The options for Northern Ireland Water

In England water services are privately run

Northern Ireland's Regional Development Minister, Conor Murphy, has told the Assembly he wants to see a change in the structure of NI Water. BBC Northern Ireland's Environment Correspondent Mike McKimm looks at what options are possible when providing a water service in the UK.

Currently the former government-run Water Service is set up as a separate company but still owned by government.

It is often referred to as a Go-Co. (That is similar to the Royal Mail which is run like a conventional company but has the government as its main shareholder.)

The main advantage of this setup is that it provides certain financial freedoms outside the mantle of government.

This is important in how the company is funded and spends its money.

Generally it is a lot less restricted than a government department. It also has an independent regulator, the Utility Regulator.

Scottish Water is run in a slightly different way but has the same government controls.

However, unlike Northern Ireland Water, they raise their funding through conventional water bills sent to customers. It is regulated by the Scottish Water Industry Commission.

In England, the water companies are privately owned by their shareholders.

'Not for profit'

While they have to meet certain standards and are regulated by Ofwat, they are free to run the business largely as they wish and make a profit. Customers are billed for water and sewerage services.

In Wales, water and sewerage services are provided by Welsh Water which is owned by the company Glas Cymru.

But unlike its English counterparts this is a company limited by guarantee. This means it has no shareholders and any financial surpluses are used to keep customer bills down. Some refer to it as a "not-for-profit" company.

It has few employees and utilises a panel of contractors for all its engineering and repairs.

Like the Scottish and English models they send out bills for water and sewerage services. It is also regulated by Ofwat.

The final option is a water service provided from within a government department.

This is the way services in Northern Ireland were run until 2007. The Water Service was part of the Department of Regional Development.

However, this structure makes it more difficult in terms of raising finance and capital spending. Funding would come through the taxpayer or from the rates.

If Northern Ireland was to switch from its current government-owned company to a different model, legislation would have to be put through the Northern Ireland Assembly.

That is unlikely to happen this side of an election.