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Last Updated: Friday, 30 May, 2003, 13:00 GMT 14:00 UK
Scots water 'most expensive'
Water bills are higher in Scotland than elsewhere in the UK
Scottish Water is the most expensive in the UK, according to a report in the Economist.

Businesses are the worst affected, collectively paying 190m more than their counterparts south of the border.

The report said Scots pay more because of the different structures for water utilities throughout the UK.

Scottish Water said its prices were higher because of an investment programme and added that prices were much higher in England during the 1990s.

According to the report, water bills in Scotland have increased by 94% in real terms over the last decade and by 22% in England.

Ian McMillan, CBI Scotland director, warned that high water bills could eventually impact on the jobs market.

The Economist said: "All that might be excusable if the aquacrats were doing much better with the extra money.

"But in fact Scots get poorer drinking water, more pollution from their sewers and their pipes are more than twice as leaky.

"Private water firms beat the public sector on all counts.

"Scotland's costly water is a salutary reminder of the cost of the country's love affair with state provision. Better to privatise it late than never."

Rising bills

BP's petrochemical refinery at Grangemouth will pay about 13m this year, whereas in England it will be 7m, the report added.

The Economist said Scottish water bills will not fall until 2007.

But Scottish Water said the charges reflected its drive to upgrade infrastructure, meet quality standards and improve operational efficiency.

The company's finance director Douglas Millican said it faced different challenges to its English counterparts.

Scottish Water sign
Scottish Water defended its position

He said: "The industry in Scotland is less efficient than in England but that is why Scottish Water was created just over a year ago - to remove inefficiencies and improve the service to customers."

Mr Millican said 30m had been saved during its first year and Scottish Water was confident about the future.

He said: "It's far too early to draw conclusions about the success of Scottish Water in improving efficiency compared to the English water companies that have spent the last 14 years transforming their business since privatisation."

The 2003/4 scheme of charges has been approved by the Water Industry Commissioner for Scotland, Mr Millican said.

Scottish Environment Minister Ross Finnie said a 1.8bn programme of investment had been introduced to improve services after past under investment.

He said: "The protection I'm offering is to have a Scottish water company that produces the highest quality of water, deals with sewage in the most efficient way, at the best possible price and the best possible quality.

"Which it does not do at the moment. I accept that and I have never claimed that it did.

"This programme of 1.8bn is essential and certainly catches up on under investment in Scottish Water over the last 10 years."

Gavin Walker reports
"The report is highly critical of Scottish Water's services"

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