Wildlife cost in water wars

BIG cuts in water bills could leave wildlife and wetlands high and dry and polluted, conservationists argued yesterday.

The Environment Agency, the Government's leading green watchdog, said it was possible to have five years of unchanged bills while still safeguarding rivers, lakes and marshes.

It joined pressure groups attacking the industry's economic regulator, Ian Byatt, head of Ofwat, for saying he wants an across-the-board cut in bills in 2000. This, they claim, pre-empts the debate about what it will cost to protect the environment.

Mr Byatt and other combatants in England and Wales' water war were on the platform at a London conference organised by the Royal Society for the Protection of Birds. At issue is the limits on household water bills which will be imposed on the water companies for the years from 2000 to 2005.

Mr Byatt plays the lead role in setting them, but the Secretary of State for the Environment, Deputy Prime Minister John Prescott, decides the balance of power between the environment, customers and water-company shareholders.

The price limits will not be settled until next November. Until then, there is a three-way fight, with distrust and hostility between the parties, all of which could be sensed yesterday's. In one corner is Mr Byatt, determined to push through price cuts. The average bill, pounds 243 this year, has doubled since privatisation in 1989; even once inflation is accounted for, the increase works out at nearly 40 per cent.

In the second corner are the Environment Agency and English Nature, the Government's wildlife protection arm. They fear that too little money will be devoted to improvements to smaller sewage works and boreholes needed to protect rivers, lakes and bogs.

The third group is the water companies, anxious to protect profits and shareholder dividends. On hand yesterday was Mr Prescott's deputy, the environment minister Michael Meacher. His speech covered all the conflicts, noted the decision for the Government on water bills was difficult, and gave away nothing about what it would be. But, after railing at water ''fat cats'' in opposition, Labour will find it tempting to endorse a cut in bills.