Saturday, 23 February 2008

Future of Scottish Water

I very much welcome any review of the structure and operations of Scottish Water to find the model that delivers best value for taxpayers and customers. There is, in my view, much merit in considering the mutualisation of the organisation (as both the Liberal Democrats and Conservatives have backed - albeit different models).

The Liberal Democrats remain totally resistant to the notion of privatisation, and would insist on legislation to ensure that the future de-mutualisation or privatisation of Scottish Water would be strictly prohibited. A mutual approach to ownership would make Scottish Water directly answerable to its mutual holders, the Scottish public, and all profits would be retained for further investment and customer savings. Crucially, it would result in significant savings to the Scottish taxpayer.

In the parliamentary debate last week, Liam McArthur MSP made these points well :

“Liberal Democrats have long called for the mutualisation of Scottish Water. We believe that the time is now right to undertake a thorough review of Scottish Water. This review must consider whether the current model delivers best value for customers – both domestic and business – as well as taxpayers.

“I am encouraged that the call for such a review appears to be gaining support within the government. But the Minister, in his speech, appeared to rule out mutualisation and gave no details about the nature or date for a review. This contradicts the SNP spin overnight where Mr Swinney was already busy finding uses for the £182 million that could be saved through mutualisation.

“Let’s not forget that when ministers published the Howat Report last summer the only comment they made on the recommendations before burying them, was to rule out any rethink on Scottish Water’s structure and operations.

“Today, rather than a commitment to a review, we have further confusion and obfuscation.”

The SNP government seems to be in a bit of a guddle over the issue. SNP spin doctors were busy briefing ahead of the debate on Scottish Water leading to "Good Morning Scotland" on BBC Radio Scotland breaking the story that SNP Ministers were willing to consider public sector alternatives to government ownership, including the option of mutualisation.

"We have an open mind about alternative public-sector models, and we are keeping that under review. Mutualisation is one possible model." (First Minister’s spokesperson)

This would have been a policy u-turn, given John Swinney’s clear position in May:

"We will not take forward the recommendation of the Howat report to turn Scottish Water into a mutual company ... Scottish Water will retain its current status. That is our clear policy position."
And SNP Ministers hastily backtracked during the debate in Parliament:

Stewart Stevenson: “I do not intend that we head towards mutualisation.”
You can read more of Liam McArthur's speech to the parliament by clicking on the headline above.