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Baroness Young of Old Scone: I hope that I did not leave the impression that I do not think that water efficiency is a good idea; I simply said that the amendment was perhaps not the best way to achieve that outcome in practice.

Baroness Byford: I hear what the noble Baroness says, but I shall read Hansard carefully tomorrow. I do not regard the amendment as in any way an apple-pie amendment; it is hugely important. So I am disappointed that someone who heads the Environment Agency, who will have to deal with the Bill and try to encourage us all—whether we work for water companies or are just private individuals—to ensure that it works, reacts in that way. But there we are.

I must say the same for the Minister; he will not be surprised at that. He said that he was sympathetic, but on this occasion we need more than sympathy. He said that he felt that the amendment cut across duties and confused other roles. Nothing is more confusing than what we are having to do, which is to go through the Bill, which refers to so many different Acts, let alone

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the statutory instruments and everything else. The amendment would clearly insert at the front of the Bill just a few words, so I am bitterly disappointed that both the Minister—although I do not mean him personally, but the department—and the Environment Agency take that view.

I am grateful to Members of the Committee who have supported my amendment. My noble friend Lord Dixon-Smith made an interesting suggestion concerning how the issue is being addressed in America. As we all know, some parts of America are very dry.

So I am not at all happy, and if we were on the Floor of the House, I should call for a Division. I register my objection. I am not satisfied, however kindly the Minister put me down, that the Government are unable to accept the amendment. We shall certainly return to it. My noble friend Lord Peel mentioned that agriculture accounts for only 2 per cent of total water drawn down. We as householders should be declaring an interest—we all use water. Each of us uses a lot of water and there are ways in which we can help.

My amendment is so small and refers to,

    "all users and consumers".

However, we are where we are. With reluctance, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 1 [Licences to abstract water]:

The Duke of Montrose moved Amendment No. 4:

    Page 2, line 9, after "days" insert "in any period of twelve calendar months"

The noble Duke said: This is a probing amendment to ascertain whether the temporary licence is intended to cover a continuous period or whether, for example, an abstractor could take water once a week from April to September to restock water storage containers. The amendment is also intended to establish whether the temporary licence may be renewed year on year for the same purpose.

Perhaps those Members of the Committee who are modern-technology literate will forgive me if I fall back on old-fashioned imperial measures. I realise that it would take a big bowser for stock to fill one with 4,400 gallons per day before the operation fell within the 20 cubic metres at which a licence is required. However, if someone was in the habit of refilling a swimming pool once a week, he might well exceed the 20 cubic metres threshold on one day of the week, but not as an average over the whole week. I beg to move.

Lord Whitty: The temporary licences are intended to be used to cover one-off abstractions of a duration of fewer than 28 consecutive days where large volumes of water are needed for short periods—for example, at a summer fair, for pressure testing of pipelines or other episodic events. Under the Government's definition, the Environment Agency will be able to assess the effects of short-duration abstraction of that order in relation to the time of year and current pressures on the system.

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With that clarification, the effect of the amendment moved by the noble Duke would be undesirable in several respects. It would allow abstractions on any 27 days in a 12-month period, rather than on 27 consecutive days. It would also allow short duration abstractions at a fixed time over many years—for example, for 27 days, or almost the whole of February, every year for 12 years. I do not think that that is the noble Duke's intention, but that is what his amendment would allow. It would also allow short-duration abstractions over many years at any time of the year—for example, any 27 days in any one year for 12 years.

Any of those cases would represent a fundamental change to what is intended to be the use of temporary licences. In all of them, the Environment Agency would have difficulty assessing what would be the impact and enforcing its decision. In turn, that would increase the time needed to determine the application and would defeat one objective of having a temporary licence provision, which is to deal with situations that may arise suddenly by providing a short-duration licence that can be issued quickly, without going through the lengthier process required for a permanent licence.

With that explanation, I hope that the noble Duke will understand what is intended by temporary licences and that his amendment would significantly worsen the situation.

The Duke of Montrose: I thank the Minister for his reply. What he said makes the meaning of the Bill's wording much clearer. We shall have to consider whether what he said is enough to make it clear for ever and a day, or whether some wording still needs to be added to ensure that anyone reading the Bill understands what he has explained to us today. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Dixon-Smith moved Amendment No. 5:

    Page 2, line 9, at end insert—

"( ) Where the issue of a licence also concerns the construction of engineering facilities that are related to the supply or storage or processing of the water that is the subject of the licence applied for, the licence issuing authority shall take into account the expected life of those related facilities when considering the duration of the period for which the licence is to be issued."

