2007 - 2021

Water Torture

waterWater is something we’ve got a lot of in Scotland. It’s something that has given us hydro power and boosted our renewable sector for decades, and it’s something that we need to protect as a public asset. Privatising the rain that falls from the sky is a surreal idea. Now water services in Scotland worth £350m over four years are to be transferred into the private hands of Anglian Water. Whatever happened to the Scottish Government’s Water Resources Bill, which aimed to shown the SNP’s commitment to protecting and supporting Scotland’s water as a public asset? In 2013 Jim Eadie MSP who sat on the Infrastructure and Capital Investment Committee said:

“The SNP Government’s determination to maintain Scotland’s water as a public asset stands in stark contrast with the constant calls from opposition parties to get rid of one of Scotland’s greatest resources by privatising Scottish Water. It is a path that would be a disaster for people in Scotland and is not something that will be countenanced by an SNP Government.”

Quite right Jim.

As the SNP conference gathers we urge all members to put pressure on their party, as has been successfully done with both fracking and UCG and bring a critical voice to this decision. But do they have the powers to resist the legislation that ‘forces their hand’?

RISE have launched a report refuting the case for water privatisation arguing: “Our report shows that putting Scotland’s water in the hands of the people is perfectly viable. We highlight the track record of Anglian Water, but we also show how a European wide movement around Right to Water has managed to apply pressure to safeguard water.”  You can download it here.

Here Stephen Paton asks (and answers) the question: Is the Scottish Government Privatising Services? Love the t-shirt. See his Left: Scotland video series for more.

Comments (37)

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  1. Duncan MacLaren says:

    I remember attending a UN Food and Agriculture Organisation seminar in Rome on water. The presenter, a world expert, said the next world war would be over water sources and many smaller wars (such as the conflict in Darfur) have really mostly been about access to water sources. He also called water the ‘new oil'(long before prices fell so drastically). Scotland’s water sources have to be kept in public hands and strategies developed to sell it to other nations suffering from a dearth of good, clean water. To privatise it would be an act of extreme folly but it forms part of the neoliberal agenda. Israel has ensured it has access to all sources of water leading into the West Bank and Gaza Strip. The motivation is clear – control over the Palestinians and ensuring Israeli citizens have water when real drought comes and not the Arabs. You don’t put such a necessary resource for life in the hands of multinational companies!

  2. Completely agree Duncan. In the coming resource-wars, giving away part of one of our greatest assets is crazy.

    1. MBC says:

      Totally agree. But playing devil’s advocate here (in a friendly way…) the Anglian contract is to supply Scottish public sector bodies with Scottish water… for which it will pay, …. Scottish Water for the supply of.

      So that’s not giving anything away, is it? (I know, I know, slippery slope and all that. But just saying…) 🙂

  3. Irene Salter says:

    Young offenders
    Young males from 16 upwards are being remanded and sentenced to Polmont in Falkirk.
    This is too remote for Highland relatives to visit .. And there’s visiting every day at Polmont.
    This will not be a popular cause … There’s plenty will say let young offenders roast in hell.
    We need a young offenders facility in the Highlands, preferably Inverness, which can be reached by public transport from most parts of the Highlands.
    Is it justice that one young person from the central belt can have visitors daily while another from the North of Scotland might get one visit in several weeks?

  4. anne says:

    thank you for highlighting this . I will be writing to my mp and msp

  5. dunderheid says:

    Nobody is privatising water itself….what is being privatised is the treatment and distribution infrastructure of that water.

    Secondly nobody is going to go to war over water….the moment it gets even remotely close to having a value that would justify a war – industrial scale desalination would be economic (right now it can cost as little $0.46/m³ and half of that is energy costs). That also means unfortunately that Scotland will not get rich as a water exporter…sorry…unless we convert more into whisky of course.

    Thirdly the point about Isreal, even if it is true, is completely contrary to your argument. There a state is using its nationalised water industry as a weapon…a private company would never want or be able to do that…

    1. IAB says:

      Actually I work in countries with large scale desalination. Supermarkets and every retail outlet down to the small corner shop are filled with bottled water as no one drinks the tap water. Natural water will have a huge market.

