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Water Bill [HL]


Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    39

 

           (6)           The power to give a direction under subsection (4) above may not be

exercised after the end of the period of six months beginning with the

commencement of section 37 of the Water Act 2003.

           (7)           After the end of the period mentioned in subsection (6) above the

Council may (subject to paragraph 11 of Schedule 3A to this Act)—

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                  (a)                 establish such committees for relevant undertakers as it

considers appropriate; or

                  (b)                 alter the allocation of a relevant undertaker to a committee

established under this section.

           (8)           The Council shall ensure that each relevant undertaker is allocated to a

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committee established under this section.

           (9)           A committee established under this section is referred to in this Act as

a “regional committee”.

           (10)          The purposes of a regional committee shall be—

                  (a)                 the provision of advice and information to the Council on

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consumer matters affecting the areas of the relevant

undertakers allocated to that committee;

                  (b)                 such other purposes as the Council may determine.

           (11)          The provisions of Schedule 3A to this Act (which makes further

provision about the Council and regional committees) shall have effect.

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           (12)          In this Chapter—

                                  “consumers” includes both existing and future consumers;

                                  “the interests of consumers” means the interests of consumers in

relation to—

                        (a)                        the supply of water by means of a water undertaker’s

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supply system to premises either by water undertakers

or licensed water suppliers acting in their capacity as

such; and

                        (b)                        the provision of sewerage services by sewerage

undertakers; and

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                                  “consumer matter” means any matter connected with the interests

of consumers.

       27B            Co-operation between Council and other authorities

           (1)           This section imposes duties on—

                  (a)                 the Authority and the Council;

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                  (b)                 the Council and the Secretary of State; and

                  (c)                 the Council and the Assembly.

           (2)           It shall be the duty of the bodies mentioned in each paragraph of

subsection (1) above to make arrangements with a view to securing—

                  (a)                 co-operation and the exchange of information between them;

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and

                  (b)                 the consistent treatment of matters which affect both of them.

           (3)           As soon as practicable after agreement is reached on any arrangements

required by this section, the parties shall prepare a memorandum

setting them out.

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Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    40

 

           (4)           Arrangements under this section shall be kept under review by the

parties.

           (5)           As soon as practicable after agreement is reached on any changes to

arrangements under this section, the parties shall revise their

memorandum.

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           (6)           Parties to arrangements required by this section shall send a copy of

their memorandum, and any revised memorandum, to each other

person mentioned in subsection (1) above who is not a party to the

arrangements set out in the memorandum (or revised memorandum).

           (7)           The Secretary of State shall lay a copy of every memorandum or revised

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memorandum under this section before each House of Parliament.”

     (2)    Schedule 2 (which inserts the new Schedule 3A into the WIA) is to have effect.

     (3)    The customer service committees established under section 28(1) of the WIA

are abolished.

     (4)    Section 28 of, and Schedule 4 to, the WIA shall cease to have effect.

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 38    Transfer to Authority and Council of functions, property etc

     (1)    The functions of the Director General of Water Services are transferred to the

Water Services Regulation Authority.

     (2)    Subject to any express amendment made by this Act, each reference to the

Director General of Water Services (or to him as the Director) in the WIA

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(however the reference is expressed) is to have effect as a reference to the Water

Services Regulation Authority (or, as the case may be, the Authority), and

accordingly in the WIA “he”, “him” and cognate expressions, in relation to the

Director General of Water Services, are to have effect as “it” (or the appropriate

equivalent) in relation to the Water Services Regulation Authority.

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     (3)    The Secretary of State may make one or more schemes (“transfer schemes”) for

the transfer of the property, rights and liabilities of the Director General of

Water Services to the Water Services Regulation Authority (referred to below

in this Part as “the Authority”) or to the Consumer Council for Water (referred

to below in this Part as “the Council”).

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     (4)    A transfer scheme may provide for the transfer to the Council of rights and

liabilities relating to persons employed in the civil service of the state.

     (5)    On the day appointed by a transfer scheme, the property, rights and liabilities

which are the subject of the scheme shall, by virtue of this subsection, be

transferred in accordance with the provisions of the scheme.

