Leader interview: Environment Agency chairman Lord Chris Smith

"The biggest challenge for water by a long way is the developing impact of climate change. That's going to determine everything that happens in water policy over the next 30 to 40 years."

So says outgoing chairman of the Environment Agency (EA) Lord Chris Smith – though he will stay in post a little longer than expected. When we meet in his Westminster office, just days before his due departure date after two three-year terms in post, he reveals the secretary of state has just asked him to stay on an extra couple of months. His successor, ex-Arup executive chairman Philip Dilley, is due to start on 8th September, so Smith will bridge the gap until the day before.

For the water industry, climate change and extreme weather patterns throw up two priority issues: the need to expertly manage water resources and flood risk. In the case of the former, Smith has his sights firmly set on abstraction reform.

Making progress
The EA is already making progress on tackling unsustainable abstractions; since 2008 it has changed 107 licences, returning 75 billion litres of water a year to the environment, and is working on changing 377 more. But Smith is itching to rationalise what he describes as “the somewhat haphazard nature of abstraction rights” going forward.

Both Defra and the Welsh Government are committed to abstraction reform; just two days before this interview, they published responses to a consultation that closed in March 2014 which proposed two options for making the system more flexible and for linking access to water to water availability. The plan is to make policy decisions next year and to implement them in the 2020s.

Smith just wants something done. He says: “It has to be sorted out. We can’t continue with the status quo sensibly, especially with climate change bringing more extremes of weather and more extremes of flow. We are potentially going to see more periods of flood and more periods of drought. Where you’ve got seriously diminished flow and some of the automatic abstraction rights that exist at the moment, you cannot manage and plan for a river catchment properly. So it has to be sorted out. In a way I don’t mind how the government gets there.”

Smith is no stranger to the second priority issue climate change presents – flood risk management. Last winter was a real howler: the wettest since records began, with 12 major storms hitting over Christmas and the biggest tidal surge since 1953 on the east coast. More than 7,000 properties flooded and the EA took as great a battering in the media, suffering headlines such as The Spectator’s February offering on the Somerset Levels situation: Floods of incompetence – why Chris Smith should resign from the EA.

Smith accepts the difficulties of handling the emergency – “that’s not a period I would relish going through again, but that comes with the territory; we deal with extreme weather”. But he says the episode nevertheless marked the low point of his six years in post. “My low would certainly be, not so much dealing with the flooding emergency itself, but coping with some of the ill-informed media coverage at the time.”

Looking back he staunchly defends the EA’s record, arguing its flood defence work since 2007, the temporary defences it installed in the face of the emergency and the hard work of around 4,500 staff saved many thousands more homes from succumbing to the water.

Playing second fiddle to these too much/too little water issues is the still-important matter of water quality. The country can be proud of its achievements on bathing water quality: this has risen steadily since 1988; 99% of bathing waters meet mandatory standards and 90% meet the higher guideline standard that will from next year become the base measure.

However, our performance against Water Framework Directive (WFD) demands is poor. As of the end of March, only 27% of water bodies in England met the required “good ecological status” criteria, down from the 2013 score and below the 32% target. Water company trade body Water UK is lobbying for greater acceptance of derogations, less stringent standards and more time.

Galvanises action
Smith sympathises with the need to revisit the directive’s demands, and says he expects change will come – in time. He observes: “In my view there are two fundamental problems with the WFD. The first is it is ultimately unachievable. To think that we could achieve good ecological status for every single water body in England – it’s not going to happen. It’s sort of physically impossible… So does it make sense to have something on the statute book that you know is unachievable? And it will be unachievable for every single European country.” He accepts the directive’s existence galvanises action, but says this pressure could be maintained with more realistic set targets.

He continues: “The other big problem for me with the WFD is the ‘one out, all out’ provision.” This states if a water body fails on even one parameter, it isn’t classified as of good status. Smith argues this incentivises “making the almost-good good rather than tackling the really terrible water quality rivers where you could make a significant improvement, probably making a big improvement to peoples’ lives who live around those rivers. In my view those are the ones that should have priority.”

Back on home turf, Smith has confidence in the basic structure of the UK water industry in the face of growing challenges. “I don’t see a great need to disrupt the format of water management in this country – having independent water companies, having Ofwat as economic regulator, ourselves as environmental regulator. That’s a system that broadly has worked well.”

He is “hopeful” PR14 will deliver the EA’s environmental ambitions for 2015-20 and that a low cost of capital will mean green goals don’t have to be sacrificed to keep bills affordable. He comments: “I’m sure cost of living issues will be playing quite strongly in Ofwat’s mind and I think we’ll find they’ve been driving a rather tough deal. But hopefully that can be achieved without sacrificing some of the particular environmental objectives that we have.”

However he adds: “The issue that’s still a little bit, I suspect, up in the air is the Thames Tideway Tunnel because that’s a major cost. In my view it is essential if we are to stop pouring raw sewage into the River Thames 20 or more times a year. But it’s very expensive and making a judgement about how it falls on the water rate payers of London and in fact Thames’ wider area is going to be a major issue.”

Finally, Smith says he will watch with interest how one structural change that took place within the EA last year works out: its Welsh operations have been split off and melded into the one-stop-shop environment service Natural Resources Wales (NRW). This new body will play a key role in the Welsh Government’s bid to – sustainably – use the country’s natural resources to spur economic growth. Smith is keen to see how NRW approaches what he sees as inevitable conflicts between competing environmental objectives.

Lord Smith will be delivering the keynote address at the Environmental Water Management Conference organised by edie sister title WWT on September 24th. Visit www.sustainable-water.co.uk

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