Water Services etc. (Scotland) Act 2005 (Consequential Provisions and Modifications) Order 2005

rose to move, That the draft order laid before the House on 10 October be approved [5th Report from the Joint Committee].       The noble Lord said: My Lords, noble Lords will be delighted to hear that I plan to speak only for a few minutes, as the instrument is straightforward. The instrument is made under Section 104 of the Scotland Act. It is made in consequence of the Water Services etc. (Scotland) Act 2005—““the 2005 Act””. It was considered and approved by the other place on 2 November. Noble Lords will be familiar by now with Section 104 orders. They are used when changes are required to the law of England and Wales or Northern Ireland, or when modifications of reserved law are required as a consequence of legislation in the Scottish Parliament. Such changes would of course be outside the legislative competence of the Scottish Parliament. The 2005 Act reformed economic regulation of the Scottish water industry to make it more transparent and accountable. That included replacing the individual Water Industry Commissioner with a body corporate, the Water Industry Commission for Scotland. The Act gives the new Water Industry Commission power to determine Scottish Water’s charges, on the basis of investment objectives and charging policy set by Scottish Executive Ministers. The purpose of the order is to provide a right of reference to the Competition Commission in relation to two of the Water Industry Commission’s functions: first, determination of the limits of Scottish Water’s charges for providing public water and sewerage services in Scotland; and, secondly, decisions to grant retail water services or sewerage services licences or to modify licence conditions. So the order balances the new power for the Water Industry Commission provided in the 2005 Act by making it accountable to the Competition Commission. The Government and the Scottish Executive have agreed that that is desirable, as the Competition Commission has the economic expertise to provide effective scrutiny of the Water Industry Commission’s decisions. This order will give it the power to do so. Noble Lords may wish to note that there is a similar right of reference to the Competition Commission under the equivalent English and Welsh water legislation. Where the Competition Commission does not agree with the Water Industry Commission’s decision, it is given the power to recommend modifications to that decision and, ultimately, to replace the Water Industry Commission’s decision with its own. Finally, the order makes consequential amendments to a number of enactments to make reference to the new Water Industry Commission and the new powers of the Competition Commission. The Competition Commission, the Water Industry Commission and Scottish Water have been consulted on the terms of the order and the principle of the proposal. All have agreed this is a sensible measure that they support. I therefore commend the order to the House. I beg to move. Moved, That the draft order laid before the House on 10 October be approved [5th Report from the Joint Committee].—(Lord Evans of Temple Guiting.)