ANALYSIS
Scottish Water is a prime candidate for major reform after the election, moving it from full public ownership into a mutual company.
Even before its Edinburgh pumping problems joined the election headlines, the organisation was heading for change.
That would not guarantee the pumps will work in future, but it would prove attractive to the ministers who occupy St Andrew's House after the election, because it would free up £180m each year.
Neither of the main contenders for power is proposing Scottish Water is moved away from full public ownership, but crucially, neither is opposed to the idea either.
Both the Liberal Democrats and Conservative are enthusiastic backers of the idea, while it is opposed by the Greens.
The Tories cite the mutual model in Wales.
Whatever the outcome of the election, LibDems or Tories could be essential in persuading one of the larger parties to adopt a move to mutual status, particularly as executive finances will become tighter over the next few years.
The £180m saving would be from the annual allocation of borrowing consent, which is not funded as part of the block grant because there is no equivalent fund for privatised English water companies.
If a mutual Scottish Water were controlled by a board of directors representing customers rather than ministers, it would be freed up to borrow money in private markets. But that would give the banks considerable leverage over the board, and opponents of the move see it as a step towards privatisation.
Nationalists have backed the findings of independent analysts Jim and Margaret Cuthbert that savings could be made without taking a risk on becoming mutual, though the party considered the move, to balance its books. Under pressure from trade union backers, Labour has ruled out privatisation at this election. But its manifesto is carefully worded to leave the mutual option open.
It states: "Scottish Water should remain publicly owned and accountable. We will constantly seek to strengthen ownership and accountability".
Eight years ago, and three years before Scottish Water was formed out of the North, East and West of Scotland water companies, use of private finance was seen as the way to hurry through changes to meet European directives on quality.While former contracts are continuing, Scottish Water is not starting new ones.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article