Detailed investigations will take place into commercialising Guernsey Water with a view to it happening by the end of 2027.
The Assembly has backed the proposals brought by the States Trading and Supervisory Committee which also sends it away to look at whether the same change should happen with Guernsey Ports and States Works with a report on those areas due by the end of next year.
It will mean following the incorporation model which has already been applied to Guernsey Post, Guernsey Electricity, and JamesCo which manages the fuel tankers.
“For a long time, we have been of the opinion that some of the unincorporated businesses would operate better if they were incorporated,” said STSB Vice President, Deputy Charles Parkinson.
“The management of these businesses would have greater responsibility for human resource practice, procurement and IT for example, and could potentially have greater flexibility in financial management that could, in turn, support long term infrastructure and investment planning.
“It’s relatively easy to set out in these sort of terms the benefits of incorporation, but some of the benefits are less tangible. As members of the STSB, we attend the highest levels of management meetings of businesses in both categories, quite simply, attending the board of an incorporated business and the board in inverted commas of an unincorporated business are a different experience.”
STSB commissioned an independent report looking at the unincorporated businesses, which also include the Guernsey Dairy and Guernsey Waste, which have been ruled out for commercialisation.
Guernsey Water was identified as the most mature and ready for incorporation.
“The ports require extensive capitalisation, and there are some key policy issues that need to be addressed by the States around both of their future asset base in relation to the Guernsey Development Agency, for example, and the role of the airport as an economic enabler.”
The proposals asked for approval in principle to incorporate Guernsey Water, Guernsey Ports, and States Works, but to proceed first with Water.
“We have noted, and as P&R have emphasised in their letter of comment, this will be a complex and delicate task.
“However, we take comfort from the fact that the States in Guernsey have been through this process before, in the cases of Guernsey Electricity and Guernsey Post, and the outcomes in each case were very successful.
“Incorporation has enabled those businesses to operate more commercially with greater agility and a more customer focused approach and to make better use of all the assets at their disposal.
“Importantly, they have done so whilst continuing to recognise their roles in supporting the State’s wider economic, social and environmental policy objectives. And just as with those previous incorporated businesses, there’s no intention in the STSB to privatize these businesses.”
Management was supportive and the initial staff reaction had been positive, he said.
The investigations are estimated to cost up to £500,000 and will be funded by the entities themselves.
Concerns raised by deputies included how regulation would work and whether it was in fact a route to privatisation.
But in the end there was limited opposition to the plans.