Briefing...

1500 More Job Losses

22 April 2003: Scottish Water have announced that 900 more jobs will be cut this year followed by a further 600 over the next two years to meet financial targets set by the industry regulator, the Water Industry Commissioner for Scotland. This is on top of some 1300 jobs that have been lost over the past two years.

When these financial targets were set in 2001 UNISON estimated that at least 2000 jobs would be lost cutting the workforce by a third (6000 to 4000). At the time we were accused of exaggerating the job cuts and scaremongering. With this latest announcement the workforce with be almost halved with job losses reaching nearly 3000.

The impact of these cuts will be significant for both staff and the public. It is impossible to cut the workforce by half without impacting on the provision of clean and wholesome water and the safe and environmentally sustainable disposable of sewage. In particular the industry has already lost many of its most experienced staff whose knowledge and skills cannot quickly be replaced.

Just recently the Regulator criticised Scottish Water for its handling of last year's cryptospiridium scare in Glasgow. He was particularly scathing over Scottish Water's ability to put only 10 vans onto the street. With these further cuts Scottish Water will be lucky to find a handful of staff who are able to respond to emergencies or more importantly have the experience to prevent problems occurring.

The Regulator's financial targets are based on economic theory, not the realities on (or in this case under) the ground. Comparisons with England are meaningless because that country has benefited from 25 years of additional investment and had their debt written off at privatisation. Over the past 13 years £50bn has been invested in water and sewage infrastructure in England and Wales. The equivalent figure in Scotland is £1bn. Scotland has a crumbling system that is only now being addressed with a £1.8bn investment programme. That programme will result in facilities that require less staff (although not half) - but they are not in place now.

It is inevitable that politicians will focus on the threat of privatisation. However, none of the mainstream parties are proposing privatisation on the English model, although the Tories plan comes very close. As we again warned in 2001 the industry has been partially privatised through PPP. The Regulator recently identified £296m wasted on PFI schemes and they have now been dropped in favour of broader private sector involvement through PPP schemes.

The real issue for government at Scottish and UK level to address is the role of economic regulators. There is an increasing disconnection between the short-term financial cuts proposed by all the utility regulators and longer-term policies proposed by the political parties. For example, the government wants to encourage renewable energy generation in the north of Scotland, whilst the energy regulator Ofgem is introducing a financial regime which will penalise generation in Scotland. Likewise in water, the public provision of a safe and environmentally sustainable water and sewage system has broad political support. However, the regulator is hell bent on short-term financial cuts, which puts this provision at risk.

UNISON's manifesto for Scotland's public services calls for a publicly accountable water industry in Scotland operating within a realistic financial framework.

For further details contact:

Dave Watson, Scottish Organiser (Utilities)
UNISON House,
14 West Campbell Street
Glasgow G2 6RX.
Tel: 0845 355 0845
E.mail d.watson@UNISON.co.uk