  6. Richard says:

    There seems to be a lot of misinformation around this issue. How much of that is ignorance and how much is deliberate, I can only guess.
    This article clarifies a few things:

    1. dunderheid says:

      All that article does is argue that it is not the SNP responsible for the privatisation. The reality is while Labour started the process…the SNP could ensure it went to a public bidder. They’d be open to legal challenge but what a great story that would be for them…Nasty English corporation attempts to steal Scotlands water from its people…even if they lost it would be a winner politically.

      Why don’t they…because like every other serious political party (a description thaty no longer fits Corbyn’s Labour) they realise that properly regulated private management of utilities is more cost effective and provides better long term infrastructure investment than public ownership and they are too cowardly and hypocritical to admit it

      1. Richard says:

        I think you’ll find that the EU competition rules forbid that.
        Also, even with a legal challenge they wouldn’t win politically; the media would whip up a frenzy about the SG was out of control and ignoring EU rules. “Nasty English corporation” wouldn’t wash with anyone anyway these days (pardon the pun).

        1. dunderheid says:

          I’m sorry the SNP have fine tuned their victimology to an art form…there is no way that they couldn’t turn a legal challenge against public ownership of “Scotland’s” water in a narrative where they are heroically standing up for Scotland’d interests against corporate vested interests. The fact that the majority of the London based media would react the way you describe would only be an advantage

        2. Iain Miller says:

          Oh yes it would!

    2. Richard have you read the RISE report or watch Stephen’s video?

  7. john young says:

    Why does the SNP not bring the FACTS to Holyrood and ask theyt the opponebts to explain in the house why they were the instigators,everything they lie about should be brought to the public,let,s see them squirm.

  8. Calum McKay says:

    Nicely summoned up in Wings by:

    “Not for the first time, Labour left a timebomb ticking and are now blaming the SNP for the fact that it’s exploded.”

    You would not find a minister, MSP, councillor, MP or member of the SNP who would disagree water should be in public hands.

    But when you follow the incompetence of labour or have to obey the rules of the EU, some time your actions are out of your own hands.

    Not often I would agree with dunderhead, a unionist, but the Scottish Government are a responsible and credible party, a party of Government. That credibility has been built up over years working within the constraints of a union where the senior partner (british establishment) are hell bent on manipulating Scotland to fail and or set their dogs of war (press and bbc) on the SNP for anything that can be dredged up to denigrate the SNP or show Scotland in a bad light. The aim being to undermine Scottish confidence, the too poor, wee and stupid philosophy.

    labour on the other hand are not credible, all they have is misinformation, a vacuum of ideas and a character that if they are going down they are taking everyone with them, irrespective of damage done.

    This week Corbyn had to tell supporters not to spit on tories in Manchester, much as I detest the tories, spitting on them is beyond contempt.

    The SNP lead, why follow labour down the path to obscurity?

    labour can spit all they want, funny thing is they are too stupid to realise they are spitting into the wind!

    1. Calum did you read the RISE report?

  9. tartanfever says:

    Ok,some fair points in the RISE document and for the sake of transparency it would be good to see the documents and points scoring system used by the Scot. Govt. in awarding the contract to Anglia.

    I also wonder if the Scot. Govt. have a different outlook on the EU reaction to awarding the contract. With recent events on Alcohol pricing are the SNP a little too wary of EU regulation thinking that the safest route would be to award a contract predominantly on price with other issues being secondary ? The EU regulation does leave wiggle room as RISE point out, but in doing so it also means that tendering processes are also vague.

    What really put me off the RISE document (I expected more from them) – the simplistic terms ‘ water privatisation’. No it is not water privatisation. Domestic supplies are still run through Scottish Water, a public body. This contract is for retail supplies – to business, councils etc and is already run through a private company ‘Business Stream’. Even though they are part of the Scottish Water Group, they are a completely separate entity.

    So my plea to RISE is please be entirely accurate, avoid the sweeping rhetoric that we hear so often from other political parties – I want the detail. It might not be sexy and headline grabbing but no one can accuse you of being ‘ dramatic’ with your publications.

    Two other points of note. This debate surely just shows how politically sophisticated the public have become that we now demand the fine detail of government policy – that is a good thing. Secondly, we must never, ever sign up to TTIP, because if we do and this situation repeats itself, the Scottish Government could find itself being sued by private firms for unfair treatment in tendering procedures.

