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Page 2, line 28, at end insert:
("( ) In this section 'environment' has the meaning given by section 1(2) of the Environmental Protection Act 1990.").

The noble Earl said: We discussed this amendment earlier. I beg to move.

The Earl of Cranbrook: I wish to make two points in relation to Amendment No. 22 which is grouped with Amendment No. 20. First, I received a comment from a friend of mine who is a professor of law that the duty to "take into account" which the noble Lord, Lord Peston, just mentioned and which is the subject of the subsection is perhaps the weakest possible duty that is worth specifying in law. This point is very important. I certainly intend, by withdrawing my amendment, to give my noble friend the opportunity to take this matter back and consider it in the context of the debate on sustainability that is fundamental to all government policy at the moment. In this Committee, we have been cross-referring to other Bills and other debates in this Chamber. I should like to import into the discussion the debate on the difference between "further" and "taking into account" that we had during the passage of the Environment Bill. If the environment is to be given parity, as it has to be within the context of sustainability, the duty to "take into account" is phenomenally weak. That is one point that I wanted to make.

I said that I would disclose the difference between my noble friend's amendment and my amendment, Amendment No. 22. It is that he has restricted the definition of "the environment" to Section 1(2) of the Environmental Protection Act, whereas I refer to the entire section. Section 1(2) of the Environmental Protection Act defines the "environment" as consisting of "the air, water and land" and so on, and "the air within other natural or man-made structures". Subsection (3) goes on to define pollution in terms of harm to the environment. Then, subsection (4) states:


and so on. I want to be absolutely sure that if we accept a definition of the environment that is only based on Section 1(2), it is big enough to include not merely the inanimate things that are mentioned. That would leave us, in my view, back where we were with the "physical environment". If we are talking about the physical environment we are talking about air, water and land. But it seems to me absolutely essential that we should make it quite clear that, by removing "physical"—as we have done by Amendment No. 15—we include in the environment the health of living organisms, the protection of ecological systems, and so on. That is the proper definition of the environment.

I hope that my noble friend will give himself the opportunity to consider that, from the point of view of sustainability, we must consider not merely the physical environment. We have taken out "physical" and must make sure that the definition of environment includes living organisms. That is why my amendment differs from my noble friend's amendment. I refer to the whole of Section 1 and he refers to only one subsection.

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Let me make a third point. My noble friend has already commented on the inadequacy of my definition of sustainable development. I agree that it is very difficult to define. Nonetheless, it is said to be a fundamental plank of government policy. In order to find some sort of peg on which to hang this matter, I referred to what will be a clause of what is still a Bill—I suppose that it is a passage in a Bill and therefore capable of refinement in theory, but I needed some sort of peg. I agree with my noble friend's criticism that it is not a particularly good peg to hang sustainable development on. But if sustainable development is a key plank of all government policy, somewhere there must be some definition of it.

A definition is beginning to emerge. Perhaps I may quote from the draft management statement of the Environment Agency which has been released. It says:


    "The basis of the strategy is a commitment to the goal of sustainable development. This seeks to reconcile the dual objectives of achieving economic development and of providing effective protection and enhancement of the environment".

That is perhaps an acceptable definition of sustainable development. Those are the Government's own words.

If my noble friend can assure me that reference to Section 1(2) of the Environmental Protection Act brings in the living environment as well as the physical environment, I shall believe that my peg was not that bad. Reference to Section 4 of what will be the Environment Act would by inference bring in the draft management statement of the Environment Agency. I give notice that I shall withdraw Amendment No. 22 in order that proper consideration may be given to this issue, and I can come back at Report stage.

Earl Ferrers: If the Committee is good enough to accept Amendment No. 20, I shall certainly look into the point to see whether or not the matters referred to by the noble Earl in Amendment No. 22 are covered. The draftsman suggested putting in Section 1(2), as in my amendment. I shall certainly consider the matter further in the light of what my noble friend said. If he is content with that, and I hope that he will be, I suggest that Amendment No. 20 be agreed to.

