Call for watchdogs to be scrapped to curb Scottish Water execs pay

The Herald Scotland

19 hours ago

They are saying that having three bodies with regulatory oversight of the industry is wasteful and means there is a lack of responsibility and suggest there should be only one.
They say restructuring will allow the same level of scrutiny with clearer lines of accountability and less expense.
Andrew Thomson, GMB Scotland's representative rep at Scottish Water, has said that the current set-up has encouraged creeping privatisation at the company and led to workers being scapegoated for executive failures.
The branch has been supported by the union in calls for ministers to implement strict conditions around public sector executive pay and bonuses through its Public Sector Pay Strategy – extending this to the quangos, commissions and regulatory bodies.
The issue surrounds a complex web of three separate regulators operating to oversee operations at Scottish Water - the Water Industry Commission for Scotland (WICS) which examines finances, the Scottish Environment Protection Agency (SEPA) which oversees pollution issues and the Drinking Water Quality Regulator for Scotland which investigates safety.
WICS, which the branch says is "a disgrace" has been at the centre of a scandal over what watchdog Audit Scotland described as inappropriate public spending, including: a £77,000 Harvard Business School course for a senior executive, lavish spending on meals, with some exceeding £200 per head and £100 gift vouchers for staff, surpassing the £75 limit for gifts.
SEPA was told by watchdog Environmental Standards Scotland (ESS) in September, last year, to improve monitoring after finding that pollution of Scotland's rivers and beaches was far more widespread than realised because ministers have failed to take the problem seriously.
The union has been concerned that ten days of strikes in a bitter pay dispute is to cost nearly £3m in bringing in extra staff as part of a contingency plan.
It comes amidst a row over Mr Plant receiving a 50% rise in the existing pay package - despite public sector pay rules saying he should expect to have a 10% cut.
Alex Plant (Image: Supplied) The £483,000 remuneration for Alex Plant over just ten months of 2023/24 is nearly £100,000 more than the outgoing chief executive Douglas Millican, received in his last full year before taking flexible retirement which resulted in a cut in salary and reduced pension benefits.
The Scottish Government's public sector pay policy has since 2010 included an "expectation" that the remuneration of a new chief executive appointment will be at least 10% lower than that of the outgoing officer.
MSPs raised their concerns in the Scottish Parliament after The Herald further revealed that executives of the nation's state-owned water supplier saw bonuses hiked by over a third in one year - taking a five-year total to nearly £1.6m despite public sector pay rules suspending the payments.
Read more by Martin Williams:
It has told users: "We will do all we can to ensure customers do not experience any disruption to their water supplies and that treatment of the country's waste water continues as usual, despite the planned industrial action.
Union members on the picket line (Image: Andrew Milligan)
While Scottish Water has remained included on the list of public sector organisations that should conform with the pay policy, the Scottish Government say that they are exempt.
Mr Thomson has taken the calls for changes to GMB Scotland's Congress saying that regulation of the water industry "is required to ensure drinking water is safe and accessible, and that wastewater is dealt with responsibly to protect human life, environmental health and our waterways".
He says that excessive regulatory demands from the three agencies has created a "blame culture within Scottish Water where workers – not management – are held to account for organisational failures and that "this motivates management to place excessive responsibilities and pressures on the performance of the workforce affecting health and morale".
He said that an "excessive number of regulatory bodies, overbearing [Scottish Water] board governance and a lack of transparency have created a top-heavy system of patronage and a culture of elitism where undisclosed contracts and bonuses are given to executives while the pay of Scottish Water workers lags far behind the private sector leading to the increased threat of industrial action".
SEPA (Image: Archive) The branch says a full review of regulatory bodies is required in relation to Scottish Water with an aim to consolidate responsibilities and reduce costs.
GMB Scotland said the long-running and ongoing industrial action at Scottish Water only underlined the need for root and branch reform.
Mr Thomson said: "It is time government which is ultimately the main regulator, concentrated on cutting preposterous costs at the high end; hold management to account and stop allowing the victimisation of workers for wasteful regulation failures.
"Prosecute the bosses and protect the workers."
A 10-day ballot of workers on a revised pay offer delivered to unions by Scottish Water will start on Wednesday but Claire Greer, GMB Scotland organiser, said disruptive and expensive strikes could have been averted months ago if executives had seriously engaged with the workforce.
She said: 'There has now been a series of different disputes at this company all marked by the same failure of management to negotiate with clarity or urgency.
A Scottish Water protest'That not only suggests systemic problems at an executive level but a failure to provide effective and proper oversight by the board and independent watchdogs.
'Scotland was meant to be different to the rest of UK with Scottish Water being structured to ensure the people of Scotland retained ownership and control.
'That means nothing unless there is rigorous and independent oversight of management by board members and expert and respected regulators.
'That is clearly not happening and a complicated and needlessly expensive system of oversight must be rebuilt for the benefit of all Scots.
A Scottish Government spokesman said: 'We remain committed to a water industry model where Scottish Water is publicly owned, commercially run and independently regulated.
"Ministers have set out their policy in relation to public sector pay. It is a matter for Scottish Water and its unions to agree a settlement within the constraints of that policy and affordability. "
A Scottish Water spokesperson said: "After the latest talks with the Joint Trade Unions on Friday, we made an improved pay offer that would see average wages increase by more than 7% over two years. This included a minimum increase of £2,825 over the period.
'In addition, we also proposed a number of other enhancements including improved stand-by payments and carers' leave.
'This is a very strong and progressive offer that balances the interests of our people and customers' and we asked the Joint Trade Unions to ballot their members on the new proposal. So we are glad they are doing so and hope members vote to accept our offer.
'It is in everyone's interests that the current dispute is resolved so that our people can get the pay increases they deserve and return to delivering an essential service to the people of Scotland.'
WICS declined to comment.