    1. Frank says:

      I’m sorry but Rise is perfectly entitled to raise the general issue of privatisation, even though it’s only a particular part of the infrastructure that is being privatised. Once you start to allow private companies into the public domain it’s a slipper slope. The SNP adopt a similar approach (correctly) when it comes to the NHS, talking about a general privatisation even though it’s specific parts which are being privatised within a nationalised framework.

      I’m beginning to feel that the SNP’s honeymoon is beginning to end.

      1. tartanfever says:

        Business Stream that currently runs retail water supplies in Scotland is a private company, not public.

        Which raises the obvious question, how do you privatise something that is already privatised ?

        I have no problem with the sentiment, just the language and inaccurate accusation.

        1. MBC says:

          Yes. The Rise document and Paton’s video constantly refer to Business Stream as a public body. It is a private business owned by a public body – Scottish Water. That slop put me off a bit, but they are generally right to raise this as it is all very opaque. There are too many ‘arms length’ companies owned by public bodies, like the City of Edinburgh Council’s EDI, or Edinburgh Leisure. It’s very confusing for us hoi polloi. like Karen Dunbar, we smell s****.

          1. Black Rab says:

            Yes. It’s privatisation by stealthy piecemeal arrangements. There’s absolutely no case for private interests owning anything at all that they haven’t developed by themselves. Owning water and oil reserves including any public utility and other institution vital to an economy or culture is an aberration of a democratic and rational society.
            Noam Chomsky once said that democracy is about people getting together and deciding which policies they would like their governments to enact and it was a case that if they didn’t then there was no point in hoping that they would achieve any of what they wished for in their society and that there would be no point in voting for them. Tell them what it is that you wish as policy and not the other way around. That’s what’s at the heart of the Scottish independence movement.

  10. Broadbield says:

    For every legal opinion on one side you often find an opposing legal opinion on another. If I understand correctly, similar arguments on social etc were made about the minimum pricing for alcohol, but the EC don’t agree. The danger of following the alternative would have been referral to the EC and endless litigation.

    I agree, though Water, and as in this case, services to do with water, should be in public ownership, along with a lot of other things privatised by Thatcher and her heirs.

  11. AMCM says:

    Like the recent rail deal with Abellio, this is a New Labour administration decision that SNP are suffering the hangover from. SNP achieved a majority in 2011 but it takes more than 4 years to turn the country Labour has taken for granted for 50 years around. The implication that SNP are on the road to privatising Scottish water is absurd. Unionists are making a fool of themselves over the Michelle Thomson story and other non-SNP pro-independence outfits are at risk of doing the same about this. Wait for the Edinburgh Trams inquiry and see how Labour mismanaged public finances/projects on a fantastic scale (mostly what the Thomson pre-emptive accusations are about.)
    Independence is the only way out.
    NB. Scott Minto outlines the situation:
    ‘Although the Acts in question are Scottish and not Westminster led, therefore the Scottish Parliament does have the power to amend them, unfortunately the lack of a majority until 2011 meant the SNP were tied to the newly privatised non-domestic water system until that point.
    By the time that they had a majority the system had been up and running for several years and if the SNP had tried to remove water provisions from being open to public procurement, they would have had to have compensated the private businesses that had now been operating within that space – an action that would have been cripplingly expensive, especially for a finance minister with no powers to borrow money and a fixed budget.’

  12. deewal says:

    RISE above it. SNP Bad. Vote Tory.

  13. rabthecab says:

    Tartanfever & MBC have got it right: Business Stream is a private company owned by Scottish Water, which is publicly owned. As such, it is already in private hands.

    1. MBC says:

      Yes, but a private company owned by a public body is a confusing and a confused concept, isn’t it? So what is it, exactly, fish or fowl? Who calls the shots in the final instance, the CEO of Business Stream or the board of Scottish Water? And does Business Stream wind up now that Anglian have the contract?

  14. Glasgow Loon says:

    Although I totally agree with some of the concerns raised about this issue I think we need to be careful about the detail. Firstly, the water and sewerage infrastructure (including distribution) is still wholly in public ownership. Scottish Water are responsible for this – they therefore make decisions on network and treatment investment, maintenance, acceptability of new connections, engage with the planning system and are responsible for ensuring that they don’t breach their environmental obligations (discharges to the water environment from treatment works etc). Domestic households are still supplied directly by Scottish Water and we pay our rates via council tax. This is totally different in England where a number of private organisations (such as Anglian Water) are responsible for these types of duties (including domestic supplies) over a geographical region.

