We are straying somewhat from the purpose of the statutory instruments that we are dealing with today, but I have that same situation whereby Anglian Water covers sewerage and Essex & Suffolk Water covers the supply of water. One critical element in the price review process that we have is that Ofwat goes through a mechanism of working through with water companies what they are allowed to invest in and, as a consequence, what the bill changes could be. We have a situation where bills go up with inflation—that has been part of the mechanism so far, and there is a price review process under way, but I have listened carefully to what my right hon. Friend said.
It has always been the case that Ofwat is there to ensure that the investment that is required in our waterways and our sewerage is made, to ensure that we get best value for money. It is important to note that these SIs cover what happens when we see water companies and other operators, having had that ability to invest, breach their permits. We want to make sure that the penalties are uncapped in order to act as an effective deterrent, as I have mentioned.
Hon. Members have asked how some of those penalties will be applied. I expect that, as now, the Environment Agency will use the guidelines for environmental offences, which are published by the independent Sentencing Council, to determine the level of all variable monetary penalties. Thinking particularly of some of the very small businesses covered by the environmental permitting regime, that will also include a number of safeguards to make sure that penalties are proportionate.