Water Industry (Charges)

Question Time — Scottish Executive – in the Scottish Parliament at 2:30 pm on 9 October 2003.

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Photo of George Lyon George Lyon Liberal Democrat 2:30, 9 October 2003

To ask the Scottish Executive what consultations will be carried out with businesses by Scottish Water and the water industry commissioner before water charges are set for the next financial year. (S2O-586)

Photo of Ross Finnie Ross Finnie Liberal Democrat

Scottish Water has already undertaken consultation with a selection of key businesses and with business representatives, and both Scottish Water and the water industry commissioner are in regular contact with individual businesses and their respective organisations.

Photo of George Lyon George Lyon Liberal Democrat

The minister will be aware that Scottish Water has submitted its proposals for next year's water charges to the water industry commissioner. At a recent public meeting in Campbeltown, the water industry commissioner indicated that he thought that it would be a waste of time to consult the small business sector ahead of his decision on next year's water rates. Will the minister use his influence with the water industry commissioner to ensure that he consults and listens to the small business sector before agreeing to next year's water charges?

Photo of Ross Finnie Ross Finnie Liberal Democrat

I was not present at the meeting, but I would be surprised if that were an accurate reflection. After all, the role of the water industry commissioner was expressly constituted to reflect consumer interests. Therefore, that response seems surprising and I certainly want to look into it.

Photo of Colin Fox Colin Fox SSP

Will the minister commission an independent inquiry into water charges and ask it to consider the situation in Ireland? As he knows, domestic water users in Ireland are not charged and the costs are borne by big business and by general taxation. I am sure that the minister is aware that that system's attraction is that it would relieve the burden that currently falls disproportionately on the poorest people in Scotland.

Photo of Ross Finnie Ross Finnie Liberal Democrat

No, I do not think that there is a case for an inquiry into any aspect of the water industry. Members are aware that the water industry commissioner produced a large and detailed report in 1998, which revealed for the first time the difficult situation that the three water companies that existed at the time were in: there was massive underinvestment, great inefficiency and a charging policy that simply was not capable of being sustained. Indeed, North of Scotland Water could not have been sustained at all. Given the size of its consumer base, it would have been almost impossible to have kept the company in being.

The Scottish Executive has taken a pragmatic step in the past four years by establishing Scottish Water in a way that allows the company to set objectives. Scottish Water has not got there yet, and there is no question of complacency on the part of the Executive. We have set Scottish Water the target of supplying water and sewerage services of the highest possible quality and at the lowest possible price. That is the right objective and I stand by the decision to establish Scottish Water on that basis.