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Water and Sewerage (South-west)

The hon. Lady is right and I shall cover some of that ground in a moment. The report rightly states:""These high…prices compared to the rest of the country cause the sense of unfairness. They also, of course, aggravate issues of affordability."" Fortunately, Anna Walker has suggested some potential remedies for that injustice. There is a clear financial imbalance in the way the water companies were set up at privatisation. South West Water customers shouldered a disproportionate burden of the programme to clean up our coastline and improve our bathing waters. It is clear from the report's recommendations that retrospective financial redress is necessary, not least to fund the continuing cost of South West Water's investments. One remedy is a one-off payment, which, as the report states""is equivalent to reducing the financial burden of the regulatory asset base per customer in the South West Water area."" That would cost approximately £650 million. Another alternative is an annual subsidy to South West Water. Walker estimated a figure of about £33 million a year. There are options on how to fund the subsidy: direct Government funding or a levy of about £1.50 to every household water and sewerage bill in the rest of the country.