By Democrat reporter
Dumbarton MSP Jackie Baillie is proposing a £100 water charge rebate for every household in Scotland.
The rebate proposal follows Ms Baillie revealing that Scottish Water and its subsidiaries have built up a £531 million “cash stash” – five times higher than the water regulator promised customers when setting water charges.
Scottish Labour interim leader and finance spokesperson Jackie Baillie, pictured right, said: “It is time hard-pressed families in Scotland got money back from this obscene cash stash.
“It is clear that water customers have been overcharged for years and they need the money in their household budgets at this time, not sitting unused in Scottish Water’s bank vaults.
“Not only can a water rebate be easily afforded from the cash Scottish Water has stashed away, it means that any planned above-inflation water charge increases can be dropped for a number of years to come.
“By delivering an immediate flat-rate £100 rebate on their next water bill, every household in Scotland will benefit – with the poorest households benefiting most. It will put cash into householders’ pockets to meet bills or boost spending that can help our high street traders as we emerge from the pandemic.
“There is so much cash in the system that we can easily afford this and retain enough cash to cover the effects of the pandemic on Scottish Water’s income.
“This is the sort of good news that households need after a hard winter. It is, after all, our money – as the people of Scotland own Scottish Water.”
There are 2.5 million household customers in Scotland. Giving a £100 rebate would therefore cost £250 million out of the £531 million cash stash, leaving a balance of £281 million.
However, it is predicted that this money will have grown further during this year to at least £631 million as the Scottish government have made clear capital investment is falling due to the pandemic.
In addition, it is estimated the build-up of the money will continue to follow the same pattern as in recent years. It is predicted to grow to over £900 million by 2026/27 if no action is taken to reduce it.
Giving an immediate rebate of £100 will cost £250 million, leaving the balance of the cash to be run down over coming years to:
- hold prices at the rate of inflation for a number of years
- make some provision for bad debt as a result of the pandemic
- leave a balance of over £100 million to meet any unforeseen contingencies (more than the regulator thought necessary for the current period)
- still meet expanded investment plans.
One per cent of water charges raises around £13 million annually.
Scottish Water’s Annual Report and Accounts for 2019/20 published 7 months late and on the eve of Christmas show that the Scottish Water Group has built up a cash reserves of £531 million.
Scottish Water’s reserves are over 5 times higher than the water regulator promised customers when it set charges for this year. Scottish Water report available here: https://www.scottishwater.co.uk/help-and-resources/document-hub/key-publications/annual-reports
- Top picture: Scotland’s environment minister Roseanna Cunningham with Douglas Millican, the regulator of Scottish Water.