On Question, amendment agreed to.

Lord Peston moved Amendment No. 21:


Page 2, line 28, at end insert:
("( ) In performing his duty under subsection (2) above the Director shall ensure that any one gas supplier charges at a uniform rate across Great Britain.").

The noble Lord said: I have searched for some way to introduce into these deliberations the whole question of pricing, charging and so on. I found it very difficult. There is not much about that in the Bill and what there is will probably be in the standard licences and such matters. Some of that material I have only had sight of in the past day or so.

Harkening back to the Second Reading of the Bill, I asked what was the Government's view of the report of the Monopolies and Mergers Commission to the effect that a consequence of this Bill introducing competition would be that some consumers would suffer higher prices. I assume that the argument would have been that as the British Gas monopoly, regulated in private hands, is engaged in a degree of cross-subsidisation or

22 Jun 1995 : Column 451

something of that kind, or else for goodwill, it was felt desirable that everybody should pay the same price for gas. But there is no obligation to do so once there is much more of a free market. On the one hand, people will charge what the market can bear and, on the other hand, their prices will be more finely tuned to the cost of supply. That, I think, was the nature of the argument.

The noble Earl, Lord Ferrers, first replied:


    "There is no reason to believe that competition will lead to higher prices for any consumers".

That was his answer. I had already argued—as I have just repeated—that I could think of quite good reasons why that might lead to increases in prices for some consumers, and so did the Monopolies and Mergers Commission. But then the noble Earl added, quite rightly:


    "However, the nature of a competitive market is that one can never guarantee that. There may be some price variations on the general downward trend and we must see what the result is".—[Official Report, 6/6/95; col. 1302.]

I do not know what that means.

I tabled this amendment to obtain some clarification of the Government's view, first, on what they believe more precisely is likely to happen; and, secondly, on what they consider is desirable. If one were wearing a very harsh, hard economist's hat, one would say—to return to the example given by the noble Lord, Lord Skelmersdale, who was, I believe, referring to the south west—that if it is more expensive to deliver gas to consumers in the south-west, that is too bad and they will have to pay more. That would be what one would say wearing the classic economist's hat.

I am interested in whether that is what the Government believe and say, "Well, that is all right. That is the way markets work and we have to accept that". I myself make no value judgment. At the moment, I am still in an exploratory mood on this matter, wanting to know what would happen. We may have to come back to this matter when I have explored the licences rather more carefully and know what would be involved.

Let me put the matter as simply as I can. With my noble friend Lord Clinton-Davis I state in this amendment that:


    "the Director shall ensure that any one gas supplier charges at a uniform rate across Great Britain".

Am I right in believing that that is not remotely the intention of the Bill and that the Government would not accept that point? Would they say, "That is now a complete irrelevance so far as the working of the free market is concerned"?

The amendment has been tabled in order to find a view and a clarification of what the Government believe is likely to happen and equally what the Government believe ought to happen. I beg to move.

Baroness Gardner of Parkes: I find the amendment rather dangerous. I have checked on what various suppliers do. For example, Marks and Spencer tell me that one pays the same in central London as in the north of Scotland. But I went on an official parliamentary visit to Boots. I was interested to see that in Watford I was able to buy items more cheaply than I could buy them in central London—the same shop and the same stock. It was explained to me that that was because the overheads were very much less in Watford. I thought that if I had been

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buying a large quantity of articles, it would have almost paid me to drive out there. Retailers and, I imagine, suppliers, would think the same way.

But what worries me most of all is that if there were an obligation to charge the same price everywhere, surely that would encourage the competition only to offer to supply in the area that was the most profitable. That is what worries me. Rather than consider offering to supply somewhere non-profitable, people would say, "Yes, I shall offer it all at the same price but I shall restrict the places where I am prepared to do it". I believe that this is a dangerous amendment.


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