Scottish Water has made a sound start but its performance can improve

13 October 2005

Scottish Water has made a good start in raising the water industry’s performance but can make further improvements, says the Auditor General.

In a report published today, Overview of the water industry in Scotland, the Auditor General for Scotland Robert Black says that since Scottish Water’s creation in 2002:

  • It has improved the efficiency and performance of the water industry;
  • it has cut operating costs significantly;
  • water quality is improving;
  • the organisation has streamlined the industry, including reducing its workforce by nearly 2,000.

However, the report says Scottish Water can further improve efficiency and performance. It adds that while the body has set a sound base for planning and performance reporting, it can do better there too.

Scottish Water has met most of its customer performance targets. However, in his most recent report, the industry’s regulator reported that the organisation fell short of the customer performance of water companies in England and Wales.

The report also points out that Scottish Water faces a challenging timeframe for delivering its capital investment programme, which is essential for future performance and efficiency gains. Its current £1.8bn capital investment programme has a deadline of April 2006 and there will be an estimated £253m worth of work still to be done at that point. Audit Scotland will undertake a separate study of this issue and report in late 2006.

Auditor General Robert Black says: “Scottish Water has made significant improvements in its efficiency and performance but there is scope for more. A robust regulatory regime is appropriate for Scottish Water which is a public sector monopoly.

“It is important that the new Water Industry Commission sets challenging but achievable performance targets that will provide a full picture of Scottish Water’s performance in future years.”