    What changed with the 2005 Act in Scotland was that it allowed Business Stream and other licenced providers to take responsibility for the ‘supply’ of water to non-domestic users – in reality these organisations are just buying the water from Scottish Water and selling it (see http://www.scotlandontap.gov.uk/). The market has been open since 2008 and a number of different providers are now ‘supplying’ a range of different customers albeit with Business Steam enjoying the largest market share. Although the government could do it, as suggested by RISE, I think unpicking the legislation given the number of stakeholders in the market could be quite complex and time consuming.

    Personally I’d like to see the Scottish Government take this opportunity to reaffirm a commitment to a publicly owned and operated water and sewerage network. They also need to find ways to continue support Scottish Water and also encourage them to maintain technical expertise in house rather than rely on consultants and private contractors. Yes Business Stream’s loss of the public sector contract is regrettable (although I would highlight that they operate as a private entity and were making steps not long ago to start taking contacts in England!) but we should remember that there are likely to be job losses as a result of this decision which could have been avoided.

  15. Gordie says:

    Read your report. Conclusion? No idea how legal side would work out but I believe Scot Gov should have legislated/repealed legislation to keep all Scottish water contracts in public sector. Not good enough from SG on this one.

    1. MBC says:

      Maybe they were badly advised. As in local authorities, where the officials employed by the Council actually run the show, and the elected representatives just passively take their word for it without challenging them. That would be the civil servants in SG I guess. Bunch of unionist numpties?

  16. MBC says:

    It just goes to show that the price of true democracy is constant vigilence. So well done Stuart Paton and Rise in querying all this. I think a lot of policy and policy advice is not made by elected representatives at all but by the backroom boys advising them, and there is too much slop and hidden agendas operating there.

    Does anybody know how you get to be a policy advisor? Who are these people? And how expert are they, actually?

    A lot of NHS policy is made up by such shadowy folk as policy makers. They go to policy makers conferences abroad. For instance it is now fashionable, policy-wise, to advise governments to sell off hospitals and hospital land, to ‘reduce the number of sites’. At a time when we have bed-blocking and a growing number of non-acute elderly patients waiting on ‘care packages’ before they can be discharged because the NHS apparently no longer recognises the concept of convalescence…. We used to have convalescent hospitals for such non-acute patients. But policy makers have decided we don’t need them any more.

    But this land and these buildings are publicly owned, yet they get sold to private developers when the sites are ‘reduced’.

    Just curious, and sceptical, is all.

  17. Kimberley Cadden says:

    Firstly RISE can’t know exactly why Anglian were awarded the contract over other bidders as whilst I believe the bids are readily available, the points system the award is decided on isn’t – and at this point, based on advice from the Scottish government, I believe an FOI would need to be completed to access that.

    What is clear from the government department responsible for dealing with this service tender process is that the environmental and social concerns the RISE report raises only relates to what is relevant to the actual procurement contract itself (which the quoted EU rules clearly state as well), and thus these areas can only be taken into account in the tendering process insofar as they *directly* relate to the service being provided. As Scottish Water is still providing the water in this case (and indeed still provides all the water in Scotland – thus our water is not privatised), the environmental record of Anglian cannot be taken into account as they have been fined for environmental issues solely in relation to their own water provision operation (this is actually clear from the contents of RISE’s own report so they should realise this). RISE rightly mention Anglian’s record on pay etc however again this would appear to be irrelevant to this procurement contract as Anglian fulfilled the Scottish government’s real living wage requirements. So when we scratch the surface it’s quite easy to see how Anglian would not have been disadvantaged on environmental or social grounds as these are relevant to this procurement contract. And this is why the difference may well have simply been that Anglian outbid Business Stream. In which case if the Scottish government were to deny Anglian the contract it would need to be on different legal grounds – but then these would need to have been embedded in the points system in the first place – i.e. the Scottish government cannot deny contracts that win via the points system, that would be illegally ‘fixing’ contracts.

