That the Grand Committee do report to the House that it has considered the Groundwater (England and Wales) Regulations 2009.

My Lords, I welcome the opportunity to introduce these regulations. The water framework directive of 2000 envisaged a new groundwater directive to clarify the WFD’s objectives for groundwater, and a new directive was agreed in 2006 to replace the 1980 groundwater directive. In the discussions on that directive, the UK aimed for simple, transparent measures to protect groundwater from pollution; locally determined risk-based standards and targeted monitoring; and to avoid measures that would be disproportionately costly compared with the environmental benefits achieved. I am pleased to report that potentially ineffective and costly EU-wide standards were, on the whole, avoided. The impact assessment indicated a cost-neutral outcome in relation to action already required under the directive. I hope that that is of some reassurance to the Committee about the nature and impact of these regulations.

The 2006 directive adopts existing EU values for controls over nitrates and pesticides, and provides for member states to determine national groundwater standards, the way in which these should be used to assess groundwater body status, and the identification and reversal of pollution trends. These elements are being transposed separately as part of WFD implementation. The regulations before us today transpose Article 6 of the directive, which makes operational the WFD objective to prevent or limit the input of pollutants to groundwater, and distinguishes the substances whose input into groundwater is to be prevented from those to be limited. Sensible exemptions facilitate a practicable approach.

Currently, there are groundwater protection measures transposing the 1980 directive in the Water Resources Act 1991 and the 1998 groundwater regulations. The new regulations introduce no fundamental changes to groundwater protection. Nevertheless, it is necessary to amend the 1998 regulations to transpose Article 6 while respecting the provisions of the 1980 directive, which remains in force until December 2013.

Consultation on transposition was completed last summer. Responses indicated broad agreement with the proposed approach. The details of the regulations are as follows.

Regulation 1 deals with coming into force and regulation 2 updates definitions. In particular, a registration or disposal under the Radioactive Substances Act 1993 will become a permit for groundwater purposes. The terms “hazardous” substances and “non-hazardous” pollutants effectively replace the list 1 and list 2 dangerous substances to be controlled.

Regulation 3 explains the meaning of “hazardous substances”—essentially those that are persistent, bioaccumulative and toxic, and of which the existing prescriptive list 1 comprises a large subset. Member states must identify hazardous substances, and that will be the responsibility of the Environment Agency in England and Wales.

Regulation 4 provides that “non-hazardous” pollutants cover all other pollutants. These new terms potentially embrace a wider range of pollutants, but in practice the agency will identify additional substances where they are problematic.

Regulations 5 and 6 reflect the welcome fact that the 2006 directive provides for sensible exceptions, such as unavoidable accidents; exemptions from the need for a permit, such as very small inputs that would not affect groundwater quality; and inputs that cannot be prevented without risk to human health or which, for contaminated ground, would involve disproportionate cost.

Under the 2006 directive, disposals of radioactive substances and discharges from septic tanks are no longer exempt and so will now be subject to permitting under these regulations. The controls relating to both radioactive substances and discharges from septic tanks are expected to enter the environmental permitting regulations in 2010. In relation to discharges from septic tanks, the current exemption will be carried over in relation to discharges that amount to less than two cubic metres per day, but from 1 January 2012 it will be necessary to register with the environmental agencies such discharges, subject to basic rules of operation and maintenance.

Article 6 of the 2006 directive requires us to prevent the input into groundwater of hazardous substances and to limit the input into groundwater of non-hazardous substances to avoid pollution. Regulations 7, 8 and 9 put this into practice and Defra guidance will clarify what is meant by the requirement at regulation 8 to prevent the input of hazardous substances. This is an important objective but will not always be achievable. European Commission guidance explains that, in this context, prevention means taking all necessary and reasonable measures, where “reasonable” means technically feasible and without involving disproportionate cost. In other words, we must do whatever we can while recognising the inevitable limitations that apply to the concept of “absolute prevention”.

Regulation 10 sets out the circumstances where the agency may permit inputs of pollutants, given a range of practical considerations. These are valuable exemptions, offering greater flexibility than hitherto. Regulation 11 requires investigations and the technical precautions to ensure that the grant of a permit is made only in accordance with the requirements.

