rose to move, That the draft order laid before the House on 19 October be approved. 36th Report from the Statutory Instruments Committee, Session 2005-06.

The noble Lord said: My Lords, three separate matters are covered by this order. The first enables the National Assembly Government for Wales to make regulations for the content and conduct of the census in Wales. The second concerns Section 156 of the Environmental Protection Act 1990, transferring the power to make regulations in relation to waste on land. The third amends the basis on which the National Assembly for Wales makes regulations prescribing conditions in relation to water fittings under the Water Industry Act 1991. The Wales Office has obtained formal agreement with the Treasury, Defra and, of course, the National Assembly for Wales itself for all the matters contained within the order.

The first matter, concerning the 2011 census of population, would give the Assembly the right in law to be consulted on the draft census order and the power to make the regulations for the census in Wales. Information arising from each census of population is used by central and local government to form policy, to plan services for specific groups of people and to distribute resources effectively. Only a census can provide information on a uniform basis both about Wales as a whole and about individual small areas and sub-groups of the population in relation to one another.

Your Lordships will recall that, following the late introduction of a Scottish tick-box in the 2001 census, there were calls for a Welsh tick-box on the census form in Wales. The Economic Secretary to the Treasury and the Registrar General for England and Wales subsequently agreed that the Assembly should have a more formal role in agreeing future census forms in Wales.

Officials of the Welsh Assembly Government, the Office for National Statistics and the Wales Office, including legal advisers, have identified an option that gives the Assembly a greater role within the constraints of current legislation. The function, under Section 1 of the Census Act 1920, of making a census order is exercisable by Her Majesty in Council. Such functions do not fall within Section 22 of the Government of Wales Act 1998 and cannot be transferred to the Assembly. However, under Section 22(1)(c) of the 1998 Act, it is possible to direct that the function of a Minister of the Crown is to recommend that a census order be made by Her Majesty in Council.

The function of making census regulations, under Section 3 of the Census Act 1920, falls within Section 22 of the 1998 Act. Therefore, in so far as that function is exercisable in relation to Wales, it can be transferred to the Assembly. It would give the Assembly greater influence in the decisions that the Office for National Statistics takes and give it the final say on the way that the census is conducted in Wales. Where there is a sufficiently strong case to do so, different information could be collected on census forms in Wales.

The second matter transfers Section 156 as it applies to Part 2 of the Environmental Protection Act 1990 and will enable the Assembly to make regulations in relation to Wales giving effect to Community and other international obligations in relation to waste on land.

The devolution settlement gives the Assembly extensive responsibilities for environmental matters, including waste management. The National Assembly has powers to give effect to Community law obligations with respect to waste management under Section 2(2) of the European Communities Act 1972. The penalties which can be imposed by regulations made under the European Communities Act are lower than those imposable by regulations made under Section 156 of the Environmental Protection Act 1990. Thus, the main advantage of Section 156 powers is that they are not subject to the same limitations as attach to the use of Section 2(2) of the European Communities Act 1972, particularly in relation to the maximum penalties that may be imposed.

The Hazardous Waste (England and Wales) Regulations 2005 were made by the Secretary of State for Environment, Food and Rural Affairs partly in reliance on Section 156. Consequently, the regulations, which amend provisions relating to penalties in the Environmental Protection Act 1990, were able to include provision on penalties beyond the maximum, which would not have been permitted had the regulations been made under Section 2(2) of the European Communities Act 1972 alone.

Because of the need to rely on Section 156 for certain provisions in the Hazardous Waste (England and Wales) Regulations 2005, those regulations had to be made by the Secretary of State for Environment, Food and Rural Affairs to cover England and Wales for the Section 156-related issues and England only for the Section 2(2) issues. The Assembly made regulations covering Wales only for the Section 2(2)-related issues. That is untidy and confusing for all interested parties. Even where the Assembly and the Secretary of State for Environment, Food and Rural Affairs make regulations together, those regulations have to reflect the different powers held by both parties.

That situation can be avoided by the transfer of Section 156 provisions as they apply to Part 2 of the Environmental Protection Act 1990. Following the transfer, on occasions where policy/regulations made partly in Wales and partly in England are reviewed by both Defra and the Assembly Government, the Assembly will be able to implement any amendment fully in Wales without being reliant on Defra.

