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Lord Whitty: The amendments which the noble Baroness has discussed seek to extend the provisions with regard to protected premises. I understand the reasons behind the amendments but it is our contention that the Bill as drafted meets virtually all of the cases which she has mentioned.

Amendment No. 1 is a technical amendment, as the noble Baroness has said. It would not in fact add any protected premises to the list. The words that the amendment seeks to delete are there simply to prevent overlap between paragraphs 1, 2 and 3 in the schedule. All private dwelling houses are protected by paragraph 1, and all houses in multiple occupation are protected by paragraph 2. Therefore we do not need in paragraph 3 to protect accommodation for the elderly that is either a private dwelling house or a house in multiple occupation. The amendment is therefore unnecessary. This points to one of the problems we have had in drawing up Schedule 1; namely, that of ensuring that everyone who should be protected is protected, without duplication or overlap. In identifying as a separate category for protection "accommodation for the elderly", we responded to concern in the other place that there might be some such accommodation not otherwise protected although we expected the vast majority of sheltered accommodation to be protected under paragraphs 1 or 2 of the schedule. That is why we included paragraph 3 in the schedule for extra protection. Indeed, the Government met every single concern that was raised in another place about the scope of protection. However, the further this process of adding protection is carried, the more remote the circumstances and the more difficult it is to see that there is a gap in the protection. I do not think there is a gap in this regard.

As regards Amendment No. 2, I suppose I should declare approximately the same interest as the noble Baroness. I do not really believe that there is likely to be a category of sheltered accommodation for the over-55s which is not already protected against disconnection by reason of paragraph 3, or by another provision of this schedule. If there is a particular highly specialised form of such accommodation which is not included in the provision, perhaps the noble Baroness will discuss that with me and I can consider the matter. However, on the face of it, even if there is such accommodation,

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sheltered accommodation will not be excluded from protection simply because there are some occupiers under the age of 60. Under the wording of the paragraph it is the letting practice of the landlord that matters, and that is sufficiently elastic to permit a few younger inhabitants, or perhaps I should add, relatively young inhabitants. Of course, water companies will be well aware of the prohibition of disconnection set out in this Bill. In paragraph 3 there is full protection for sheltered accommodation for the elderly in the sense that the word "elderly" is generally understood. I ask the Committee to leave paragraph 3 as it stands.

Amendment No. 3 is slightly more complicated. It seeks to protect accommodation for the homeless. This is clearly another case of overlap with existing provisions. Rented dwellings, including council houses, are protected by paragraph 1. Houses in multiple occupation, (HMOs) are covered by paragraph 2. Between them, those two provisions must cover most if not all premises in which a local authority houses homeless people. In particular, the definition of houses in multiple occupation has been interpreted widely by the courts. For example, a hostel has been held to be an HMO, as has a hotel accommodating homeless persons.

However, we recognise the point behind this amendment; namely, that some accommodation provided for housing the homeless might not be protected. In our view most such accommodation is likely to be deemed an HMO and is therefore already clearly protected. There may be a residual problem in that, depending on the type of property, some hotels may not be classified as HMOs, although they may sometimes be used by local authorities to house the homeless. But some of those same hotels may also have other guests of all kinds on all terms and conditions. Water companies do not have the information to differentiate between the different status of different guests.

Unfortunately, if we extended protection in that way to all premises accommodating the homeless, the effect would be to prevent disconnection of all hotels. We do not believe that is appropriate. Indeed, taking that view, it would also be quite protective. Accommodation provided for the homeless must by law be suitable for the homeless. If disconnection were threatened the result would be the same as if the premises were threatened by closure for reasons of health and safety; in other words, the guests would immediately have to be moved and the local authority would have to find another place of accommodation. It is not realistic to specify hotels in general under this clause, which is the implication.

The welfare of homeless people is safeguarded by the existing clauses. Hotels are competitive commercial establishments and they should be subject to the same rules as regards their water supply as other such commercial premises. I believe that we have covered the concerns that lie behind the three amendments. I hope that the noble Baroness will feel able to withdraw Amendment No. 1.

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4 p.m.

Baroness Hamwee: I thank the Minister for that reassuring response. I take the point that the accommodation, the subject of Amendment No. 3, must be suitable, but there is a short period--one would hope very short--between a potential cut or disconnection and the authority discovering that the premises had been disconnected. That seems to underlie the Government's reasoning on children's homes and so on--it was referred to in another place--and is why I thought it was worth airing this matter.

I am reassured to know that most establishments of this type will be covered; it is the minority which are a cause for concern. Perhaps I should rely on the fact that an establishment which is so badly run that disconnection might happen would not be likely to attract guests on a commercial basis. I thank the Minister for his comments on the other amendments. I beg leave to withdraw Amendment No. 1.

Amendment, by leave, withdrawn.

[Amendments Nos. 2 and 3 not moved.]

Schedule 1 agreed to.

Clauses 2 to 4 agreed to.

Clause 5 [Regulations concerning charges schemes]:

Baroness Hamwee moved Amendment No. 4:

Page 3, line 16, after ("principles") insert ("(which shall include affordability)")

The noble Baroness said: In moving Amendment No. 4, which stands in my name and that of my noble friend, I shall speak also to Amendment No. 5 and to Amendment No. 6, standing in the name of the noble Baroness, Lady Miller of Hendon, which is in the same grouping.

Amendment No. 4 deals with the charges schemes' regulations. Clause 5 enables the Secretary of State to specify the principles to which undertakers must have regard when calculating charges to customers. But what those principles should be are not stated on the face of the Bill. No doubt many of your Lordships could produce a list of principles, and I may be told that that could cause difficulties because once one starts describing detailed principles one might be knocking out others with an equally good claim. However, it is worth airing the principle of affordability. It is something of a truism perhaps, but it is accepted that water is a human necessity. I am concerned that access to water will continue to depend to an extent on ability to pay.

Although it is not perhaps accepted that the objective of the Bill is extended metering, that will certainly be an outcome. It is the theme behind the Bill. That in itself imposes cost pressures on consumers. Those who argue for metering often say that it is the increased costs which will lead to some reduction in the volume of water used. I accept entirely the steps that the Government have taken to protect vulnerable groups. The protection is to limit the bills of vulnerable groups to the cost of the average measured bill. That is not the same as the bill being affordable. It could be that the average bill will be high in a particular area and still not be affordable, and poorer customers will still be under pressure to economise in their use of water. By bringing the

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amendment forward today I am hoping that the Minister will be able to give the Committee some assurances about the principles likely to be included by the Secretary of State and that we will not have a problem of water charges being in any way unaffordable.

Amendment No. 5 seeks to ensure that the regulations are practicable for the undertakers. Having looked in the first amendment at the position of certain consumers, I am now turning to the position of the undertakers. This clause and the previous clause allow charges to be modified by the regulator so that the bills of vulnerable customers will, in effect, be subsidised by other customers. That is a change to the way the industry is regulated. The noble Baroness, Lady Miller, will table an amendment later about consultation. I agree with her that it is vital that the Government consult very widely on regulations to ensure that they are practicable and reach the groups in greatest need.

I am told that the water industry is very keen to be involved in the debate on how best to implement the proposals. The regulations must be the subject of wide consultations with expert groups. They should also--this is the point of the amendment--reflect the categories of customers already recognised by the DSS. We should consider whether the system should be implemented by the Government. Admittedly, the water industry is very profitable, but we are loading new regulations upon it and we should pause to consider what the overall effect might be. I beg to move.

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