Landmark Agreement on Future Water Investment and Charging

“This agreement marks a significant step towards achieving a customer-centric approach in the SRC27 process, to ensure Scottish Water is independently challenged, and that our customer engagement is robust, transparent, and effective.”

Alex Plant
CEO Scottish Water

Consumers, communities and the environment will be central to the forthcoming Strategic Review of water charges under a new joint agreement.

A new Memorandum of Understanding (MoU) has been signed by three statutory bodies: the Water Industry Commission for Scotland (WICS), Scottish Water and Consumer Scotland.

The future level of water charges for the six-year period from 2027/28 to 2032/33 will be determined by the Strategic Review of Charges (SRC). The review aims to ensure that customers pay no more than necessary to fund existing services, invest in future infrastructure and deliver the overall policy objectives set by Scottish Ministers.

The review will consider the rate of progress to be made in the 2027-33 period in relation to Scottish Water’s Long-Term Strategy, as it seeks to protect water services from the twin challenges of the climate crisis and ageing water infrastructure.

Under the new MoU, the public will be engaged throughout the price review process. This will help Scottish Water to create a business plan which is clearly shaped by customers views and enables WICS to ensure its final determination of charges commands customer support.

The MoU will be delivered under three pillars of work: evidence, challenge and confirmation. Consumer research will provide evidence for the Independent Customer Group to challenge Scottish Water’s decision-making as it develops its Business Plan. The final confirmation stage will ask consumers whether Scottish Water’s Final Business Plan commands their support.

Alex Plant, Chief Executive of Scottish Water, said: “When developing our plans and investment for the future, we must balance legal requirements and Ministerial expectations with the views of our customers. As a publicly owned, commercially run and independently regulated service which underpins daily life for millions of people, customer voice is a key element factor in our decision-making.

“This agreement marks a significant step towards achieving a customer-centric approach in the SRC27 process, to ensure Scottish Water is independently challenged, and that our customer engagement is robust, transparent, and effective.”

Sam Ghibaldan, Chief Executive of Consumer Scotland, said: “The decisions being taken in the SRC for consumers will have significant implications for consumers during the six-year period of the current SRC, but also far beyond.

“This is a groundbreaking agreement that asks consumers whether Scottish Water’s Final Business Plan commands their support, a significant innovation on previous SRC processes.

“It underlines the importance of Scottish Water taking full account of consumer research and will help enable WICS to reach a Final Determination of charges that meets the requirements set out in the Commissioning Letter from Scottish Ministers.

“This agreement will help ensure consumers are central to SRC27.” 

David Satti, Interim Chief Executive Officer for WICS, added: “We are pleased to formalise this collaborative commitment with Scottish Water and Consumer Scotland, placing customers firmly at the heart the Strategic Review of Charges 2027-2033.

“This partnership will help ensure that our Final Determination of charges commands consumers’ support, embedding open engagement, robust research and independent challenge.”