The third matter amends the basis upon which the Assembly may make regulations under Sections 47, 53, 55 and 66A of the Water Industry Act 1991 prescribing requirements in relation to water fittings, contravention of which will release a water undertaker from its water supply duties in certain circumstances. The requirements that can be prescribed by these regulations are confined to those contained in regulations made separately under Section 74 of the Water Industry Act 1991.

An anomaly exists in the way in which the functions under Section 74 and Sections 47(2)(g), 53(2)(c), 55(4) and 66A(6) have been transferred to the Assembly. The power to make regulations, under Section 74, has transferred in relation to water undertakers whose areas are wholly or mainly in Wales but not in relation to any licensed water suppliers. However, the powers, under Sections 47(2)(g), 53(2)(c), 55(4) and 66A(6), have transferred “in relation to Wales”. Water undertakers are the principal suppliers of public water and are appointed under Section 6 of the Water Industry Act 1991. Licensed water suppliers are a fairly new phenomenon.

The Water Act 2003 introduced new provisions into the Water Industry Act 1991 permitting companies that are holders of a water supply licence to have access to water undertakers’ supply systems, enabling the licensee to supply water to eligible non-household premises. Prospective suppliers have to obtain a licence from Ofwat.

The areas of supply of the Welsh undertakers do not align with the boundary of Wales and consequently some functions are transferred to the Assembly on a water undertakers’ area basis, such as Section 74. Because the functions under sections of the Act that I have already mentioned are exercisable by reference to regulations made under Section 74 of the Act, the basis of transfer of all those provisions needs to be aligned.

The proposed transfer of functions is intended to correct the disparate manner in which these interrelated functions have been transferred to the Assembly so that the Assembly’s ability to regulate the water industry in Wales more accurately reflects the devolution settlement as it has effect in relation to the supply of water by water undertakers. I beg to move.

Moved, That the order laid before the House on 19 October be approved. 36th Report from the Statutory Instruments Committee, Session 2005-06.—(Lord Evans of Temple Guiting.)

My Lords, we are all grateful to the Minister for his clear exposition of the order before the House and for supplying us with ample Explanatory Notes on its detailed and occasionally abstruse provisions. The order is not hugely contentious, as far as I can see, although others may take a different view. That said, it would be helpful if the Minister could respond to one or two questions in his winding up.

Before I comment on the provisions in the order, I would like briefly to refer to what I can only describe as the casual discussion that took place at the Welsh Assembly plenary session on this order on 18 October this year. Only two Members participated in the debate, one of whom was the responsible Minister. The fleeting discussion that occurred concerned me, and I fear that the level of scrutiny was far from appropriate. The order includes, as the Minister said, the transfer of three items, two of which were barely even mentioned. I would be interested to hear whether the Minister believes that the debate that took place was satisfactory.

The first part of the transfer order would give the Assembly the right to be consulted on the draft census order and the power to make regulations on the content and conduct of the 2011 census of population in Wales. That would allow for different information to be collected on census forms in Wales, as is currently done for data on familiarity with the Welsh language, which has been done since 1891. It is sensible for the Assembly to have a share of influence over the production of the census form, especially since the tick-box debacle of 2001 to which the Minister referred.

Discussions on the recording of Welsh identity, which became controversial prior to the 2001 census because of the absence of the Welsh tick box, have finally resulted in agreement that the Assembly should have a more formal role in agreeing future census forms in Wales. It is important that the Assembly gets the census data required to support effective policy-making in Wales. This is, therefore, a change that I welcome in principle. Of course, the challenge will be to exercise restraint and discrimination in the choice of special Welsh data sought in the census.

Before moving on, I would like to clarify the financial implications of transferring these powers. Will the funding of the census in England and Wales still remain the responsibility of the Office for National Statistics, as will the conduct of the census? Will the Assembly meet the costs of any change which it specifically requires? Can the Minister confirm that any such costs will be met from the Assembly budget? Are any extra administration costs expected and how will they be met?

On the transfer of Section 156 of the Environmental Protection Act as it applies to Part 2 of that Act, this will, as the noble Lord said, supplement powers already available to the Assembly under the European Communites Act 1972 and enable the Assembly to make regulations giving effect to Community and international obligations about waste management on land. I understand that the penalties for offences under the EPA are greater than those available under the European Act. The noble Lord has confirmed that. Will that have any specific significance in this context? Will it radically change the situation in Wales?

