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Flood and Water Management Bill

My Lords, Amendment 101 would specify in the Bill a number of issues that would otherwise have to be included in agreements for the adoption of new foul sewers and lateral drains by statutory sewerage undertakers. It would also remove the requirement that a mandatory build standard published by the Secretary of State and by Welsh Ministers be followed unless the parties to the agreement agreed to a different approach. We are committed to preventing problems of private sewers connecting to the public system. Clause 42 therefore requires adoption agreements to be in place and for the sewers then built to be adopted. When we were developing this policy, stakeholders advised us to retain the agreements under Section 104 of the Water Industry Act 1991 as the vehicle for adoption. Such agreements are flexible enough to include whatever detail the parties may agree, and Ofwat can resolve disputes. We therefore have only three requirements: first, an agreement must be in place; secondly, it must have an agreed build standard; and, thirdly, there must be provisions for adoption. We think it is right to promote innovation and enable the needs of a particular site to be reflected, and therefore we do not wish to constrain agreements by making further requirements in the Bill. This flexibility is supported by both the House Builders Federation and Water UK. This approach will ensure that all new sewers which connect to the public network are adopted and do not become a burden on householders, and that all such sewers are built properly so that undertakers do not end up adopting a liability. The water companies and developers also support a mandatory build standard. Developers want a transparent standard and sewerage undertakers want to be sure that what they have to adopt is fit for purpose. The mandatory build standard gives them this, and both developers and sewerage undertakers are helping to draft a build standard, which will be consulted on over the summer. Without such a standard, Section 104 agreements might routinely take longer to put in place, putting undue burdens on small developers who do not currently use the adoption process and delaying developments. However, where site-specific standards and innovative approaches to drainage may be useful, Clause 42 also allows the agreement to depart from the mandatory standards. The Bill enables us to place further requirements on these agreements if needs be, but we hope not to use that power and wish to retain the flexibility of the current provision. The new clause proposed by Amendment 102 will, in our view, impose a costly and disproportionate new burden on the Environment Agency compared with any real benefit and will duplicate work already done on costs. In July 2007, the Government consulted on whether to do an audit of private sewers and lateral drains by requiring water and sewerage companies to establish pilot schemes to assess their extent and condition. Seventy per cent of those who responded rejected the idea and only 21 per cent supported it. The stakeholder steering group for Defra’s review of private sewers agreed with that result. The latest estimate from UK Water Industry Research of the costs of a full mapping and surveying exercise is in excess of £1 billion. Even pilot schemes would be extremely expensive, and that is all before a penny is spent on the cost of repair. Such an approach would also duplicate work already done. The companies’ cost estimates have been reviewed by Ofwat and were set out in the impact assessment that accompanied the Government’s announcement on 15 December 2008 of their decision to proceed with the transfer. The estimate was of over £1 billion in one-off capital costs, average annual operating costs of £133 million and an increase in customers’ bills of between £4 and £12 per year. An updated impact assessment will accompany our consultation on the regulations for the transfer when they are published. I do not believe that pilots would produce enough useful information to warrant the cost or the delay in bringing the benefits of transfer to householders. In practice, the costs of an audit would be better spent dealing with the real problems that exist in relation to private sewers. In the light of this, we therefore see little value in the approach proposed in this new clause. Turning to the other new clause in this grouping, proposed in Amendment 103, the noble Earl referred to Sir Michael Pitt’s recommendation in his review of the 2007 floods. I repeat what the noble Earl said: ""The automatic right to connect surface water drainage of new developments to the sewerage system should be removed"." The Bill achieves this by requiring proposals for surface water drainage from new development to be approved by the SUDS approving body in accordance with national standards before any residual connection to the public sewer is allowed. The relevant provision is paragraph 16 of Schedule 3 to the Bill, which inserts a provision into the Water Industry Act which says that the right to connect under Section 106(1) of that Act, in respect of surface water, may be exercised only if a drainage system was approved under Schedule 3 to this Bill and the approved drainage system provided for such a connection. I hope that answers the noble Earl’s point. Water and sewerage companies will be statutory consultees in this process. Surface water cannot, in any event, be connected to public foul-only sewers unless the water and sewerage company gives its permission. The ability to connect foul drainage to the public sewerage system will remain, but subject to the requirement under Clause 42 for a Section 104 agreement, as I have already explained. Foul-water flows and connections are, in themselves, not the primary cause of foul sewer flooding. They are usually stable and predictable. Most sewer flooding occurs when rainstorms lead to excess levels of surface water in the public sewer. For reasons of public health, foul sewage should be taken away for treatment and the right to connect remain. Water and sewerage companies have a statutory duty effectually to drain their areas, and it is for them to finance their investment programmes, which should already make provision for improving the capacity of their infrastructure in response to local development plans. If a local planning authority thinks additional capacity is needed earlier than planned to enable a development to proceed to a certain timescale, it can already seek a contribution to the financing of that investment from the developer. It may also refuse planning permission where it is not satisfied that the necessary infrastructure can be put in place. This amendment would undermine the balance that we have sought to achieve between the needs of developers, water companies and local authorities. We know, therefore, that it is of some concern to the House Builders Federation. While I sympathise with the general aim of the new clause, the provisions contained in the Bill, together with the existing provisions of town and country planning legislation and the Water Industry Act 1991, already provide a regime that protects against unrestricted burdens being imposed on new development. I hope that, with these explanations on the three amendments to which I have spoken, the noble Earl will feel able not to press them.