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[Made a request to intervene.]

I join members in thanking the Public Audit Committee. I am not a member of the committee, although I sit on the Scottish Commission for Public Audit. The work that the Auditor General for Scotland has done underlines the importance of Audit Scotland and the AGS. I thank the convener for his powerful comments at the beginning of the debate.

Reading the committee’s report, the word “egregious” springs to mind. At the root of a raft of bad decisions by WICS, there was clearly a lack of focus on its core role as a public body and a deep cultural problem within the organisation. WICS had been encouraged by the Scottish Government to expand its remit into acting as a private sector consultancy on the international stage. Unfortunately, with that came a total indifference to upholding the standards that are required of a public body. There should have been no confusion at all on the part of the chief executive officer, the chair and the board—they should all have known better. The Scottish Government’s arrangements should have worked to rein in excessive and inappropriate spending from day 1, and the Government should have heard the alarm bells ringing far earlier.

The fact that the chief executive officer at the time resigned to avoid scrutiny by the Public Audit Committee is distasteful—that his pay-off cost the taxpayer more than £100,000 even more so. The £70,000 Harvard training courses, funded masters in business administration, £200 dinners and Christmas gifts are all symptoms of an organisation that had lost its sense of responsibility to act in the public interest and deliver value. The whole affair has undermined trust in the regulator and has been damaging to the water industry in Scotland more broadly. However, I am pleased that lessons have now, belatedly, been learned. The organisation has been refocused back on to its public role and will move forward, with further monitoring from the Auditor General.

As Sarah Boyack outlined, now is the time for a renewed focus on the water industry and its regulators. It is 20 years since the Water Environment and Water Services (Scotland) Act 2003 was passed, which established WICS. We are also in the early days of a climate crisis that will be driving huge investment decisions for generations to come. The director general net zero told the committee that WICS provides

“the impetus to deliver on efficiency savings, reduced taxpayer bills and the improvement of the asset”,—[Official Report, Public Audit Committee, 19 February 2025; c 68.]

but there is no fundamental reason why that impetus cannot come directly from Government, with no economic regulator in place. Arguably, WICS helped to bring a focus to Scottish Water in those early days, especially in reducing costs and improving performance. However, is it still fit for purpose? Why cannot that regulatory capacity be built within Government? Other states around the world regulate their nationalised utilities by Governments setting out formal agreements on performance, pricing and other obligations. They manage to focus on improving governance, robust auditing and citizen engagement, without an economic regulator. They manage to get the balance right between the necessary technical decisions and the more political choices.

When WICS was established, at a time when the Scottish Executive was flirting with privatisation, Ross Finnie, the Lib Dem minister, was keen on turning Scottish Water into a mutual, like Welsh Water—public on the outside and private on the inside. In effect, it would have been a public shell company with a business being operated by private contractors. I can see the benefit of an economic regulator in that context, but that is not a model that was ever fit for Scotland. Moreover, the context of the water industry has changed dramatically around the United Kingdom, even in just the past couple of years. With a water bill inevitable in the next session of the Scottish Parliament and further regulatory reforms coming in England, it is time to consider whether WICS is still fit for purpose.

It is a separate issue from the historical bad practice that the Auditor General has reported on, and it should remain so, but there are broader questions about the future of water industry regulation in Scotland, and we should not be afraid to discuss them.

This time last year, the Cabinet Secretary for Transport talked about how flexi and season passes were going to be the way forward and the way to reduce costs. Was there any analysis of how successful that approach was, and did that lead the Government to changing its view and reintroducing off-peak fares all day? I just thought that that was the main answer that the Cabinet Secretary for Transport gave this time last year.

I am struck by just how important electrification is going to be in all areas of our lives. Beyond the important UK Government decision on electricity market reform, decoupling gas from the electricity price and allowing CFDs—especially the new CFDs that you have outlined this morning—to reduce costs over time, what can householders do? How can they be supported to reduce their electricity costs?

At the moment, the market is providing low-cost tariffs. For example, under EV tariffs, people pay 8p or 8.5p per kilowatt at night, typically, as opposed to 25p to 30p per kilowatt during the day. What supplementary measures can the Government take to support people? Battery storage in the home would enable people to shift a great proportion of their electricity consumption to the night time and, as a result, they could benefit by signing up for those far cheaper rates.

I do not know what the picture should look like for householders and consumers, but, beyond the big question of electricity market reform, which householders are not able to influence, what measures can people take in their homes? What should the Government be doing to support them on that journey?

Do you think that those variable, far cheaper electricity prices will be a fixed feature for consumers and householders? Can consumers and businesses that supply technology such as night-time battery storage be certain that it will always be possible to buy cheaper electricity at certain times and thereby save on bills?

Thanks, convener. I turn to buildings—both homes and other buildings. Earlier, you put it to us that there is a real need to switch to much more efficient technologies that are lower cost for consumers but also much lower carbon. I ask you to reflect on the change that we have seen in expectation. In the 2020 climate change plan update, the Scottish Government had a very ambitious programme—well, it was not a full programme as such, but it contained an ambitious target of a 63 per cent reduction in emissions from the building sector to 2030. That clearly represented an enormous ramp-up of a range of technologies, although the programme at that time did not really specify how that would be achieved. That differs quite a lot from what you are now putting forward in the balanced pathway, which sees a much greater adoption of technologies than in the third and fourth budgets.

Can you offer a bit of narrative as to what you think has changed around the expectations on building carbon reduction in recent years and what is now the realistic pathway?

So you really see the reduction in electricity price as a trigger, whether it is for transport, for home heating or for people shifting over to electrifying technology. At the moment, we are not quite there in terms of a market signal being sent to consumers that it is obvious that they should switch to an electric vehicle and an air-source heat pump.

We will be future proofing entry into those markets.

Okay. I think that you are advising decarbonisation in non-residential buildings earlier than in residential buildings. Will you explain that?

I perhaps take a different view, convener. To me, the 6 per cent figure sounds pretty pitiful, to be honest. As someone who lives in a rural area, I could quite easily reduce my mileage by 6 per cent just by organising my day a little bit better, by joining up with other families when taking my kids to activities, for example.

I think that Eoin Devane is making a point about the real reduction coming from urban areas, but in the CCC’s advice, I do not see what the game changer could be if we are to significantly reduce vehicle mileage. For example, some cities in Europe have completely free public transport systems. If that is put in place and funded through congestion charges, could that result in a much greater reduction—say, 30 per cent—in vehicle mileage in urban areas? It could mean that there simply would be no point in driving any more if people are charged to drive but had a completely free, well-funded public transport system.

I feel that we are in a climate emergency. What is the game changer here? Many projects have been tried across Europe, and you have collated some of the best practice on that. However, none of this feels like the big, big shift that is needed. If we are sitting here debating a 6 per cent reduction—or one journey in every 20—that does not really feel to me like a shift in behaviour. I know that I am being provocative, but I am interested in finding out what the big ideas are that could really shift things fairly and in a way that actually benefits people.