    However this is where the RISE report gets very confused in my opinion. For example where it speaks of ‘plenty of legal wriggle room’ in relation to EU rules, the report highlights the notion of ‘maximum flexibility’ from a quoted section of EU Directive 2004/17/EC to make its argument and yet fails to argue at all how this would/could relate to such procurement contracts in any way at all, let alone in a way that would actually have altered the outcome in this case. Indeed RISE seems to think that ‘flexibility’ automatically means that somehow preference for public ownership can be embedded in the procurement process – in which case I would suggest they read a bit further on in said Directive, where it states the following: “To ensure a real opening up of the market and a fair balance in the application of procurement rules in the water, energy, transport and postal services sectors it is necessary for the entities covered to be identified on a basis other than their legal status. It should be ensured, therefore, that the equal treatment of contracting entities operating in the public sector and those operating in the private sector is not prejudiced”. In other words governments cannot *in any way* be prejudiced against private sector bids for water services that are open for competition. So I would say to the folks in RISE if you really think these EU regulations demonstrate how the decision regarding Anglian could have been different and still be well within the law you need to say exactly how and why in order to be taken seriously. As it stands the evidence RISE has cited not only helps to demonstrate that Anglian won’t have received any loss of points due to environmental or social concerns and thus the fact they outbid Business Stream very likely is the reason they legally had to finally win the contract, but also that since these services are open to competition it would have been utterly illegal for the Scottish government to have any preference of public over private by virtue of these statuses.

    That is likely why the academic legal advice from Marco Goldoni that the report goes onto quote as a follow up point isn’t a follow up point at all but rather is the simple statement that the EU doesn’t force governments to open up services to competition – no-one said that they did. It is the 2005 Water Services Scotland Act that opened up some water services to competition and the deregulation of non-domestic water customers (which the report then goes on to acknowledge). But once services are opened up to competition then EU rules come into effect.

    Then RISE seems to misunderstand criteria on licence provision when they say “the Scottish government may under s7(2) of the Act specify whatever criteria it deems appropriate in the awarding of licenses to water suppliers by making a ministerial order, without recourse to Parliament”. Not only are the ways in which EU laws affect how these processes are determined very clear now, and that indeed the Scottish government can’t just do whatever it wants to; but let’s look at what this section cited by RISE actually says: “(1)The Commission may grant a water services licence or a sewerage services licence only if satisfied that the applicant has the ability to perform adequately the activities authorised by the licence. (2)In assessing an applicant’s ability so to perform those activities, the Commission is to have special regard to the following factors (in so far as relevant in relation to the performance of those activities)—(a)acknowledge, expertise and experience; and (b)financial acumen and business viability, and such other matters as the Scottish Ministers may by order specify”. In other words the government can only add further criteria insofar as it *directly* relates to the *ability* of the provider to perform what they will be contracted for. This is quite different to what the RISE report would have us believe was meant here.

    As for the 2005 Act itself and the assertion by RISE that the SNP should have repealed it, RISE again disappoint as they have made no mention in the report of the fact that the Act itself was in response to the 1998 Competition Act (UK) and that the opening up to competition of the retail aspects of non-domestic water provision was viewed as the best option available when it came to how to deal with the new constraints and threats presented by the Act with regards to protecting Scottish Water and the public. Indeed during a Scottish Parliament debate on the issue Green MSP Mark Ruskell stated “The sale of water requires a licensed billing mechanism, which the bill would regulate. That is the element of supply that I talked about and which represents an area into which some privatisation is being introduced. I am not condemning the Executive for that; I do not believe that it has any alternative, which is why the Green party is supporting the bill”. It’s why the SNP supported it too.

    Then of course there is the EU, and the fact that once services are open up to competition it is very difficult to later exempt them from competition. Left Futures writes on the issue that Article 106 of the ‘Treaty on the Functioning of the European Union’ has been interpreted by the EU’s Court of Justice as “giving private companies the right to argue before the national courts that services should continue to be open to private-sector competition. Nationalised services are prima facie suspect and must be analysed by the judiciary for their ‘necessity’. Thus the EU has given companies a legal right to run to court to scupper programmes of public ownership”. I am not clear how bringing the retail aspect of water services for non-domestic customers would ever be viewed by the EU as any kind of ‘necessity’ on any level….

