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Water Companies' Obligations

Volume 589: debated on Thursday 30 April 1998

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asked Her Majesty's Government:What progress has been made towards the setting of price limits for water companies from 1 April 2000. [HL1729]

The Director General of Water Services sent an open letter and accompanying paper Setting the Quality Framework to my right honourable friends the Secretary of State for the Environment, Transport and the Regions and the Secretary of State for Wales on 30 April, seeking guidance on the quality obligations to be placed on water companies in the period 2000 to 2005. Copies of the Director General's letter and accompanying paper have been placed in the Library of the House.We expect also to receive advice on this issue from the Environment Agency in mid-May, which we shall take into account in formulating the guidance to the Director General. That advice will, similarly, be placed in the Library of the House.The Department of the Environment, Transport and the Regions (DETR) will issue a consultation letter on 1 May, seeking the views of all those who have an interest in or involvement with the water industry on the issues raised in the Director General's letter and accompanying paper, and inviting the submission of reasoned arguments over the appropriate level of obligations to place on water companies, to be funded from customers' bills. We are keen to strike the right balance between investment to deliver desirable environmental and quality improvement and the level of water bills.At this stage in the periodic review, costings have not been finalised. Further work will be needed to refine this information. There also remain uncertainties in relation both to the precise nature of some of the EU obligations that water companies will have to meet, as well as to the costings of possible obligations. Against that background, however, we shall seek to give guidance in the summer which is as clear as possible when responding to the Director General. We should welcome views on the issues raised in the Director General's letter and paper, which we shall take into account in providing guidance.A copy of the DETR's consultation letter, which will seek comments by Friday 12 June, will be placed in the Library of the House.