Part 2: Legislative and executive competence: further provision Chapter 16: Water Section 48: Water and sewerage
This section provides for the replacement of reservation C15 of Schedule 1 (water and sewerage) and thereby the amendment of Schedule 7A to GoWA. This note should be read in conjunction with the note on that reservation at page 28.
	The version of C15 which will be in force on the commencement of Schedule 7A reflects the historic arrangements for the devolution of water supply services. It therefore expresses competence (now for both water supply and sewerage services) on the basis of water and sewerage undertaker appointment areas. This is expressed in terms of "appointment and regulation" of undertakers, and "licensing and regulation" of licensees operating in those undertaker areas. Appointment areas are based on river catchments, some of which straddle the England /Wales border. Where those appointment areas straddle the border, only the Welsh parts of those undertakers who operate mainly in Wales ("Welsh undertakers") is devolved. The areas of undertakers who operate wholly or mainly in England ("English undertakers"), including any parts of those areas which are in Wales, and the regulation and licensing of licensees in those undertaker areas, are reserved. The English parts of Welsh undertakers' areas, and the regulation and licensing of licensees in Welsh undertakers' areas in England, are outside the Assembly's geographic competence.
	Section 48 aligns legislative competence for water and sewerage undertakers with the geographical boundary between Wales and England by removing the reservation relating to the parts of English undertakers' areas in Wales. When the section is commenced, the effect will be that legislative competence to implement the majority of the policy over the supply of water and sewerage services (i.e. the appointment and regulation of undertakers and the regulation of licensees) will be devolved to the Assembly in relation to Wales (rather than in relation to appointment areas). The licensing of water supply and sewerage licensees, the regime overseen by the economic and competition regulator of the water industry (Ofwat), will remain reserved.
	This section also amends the Water Industry Act 1991 to require the Water Services Regulation Authority (Ofwat) to make its annual report (under section 192B of that Act) to Welsh Ministers as well as the Secretary of State. The Welsh Ministers are required to lay the annual reports before the Assembly and publish them as appropriate.