The devolution settlement gives the Assembly extensive responsibility for environmental matters, which include waste management. Wales contributes to the 330 million tonnes of waste produced annually in the UK, a quarter of which is from households and business. The rest comes from construction, demolition, sewage sludge, farm waste, spoils from mines and the dredging of rivers. The issue of waste disposal is an increasingly important one, but because the functions under Section 156 have not been transferred to the Assembly, the Assembly has relied on the Secretary of State to use powers on its behalf. This has resulted in a confusing and messy situation where the waste management regulatory framework varies across England and Wales. The transfer is a tidying-up measure which will help to avoid the difficulties of maintaining a common waste management regulatory framework across the border.

The Assembly Government published their waste strategy in 2002, and have made substantial financial resources available to local authorities to support the delivery of the strategy. Any measures which can further improve the organisation of waste management must be supported. I therefore welcome this transfer.

Finally, the transfer under the Water Industry Act will amend the basis on which the Assembly can make regulations prescribing requirements in relation to water fittings, or connections, and the prevention of contamination or waste of the public water supply by water or sewerage undertakers whose areas are wholly or mainly in Wales. It will amend an anomaly in the way that powers under the Water Industry Act 1991 have been transferred to the Assembly. I understand that this has been supported by Ministers in the Assembly and at Westminster, and I wish to add my support to the transfer.

Before I finish, I raise the question of whether it is wholly appropriate to introduce orders containing three unconnected items, as this one does. I would be grateful if the Minister would comment on this decision. It is not that I have any strong objection, but I would have thought that it might be somewhat confusing to have three such disparate and different matters combined in one order, from a governmental point of view.

My Lords, this transfer of functions order and the variation of the 1999 transfer order are the precursor of business to come next year, when many Orders in Council will arrive here for debate as a result of the Government of Wales Act 2006. I look forward to many initiatives of progressive legislation coming here from the Welsh Assembly Government and the National Assembly for Wales after next April, when the Government of Wales Act is implemented.

The noble Lord, Lord Roberts of Conwy, and the Minister have adequately outlined the structure we are discussing. I shall not detain the House by going over all of what has been said. However, the three census issues, the Environmental Protection Act 1990, the variation of the 1999 Act and the Water Industry Act 1991 are contained in these measures. We welcome these measures, which are timely, and all the detailed information that the Minister and his team have provided.

The census has been a controversial issue for some time. There was denial of the very fact that one was of Welsh origin, although the census in Wales did ask whether one was Irish, English or Scots. It was an incredible anomaly. The “no tick box” issue was an amazing situation for the Welsh, in their own country. I am pleased to see that there has been a quantum leap in putting such anomalies right.

A number of things have concerned me over the years. For many years the Office for National Statistics issued no statistics at all for my area, Powys. Earnings, employment and especially GDP figures were “unavailable”. I bombarded the ONS and the Wales Office for information but it was not forthcoming for a long time. Fortunately, that has recently been put right. Eventually, in the mid-1990s, some figures emerged just in time to prove that the GDP in Powys was only 1 per cent above the 75 per cent level required to qualify for Objective 1 funding. So Powys got Objective 2 funding. But then 12 wards receiving Objective 2 funding in Powys were somehow transferred to Cardiff, leaving little or no Objective 2 funding in south-east Powys. It illustrates the importance of ensuring that we get the correct statistics and that the Welsh Assembly is able to provide variations.

I remain unconvinced that health needs are not accurately compiled in existing census information. The important points of demography and poor health from a lifetime of hard physical work by, for example, miners, steelworkers, farmers and farm workers—of which Wales has a high percentage—have resulted in greater health needs in Wales. Indeed, if that is put together with a low-wage economy, it kicks back to resources—at the moment, the NHS in Wales is in debt to the tune of £100 million—the Barnett formula and the block grant. Unless we have good statistics from the ONS and sub-regional information from the Assembly, Wales will lose out because inadequate information will result in inadequate resource allocation. We must remind ourselves that Wales is one of the poorest areas in the United Kingdom, with average GDP at only 80 per cent of the UK average. Planning matters in the use of statistics.

