Corporate plan 2021-27

This document explains how WICS intends to fulfil its remit and statutory responsibilities during the regulatory control period 2021-27.

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How we will deliver these outcomes

We have identified a number of activities which, taken together, will deliver the outcomes described in the previous section. 

Many of these activities contribute to more than one outcome, and any specific project that we work on may require a number of different activities. We intend to reflect this level of integration in our future operational model/office structure. 

These activities are necessarily high level given the length of time that is covered by this plan. We will publish more detail about our planned activities and budget at the start of each year. Our performance in delivering this annual list of activities is one of our key performance indicators.

The activities that we will undertake in the period covered by this Corporate Plan are as follows:

Implement or support the Scottish Government’s policy initiatives 

  • Provide support to the Scottish Government as it develops policy measures in response to COVID-19.
  • Support the implementation of process changes to the retail market framework to reflect the Ministers’ Statement on the Principles of Charging.
  • Understand the costs of connecting rural communities to Scottish Water’s network and compare these with the costs of monitoring and supporting private water supplies. 
  • Review the charging arrangements for developers as required under the Ministers’ Principles of Charging to ensure that developers pay appropriately for the infrastructure services that they are provided with by Scottish Water.
  • Improve understanding of the drivers of costs of property and highway drainage and how best to recover those costs given the industry’s challenge to achieve net zero emissions by 2040.

Embedding the trust and confidence model

  • Ensure that all WICS staff understand the principles of EBR and the associated behaviours and values and put these into practice through engagement with experts in the field.
  • Encourage Scottish Water and other stakeholders to use experts in the field of EBP to discuss the concept and to help them implement the associated behaviours and values within their organisations.
  • Identify best practice and influence future communication between Scottish Water and stakeholders through the use of real examples provided by stakeholders where things have worked well, and ensure that lessons are identified and communicated in cases that have not worked so well.
  • Establish a forum for regular discussion of what has gone well and what has gone less well in implementing EBR and EBP.
  • Identify test cases of good and less good practice to gather stakeholders’ views, including through workshops.
  • Undertake ongoing engagement with stakeholders through, for example, an annual review of the model and by holding individual sessions with stakeholders.

Supporting licensed providers to implement the principles of EBP in the retail non-household market

  • Undertake an extensive engagement process with licensed providers (this may involve a pilot project, facilitated by experts in the field).
  • Introduce a voluntary market-wide process that allows licensed providers to demonstrate behaviours consistent with EBP.

Reviewing and commenting on performance

  • Comment strategically and publicly on Scottish Water’s performance each year as a minimum or more frequently if there is benefit to customers, communities and other stakeholders in doing so.
  • Understand how Scottish Water is delivering the Ministers’ Objectives by attending and contributing actively to quarterly Delivery Assurance Group meetings.
  • Work with international experts to understand Scottish Water’s progress as it implements its Asset Management Transformation Plan.
  • Comment strategically and publicly on Scottish Water’s activity as a wholesaler, each year as a minimum or more frequently if there is benefit to licensed providers and customers in doing so.
  • Keep under review the growth in population and population migration within Scotland.
  • Keep under review the impact of macro-economic factors such as cost and price inflation, and interest rates on Scottish Water’s business.

Reviewing costs

  • Undertake a bottom-up review of Scottish Water’s wholesale costs across geographical areas and the value chain. This work will help ensure that future charging arrangements support the behaviours necessary to achieve the Ministers’ Objectives.
  • Review the default tariffs and the margins that are available in the non-household retail market (e.g. trade effluent).
  • Keep under review how Scottish Water allocates costs between expenditure that is subject to the financial tramlines (such as operating costs and asset repairs) and the investment that is subject to investment prioritisation.

Ensuring appropriate incentives

  • Keep under review the regulatory framework to ensure that it provides appropriate incentives for Scottish Water to deliver Ministers’ Objectives as effectively and efficiently as possible. 

Understanding investment requirements

  • Review the way in which Scottish Water currently appraises investment and help to develop a more comprehensive ‘economic toolkit’ for appraising future investment.
  • Attend and engage constructively with Scottish Water’s Investment Advisory Group to help the pricing of externalities and societal/environmental costs and benefits (‘capitals’).
  • Conduct a periodic review of the long-term asset replacement requirements with better and more up-to-date information on Scottish Water’s assets.
  • Develop a deeper understanding of the way in which Scottish Water is prioritising the investment required to meet Ministers’ Objectives at IPPG.

Understanding and acting on the views of customers

  • Ensure that the customer and community voice is embedded within Scottish Water’s decision-making process and that they are able to demonstrate that they have taken due account of these in the decisions they take.
  • Support Scottish Water in carrying out research – including behavioural insights – in order to gain a better understanding of the preferences of customers.

