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Changes to regulation could see removal of abstraction licences without compensation

Government plans to reform water abstraction policy has created concerns among the industry that licences could be revoked or volumes reduced without compensation to the grower. Alice Dyer reports.

The Improving the Management of Water in the Environment consultation, which closed on March 12, outlined plans to change the conditions under which the Environment Agency (EA) can amend licences to secure good ecological status.

 

 

Defra says it plans to amend licences in cases of unsustainable abstraction and support innovation by encouraging water trading and storage, to introduce more low flow controls to protect the environment and replace seasonal constraints to allow extra abstraction at high flows.

 

Concerning

 

Paul Hammett, NFU water resources specialist, says the proposal to give the EA some ‘quite sweeping’ new powers is a concern because at present it can only make uncompensated changes to licences on two very restricted grounds.

 

 

He says: “The first is if a licence is not used for four consecutive years, then the law says a licence can be revoked without compensation.

 

 

“But the Government proposal is to extend this in quite a major way and give the EA powers to take away parts of abstraction licences which have been underused.”

 


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This includes uncompensated removal of some licenced volumes which are not being used regularly at their full capacity. This major change could have an impact on farmers which hold spare volumes of water in case of dry years, says Mr Hammett.

 

Underuse

 

He says: “Part of the consultation looked at how many years would constitute ‘underuse’ and what percentage of a licence is underused. The point we made is when you are thinking of wrapping this into primary legislation, how can you get to clarity by what you mean by underuse?”

 

 

Defra has also proposed to widen the scope of how licences can be changed or revoked.

 

The only way a licence can currently be varied or revoked without compensation is when the abstraction is occurring, for example, in or around a precious wetland which is a designation of European importance, says Mr Hammett.

 

 

“Defra wants to give the EA increased powers so it could vary or revoke abstraction rights without having to offer compensation to licence holders. These powers could be used where the agency identifies a risk of future environmental harm arising from abstraction in many water bodies and not in the most environmentally precious sites as at present.”

Focus

 

It is not yet known when such changes are likely to come into force, but Mr Hammett believes Defra should be doing more to improve water management across the board.

 

 

He says: “Agriculture accounts for less than 2% of total water abstracted so we think the focus should be on the public water industry. There is a lot which can be done to focus on the bigger strategies and get this in order first.”

 

 

Last year Defra announced four priority catchments – two in East Anglia and two in the East Midlands.

 

Voluntary

 

“These are all about innovation, collective working and a collaborative approach to linking people together for better, joined-up water management,” says Mr Hammett.

“We think those sorts of voluntary, catchment-based initiatives should be given a chance to succeed before quite wide-ranging new powers are given to the regulator. If these new powers were introduced, it would be like giving the EA new powers before the collaborative voluntary approaches had a chance to succeed.”

 

 

The CLA has also voiced concerns over the lack of action being taken against water companies to make improvements.

 

In its response to the consultation, the CLA argued more should be done to encourage water companies to reduce leaks, consumers pushed to be more efficient, and farmers urged to trade water and invest in winter storage facilities first, and variation of licenses to abstract water should be used as a last resort.

 

 

Susan Twining, CLA chief land use policy adviser, says: “While we would not condone unsustainable abstraction of water by any means, and support the collaborative efforts to address the problems, it is simply wrong for Government to propose revoking licenses without proper redress. It is only fair that businesses should generate full compensation for commercial losses if taken away.”

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