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Sewerage Charges

Volume 933: debated on Monday 13 June 1977

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Motion made, and Question proposed, That this House do now adjourn.—[ Mr. Thomas Cox.]

11.24 p.m.

Prior to my application to Mr. Speaker for this Adjournment debate, I understand that my hon. Friend the Member for Goole (Dr. Marshall) also made application for a debate on his proposed Bill covering the same topic. I had made application for this debate before a debate took place on that proposed Bill. I understand that such a debate took place on the last day before the Recess. It will not, therefore, be my intention to cover all the ground again which must have been covered on that date, and I shall seek to deal instead with the matter as it affects my constituents principally, and to suggest, if it is in order, some ways in which the Government's proposed Bill might be worded.

The House will be aware of the now famous Daymond judgment. The Times Law Report of 5th May 1975 of the action which took place in the Queen's Bench Division between Daymond and the Plymouth City Council and Another, before Mr. Justice Phillips, reported as follows:
"A water authority constituted under the Water Act, 1973, has no power to exact payment in respect of sewerage and sewage disposal services from a householder whose premises are not connected to its sewers."
In his judgment, Mr. Justice Phillips said that if the defendants were entitled to make the charges, the water authority could exact payments from a householder whose premises were so far from the nearest sewer that there was no practical possibility of their ever being connected to a sewer, and a householder in remotest Dartmoor would be liable for payments in the same way as a householder in the middle of Plymouth. He said that it was a test case and that the result would affect all water authorities and most hereditaments not connected to their sewers.

I believe that this was a perfectly sensible judgment on the part of Mr. Justice Phillips, and I am not here to try to overturn that judgment. But the effect, which I imagine was not foreseen at the time, was not so much to make householders in remotest Dartmoor liable for payments in the same way as a householder in the middle of Plymouth. What it did was to make householders who might have been in the middle of Plymouth liable to the payments previously being made by householders in the middle of Dartmoor. It is this effect that has caused grave concern amongst a number of my own constituents.

Although this judgment, in the case of rural cesspit owners not connected to mains sewerage, led to the abolition of the general sewerage charge on un-sewered properties, it also led to the application of the same principle to urban dwellers who were connected not to main sewers but who had cesspits. The money that was lost by the water authorities from this order has been recouped by them by their imposing upon urban cesspit owners a sewage treatment charge which, in the case of my own water authority, the Severn-Trent, ran at the rate of £3 per 1,000 gallons in the first year. I understand that these charges varied throughout the country. Some water authorities charged slightly less and some charged substantially more.

When this charge was levied by the Severn-Trent Water Authority on the Dudley borough, the Dudley Metropolitan Borough considered how it should deal with the charge. In a letter to me, the chief executive of the council wrote:
"… the recent increase in charges for this service is as a direct result of increased charges being imposed upon the council by the Severn-Trent Water Authority for the disposal of the contents of cesspits and septic tanks into the sewers under the control of the Severn-Trent Water Authority. The increase imposed by the council is only that necessary to ensure that the council recovers the charges that have been made to them by the water authority."
In other words, as a result of the Day-mond judgment, we start a chain of reactions—as it were, a series of shunting trucks. It is the final truck—that of ray constituents who own urban cesspits—which actually hits the buffers. The cost has been passed on successively from the water authority, by the local authority, and it ends up in the hands of the owner of the cesspit or of the house which is connected to a cesspit rather than to mains sewerage.

In my constituency the owners of urban cesspits, amounting to 184 householders in the whole of the Metropolitan Borough of Dudley, had previously paid the general service charge through their rates in exactly the same way as any householder connected to the main sewerage, and paid at the same rate. As a result of the imposition of the charge—£3 per 1,000 gallons in this instance—and the Daymond judgment, the borough council felt it necessary to waive the genera! service charge and to charge instead a collection charge plus the charge made by the Severn-Trent Water Authority. The result has been an additional charge of up to as much as £70 to £100 a year for individual constituents. I can tell the House the average increase, because I have been given figures by my metropolitan borough. If it had met the cost of continuing to charge the same general service charge as previously, it would have had to pay an additional £8,500 a year. Divided by 184, that gives an average of £46.20 per household. This additional charge arises directly from the Daymond judgment, in that the water authority sought to collect from the urban cesspit householders that money which it was previously collecting from those rural cesspit householders who are no longer liable to make payment.

That average of £46.20 is an unreal figure. I have received a petition on the matter from no fewer than 56 of my constituents. One of the things they have made clear to me is that the extra charges have driven them to great economy, not in the use of water but in its disposal. Instead of disposing of it into their cesspits, when they will be charged for its collection and treatment, they are tipping it into the road and elsewhere. I understand that basins or the sink are being emptied into gardens or, more likely, the gutter. It seems to me an extremely un- hygienic practice, to say the least, but it is the kind of practice that such excess charges naturally lead to. If the householders continued to dispose of their water as they did under the general service charge, the figure might have been much higher—possibly about £60. I stress that that is an additional cost, above the general service charge.