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     (6)    Schedule 3 is to have effect in relation to transfer schemes and transfers under

this section.

 39    Conditions relating to costs of water regulation

     (1)    In this section “payment conditions” means conditions included in an

appointment under Chapter 1 of Part 2 of the WIA by virtue of section 11(1)(c)

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of that Act.

     (2)    The payment conditions of such an appointment may (without prejudice to the

generality of section 11(1)(c)) require the payment by the company holding the

 

 

Water Bill [HL]
Part 2 — New regulatory arrangements, etc

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appointment of sums relating to any of the expenses mentioned in subsection

(3).

     (3)    Those expenses are—

           (a)           the expenses of the Council, and

           (b)           the expenses of the Authority, the Secretary of State or the Assembly in

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relation to the establishment of the Council.

     (4)    The Authority may, in accordance with this section, modify any payment

conditions where it considers it necessary or expedient to do so in consequence

of, or of preparations for—

           (a)           the establishment of the Council, or

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           (b)           the abolition of the customer service committees established under

section 28(1) of the WIA.

     (5)    Where the Authority modifies under subsection (4) any payment conditions of

an appointment it may make such incidental or consequential modifications as

it considers necessary or expedient of the other conditions included in the

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appointment.

     (6)    Before modifying under subsection (4) or (5) the conditions included in such an

appointment, the Authority shall consult the company holding the

appointment.

     (7)    The powers of the Authority under subsections (4) and (5) may not be exercised

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after the end of the period of two years beginning with the commencement of

this section.

     (8)    The Secretary of State may, after consulting the Assembly, give directions to

the Authority for the purpose of securing that sums relating to any of the

expenses mentioned in subsection (3) are included in the sums payable by

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virtue of payment conditions; and the Authority shall comply with any such

direction.

     (9)    If this section comes into force before the coming fully into force of section

38(1), references in this section to the Authority are to be read as including

references to the Director General of Water Services.

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 40    Forward work programmes and annual reports

     (1)    Before section 193 of the WIA there is inserted—

       “192A            Forward work programmes

           (1)           The Authority and the Council shall, before each financial year, each

publish a document (the “forward work programme”) containing a

35

general description of the projects, other than those comprising routine

activities in the exercise of its functions, which it plans to undertake

during the year.

           (2)           That description must include the objectives of each project.

           (3)           The forward work programme for any year shall also include an

40

estimate of the overall expenditure which the Authority or the Council

expects to incur during the year in the exercise of its functions.

           (4)           Before publishing the forward work programme for any year, the

Authority or the Council shall give notice—

 

 

Water Bill [HL]
Part 2 — New regulatory arrangements, etc

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                  (a)                 containing a draft of the forward work programme; and

                  (b)                 specifying the time within which representations or objections

to the proposals contained in it may be made,

                                       and shall consider any representations or objections which are duly

made and not withdrawn.

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           (5)           The notice under subsection (4) above must be published by the

Authority or the Council in such manner as it considers appropriate for

the purpose of bringing the matters contained in it to the attention of

persons likely to be affected by them.

           (6)           The Authority must send a copy of any notice given by it under

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subsection (4) above to the Council, the Secretary of State and the

Assembly.

           (7)           The Council must send a copy of any notice given by it under

subsection (4) above to the Authority, the Secretary of State and the

Assembly.

15

       192B            Annual and other reports

           (1)           The Authority shall, as soon as practicable after the end of each

financial year, make to the Secretary of State a report (the “annual

report” for that year) on—

                  (a)                 its activities during that year; and

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                  (b)                 the activities of the Competition Commission during that year

in respect of any references made by it.

           (2)           The annual report for each year shall include—

                  (a)                 a general survey of developments in respect of matters falling

within the scope of the Authority’s functions;

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                  (b)                 a report on the progress of the projects described in the forward

work programme for that year;

                  (c)                 a summary of final and provisional orders made and penalties

imposed by the Authority during the year;

                  (d)                 a report on such matters relating to any relevant undertaker

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whose area is wholly or mainly in Wales as the Assembly may

from time to time require; and

                  (e)                 a report on such other matters as the Secretary of State may

from time to time require.