Under regulation 12, future reviews of permits will be carried out as necessary rather than on the current statutory four-yearly basis, and should therefore save resources. In practice, such reviews will normally follow the water framework directive’s six-year review cycle for the publication of river basin management plans.

Regulation 13 carries over the offence of “causing or knowingly permitting” an unauthorised discharge, established in the 1991 Water Resources Act and the groundwater regulations 1998. As before, exceptions are made for highway drains—there are too many to permit individually—and for discharges of less than two cubic metres a day from septic tanks.

In both cases, the agency may serve a prohibition notice where problems arise. Regulation 14 carries over relevant defences. Regulations 15 and 16 provide for transfer and administration permits, including conditions, reasons for refusal and for appeals against refusal, variation or revocation of permits. Regulation 17 enables the agency to serve a notice requiring information, and regulation 18, similar to current powers, to prohibit an activity which might lead to the input of a pollutant to groundwater, with a right of appeal contained in regulation 19.

Regulation 20 carries over the provision in the 1998 groundwater regulations for Ministers to approve codes of good practice giving guidance on compliance with the regulations to be taken into account by the agency when serving a prohibition notice. Regulation 21 requires the agency to record details of permits on a public register. Regulations 22 to 24 update the standard penalties for offences and regulation 25 revokes the 1998 groundwater regulations.

We intend to consult on draft guidance to the Environment Agency once the regulations are made. The regulations will be short-lived, in that they will be absorbed into the environmental permitting regulations in 2010. However, the transposition date for the 2006 directive means that these regulations are needed to bridge the gap.

In conclusion, I commend the groundwater regulations as a good example of successful EU negotiations contributing to good operational management, reflecting my department’s approach to better regulation. I beg to move.

I thank the Minister for introducing the regulations and going through them. I think that he shares my determination to use this brief debate to expand on the Government’s reasons for their introduction. We on these Benches appreciate and understand that groundwater is an important resource. Its contamination is potentially very dangerous to human health, aquatic life, plant life and animal life. Damage to it is very difficult and costly to remedy.

I must declare my interest as a farmer and grower and start by asking what impact the regulations might have on livestock farmers, particularly the aspect of diffuse pollution, which may cover muck-spreading and slurry. My second interest is as someone living in the countryside, far away from mains sewerage and dependent on septic tank drainage. I am not alone, of course. How many dwellings in England and Wales have domestic septic tanks and how many have other types of domestic sewage treatment, similarly not connected to the mains sewerage? I am minded to think that the regulations would include mini-schemes covering small hamlets, clusters of houses and rural businesses, using schemes such as I have at home, a Clargester system for the pack house premises. Almost all those systems are linked to soakaways, which would see them included.

Why was the current exemption limit for domestic discharge set at two cubic metres per day? Does the new European groundwater directive specifically ban such discharges and remove the previous exemption, or is that the Government’s interpretation? The major consequence of the regulations is that that exemption will be removed in due course. What is the current extent of groundwater pollution from domestic septic tanks discharging less than two cubic metres per day? Can that be characterised by location, frequency or the type of equipment used? What is the level of resultant damage?

I know that those are detailed questions, but they are of great interest to the large number of people who may well find themselves involved.

Does the Minister believe that any domestic sewage installations currently in use will be rendered unsuitable by the implementation of these new regulations? After all, some may be of proper interest to English Heritage. How many septic tanks or sewage plants will have to be replaced? What are the costs involved and who is picking up the bill?

The Environment Agency—I refer here to a Written Answer given by the noble Lord, Lord Tunnicliffe, to a Question I tabled on 17 September—has 20,000 discharge permits or input permits and groundwater extraction authorisations. How many permits is it estimated will be sought by the owners of domestic sewage systems when they are included, as now they will be? How will the agency ensure that householders in isolated dwellings that may require a permit will be given the information they need to make their decision? I note that a web-based system of registration is proposed, but what percentage of the households affected have access to the web? On what grounds will the Environment Agency be able to refuse to issue a permit to the owner of a domestic sewage system, and what will be the probable charge for a permit to use a septic tank? Will householders who pay to have septic tanks emptied need a permit each time? Will the web-based registration scheme for discharges from isolated dwellings be a record of all discharges or just a record of septic tank owners?