The council, which I have approached on this matter on numerous occasions, has always maintained that under the law as it stands it is obliged to pass on the cost or, if not, must regard it as an additional cost. I have been told in a letter that:
"The Council's Environmental Health and Control Committee, at their meeting on the 30th June, gave further consideration to these charges, in the light of the decision of the Policy and Resources Committee that they were unable to make any financial resources available to the Committee to offset any loss that might be incurred as a result of the reduction of charges."
This, of course, follows from the stringent cost-cutting directives that have been laid down by the Government.

My constituents are caught in something of a vice in this matter of the additional costs that are being imposed upon them. I wrote to the Minister on this subject earlier and he said in a letter to me that he had no reason to believe that the water authorities would fail to comply with their obligations in fixing charges for emptying cesspit contents but that he was not satisfied with the incidence of these charges on the owners of unanswered properties and that the Government would look into the matter.

I understand that, arising out of the Bill that was proposed by my hon. Friend the Member for Goole, the Government will bring in measures to deal with the problem that is faced by my constituents. I should like to make some points about the form of the Bill. I hope that the Minister will be prepared to consider and take them into account. Under the Daymond judgment it seems to be a perfectly ligitimate thing that a householder should have the choice whether he wishes to pay his own costs or to come under the general service charge. Indeed, I suspect that that was the effect that the judge thought would result from his judgment. I am sure that the judge in the Daymond case did not expect that his judgment would affect urban cesspit owners. I should like to see householders given the choice of paying their own costs or the general service charge as it applies to all other ratepayers in the borough.

Not only is it unhygienic that urban dwellers should be impelled to dispose of their liquid waste in the ways that I have described, but councils are, under Section 14 of the Public Health Act 1936, liable to provide for the disposal of sewage. In 1977, as opposed to 1936, the mere collection of sewage might not be a sufficient fulfilment of the Public Health Act under modern conditions. However, because the judgment bears so heavily and unfairly upon a small pro portion of the population—in the case of Dudley it is only 184 houses at a cost of £185,000—and because the health of the public is a matter for the whole public, I recommend that the normal cost of the general service charge should be applied in the case of all cesspit owners who elect to pay them. In other words, there should be a cessation of the current dual charge.

I understand from the Minister that in some cases householders are paying a triple charge—that is including the general service charge. That is grossly unfair and a matter for the whole population of the area, the general ratepayers, because it is to their advantage. I therefore commend to the Minister that the option should be given to any householder to pay his own costs or to pay the general service charge. In that way the spirit of the Daymond judgment would not be impinged upon in any way and it would save my constituents and others from paying a substantial and unjust additional charge.

11.39 p.m.

I congratulate my hon. Friend the Member for Dudley, West (Dr. Phipps) on his persistence in obtaining a debate on this important but not exactly glamorous subject on our first day back after the break. However, it is an extremely important subject and I am well aware from the mail that I have received as an MP and as a Minister, and from the Bill that was introduced by my hon. Friend the Member for Goole (Dr. Marshall), that there is considerable public concern about the level of charges on some cesspit owners. I must add that the concern is not confined to urban areas and that it was not only the rural areas that received the benefit of the Daymond judgment but those in urban areas, too.

My hon. Friend will know that I spoke on the Second Reading of the Bill brought in by our hon. Friend the Member for Goole and commented on some of his suggestions. Unfortunately, it was a short debate and my hon. Friend was in the middle of withdrawing the Bill when Mr. Speaker called time at 4 o'clock. The problem remains.

There is no doubt that the owners of some cesspools face very large charges—in some cases much higher than those quoted by my hon. Friend tonight. It is important to understand the reasons for these high charges. The problem is difficult and complicated and we should not be deluded into thinking that it is capable of simple solution.

Until the House of Lords judgment in the Daymond case and the Water Charges Act 1976, all properties were liable to a sewerage charge levied by the regional water authority, regardless of whether they had mains drainage. The Daymond judgment ruled that only connected properties were liable to a sewerage charge, and the 1976 Act provided for the refund of charges by water authorities for the past two years. But immunity from sewerage charges is, as my hon. Friend has pointed out, scant consolation to those people who now find themselves faced with much higher charges for emptying and treatment. In most cases, these high charges affect properties with cesspools which require frequent emptying. I make here a distinction between cesspools—sealed containers which need to be emptied when full—and septic tanks, which are, in effect mini sewerage works which in most cases require only infrequent attention.