           (3)           The annual report for each year shall set out any general directions

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given by the Secretary of State under section 27(3) above.

           (4)           The Secretary of State or (as the case may be) the Assembly shall consult

the Authority before exercising the power under subsection (2)(d) or (e)

above in relation to any matter.

           (5)           The Secretary of State shall—

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                  (a)                 lay a copy of each annual report before each House of

Parliament; and

                  (b)                 arrange for the report to be published in such manner as he

considers appropriate.

           (6)           The Authority may also prepare other reports with respect to any

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matter falling within the scope of its functions and may arrange for any

such report to be published in such manner as it considers appropriate.

 

 

Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    43

 

           (7)           The Authority shall send a copy of each annual or other report under

this section to the Assembly, the Council and the Chief Inspector of

Drinking Water.

           (8)           In making or preparing any report under this section the Authority

shall have regard to the need for excluding, so far as that is practicable,

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any matter which relates to the affairs of a particular individual or body

of persons (corporate or unincorporate), where publication of that

matter would or might, in the opinion of the Authority, seriously and

prejudicially affect the interests of that individual or body.”

     (2)    Sections 193 and 194 of the WIA (which make provision about annual and

10

other reports by the Director General of Water Services and customer service

committees) shall cease to have effect.

Objectives of regulation of water industry

 41    Objectives and duties under WIA

     (1)    Section 2 of the WIA (general duties with respect to water industry) is

15

amended as follows.

     (2)    In paragraph (a) of subsection (1), after “relevant undertakers” there is inserted

“and of licensed water suppliers”.

     (3)    For subsection (2) there is substituted—

           “(2A)              The Secretary of State or, as the case may be, the Authority shall

20

exercise and perform the powers and duties mentioned in subsection

(1) above in the manner which he or it considers is best calculated—

                  (a)                 to further the consumer objective;

                  (b)                 to secure that the functions of a water undertaker and of a

sewerage undertaker are properly carried out as respects every

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area of England and Wales;

                  (c)                 to secure that companies holding appointments under Chapter

1 of Part 2 of this Act as relevant undertakers are able (in

particular, by securing reasonable returns on their capital) to

finance the proper carrying out of those functions; and

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                  (d)                 to secure that the activities authorised by the licence of a

licensed water supplier and any statutory functions imposed on

it in consequence of the licence are properly carried out.

           (2B)              The consumer objective mentioned in subsection (2A)(a) above is to

protect the interests of consumers, wherever appropriate by promoting

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effective competition between persons engaged in, or in commercial

activities connected with, the provision of water and sewerage services.

           (2C)              For the purposes of subsection (2A)(a) above the Secretary of State or,

as the case may be, the Authority shall have regard to the interests of—

                  (a)                 individuals who are disabled or chronically sick;

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                  (b)                 individuals of pensionable age;

                  (c)                 individuals with low incomes;

                  (d)                 individuals residing in rural areas; and

 

 

Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    44

 

                  (e)                 customers, of companies holding an appointment under

Chapter 1 of Part 2 of this Act, whose premises are not eligible

to be supplied by a licensed water supplier,

                                       but that is not to be taken as implying that regard may not be had to the

interests of other descriptions of consumer.

5

           (2D)              For the purposes of subsection (2C) above, premises are not eligible to

be supplied by a licensed water supplier if—

                  (a)                 they are household premises (as defined in section 17C below);

or

                  (b)                 the total quantity of water estimated to be supplied to the

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premises annually for the purposes of subsection (2) of section

17D below is less than the quantity specified in that subsection.

           (2E)              The Secretary of State and the Authority may, in exercising any of the

powers and performing any of the duties mentioned in subsection (1)

above, have regard to—

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                  (a)                 any interests of consumers in relation to electricity conveyed by

distribution systems (within the meaning of the Electricity Act

1989);

                  (b)                 any interests of consumers in relation to gas conveyed through

pipes (within the meaning of the Gas Act 1986);

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                  (c)                 any interests of consumers in relation to communications

services and electronic communications apparatus (within the

meaning of the Communications Act 2003),

                         which are affected by the exercise of that power or the performance of

that duty.”

