish between whole costs and extra costs because some of the benefits, particularly in terms of those arising from water company activities, are already being dealt with through the current price review. I have not answered the question because I do not know all of the answers because we are at a very early stage. We do have the issues listed. We have had good stakeholder involvement in these economic issues and we need to take that forward.

  258. Coming back to the subject of our first evidence session, which was public consultation, one of the things that the public will be interested to know about, whatever way you describe the public, is what it is going to mean to them in terms of what they have to pay, which is why I asked the question when do you think some of the work will be concluded? We have to talk to members of public, we as members of Parliament could get a lot of representations from concern wherever because they want to participate in public discussion of what they are prepared to pay for, so they will need to know what they are going to get, what their obligations are and how much they are going to have to pay. When are we going to get meaningful consultation? When will be public get a feel for this cost exercise?
  (Dr Skinner) That discussion cannot start now in catchment specific detail because we have yet not characterised the catchments, we have not specified the threshold for the standards and until that is done the costs cannot be enumerated. We have the time and that is why we have already started the work to devise the mechanisms which will present those figures and they will have to be presented in the river basins plans because that is only way that the judgment can be made and preference expressed and decisions about disproportionate costs made, but not now, that is not until 2008 on the first cycle plans.

  259. Does this mean we are going to have to have a much more sophisticated menu of prices for the use of and the disposal of water and waste water? Are you going to be able to manipulate the water pricing mechanism to assist in the implementation of the Directive, is it going to be very different? You said earlier we have to use the tools that we have, what happens if you discover the tools that you have are not adequate for the job in trying to turn on or turn off problems in terms of the Directive.
  (Dr Skinner) One of the key players here is going to be the Director General of OFWAT, those are his tools. As we already said, we do not think that the present five year cycle of existing tools is going to be the way in which this business will be done as we go into delivering the Framework Directive. It is early days, but we have already had those discussions and I expect those to go forward.
  (Baroness Young) We should not give the impression the majority of the Water Framework Directive will be met by water charge payers. One of the ways in which the public may pay is if they buy a house in an urban development where sustainable urban drainage systems have been part of that development to prevent pollution and flood risk and it is a small part of the cost of the house that they buy. They will be paying for this in a whole variety of ways. We need to have a debate round the River Basin Plan that allows people to discuss whether the measures proposed are legitimate and value for money but then the mechanisms by which they will be paying for it will be a whole plethora of things. I would not want to alarm water customers that they are suddenly going to see their bills shoot up as a result of this, beyond what we need have in terms of debate in the next water price round, which is, the public do want to see cleaner rivers, they do want to see biodiversity and they have indicated in the opinion polls that have been done they are willing to pay for it.

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