Responsibility for dealing with cesspools is split between local authorities, who do the emptying, and water authorities, who treat the emptied contents. Both local authorities and water authorities are entitled to charge for the service that they provide. Although many local authorities used to provide a free or subsidised emptying service, they have tended to raise their charges to something near an economic level in order to avoid a burden on the rates and thus a subsidy from the general body of ratepayers. It is, of course, for individual councils to decide what charges they will make.

At the same time as this move to an increase in local authority charges, the regional water authorities have introduced treatment charges. Although these charges vary from authority to authority, I have no reason to think that they are excessive. Water authorities have a statutory obligation to break even, so a less than economic cost to one group of consumers must be reflected in higher charges to everyone else. Emptying cesspools is expensive and if owners do not pay for emptying and treatment, they have to be subsidised by the rest of the population.

The harsh fact is, therefore, that emptying and treatment charges have gone up to something like the real cost of providing the service. Cesspool emptying is an expensive business, certainly more expensive than the use of mains drainage. The average sewerage bill to a connected property for 1977–78 is about £18. The average cost of emptying a cesspool once is about £12. For those small cesspools requiring frequent emptying, the provision of the emptying and treatment service can be very expensive indeed. My hon. Friend mentioned £60–£70. In some cases it must be several hundred pounds.

Despite these facts, which will not go away, I fully accept that some people are now faced with paying very high rates, whereas before Daymond their sewerage bill was relatively modest. This problem will not go away either. It was for this reason that the Government's consultative document on the review of the water industry, which includes sewage and sewerage, raised for public comment the question whether the same body might be made responsible for both cesspool emptying and treatment. Some rationalisation of charges might then be possible.

If it were decided that there should be a subsidy of people with cesspools, it might be better to spread it over the whole area of a water authority rather than over the area of one district council, which may cover many such properties.

We received a large number of representations on this aspect of the consultative document. Most of them were, of course, from the owners of properties with cesspools, who were naturally anxious to draw attention to the levels of their charges. But some representations have drawn attention to the fact that a subsidy to unconnected properties could be achieved only at the expense of higher charges to connected properties. We should not forget that connected properties faced very steep increases in their charges in 1976–77 as a result of Daymond refunds and the contraction in the charging base.

We have been considering with particular care the representations that we received on this aspect of the consultative document. We shall be announcing our conclusions on this and all the other issues raised in the consultative document, in a White Paper that we shall publish shortly. It would be quite wrong for me to seek to anticipate the contents of that White Paper.

I hope that my hon. Friend will understand that at this stage I am unable to say more than that we are aware of the problem that he has raised so eloquently, and that the White Paper will say what we propose to do about it. It is always difficult, during the formulation of a major policy statement of this nature, to deal with this type of problem. But, as recent evidence of the Government's recognition of the problem, I can point to the recent changes in VAT arrangements for both emptying and treatment charges. The Inland Revenue has agreed that such charges should be zero rated because initially people had to pay VAT. I do not pretend that these changes are more than a minor palliative. I can assure my hon. Friend that they are not intended to serve as a permanent cure.

I am in no doubt about the urgency of the problem. I hope that my hon. Friend will not have long to wait before the publication of the White Paper which will lead to legislation. At present I cannot tell water authorities or local authorities not to make charges. They are entitled to do so if they wish.

My hon. Friend mentioned some people who are in extremely difficult circumstances because of the Water Act 1973 and the resulting judgment in the Daymond case. Some people, because their surface water drains are connected to the main drains pay twice the normal charges and for their cesspools to be emptied. I appreciate that the people in that situation tend to be less well off. They are usually older people living in old houses.

I listened carefully to my hon. Friend's advice about what might be in a Bill. I hope that we shall introduce a Bill when the White Paper has been considered by the House. My hon. Friend suggested that people should have a choice. Those who would opt not to pay the general rate but to pay the charge would be those who would be better off by making that choice. People with septic tanks would opt out. I have my doubts about giving people that choice.

Taken to its logical conclusion the Daymond judgment implied that there should be an element of choice. The judgment says that people who elect not to have cesspools emptied should make no payment. It is logical that people should have the choice to decide whether they empty their cesspools themselves or have it done for them under a general service charge.

If it is done under a general service charge with a subsidy to those whose cesspools require emptying we shall not give the general ratepayers any choice whether they pay for it, even though their costs are less than the rates they pay. I mention that as a possibility, but I must not comment too much on what my hon. Friend said.

I assure my hon. Friend again that we are aware of the urgency. We are trying to get the White Paper out as soon as we can. We hope, but we cannot guarantee, to bring in a new water Bill which will be a substantial measure and not refer merely to this aspect of the problem.

I thank my hon. Friend for the points that he has raised, and I assure him once again that his contribution tonight has added to the urgency with which we in the Department view this matter.

Question put and agreed to.

Adjourned accordingly at ten minutes to Twelve o'clock.