How does the Environment Agency discover that someone is discharging less than two cubic metres of effluent daily and how is it traced to its source? What are the agency’s costs for enforcing this legislation? We have the impact assessment, but has an independent evaluation been made of the cost burden that it will bear for bringing in daily discharges of less than two cubic metres from isolated dwellings? The impact assessment sought information on which groundwater policy would be reviewed to establish actual costs and benefit. It would be interesting to know whether this is going to be forthcoming, and if so, how frequently. I know that the Government propose to make all this part of a regular river basin management process, and while the long-promised floods and water management Bill—I hope that we will see it in the forthcoming Queen’s Speech—will undoubtedly consider this aspect, the draft Bill makes no reference to these regulations.

Taken as they stand, these regulations will have a huge effect and generate potentially considerable costs for UK householders and businesses alike. The Explanatory Memorandum talks of a light touch in their implementation, but I note that the punishment for failing to comply with them is a fine of up to £50,000 or up to 12 months in prison for those who find themselves inadvertently caught within their scope after 1 January 2012, so no light touch there. Is this really a like-for-like interpretation of EU water regulations? I know from my French experience that my soakaway system has been examined and approved by the local authority. Has Defra discussed with other European countries how they are handling this directive?

I make no apology for the highly interrogative nature of my contribution. We have a duty to ensure that the implications of these regulations have been thoroughly thought through by Her Majesty’s Government, and I look forward to the Minister’s response to my remarks.

My Lords, I rise on behalf of the Liberal Democrats to give a general welcome to these regulations, which seek to transpose the groundwater directive of 2006. There was an obligation to transpose it by 16 January this year, so we are only 10 months late. By the normal standards of these things, perhaps I should congratulate the Government on being only some months late when compared with the years that it can sometimes take to do these things. Why it always takes so long is a mystery buried in the depths of Whitehall but at least this is being dealt with in the same calendar year, so I offer the Government some gentle congratulations.

As the Minister said, these regulations will not have a long life and will be absorbed into the environmental permitting regulations at some time in 2010. Perhaps the Minister will confirm that. As they will simply be absorbed, that will not make much difference. By and large, these are sensible regulations that transpose a sensible directive and, in that respect, we give them a general welcome.

The noble Lord, Lord Taylor of Holbeach, spoke on the two aspects that require further probing. The first is the review of existing authorisations and the second is the issue of septic tanks and similar devices that lead to small-scale soakaways to which the regulations will apply from the beginning of January 2012.

On the review, the noble Lord, Lord Taylor, previously asked a Question of the noble Lord, Lord Tunnicliffe, who told him that there are “upward of”—I presume that that means more than—20,000 authorisations at the moment. I am not clear about what the procedure will be for the review of these authorisations. Paragraph 12(2) of the order states:

“All permits granted before the coming into force of these Regulations must be reviewed before 22nd December 2012”.

What is a review? Will it be new or merely a desk review looking at regulations which, given the risk-based assessment that the Minister said would take place, will require further detailed investigation, while the majority will be put on the desk pile for regulations that do not need any change? Can the Minister explain exactly how this review will take place? This relates to what the noble Lord, Lord Taylor, said about resources. The figure of 20,000 is a lot, and if many of those authorisations are to be reviewed in detail, what resources will be involved? Will the Environment Agency have sufficient finance and manpower to carry out the task?

The noble Lord asked many detailed questions about septic tanks, some of which I was going to ask. I shall not go into detail on those because there is no point repeating what he said. Not all septic tanks will be affected. Some, especially those in urban areas, are emptied by a vehicle that comes around and takes away the contents. However, septic tanks with a soakaway will be affected in just over two years’ time. The fundamental questions are, first, does the Minister know how many of these installations there are around the country and, therefore, what the scale of the task is and, secondly, will the Environment Agency really have the resources to carry out the review, or will it rely on existing approvals and consents at a local level of the type that the noble Lord, Lord Taylor, mentioned?

In most cases, these soakaways do not cause a problem. They work—they clearly soak away—and, presumably, they are absorbed within the fairly immediate locality as biological processes deal with them over time so they do not get down into serious groundwater. There are a number of instances, however, where they cause serious problems. How is the Environment Agency going to determine which ones it needs to look at seriously? How will it separate the wheat from the chaff? The wheat will be a small proportion of the total, but there are problems that need to be looked at nevertheless. Will it be a matter of relying on complaints? If so, complaints from whom—from nearby residents, owners of land or local authorities? Or will it simply apply throughout the whole lot? Presumably, it would take a long time to deal with them all.

