Water - Delivery Assurance Group (DAG) report: quarter 2 - 2022 to 2023

8. Conclusion

The DAGWG is invited to note that:

• At the end of Q2 2022/23 of the new regulatory period Tier 2 Investment was £325m made up of planned repair and refurbishment (£196m), enhancement (including flooding) (£97m) and growth (£31m).
• Tier 2 investment was £14m above the central forecast for Q2 (£311m) and we are forecasting that we should be at the top end of our Delivery plan range of £620m to £690m at year end.
• Scottish Water's IPOD position at 420 points is on track against the forecast dates in the Committed List.
• In relation to the milestones measured under IPOD performance on achieving the Start on Site and Financial Completion milestones has been good. Scottish Water are experiencing delay in achieving Acceptance on a number of Water and Wastewater projects as delivery risks are realised: -
• o 36 projects in the Wastewater programme have had their acceptance date reforecast.
• o 23 projects on the Water programme have had their acceptance date reforecast.

Reforecasts are broadly due to scope variations; third party risks; construction risks and challenging construction market conditions. Where appropriate and if necessary temporary mitigation is put in place to maintain service. In addition, learning is being taken for new additions to the committed list whilst maintaining the aim of setting realistic but challenging forecasts. This is in keeping with the principles of the new IPPF framework under which Scottish Water look to set forecasts, monitor variances and take on board learnings.

• The request to monitor outputs at DAGWG has been noted and work is ongoing on system alterations to accommodate this in the future. The DAGWG will be kept informed of progress.