This item was published during the term of a previous administration that ended in April 2007
Listen
Report on Scottish Water
20/04/2004
A report on Scottish Water's investment programme and
asset management was published today.
Deputy Environment Minister Allan Wilson commented that
Scotland's water industry is improving but we must keep up
the momentum of development.
The main findings of the report show that Scotland's
drinking water quality is continuing to improve, nearly all
Scottish Water's work on secondary sewage treatment has
been completed and there are encouraging signs that the
Company is continuing to improve its asset management
processes.
The report by the Water Industry Commissioner (WIC) is
on investment in the water industry in Scotland in the
first year of Scottish Water's existence 2002-03.
In his report the WIC identifies some concerns about the
Company's delivery of its investment programme.
This is the second such report made by the WIC's office,
the first being an assessment of the final year of the
three previous water authorities. It compares a number of
aspects of investment, asset condition and performance with
those of the water companies in England and Wales.
Allan Wilson said:
"The Executive established Scottish Water to bring
significant improvements to the quality and efficiency of
Scotland's water supply industry.
"I welcome this report on the Company's first year of
operation. I am pleased to see that drinking water quality
is continuing to improve and real benefits to the
environment are being delivered.
"However, it is clear that Scottish Water still faces
considerable challenges to deliver the remainder of the
£1.8 billion investment programme over the next 2
years.
"I recognise the delay in the capital programme has been
as a result of the setting up of more efficient delivery
mechanisms.
"I am encouraged that since Scottish Water Solutions Ltd
was set up a number of major projects have begun throughout
the country. When completed they will bring much needed
environmental and drinking water improvements and at
substantially better value for money.
"I will continue to monitor Scottish Water's performance
on this issue very closely and expect to them to speed up
the efficient delivery of this vital programme of work
which reverses the trend of decades of under-investment in
our water infrastructure."
This is the second annual Investment and Asset
Management Report produced by the Water Industry
Commissioner's office. The first dealt with the final year
of the East, North and West of Scotland Water Authorities,
and this is therefore the first such report on Scottish
Water, concentrating on the financial year 2002-03 and
covers the first year of the current investment programme,
Quality and Standards II.
Financed by the Executive but paid for by customers out
of charges, Quality and Standards II is the biggest ever
water investment programme in Scotland. A total of £1.8
billion will be invested to improve the quality of drinking
water for the people of Scotland and clean up Scotland's
coastal waters and rivers. Between now and 2006, this
includes the commissioning of more than 1500 individual
projects across Scotland which will responsible for up to
50% of the civil engineering work in Scotland.
Scottish Water is working hard to improve the
efficiency of their organisation to secure benefits for the
customer. In response to the significant investment
challenges set by the Water Industry Commissioner (i.e. to
deliver £2.3bn of capital projects for £1.8bn), Scottish
Water established an asset delivery partnership with the
private sector called Scottish Water Solutions Ltd to
secure more efficient delivery of its capital investment.
This is an innovative partnership with 2 private sector
consortia. The two consortia partners are Stirling Water -
comprising Thames Water, Kellogg Brown & Root, Alfred
McAlpine, and MJ Gleeson; and UUGM - comprising United
Utilities, Galliford Try and Morgan Est.
Scottish Water Solutions Ltd are managing a number of
major projects throughout Scotland. Examples include:
- Philipshill waste water treatment works, South
Lanarkshire - £6m
- Greenock/Gourock/Port Glasgow - Inverclyde -
£2m
- Lochaber water treatment works at
Salen/Drimnin/Achargill - Highland - £4.4m
- Lochgilphead waste water treatment works- Argyll
& Bute - £8m
- Katrine Water Project - West Dunbartonshire -
£100m
The WIC report reveals that there has been a slow down
in the delivery of Scottish Water's investment programme.
This is mainly due to the process of forming the new joint
venture company. Scottish Water took the view that it was
better for customers to accept slight delays in the
delivery of investment while Scottish Water Solutions was
being set up, than compromise on progress towards benchmark
efficiency. In his report the WIC accepts that this delay
was in the customers interest but looks forward to Scottish
Water accelerating the delivery of its capital
programme.
The report by the WIC can be found at
www.watercommissioner.co.uk