Developing the SRC 2028-34 methodology

  • Take due account of Scottish Water’s transformation during the early years of the period, and develop the methodology for the 2028-34 price review.

Undertaking horizon scanning

  • Review regulatory frameworks in other countries to identify best practice that may be applied to the model in Scotland or more widely through our Hydro Nation work.
  • Undertake proactive review of innovations in other asset-intensive industries and review innovative practices within the water industry in order to inform our commentary on Scottish Water’s performance.
  • Understand the techniques for valuing concession arrangements and changes in market value over time.
  • Engage with international organisations such as OECD NER/WAREG/IWA/ EU Commission in order to maintain an up to date knowledge of regulatory approaches and identify best practice.

Managing and administering the non-household retail market

  • Review and process any new licence application, licence revocation and licence transfer.
  • Review and where relevant implement proposed changes to the market codes and other refinements to the market framework as part of the CMA Technical Panel process or following a Commission-led consultation process.
  • Review the financial resilience of licensed providers. Consider further measures to protect the integrity of the market to ensure that licensed providers are operating on a sustainable basis and are resilient to future shocks.
  • Review and monitor customer retail-related enquiries.
  • Review any alleged licence breach and where appropriate undertake formal investigations.
  • Monitor the market through frequent engagement with licensed providers and the CMA.

Supporting the Hydro Nation initiative

  • Undertake to deliver projects in Europe and internationally by providing strategic and analytical support, and through offering appropriate training programmes (with the relevant high-quality supporting materials).
  • Seek new opportunities for business development through activities such as developing our partnerships and exploring links with potential contractors.
  • Explore with the Scottish Government the pros and cons of developing a separate legal entity for our Hydro Nation activities.
  • Maintain MOUs with other international regulatory bodies.
  • Develop relationships with countries that we have identified as potential future partners.
  • Continue our active membership of WAREG and other international organisations.
  • Support the Hydro Nation scholars by providing training.
  • Seek out secondment opportunities for staff to work externally and for external contacts to be seconded into WICS.

Undertaking performance management

  • Ensure that we have appropriate procedures and policies in place in relation to governance, budgeting and resources, to support the successful delivery of our strategic objectives.
  • Report performance against our corporate plan KPIs and annual work plan to the Commission Board and in our Annual Report. 

Delivering IT services and cyber resiliency

  • Ensure that our systems are cyber resilient through our people-focused approach, by strengthening our defences in line with the Scottish Government Cyber Resiliency Framework, and by remaining compliant with the Cyber Essentials Plus standards.
  • Provide stable, secure and flexible IT services to support the IT and telecommunications requirements of the office.
  • Build on our existing approach to incident management and business continuity planning.

Managing our finances

  • Ensure that policies and procedures are in place that are in line with the Scottish Public Finance Manual.
  • Prepare annual accounts in line with the Financial Reporting Manual.
  • Monitor and report on expenditure against budget, highlighting areas of concern.

Recruiting and retaining staff

  • Develop and keep under review our overall graduate recruitment strategy, including an assessment of our recruitment requirements.
  • Undertake promotion and engagement activity.
  • Deliver induction training and manage our graduate training and development programme. This includes opportunities for inward and external secondments.
  • Manage our staff development and assessment framework.

Engaging with our external and internal stakeholders

  • Develop and agree our communications strategy, which will describe our key stakeholders, their interests and motivations, our approach to engagement and the tools and resources required.
  • Implement our communications strategy by using a wide range of tools to communicate with our external and internal stakeholders. These stakeholders are wide-ranging and encompass national and international stakeholders, the licensed providers, household and non-household customers, MSPs and the media, and current and potential employees.
  • Publish information documents as appropriate in order to support understanding and transparency; this would include our annual report and the documentation relating to current and future Strategic Reviews of Charges.

Information management 

  • Promote best practice records management.
  • Ensure compliance with legislation in relation to FOI, GDPR, and data protection.
  • Handle enquiries and complaints in a timely and relevant way.
  • Facilitate information provision to the Commission Board.

Risk management 

  • Manage the corporate risk register and operational risks.
  • Identify risk and implement mitigations and review.

Work planning and resourcing 

  • Develop forward plans to ensure that we deliver against our KPIs and in support of our strategic objectives.
  • Prepare our annual work plan and monitor and report progress against it.
  • Undertake resource planning to support our work plan, deploy resources as appropriate, and provide project management support.
  • Make arrangements for future staff working that draw on the experience and lessons learned from operating during lock-down.
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