    Taking all of the above into account it’s very clear to me that the Scottish government had no choice but to put the contract for said retail services out to tender and that based on the points system and EU law would have always ended up with the lowest bid, that also fulfilled all other requirements consistent with EU laws and regulations, winning out. Sometimes that won’t be companies we like. Anyone who wants this to change needs to come up with a solution to the constraints and issues arising from the 1998 Competition Act, which all other parties felt the 2005 Act was the best response to except the Tories who wanted everything opened up to competition, and the SSP whose MSP Frances Curran even realised at the time the only alternative was to ask the UK government for an exemption to the Act, which would have always been very unlikely and never more so than now with this Tory government. They would also have to manage to get the EU to view taking retail water services for non-domestic customers back into public ownership as some kind of necessity – which is equally unlikely in my view.

    We should note too that amongst all the faux outrage across much of the political spectrum condemning the Scottish government for ‘privatising Scottish water’, not once has anyone criticising the government mentioned that Business Stream is a *for-profit* business, just like Anglian; in other words there is no change to the profit aspect as a result of this award.

    1. Angry Weegie says:

      A very clear and detailed explanation which makes it clear what difficulties would have been faced by SG, should they have attempted to either not initiate the tender process or fix the outcome to make sure Business Stream won.

      The general view against the current decision seems little different from the view expressed by many about the current benefit changes, which goes something like “we know that Westminster are making changes which Scots don’t like or want, so it’s up to SG to use their powers to mitigate the effects in Scotland. Any comment about affordability is a red herring.”

      In this case, the argument goes “we know that the previous Labour administration put legislation in place to make a tender necessary and we know that EU rules would make it at least very difficult, verging on impossible to change the legislation, but SG should just do it anyway, ignoring whether other bids cost more or whether a fortune would have to be spent in legal costs defending the action against the EU and possibly private suppliers as well.”

      It’s disappointing that the original article makes no reference to these issues. Without both sides of the story, it stops being an attempt to inform and becomes yet another SNP bad story.

      It’s a pity that support for one pro-independence political organisation, in this case RISE, must always be accompanied by denigration of SNP/SG. Unfortunately, it seems that those involved with RISE (and others) believe that success in the May election can only come at the expense of SNP. Should the strategy of running down the SNP succeed, I hope, for all our sakes, that it’s not at the expense of an SNP majority and the opportunity for progress on IndyRef2.

    2. Moray Man says:

      Thank you Kimberely for taking the time and effort to examine the assertions by RISE.

  18. Penny says:

    RISE had a choice: put forward a well researched alternative or a poorly researched critique of a specific SNP decision. Their paper on water does not inspire confidence in them.

  19. James Anderson says:

    Superb dissection Kimberley Cadden. Mike Small – Kimberley clearly did review the RISE report.

    There’s a tremendous amount of wish-fulfillment going on just now on the fringe Left including the Greens. It involves parasitically participating in the mainstream SNP-bad narrative around the minutiae of every SG decision. Yet the totality of the past 8 years evidences a Party that has put Universalism at the heart of its stakeholder-society; protected frontline public services during a half-decade of Austerity; and has resisted, possible, Scottish taxpayers paying twice for Westminster’s betrothal to unregulated financial capitalism. For those that claim the SNP don’t get held to account, clearly they live in a different country where all dailies and weeklies, Sky and the Beeb, and Westminster-backed mainstream Unionist parties frequently endorse the Yellow & Black Twibonned peril. Blink and it’ll be gone folks.

  20. fraise says:

    Je accuse Bella for not reading this article prior to publishing. It is a mishmash of misinformation only designed to confuse the situation. Business steam IS what is says a for profit business NOT a public body, although wholly owned by Scottish water which is. Anglia water does not supply or has hands on dealings with Scotland water. It supplies metering and billing. Most of the money paid to them for the supply of said water to businesses will be paid to Scottish water for supplying the water to Anglia. Therefor environmental failings of Anglia do not (pun intended) hold water. Tendering is part of EL legislation the same as Calmac and Scott rail.
    O/T if RISE wish people to read their articles they should do so without having to give email and private details. It smacks of big brother, if I wish to continue reading their articles I will voluntary sign up.

  21. bill fraser says:

    I cannot for the life of me that such an important as water is transferred to S>E England Money seems to be the reason ,but why ? At this rate we will end up with meters in a country which has no drought problems.Hands off Scottish Water!

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