Hansard

I thank the members of the Public Audit Committee for their work, and the clerks to the committee for their support.

This is a damning committee report. There is clear evidence from the Auditor General for Scotland that WICS and the Scottish Government consistently failed to lead by example in ensuring value for money due to significant weaknesses in governance, financial management arrangements and accountability. There was spending on overseas training courses costing more than £70,000 and Christmas gift vouchers bought without proper approval, and a culture that tolerated excessive hospitality and poor accountability. That matters to all of us, because Scottish Water is a publicly owned utility that people across Scotland depend on every single day. We should be able to take clean, affordable water for granted. It is vital that lessons are learned from today’s debate, that the Scottish Government is held to account for the failures and that the culture in WICS fundamentally changes. It is also important that other public bodies are made aware of the issues so that the failures are not repeated.

The areas that the committee investigated and the work of the Auditor General for Scotland are wide ranging. There was poor governance in WICS’s expenditure approval and weakness in its financial control. There is also the role of the Scottish Government’s sponsorship team, the role of the board and the departure of the former chief executive. This is about accountability and value for money. WICS is the organisation tasked with holding Scottish Water to account—what an irony. Its job is vital in that regard. WICS is there to determine the lowest reasonable cost that Scottish Water will have to incur to meet ministers’ environmental, quality and service objectives for the industry. WICS’s decisions must be consistent with the guidelines that are set by ministers in their principles of charging. The repeated failures that the committee has highlighted and that Audit Scotland identified need to be addressed urgently.

In a powerful opening speech, Richard Leonard highlighted the extreme examples of governance and financial issues. The Auditor General noted that WICS fell far short of what is expected of a public body. It is deeply concerning that the committee and the Auditor General also highlighted Scottish Government failures to hold the commission to account in decisions that involved expenditure that did not meet standards of value for money and accountability. Taxpayers’ money was being spent in ways that did not meet the Scottish Government’s guidance. We have had numerous debates during recent months about the Government wasting taxpayers’ money. Those huge failures must be addressed urgently.

We should be proud of the fact that we have a publicly owned water company in Scotland. WICS is meant to be the economic regulator for the industry and to promote the interests of Scotland’s water and sewerage customers. We should be using our time today to talk about Scottish Water, because it is key to producing high-quality clean water for our constituents across Scotland. However, affordable bills have gone up by inflation-busting increases of almost 10 per cent this year after 8.8 per cent last year and there have been large bonuses for senior staff who already have big salaries. There are concerns about the widening gaps between the wages of workers who do the daily work that keeps our infrastructure working and those on the top salaries. I was concerned to hear from Unison members about the fact that they are seeing privatisation by stealth and an increase in private contracts and tenders. We need support for concerned staff across the public sector who want to be whistleblowers. That was emphasised in the committee’s report.

We should also be talking about sewage. Research that was carried out by Surfers Against Sewage highlighted the need for more reliable data and monitoring of sewage outflows and the need for increased action on extreme weather events causing heavy rainfall and water shortages. As was discussed at First Minister’s question time today, we now have water shortages that are impacting on our constituents, farming and business communities.

That all means that WICS has to work properly by holding Scottish Water to account through value for money in the bills that we all pay. It means that WICS needs to deliver value for money and be accountable. The committee’s report highlights significant repeated failures by WICS and the Scottish Government. The lessons need to be learned, not just by WICS but across the public sector. How did this happen? The committee’s recommendations need to be implemented urgently and consistently across the public sector.