The noble Lord said: The amendment is grouped with Amendment No. 55, which picks up a similar point. That point was mentioned on Second Reading by several of my noble friends—Lord Elliot of Morpeth, Lady O'Cathain and Lord Peel—and by the noble Lord, Lord Borrie. Indirectly, it was mentioned by the noble Baroness, Lady Young of Old Scone, who sought to give reassurance on the issue of discharge licences, which are subject to a four-yearly review that, she says, appears not to cause any problems. I accept that. It may or may not be an argument, but how many times have we all read in legislation that a Minister may decide on different courses of action for different cases? I hate to think how many times I have read that since I have been in the House.

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The problem is the glaring inconsistency between the problems of long-term planning and financing of the water industry—especially of infrastructure—and what we know of the suggested licensing regime under the new system that will operate on 12-year blocks. If one simply considers the problems of providing major reservoirs—or, indeed, catchment area transfer schemes—to supply water over big distances, they probably have at least a 20-year planning and lead-in time before they can be brought into action.

No one, and I seriously mean no one, will consider anything of that nature—it will not even get to first base—on the basis of an assurance of an abstraction licence for 12 years. That is unreal. So we have an immediate and apparent problem. One Member of the Committee has already referred to the fact that parts of the water industry are still running on essentially Victorian infrastructure. I do not suggest that one would necessarily want to introduce a licence that would match the lifetime of the infrastructure, but I hope that we can ensure that, even today, the industry builds to similar standards. The disruption that is caused if we do not is usually a hidden on-cost that the whole of society must reluctantly bear.

One would not build a house on the basis of a 12-year supply of water, but the Government are blithely talking about adding about another 500,000 houses in the south-east of England, where water supplies are already supposed to be under pressure. That is a glaring inconsistency.

This is a probing amendment—although I regard the whole Grand Committee process as a probing process. The amendment would simply require the "issuing authority"—I used that wording deliberately because, without wanting to hurt anyone's feelings, nothing lasts for ever and the Environment Agency may not last as long as much of the infrastructure that it sees installed—to,

    "take into account the expected life of those related facilities".

I shall listen to the Minister's reply with interest, but I suspect that the wording might have been slightly more appropriate if I had used the words, "the funding period", which would at least have allowed the installer to get out of financial trouble. Major infrastructure for the water industry is enormously expensive. It is expensive for whoever undertakes it. If a farmer creates an impounding reservoir to take winter run-off and use it for irrigation in the summer, relatively for him, that is a very high cost. The same argument applies to someone using boreholes for aquifer recharge—as can be done. All those systems are expensive for the person undertaking the work. That is a fundamental point.

I hope that the Government may be somewhat more sympathetic to this amendment than to earlier amendments that, in my view, are equally important. We shall come to the question of licences later, but if there is concern that it will be impractical to manage the abstraction of water in the interests of the catchment area sufficiently well if the licence period is too long, I suggest that that is the problem not of the

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person holding the licence but of the person issuing licences. We must think carefully, but there is no reason why in particular cases involving major infrastructure costs, or an individual who is undertaking high relative expenditure, people should not have a licence for the full period—at any rate for them to recover their costs. That would make planning such operations much easier.

I shall say no more. I could enter some slightly less productive areas that are, to an extent, red herrings to the issue, but the fundamental point stands. I accept and place on record that the existing system is working extremely well. In my briefing, I am assured that long-term planning continues and that the system is beginning to work extremely well. But if we look for the legislative authority that makes it work, it does not really exist. At least, it is not spelled out.

I am encouraged to the extent that people will undertake what needs to be undertaken regardless of the law. That has always been the case. But some provisions should be in primary legislation, so that everyone knows what is the background and, more importantly, so that some lunatic cannot get hold of the system and make a mess of it. I beg to move.

5.30 p.m.

Baroness Miller of Chilthorne Domer: My name and that of my noble friend Lord Livsey are attached to Amendment No. 55, along with those of the noble Baronesses, Lady O'Cathain and Lady Byford, because we, too, want to probe the issue and discover the Government's thinking.

We feel encouraged by the balance in the Bill that ensures that the habitat side of the business will be protected in a way that it has not been before. However, to have proper regard to sustainability, we must ensure that when people decide to invest in something, the agency will get its judgment right. The amendment places an additional onus on the agency to get its judgment right, so that it does not jeopardise someone who makes an investment only to discover that it was not as good as he thought.

The Bill includes sufficient safeguards for eventualities that we may not predict, such as periods of drought. The amendment is geared more to times of normality. I look forward to hearing the Minister's reply.

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