MPs have welcomed Government commitments to collect further information on the impact of pharmaceuticals on aquatic ecosystems, following the recommendations in the Science and Technology Committee’s First Report of Session 2013-14, Water quality: priority substances published in June 2013.

The Government’s comments came in its Formal Response to the Committee’s Report which agreed that issues such as the monitoring of emerging pollutants, the importance of innovation and the need for political support are important for ensuring water security.

The response said that the Government recognised that a water industry which is innovative and efficient is vital to meet the demands of the future, where increased pressures on water resources will be faced as a result of a growing population and changing climate.

Since the Committee completed gathering evidence, agreement in principle has been achieved at first reading on the European Commission's Priority Substances proposal. The UK's lead in resisting inclusion of three substances (estradiol, E2, naturally produced as well as used in medicines; ethinylestradiol, EE2, used in the contraceptive pill; and diclofenac, used as an anti-inflammatory) owing to high costs but with a weak benefits case at the current time, was supported by other Member States and the European Parliament. The substances were deleted from the list of priority substances and instead put on a "watch list" for gathering information over their occurrence across the EU.

In response to the Committee’s recommendation that the UK Government should contribute to the collection of further information regarding the environmental impact of certain pharmaceuticals on the aquatic environment, the Government said it recognised that it may become appropriate to regulate concentrations of certain pharmaceuticals in surface waters on the basis that the action was proportionate to the risk. However, pharmaceuticals in the environment is an emerging issue and the derivation of robust evidence on which to make policy decisions is at an early stage. The Government said it would report to the Committee on progress with its development of the evidence base on pharmaceuticals in the environment in 12 months.

Following formal agreement of the revised priority substances proposal, the European Commission is expected to draw up the first watch list during 2015, with Member States to provide information within a set timeframe following that (earliest expected deadline, end 2016).

On financial issues, the Committee’s report said that despite the financial cost of improving water treatment being a key element of the arguments presented against current European Commission proposals to designate more priority substances, it had not seen a clear estimate of what the cost would be. The Committee’s Report stated:

“Allegations that official estimates deliberately over-state the cost, through gold-plating the regulations or failing to consider alternative treatment methods, are troubling and the Government should seek to address this. In addition, it is concerning that estimates have focused solely on the cost implications of removing pharmaceuticals from wastewater, despite there being twelve other substances which will be designated as priority substances. The Government has a responsibility to inform the public if these proposals, as negotiated by the EU Presidency, are likely to significantly increase water bills. “

In response, the Government said that the potential costs of the proposal were overwhelmingly dominated by wastewater treatment of E2, EE2 and diclofenac. Other costs were significant (e.g. the revised draft impact assessment estimates costs of £27.3m-£45.3m over 20 years for additional environmental monitoring) but relatively small in comparison to the tens of billions of pounds estimated for wastewater treatment of the pharmaceuticals.

Pointing out that the Commission's proposal was not publicly consulted upon in advance of publication, the Government said it had rapidly developed its response to the proposal using available sources of information and had also provided the opportunity for stakeholders to contribute to the production of the draft impact assessment for the proposal. Subsequently in April 2012 it had provided the draft impact assessment to the House European Scrutiny Committees as part of their examination of the proposed EU legislation.

The Government said that the updated impact assessment, based on the amended proposal, will be consulted upon as part of the implementation of the proposal and will set out the associated costs. In the Government’s view the time to revise estimates of the costs of wastewater treatment will be in line with the preparation for the next proposal (expected 2017) as further investigations as to the level and type of treatment required in the UK should by then be available.

The Government also commented that it considers that its estimates of potential costs of wastewater treatment for pharmaceuticals were reasonably consistent. UK Government estimates of £27-30billion over 20 years to treat EE2 are in line with the EU Commission estimate of 18 euros/person/year for the UK to treat E2 (assuming the UK has about 60 million inhabitants). It had not attempted to further attribute costs to customer bills as additional treatment costs would be dependent upon local conditions and it could be misleading to provide a "per UK customer" cost estimate.

The Committee Report expressed trenchant views about the water sector’s ongoing lack of innovation, commenting:

“We have not seen evidence to suggest that the water industry's approach to innovation has improved significantly since the Council for Science and Technology's 2009 review described it as "highly variable". It may be that strict regulatory standards, such as those suggested by the European Commission, are required to drive innovation in this sector. “

“…..We are disappointed that there has not been more progress in encouraging innovation within the water industry since the Council for Science and Technology's report. We have seen no evidence that the "urgent need for a step-change" recommended in the report has been attempted, let alone delivered, and the Government should address this lack of progress. ….The Government should update in the Committee in a year's time regarding progress to achieving these outcomes.”

In response, the Government said it is now providing strategic leadership for innovation through the “refreshed” Water Sector Innovation Leadership Group (comprising representatives from water companies, the supply chain, Defra, BIS, Ofwat, the Environment Agency and Technology Strategy Board). It also pointed out that the new Water Bill had the specific aim of introducing innovation into the provision of water services, removing barriers to competition and encouraging new entrants to enter the market. The Government said this would encourage the development of new technologies, enable water resources to be used more flexibly, or to be re-used or treated more efficiently.- all increasing our resilience and benefitting the environment.

The Government response also flagged up a range of other initiatives it said would provide additional spurs to innovation, including:

The UK Water Research and Innovation Partnership (UKWRIP), chaired by the GCSA which brings together industry, policymakers and research funders to provide direction and co-ordination of water research and innovation with the aim of improving UK and global water security, and increasing the UK share of the global water market.

Ofwat's approach to the next price review which is predicated on incentivising sustainable innovation by water companies, who will be given more ownership of their plans and accountability for delivery.

The Government said it would update the Committee in 12 months with expectations for innovation to be delivered by the water industry.

The Committee also recommended that the Government should be more pro-active in providing Parliament with sufficient information to effectively scrutinise EU legislation before it is agreed to, particularly when such legislation could result in significant additional costs for UK taxpayers.

The Government responded by saying it was “committed to the principle of effective scrutiny of European legislation and supports the view that Parliament needs to be able to effectively scrutinise such legislation. Parliamentary Scrutiny Committees play a significant role in examining proposals for EU legislation. The Government appreciates the Scrutiny Committees' interest in this technically complex area.”

Commenting on the Government response, Andrew Miller MP, Chair of the Science and Technology Committee, said:

“Chemical pollution of surface water can have a number of detrimental effects on aquatic organisms, ecosystems or human health. We welcome the measures being taken by the Government to collect additional evidence on the effects of pharmaceutical products on the health of the aquatic environment, in accordance with the Committee’s recommendations on this matter. We also look forward to seeing additional measures being brought forward to improve innovation in the water industry, as promised in this response.”