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Lord Macdonald of Tradeston: I take the general point just raised by the noble Baroness. During some of the more dejected periods of my life I have chaired bodies for a living. It depends very much on the individual circumstances of the particular committee. There are times when one will want larger representation. But it is the judgment of the people close to the industry that in this case they have the right size of committee and they will be able to achieve what they want effectively. Therefore, I defer to the professionals involved in the water industry and the officials whose advice they take.

Lord Mackay of Ardbrecknish: That reply was a bit like the curate's egg: good in parts. I shall deal first with the good bit and get it out of the way. I was grateful to the Minister for his assurance that most if not all of the meetings would be held in public. Knowing how ministerial assurances are examined, that will probably tie down firmly not only the new Scottish executive but the commissioner and consultative committees and they will hold most of their meetings in public. I welcome that assurance, but that is about as far as it goes.

When the Minister described what these bodies would do I began to wonder whether it would be worth anybody's while being a member, let alone any member of the public going along to listen. I am as amazed as the noble Baroness, Lady Hamwee, by the argument against going from a membership of between six and nine to one of between seven and 11. I find it hard to believe that a committee of seven to 11 people is unwieldy when one from six to nine is not. I have chaired meetings of more than 11 members. I accept that as the number approaches 20 it becomes unwieldy. For three years I chaired the board of the Sea Fish Industry Authority, which had 12 members. I would not have described it as unwieldy. Although the board reflected the whole of the United Kingdom it was concerned solely with the fishing industry. One of the greatest difficulties was to achieve, even within 12 members, a board properly representative of both the various parts of the industry and its geographical spread. I am not entirely convinced by that argument.

But it almost does not seem to matter when I hear the description of what the Consultative Committees will be asked to do. At the end of the Minister's remarks on the first four amendments I was left wondering whether the whole intention was that the committees should be the lapdogs of the commissioner. Therefore, "consultative" seems to me to be too strong a word for what the Government envisage. It also appears to be perfectly proper to allow the Commissioner to be the chairman. Presumably, he would control the agenda and everything else. I was not convinced by it. The Minister's remarks indicated that I was wrong to assume that they would be consumer bodies. I shall study the Minister's words in detail to see whether my impression is justified by the text.

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I find it odd that the Minister should say that there will not be any conflict at any time between the water authorities' position and that of the consumer. Even though the water authorities are public bodies they will have problems to resolve which consumers believe should have been dealt with differently or better. There will be conflicts. If not, why bother to have these committees at all? For example, one can argue that because local authorities are public bodies none of us has any complaints about council tax or the delivery of services. Members of the Committee are aware that I live in the people's republic of Glasgow where the council tax rate quietly goes through the roof year on year, except in those years when the comrades have to face the electorate. Then, for some strange reason, they manage to keep down the council tax. I believe it is time that parts of the council face the electorate every year. In that way I have little doubt that the council tax will be hugely lower. The idea that because the City Council is a public body we have no problems or complaints as consumers, let alone payers, is rubbish. Water users are in exactly the same boat.

I did not intend to make the following point but I feel that I must now do so. Recently at Question Time I mentioned additional costs to be imposed on rural abattoirs and agricultural markets as a result of the new meat inspection regulations by the North of Scotland Water Authority. Over the next four years that authority intends to increase its charge to Stornoway abattoir from £10,000 to £51,000 a year. The same authority intends to increase its charges to Perth Auction Mart from about £24,000 to £150,000 a year. Frankly, those consumers are not best pleased and the regulator will have his ear bent by them. No doubt the water authority will tell the regulator why it intends to do that.

The idea that there will not be a conflict between the water authority and consultative committee is just cloud-cuckoo-land. That is why it is important that the chairman should be independent. If I were a member of any of the organisations that I have mentioned I would not look at this body with any great hope that it would represent my views, because it appears that the chairman is not there to represent consumers' views.

I am not very pleased with the answers. I found it odd that the Minister began by saying that there was a consensus that the present regime was unsatisfactory. That may or may not be so. From my discussions with the Scottish Consumers' Council, there is not a consensus that what the Government are doing is satisfactory. Together with the Scottish Consumers' Council I shall take away what the Minister has said and examine it. I hope that the Minister will take away what I have said and think about it and perhaps return to this matter at Report. With that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 12 agreed to.

Schedule 2 [Schedule to be inserted in the Local Government etc. (Scotland) Act 1994]:

[Amendments Nos. 30 to 33 not moved.]

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Schedule 2 agreed to.

