The investment, backed by £720 million of borrowing from the Scottish Government, will improve drinking water supplies, protect the environment and support the economy.

Officially announce the programme in Glasgow this morning, Deputy First Minster Nicola Sturgeon said it will ensure Scottish Water continues to provide one of the best value for money water services in the UK.

Investment projects planned include:

The Scottish Government has set out in its policy statement that water charges must remain stable and not increase by more than the rate of inflation.

An exemption scheme will be extended to more of the charitable sector to help pay for their water and sewerage services.

Ms Sturgeon said: “Water and sewerage services are vital to our everyday lives. It is important that we continue to invest to ensure that these keep on meeting the needs of customers, the environment and economic development.

“I recognise that households and businesses are under financial pressure. That is why I expect Scottish Water to continue to deliver this £3.5bn investment programme without the need for inflation-busting charge increases.

“The Government will be making available up to £720m to support this programme. It will also be extending the assistance to more of the charitable sector to help pay for services.

“This Government is determined to ensure that Scottish Water continues to be a public sector success story. This programme is good news for customers, the construction industry and our environment.”

Douglas Millican, Scottish Water’s chief executive, said: “I am delighted that we are announcing the start of this major investment programme for 2015-21 which will enable Scottish Water to continue to provide first-class customer service, while supporting the Scottish economy and creating jobs in the construction industry.

“We look forward to working closely with our customers and communities to further improve drinking water quality and the environment the length and breadth of Scotland.”