This item was published during the term of a previous administration that ended in April 2007
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Plans to protect public water supply outlined
03/02/2003
Were they to form the next Administration, Scottish Ministers intend to bring forward legislation to safeguard public health, environment protection and social objectives for Scotland's public water industry, it was announced today.
Legislation will be a matter for the next Parliament, but in responding to a Parliamentary Question, Minister for Environment and Rural Development Ross Finnie made clear that were the Executive to form the next Administration, it would consult on a draft Water Services Bill.
The Bill would enshrine the Executive's longstanding commitment to ensure that the possibility of competition in the water industry would not erode the Executive's public health, social and environment protection objectives for the industry.
Mr Finnie said:
"The Scottish Executive is entirely clear that public ownership of the water industry provides the best means of safeguarding public health, the environment and general access to high quality supplies.
"The draft Bill we are proposing is needed to address the possibility of competition on the public water and sewerage networks. It would protect public health and the environment by prohibiting common carriage on the public water and sewerage networks and ensuring that Scottish Water alone was able to add treated drinking water to and draw wastewater from the public networks.
"It would safeguard our social objectives by prohibiting anyone other than Scottish Water from retailing water services to households on the public networks. This would mean that domestic water charges could continue to reflect customers' ability to pay by retaining the link between domestic charges and the banding and discount arrangements of the Council Tax system.
"The Bill would also provide for business customers on the public networks to benefit from the introduction of choice in the provision of retail services, while ensuring that they continue to pay a fair share of the costs of the networks. This will be achieved by introducing a licensing regime for third parties supplying non-domestic retail services.
"These proposals strike the right balance between environmental justice and increased competition. They will enable competition to develop in carefully defined circumstances, while ensuring that domestic water charges continue to take account of ability to pay and that public health and environment protection continue to be safeguarded rigorously."
The Competition Act 1998 opens up the prospect of competition on the public water and sewerage networks operated by Scottish Water. The Executive's long standing position is that the regulatory framework of the water industry needs to be revised in light of this to protect the Executive's public health, environmental and social objectives.
Common Carriage is the process by which a third party adds treated drinking water to the public mains, or draws off wastewater from the public sewers for treatment. The Executive's proposals would prohibit all forms of Common Carriage and ensure that Scottish Water alone was able to add water to or draw wastewater from the public networks. This is in order to protect the public from the potential health risks associated with multiple parties adding drinking water to the networks.
Retail Services are services such as billing customers and dealing with customer complaints and queries. They are distinct from the physical delivery of services, dealing instead with issues relating to information about and payment for the service. In the interests of protecting vulnerable groups from increased water and sewerage charges the proposals will prohibit third parties from entering into contractual arrangements for the supply of water and sewerage retail services to households on the public networks. However the proposals will allow third parties to supply retail services to business customers on the public networks.
A licensing regime will be established that will regulate third parties wishing to supply retail services to business customers on the public networks. The regime will be run by the Water Industry Commissioner and will ensure that business customers, while benefiting from a choice in the provision of retail services, continue to pay a fair share of the costs of the public network as a whole.
The intention, subject to the Executive forming the next Administration, is that a draft Bill would be consulted on in June 2003.