Clause 13 [Commissioner's advice on charges]:

Lord Mackay of Ardbrecknish moved Amendment No. 34:

Page 9, line 29, at end insert (", and
(f) the impact of charges on consumers, and especially on vulnerable and disadvantaged consumers.")

The noble Lord said: I rise to move Amendment No. 34. In Clause 13 one sees a list of items under the general rubric "Commissioner's advice on charges". Subsection (3) lists a number of items:

    "In preparing his advice the Commissioner shall have regard to--

    "(a) the economy, efficiency and effectiveness with which authorities are using their resources in exercising their functions,

    "(b) the likely cost to each authority, for the period of the advice, of exercising the functions mentioned in subsection (4) below".

To return to the previous point, inevitably that will mean that the commissioner must balance the complaints of the consumer on price against the needs of the water authority to raise money. The subsection continues:

    "(c) the likely borrowing capacity of each authority for the period of the advice,

    "(d) any guidance issued to authorities by the Secretary of State, and

    "(e) any directions issued under section 116 or 117 of this Act".

My amendment seeks to add another item: the impact of charges on consumers, especially on vulnerable and disadvantaged consumers. The Water Industry Commissioner is to be given the general function of promoting the interests of customers of the new water and sewerage authorities. That is what we have been discussing. It should be explicitly stated in this clause that he or she must have regard to the interests of consumers in giving the Secretary of State advice on charges. In particular, he should be required to have regard to the interests of vulnerable groups of customers; for example, those on low incomes, or those with a medical condition who require access to a plentiful supply of water. He should have regard to the impact on non-domestic consumers whose business may be adversely affected by the huge hikes in water charges which I mentioned in the last round of amendments.

I can see no reason why such words should not be added to the Bill to make clear the commissioner's duty to consumers in general, and to the vulnerable and disadvantaged in particular. I beg to move.

Lord Macdonald of Tradeston: In addressing this amendment, I am afraid that I shall have to repeat much of what I said a few moments ago. Let me take the opportunity of replying to the jibes of the noble Lord about my Glaswegian origins and the behaviour of my party in my home town. If members of the party have any complaints about the council tax, they are not nearly as strong as the complaints they had about his poll tax!

Much of what he said may have baffled others listening who were not aware of the fact that in a month's time there will be a Scottish Parliament with 129 MSPs who will no doubt give very detailed scrutiny to many of the important issues in what is a huge industry planning a £1.5 billion capital investment.

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I think that he both underestimates the scale of the challenge that will be there for the committees, and the public-spirited nature of his fellow Scots.

When framing advice for Ministers on charges, the commissioner's only concern will be the interests of the customers as a whole, as it will be in all aspects of his or her work. Clause 13, in dealing with charges, establishes the framework within which the commissioner will formulate advice for Ministers. That framework will enable the commissioner to deliver an objective assessment of the minimum charge levels needed by the authorities.

Clause 13(3) specifies a number of factors the commissioner must consider in framing the advice. Thus the commissioner is required to take account of the duties placed on the authorities, of the various standards they must meet, and the costs of doing all that. Crucially, he or she must also have regard to the economy, efficiency and effectiveness of the authorities and the way in which they are managed.

The purpose of these provisions is to ensure that the customers as a whole pay no more than is necessary for the service they receive. More particularly, they will give the commissioner the power to stop the cost of any inefficiency on the part of the water authorities being passed on to the customers.

Against that background, I do not believe that the amendment could add anything to the way in which the commissioner serves the customer in this area. As the Bill stands, everything that he or she will do in relation to preparing advice will be with a view to minimising the impact of charges.

Requiring the commissioner to consider the impact of charges on particular groups of customers would fundamentally alter the commissioner's remit. The commissioner's task is to come to an objective view on the income requirements of the authorities. Expanding the remit, as the noble Lord suggests, would involve the commissioner in matters not directly related to the efficient operation of the water and sewerage industry.

In such circumstances, the commissioner would be expected to reach judgments on whether customers, or particular categories of customers, were able to afford particular levels of charges. That would draw the commissioner into an area of wider social policy which is for the Government to address.

The Government believe that by concentrating efforts on keeping prices as low as is consistent with a high quality service, the commissioner will be able to serve the interests of all customers.

This amendment, rather than advancing the interests of customers or groups of customers, is likely to blur the commissioner's role and make the commissioner less effective in promoting the interests of customers. Accordingly, I hope that the noble Lord, Lord Mackay, will agree to withdraw it.

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