These are serious issues, even though they are small-scale and local. On the one hand, we want problems tackled properly where they exist; on the other hand, in the majority of cases where there are not serious problems, we do not want a huge new tier of regulation and bureaucracy where it is not necessary. What is the answer to this conundrum? I shall be interested to hear what the Minister has to say about it.

My final question is on the draft guidance that the Government intend to issue to the Environment Agency, and which it is going to consult on. What main issues will the guidance cover?

As I said at the beginning, we welcome these regulations and congratulate the Government on not being too late in bringing them forward.

My Lords, I apologise to the Minister and other noble Lords; I was told that there would be a 10-minute break after the previous set of orders, and I am afraid that I was downstairs supporting Lantra in its important work of highlighting the need for skills in land-based work. I shall listen carefully to what the Minister has to say.

I want to pick up on one or two things. There is the question of how people will be notified. In very rural areas, websites are inadequate. The Minister will know well that we have had debates in the House about broadband; I think I have a Question coming up shortly on that very topic.

What is the position of an “owner” or a “business” rather than a tenant? Here I have to declare an interest: I have two cottages in our lane at home, one of which has a septic tank and the other a soakaway. This sounds very basic, but when the new tenant comes in, the septic tank is emptied, so they start at square one; after that, though, it is their responsibility. If they do not do what they should and thereby cause pollution, where does the buck stop? Does that come my way, or does it go to the tenant?

My Lords, I do not need to go over what I said. I hope that the Minister heard my question. My first point was about broadband; the second was on the whole question of septic tanks and soakaways.

I have two other questions. The third is: what happens if you are in an area such as Lincolnshire, as my noble friend is, where the groundwater rises and falls? How will the agency take that into account? Fourthly, what is the distinction between the role of the Environment Agency and the local authority? Will the local authority be given direction from the Environment Agency? I am not clear who will operate the system. I know where the responsibility lies, but it is the practicality on which I seek clarification.

My last two questions follow from comments made by other noble Lords. One is on permits and the other is on the total cost and the likely cost to individuals.

My Lords, I am grateful to noble Lords for their contributions, and even more grateful for the small intermission, which enabled me to get some grip on the volley of questions. I am especially grateful to the noble Lord, Lord Taylor, who gave me notice of his questions. He apologised for the interrogative nature of his speech. No apology is necessary; these are real issues that we need to identify. My only apology is because he asked me such a volley of questions that I may be slightly protracted in my reply.

I am also grateful to the noble Lord, Lord Greaves, who said that he would listen intently to the responses I made to the noble Lord, Lord Taylor, and who otherwise would have asked those questions if they had not already been put. If I take a little time over these issues, particularly as they relate to septic tanks, which has been the main burden of this discussion, I shall satisfy all noble Lords. I will also comment on the particular points raised by the noble Baroness, Lady Byford, in her contribution.

I start by giving the good news first because it cheers me and I hope that it will do the same for the Committee. I was asked by the noble Lord, Lord Taylor, how we compare with other European countries in how we tackle this issue. We think that we get off reasonably lightly. Many other EU countries are going to require full permits, probably at the municipal level because of the nature of their government—that is certainly likely to be the case in Germany—while others have clear registration and notification schemes that will require compliance. I hope that my answers will make it clear that we have a somewhat lighter touch than the full-permit regime requires. That is the context in which I want to begin my response to the questions.

Obviously, the issue of septic tanks is very significant. Small discharges from isolated domestic dwellings not connected to the sewerage system were previously exempted from the requirement for authorisation. That will not be the case in the longer term and the intention is that, under the EPRs, discharges from septic tanks of two cubic metres or less should be subject to registration with the Environment Agency as exempt groundwater activities. Registration will be dependent on compliance with basic rules of operation and maintenance and will be free, as the consequence of a previous ministerial decision. Meanwhile, until 1 January 2012, small discharges—those of under two cubic metres per day—will continue to be exempt unless they are the cause of an environmental problem in that they might pollute a drinking water supply. In those cases the Environment Agency may serve a notice either to prohibit the activity or to require that a permit should be applied for. The arrangement will also apply in the case of registered exemptions under the EPRs. As is the case at present, all school discharges within a defined area around a drinking water supply will require a full permit, subject to an application charge but not subsistence charges.