Transfer of the power under Section 156 of the Environmental Protection Act to make regulations is all about waste on land and matters allied to it. It will allow the Assembly to take care of European Community issues on the one hand and international obligations on the other. In such matters it is vital to have cohesion with England. Those are undoubtedly excellent and sensible objectives. They impact on crucial issues such as hazardous waste and it is good that the Welsh Assembly Government will be able to produce their own regulations and not have to rely on Defra.

Other important and interesting issues relate to the Water Industry Act 1991, for example, and deal with preventing contamination or waste of the public water supply by means of water fittings. Amendments will be made to the National Assembly for Wales (Transfer of Functions Order) 1999 and the regulations will then apply to water or sewage undertakers. Although we welcome these transfers of functions under the 1991 Act, a question remains. In the information which the Minister gave us there was mention of water undertakers whose areas are mainly in Wales. As the Minister will know, some water undertakers’ areas are mainly in England though they have functions, customers and consumers in Wales. When I was a Member in the other place, there was a situation where a water undertaker whose main operations were in England long refused to sort out the sewage situation in the town of Knighton, which was in my constituency. It took a long time and a lot of hard words to get it to do anything at all about the situation—which actually prevented housing development. Indeed, sewage pipes were overflowing. So this is a two-way business for water undertakers. Dwr Cymru, for example, operates in more or less the whole of Herefordshire, and people in England can say the same thing in reverse of what I have just said about the situation in Wales. We therefore hope that these transfers will ensure that there are obligations on water undertakers that operate mainly in England but have functions in Wales. That is a cross-border issue that is complicated and needs sorting out.

Finally, why was the Welsh Assembly Government or the National Assembly for Wales not consulted on the transfer of these functions? The Minister was candid when he said that Defra was one of the consultees and the Wales Office was another, but there was no consultation with the Welsh Assembly Government or the National Assembly for Wales. I have extrapolated that omission and am sure the Minister will tell me if I am wrong in that. On the whole, however, we welcome these transfer orders and are grateful for the information that the Minister provided.

My Lords, I am very grateful to noble Lords for their overall support for this order. On the first question raised by the noble Lord, Lord Roberts, regarding the plenary debate on 18 October, I note his concern. I also note that he is sitting with two colleagues this evening. However, the level of debate that Assembly Members enter into is a matter for the Assembly, and it really is not appropriate for me to comment on that.

The noble Lord’s second point concerns funding. I can confirm that funding of the census in England and Wales will remain the responsibility of the ONS, as will the conduct. The Assembly will have only to meet the costs of any variations it wishes to make to the census in Wales. Assembly committees will discuss the 2011 census over the next few months. It is not yet possible to quantify the extent of additional costs, if any.

The noble Lord’s third point concerned penalties for offences under Section 156 of the Environmental Protection Act 1990. I can confirm that the level of penalties has no specific significance for the Assembly seeking these further powers. It will simply ensure that the Assembly is competent to legislate in this area to the same extent that the Secretary of State for Defra can in England.

Finally, the noble Lord, Lord Roberts, questioned why unconnected items were contained in this single order. This is not the first time unconnected functions have been transferred to the Assembly in one order. It merely reflects different departments within the Assembly seeking to transfer functions within a common parliamentary timetable. It also means that we do not have to take up parliamentary time with individual orders, some of which are very small.

The noble Lord, Lord Livsey, asked what type of questions could be contained within the Welsh census, and made a number of very important points. This is a matter for the National Assembly and, as I mentioned earlier, will be discussed in committee over the next few months, but I am sure that representatives of the National Assembly will be very interested to read the noble Lord’s comments.

The transfer of the Water Industry Act functions has not been subject to public consultation because its purpose is merely to amend a technical anomaly. The Assembly will consult interested parties as and when regulations using the stated powers are brought forward.

The noble Lord, Lord Livsey, also raised some interesting points about the water industry’s cross-border concerns. The Assembly does not have cross-border concerns in relation to this industry. However, any future concerns or problems that may occur can now be resolved following the transfer of this function.

Finally, I can confirm that the Assembly would have been heavily involved in the consultation on transferring powers under the Water Industry Act 1991, as it was the instigator of the transfer request.

On Question, Motion agreed to.