Utility Week

UTILITY WEEK | 6TH - 12TH DECEMBER 2019 | 9 Election 2019 Interview As part of Utility Week's Election 2019 series, David Blackman talks to Baroness McIntosh, the co-chair of the All-Party Parliamentary Water Group. Former lawyer Baroness McIntosh was chair of the Envi- ronment, Food and Rural A airs Select Committee from 2010 to 2015. Since standing down in the Commons that year, she has maintained a close interest in the sector, serving as both co-chair of the All-Party Parliamentary Group on Water and vice president of the Association of Drainage Authorities. The 65-year-old former Conservative MP hasn't always seen eye to eye with her party, su ering a bruis- ing vote of no-conˆ dence from local members before stepping down as an MP in 2015. But there is no ques- tion that she is loyal to the legacy of the party's privati- sation policy, describing ownership as the "key issue" facing the water sector in this year's general election. "The lasting beneˆ t of water privatisation has been access to capital and its appeal to investors: anyone who has a private pension has beneˆ ted from steady income in terms of dividends." And it's those same retirement investors who will su er if Labour's plan to renationalise the industry is carried out, Baroness McIntosh says. "This will hit pension funds particularly hard if they are not given the commercial rates." However, the beneˆ ts delivered by water privatisa- tion must be viewed in the context of the improved water quality standards that the EU has imposed on the UK, she says: "More or less in the same period that we invested in the water sector through priva- tisation, there were game-changing European directives going through. "We were known in the 80s as the 'dirty man of Europe'. Through privatisation, additional investment and EU directives, we gradually cleaned up both the rivers and the bathing water," says Baroness McIntosh, who remembers the days when it was unsafe to catch salmon from the River Tees, near where she grew up. "Having joined the EU in 1973, we would have been bound by these EU directives but it would have fallen on customer bills or general taxation, so it has helped to ease the burden." Brexit burden Beyond the election, the UK's departure from the EU will be the key issue for the industry, particularly the post-EU future of environmental regulation. She says: "We have some of the highest environmental protection: we want to make sure we have those going forward." The baroness says the House of Lords energy and environment committee, which she has recently joined, has exchanged correspondence with junior environ- ment minister Lord Gardiner about progress on the establishment of the Ož ce of Environmental Protection, the body that is due to take over the European Commis- sion's regulatory duties in this area. "We've been assured that OEP is in shadow [form], but we don't know what the penalties will be for infringements." In the meantime, it doesn't look like there is much chance of Labour's nationalisation plans coming to fruition. "It hasn't caught public imagination in the way Labour might have hoped in this election, probably because people don't view it as required," she says. But there is scope for refreshing the existing owner- ship regime, says the former MP. For the ˆ rst 20 years a¢ er privatisation, the idea was not really contested, partly because the actual process was well thought through, she argues. But that has changed during the past decade as questions have grown over the industry's pricing regime and ownership structures. "They have to show they are restructuring and are not fat cats, which is an easy hit for Labour," she says. The next generation is key Younger voters, having grown up with the cleaner water delivered over the past three decades, don't appreci- ate the beneˆ ts this combination of tougher regulation and improved investment has delivered. It is the job of the water industry to more e ectively communicate the beneˆ ts, she says. The peer says the industry should capitalise on the current wave of concern about climate change by devel- oping a new environmental and social contract with the communities it serves. A practical change would be to make water compa- nies statutory consultees when planning applications are being determined for major new developments, in the way that the Environment Agency currently is. And she urges companies to capture the imagination of climate change conscious schoolchildren by taking them on tours of their reservoirs and water treatment plants. "The idea of environmental contract would ˆ re up the nation because we are all contributing as water customers. "For the ˆ rst 20 years, they made great strides cleaning up and delivering consistently high standards and good quality drinking and bathing water. Privatisation is something to celebrate but they can't rest on their laurels." "Water fi rms need to connect with youth and shake off the fat cat stereotype that makes them an easy target for Labour."

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