That is the background, but the noble Lord, Lord Taylor, has addressed to me a series of specific questions to which I want to reply so as to flesh out the issues which have been raised. If my responses do not do that, I will take note and be only too prepared to write subsequent to our proceedings to noble Lords who have contributed to the debate.

I was asked why the exemption limit has been set at two cubic metres per day. This is the Environment Agency’s practical interpretation of the original exemption in the 1980 directive. It is a practical limit sufficient for the daily needs of a household of up to 10 persons. With regard to the 2006 directive, the position is that the 1980 groundwater directive and regulations of the same year exempt such discharges. The exemption is not sustained in either the water framework directive or the 2006 groundwater directive. The issue was explored at length in the European Parliament and an automatic exemption cannot be included in the new regulations except for a period lasting until January 2012, which recognises that the 1980 directive remains in force until we get to 2013.

My Lords—

I thought for a moment that I was near the end, but I give way to the noble Lord.

I am grateful to the Minister. I do not think that the question about permits refers specifically to septic tanks. The point I raised was that although the new, more flexible system of review is welcome, in that it does not have to be carried out every four years but will be done on the basis of risk, the regulations as set out appear to say that all existing permits have to be reviewed before 22 December 2012. My question concerned the scale of resources required to do that.

My Lords, perhaps I may return to two points. I will read the Minister’s remarks very carefully tomorrow, but I think he referred to sealed septic tanks. Could he define what they are?

I think that the noble Lord referred to sealed cesspits.

I thank my noble friend because I was not sure whether I had heard it correctly.

My other question is this. When the Environment Agency reviews its costs and charges, will anyone else be able to check them or is the agency free to set its charges at levels it regards as relevant?

The Environment Agency is under the scrutiny of the obvious source; namely, the Secretary of State. He examines the decisions the agency takes. If it were thought that the agency was levying charges that could not be justified by the actions being carried out, the Secretary of State would be expected to act. I am in no doubt that if it did not happen at this end of the building, there would be a fair fuss at the other end. There is a fallback position in those terms.

I just say to the noble Lord, Lord Greaves, that the current four-yearly review is in its last cycle, which will be completed in 2012.

Before the Minister concludes, it is of interest that there are two elements to the regulations: there is the registration requirement and the permitting element. As I understand it, the permitting element refers to those in a location that may give rise to a hazard. If that is the case, I seek to make a plea to the Minister that for those whose responsibility is purely to register that they have a non-mains sewerage system, the registration should be kept as simple as possible. If the registration requires a full description of the system employed, I can assure him that in old properties, it is almost impossible to know quite how the system operates. Bits may have been added on, and it would be difficult for individuals if they subsequently found themselves falling foul of the regulations, which carry quite heavy penalties, because they had failed accurately to describe the full implications of their system. If registration is considered to be necessary, it should be kept as straightforward and simple as possible so that people feel that they can comply without too much wear and tear on their nerves.

That point is well received. I said that we are concerned to deliver light-touch regulation. I entirely understand what he says about registration; that point will be borne in mind.

I wonder whether I can have one final bite at the review business. The Minister says that we are within a four-year review period that ends on 22 December 2012. Regulation 12(2) seems to say that all the existing permits must be reviewed between the coming into force of the regulations and that date. Is the Minister saying that in practice, reviews that have taken place during the past year—because we appear to be about one year into the four-year review period—will be counted, regardless of what the regulations say?

I am grateful to the noble Lord and I will address the specific point in a moment. The regulations exempt until 2012. The registration, which we have also discussed, is being introduced under the 2010 environmental permitting regulations, the EPRs, which we have not debated yet. They will need to be considered, so we shall have the opportunity to examine that part of the regime in due course. The regulations we are debating today merely exempt until 2012.

I have answered noble Lords as far as I am able in what has been a very intensive debate. I am only too prepared to write further if that is considered necessary. I have carefully identified the participants in this debate, who have etched themselves into my memory, so I will know if they are dissatisfied and will write to them accordingly.