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     (4)    For subsections (3) and (4) there is substituted—

           “(3)              Subject to subsection (2A) above, the Secretary of State or, as the case

may be, the Authority shall exercise and perform the powers and duties

mentioned in subsection (1) above in the manner which he or it

considers is best calculated—

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                  (a)                 to promote economy and efficiency on the part of companies

holding an appointment under Chapter 1 of Part 2 of this Act in

the carrying out of the functions of a relevant undertaker;

                  (b)                 to secure that no undue preference is shown, and that there is

no undue discrimination in the fixing by such companies of

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water and drainage charges;

                  (c)                 to secure that consumers are protected as respects benefits that

could be secured for them by the application in a particular

manner of any of the proceeds of any disposal (whenever made)

of any of such a company’s protected land or of an interest or

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right in or over any of that land;

                  (d)                 to ensure that consumers are also protected as respects any

activities of such a company which are not attributable to the

exercise of functions of a relevant undertaker, or as respects any

activities of any person appearing to the Secretary of State or (as

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the case may be) the Authority to be connected with the

company, and in particular by ensuring—

                        (i)                        that any transactions are carried out at arm’s length;

 

 

Water Bill [HL]
Part 2 — New regulatory arrangements, etc

    45

 

                        (ii)                       that the company, in relation to the exercise of its

functions as a relevant undertaker, maintains and

presents accounts in a suitable form and manner;

                        (iii)                      that, if the person is a licensed water supplier, its licence

does not authorise it to carry on any activities in the area

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of the company;

                  (e)                 to contribute to the achievement of sustainable development.

           (4)              In exercising any of the powers or performing any of the duties

mentioned in subsection (1) above in accordance with the preceding

provisions of this section, the Secretary of State and the Authority shall

10

have regard to the principles of best regulatory practice (including the

principles under which regulatory activities should be transparent,

accountable, proportionate, consistent and targeted only at cases in

which action is needed).”

     (5)    After subsection (5) there is inserted—

15

           “(5A)              In this section—

                                  “consumers” includes both existing and future consumers; and

                                  “the interests of consumers” means the interests of consumers in

relation to—

                        (a)                        the supply of water by means of a water undertaker’s

20

supply system to premises either by water undertakers

or licensed water suppliers acting in their capacity as

such; and

                        (b)                        the provision of sewerage services by sewerage

undertakers.”

25

     (6)    In subsection (6), for paragraphs (a) and (b) there is substituted—

                  “(a)                    subject to subsection (6A) below, the reference in subsection (1)

above to the provisions of this Act relating to the regulation of

relevant undertakers and of licensed water suppliers is a

reference to the provisions contained in Part 2 of this Act (except

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section 27A, and Schedule 3A), or in any of sections 37A to 38,

39, 39B, 39C, 66B, 66D, 66F to 66H, 66K, 66L, 95, 96, 153, 181, 182,

192A, 192B, 195, 195A and 201 to 203 below;

                  (b)                    the reference in that subsection to the provisions relating to the

financial conditions of requisitions is a reference to the

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provisions contained in sections 42, 43, 43A, 48, 51C, 99, 100 and

100A below; and”.

     (7)    In subsection (6A), for “Subsections (2) to (4) above” there is substituted

“Subsections (2A) to (3) above and section 2A below”.

     (8)    In subsection (6B), for “subsections (2) to (4) above” there is substituted

40

“subsections (2A) to (3) above and section 2A below”.

     (9)    After subsection (6B) there is added—

           “(7)              The duties imposed by subsections (2A) to (3) above and section 2A

below do not affect the obligation of the Authority or, as the case may

be, the Secretary of State to perform or comply with any other duty or

45

requirement (whether arising under this Act or another enactment, by

virtue of any Community obligation or otherwise).”

 

 

 
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