I'm teaching this song in 3rd grade right now, and the students were dying to know what the story of the song is. I told them I'd look it up and I found myself here - looking forward to sharing this entire conversation with them in the morning. Maybe I'll ask them first where they think the song comes from? Sure to produce outrageous tales of horror and woe!

The version in my resource and which I learned as a kid (growing up in the US outside Chicago) is the same as Nessie:

Scotland's Burning! Scotland's Burning!
Look out! Look out!
Fire! Fire! Fire! Fire!
Pour on water. Pour on water.