My Lords, with the leave of the House, and to assist noble Lords participating in this debate, I will speak to the government amendments in this group. I will of course address the amendments tabled by noble Lords and the wider debate in my closing remarks.
All the amendments in my name address the major issue of nutrient neutrality, which has effectively stalled or blocked completely housing development in affected areas. For procedural reasons, and agreed in the usual channels, I will treat the tailing amendments—Amendments 247YE and 247YX—as de-grouped.
This issue is hampering local economies, depriving communities of much needed housing and threatening to put the SME builders out of business. Nutrients entering our rivers is a real and serious problem, but the contribution made by new homes is very small compared with that from sources such as industry, agriculture and our existing housing stock. Government Amendments 247A to 247YW cover a range of improvements to our current approach to improving wastewater treatment. These amendments respond to comments and concerns of noble Lords in Committee about more nature-based and catchment-based approaches. I hope they will be welcomed.
I now turn to Amendment 247YYA, mentioned by the noble Baroness, Lady Willis of Summertown, which would require a competent authority to make a reasonable assumption for relevant developments that nutrients from that development will not adversely affect the integrity of the site. The assumption we are asking competent authorities to make is reasonable for two reasons. First, this assumption is limited to the development where the wastewater is treated by a wastewater treatment works or private treatment system regulated under the environmental permitting regulations. This means that nutrient loads in wastewater will remain strictly controlled through the environmental permitting regime, which places legally binding duties on water companies, and through the regulators of the water industry, which are subject to the requirements of the habitats regulations. Secondly, the mitigations that we are putting in place will ensure that there are no additional nutrient loads from residential development.
If we are to take these reasonable steps, we need to amend the habitats regulations in the way our amendments set out. This is a carefully targeted and specific change, aimed only at addressing a disproportionate application of the regulations since the Dutch nitrogen case in the European Court of Justice. Following the findings in this case, since March 2022 housing development in affected catchments has been stalled or blocked—even though new housing contributes such a small proportion of pollution.
In these areas, following the guidance that Natural England was required to issue, development may not be consented unless and until, case by case, house by house, mitigation is in place. This applies even though the additional pollution we are talking about—the additional nitrate and phosphate which remains in the water after domestic sewage is treated—will not get anywhere near the waterways unless the houses not only have planning permission but have been built and occupied.
New development is stalling at the point of planning permission, or even, in many cases, after permission has been granted. It is an absurd situation that is undermining local economies, costing jobs, threatening to put small developers out of business and, above all, leaving communities without the homes that they want and need.
This is not to say that the problem of nutrient pollution in our rivers is unimportant—it very much is—but developers and local planning authorities are bound up in a burdensome and expensive process that does nothing to give certainty to anyone, creating huge
opportunity costs. In some catchment areas, hard work by Natural England, environmental groups and developers has started to allow some housing to be consented. However, having listened to the concerns of local communities, local authorities and housebuilders, it is clear that these schemes are moving too slowly, with no guarantee that demand can be met imminently.
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In short, our habitat protections are rightly prized, but in this case they are focusing huge effort on a very small part of the problem and distracting from the root causes of nutrient pollution. Therefore, in parallel to the amendments we propose, the Government have set out an ambitious plan for nature recovery. We are, through existing provisions in the Bill, obliging water companies to upgrade wastewater treatment works in designated catchments by 1 April 2030. These provisions alone will outweigh the nutrients expected from the new housing developments by putting in place wider upgrades for the long term and will benefit existing houses, not just new ones.
We are providing Natural England with £280 million to expand and evolve its existing nutrient mitigation scheme. Natural England’s own judgment is that this is sufficient funding to compensate for any additional nutrient flows from up to 100,000 homes between now and 2030.
We will work with Natural England to develop what are known as protected site strategies—plans drawn up in partnership with local communities that will chart a course to full restoration of the most affected habitat sites in catchments where demand for housing is highest. These will further be underpinned by action to address the real sources of nutrient pollution: conducting at least 4,000 farm inspections each year to make sure that slurry and other pollutants are handled in the right way; investing £200 million in grants for improved slurry storage and equipment; and devoting £25 million to farming innovation in nutrient management and making sure our farmers get the best out of new technologies. All these measures will play their part in ensuring the Government meet their legally binding target to reduce nitrogen, phosphorus and sediment pollution from agriculture into the water environment by at least 40% by 2038, with the interim target of a 10% reduction by 31 January 2028, and a more stretching 15% in the relevant catchments.
Before I conclude, I turn to Amendments 247YX and 247YY, which provide for delegated powers in support of the principal provisions. With your Lordships’ leave, I will also speak to Amendment 247YYZB from the noble and learned Lord, Lord Hope. I am grateful to the Delegated Powers Committee for its comments on these powers and take seriously its considerations. I wrote to the committee earlier today.
It remains the Government’s position that the powers we are taking are necessary and proportionate. While the power provided for under these amendments is couched in broad terms, this is as a consequence of the complexity of the existing law—complexity acknowledged by the Delegated Powers Committee. However, I wish to make it clear that the Government will use these delegated powers sparingly, and only to avoid unforeseen confusions or contradictions that may arise. There is
also a sunset clause, which ensures the powers will fall away in 2030, which should allow sufficient time to ensure that the statute book is operating as intended.
The Government have also reflected on some of the points made in recent days and agree that there would be benefit in providing for consultation prior to the use of these powers, as well as ensuring that the vires do not extend beyond what is strictly necessary. We therefore intend to accept Amendment 247YYZB in the name of the noble and learned Lord, Lord Hope of Craighead.
I wish to end by noting, for the benefit of noble Lords, the views of both developers and local authorities on the Government’s approach. The Home Builders Federation noted:
“With some areas having been blighted for 4 years, the prospect of a swift resolution will be much-needed good news for companies on the verge of going out of business”,
while the District Councils’ Network noted that
“It will unblock tens of thousands of much needed new and affordable homes for more than 40 of our member councils”.
This is why the Government have decided to act. It is why this debate matters so much. I hope my explanation has been an assistance to noble Lords in considering these amendments.