Mark Dampier, head of research at Hargreaves Lansdown, says you should look to the environmental funds, or invest in the Impax investment trust. One specialist fund is Pictet Water, an offshore fund domiciled in Luxembourg. Dampier says he expects specialist water funds to become a more prominent theme.Liquid assets: five companies to consider* Severn Trent: Martin Walker of Invesco Perpetual says this is a stable company that could provide reliable returns even if the current stock-market volatility continues. It's a classic defensive play, in that people's water usage does not change whatever happens in the economy. And a decent dividend yield is good security.* Hydro International: the UK's water infrastructure is Victorian, and shortages are partly a result of leakage from crumbling pipes. Charlie Thomas of Jupiter, says Hydro has specialised in innovative technology that is slowly improving water distribution and network management.* Amiad Filtration Systems: based in Israel and listed here on AIM, Amiad is a global supplier of automatic self-cleaning, low maintenance filtration systems Thomas says Amiad sells its products in 60 countries. Products are used for purposes from improving the quality of drinking water and recycling water in aquaculture industries to recycling water used by car-makers.* Bio-Treat: this Singapore-listed waste-water treatment company is pioneering the use of bio-technology for water treatment in China, says Aled Smith of M&G.

Instead of sludging methods, the company treats water using bacteria, which is more cost efficient and environmentally friendly. Bio-Treat, the only company that uses such technology, is the owner of several patents.* Guangdong: the Chinese utility and infrastructure company, listed in Hong Kong, has had financial problems in the past but turned itself around and emerged a leaner, more efficient company, says Ian Beattie of New Star. China is increasing water prices in a bid to control wastage by big industrial companies. Guangdong, as a big supplier, is a prime beneficiary of increased prices.. Tony Blair's own environmental adviser has warned him that building more nuclear power stations could "drain resources" from developing renewable energy and other green forms of fuel.

In a report to the Government's energy review, the Environment Agency has warned that no more power stations should be built until the Government has devised a strategy for disposing of tons of nuclear waste.. Tony Blair has been accused by the Government's sleaze watchdog of failing to do enough to restore public trust in government, following the cash-for-honours scandal. Sir Alistair Graham has criticised Mr Blair's ethical record and called for urgent action to restore trust in public life. The chairman of the Committee on Standards in Public Life said he fears that Mr Blair's plans to review funding of political parties will not restore the confidence of the public. He wants the public to be able to give their views on how political parties are funded, to avoid a "stitch-up" between the parties. Sir Alistair is understood to be frustrated by the lack of commitment by Mr Blair to ethical issues. He recently met Gordon Brown for a private meeting and is said to have been impressed by the Chancellor's interest in restoring public confidence in the Government. Sources close to Sir Alistair said the sleaze watchdog was now hopeful that Mr Brown would inject more energy into resolving sleaze issues if he becomes prime minister.

"Gordon Brown obviously takes standards issues seriously," said one source close to Sir Alistair. At a meeting of the Committee on Standards in Public Life last week, Sir Alistair expressed his frustration at a string of scandals. Committee members believe that Mr Blair's pledge in 1997 to be "purer than pure" on ethical issues in government is in jeopardy. Sir Alistair's intervention will embarrass Mr Blair whose image has been damaged by the loans-for-peerages affair. In an interview with The Sunday Times, Sir Alistair criticised the Prime Minister for treating standards as a "minor issue, not worthy of serious consideration" He accused Mr Blair of "a major error of judgement". Police are currently investigating the Government's decision to offer peerages to millionaires who had donated to the party and lent it money.