State poised to jack up water by $38

16/02/2019 Posted by admin

REDLAND water users could face hikes in state government bulk water prices of up to $38 a year for the next three years if a proposal in a draft Queensland Competition Authority report is adopted.

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It would be the highest rise in bulk water prices across 11 South East Queensland councils and equates to an extra 8.3 per cent for bulk water every year until 2019.

Queensland Competition Authority chairman Malcolm Roberts said the price increase was recommended for Redland because it was paying less for bulk water than other councils.

In 2006-2007 the council negotiated with the state for reduced water pricing for 10 years. The deal resulted in Redland residents paying the lowest water prices in the south east.

But the reduced pricing deal runs out in 2016-2017, when residents will feel the full effects of the state government’s bulk water pricing as councils move to reach a common bulk water price of $2.77/kL.

However, not all news was bad for Redlands and Mr Roberts said the report recommended giving Redland an extra two years before its bulk water price hit the “common price” target, which would be $2.91/kL in 2019.

Once the price reached the common target, the price of bulk water would rise by the CPI every year, according to the draft report.

Mr Roberts also said the draft report’s proposed price increases were $11 lower than previously forecast.

At the moment, water users in Redland pay $1.96 per kilolitre for the state’s bulk water, which is about 70 per cent of the overall cost of water and equates to about $392 for an average 200kL per annum.

The report said its recommended 2015-16 price increase for Redland was $38, $11 less than a 2013 plan in which an annual 200kL household bill would rise by $49 until 2017 and then sky-rocket by $153.

Redland City’s QCA recommended $38 annual increase for 200kL compared with decreases of $70 for Somerset Council water users, $42 in Scenic Rim and a $9 drop in Moreton Bay Regional Council.

Brisbane residents will have an average $18 increase in the bulk water price, Ipswich $19 and the average Sunshine Coast and Noosa bill will rise by $33.

Under the 2013 plan, which the draft QCA report amends, the expected state-imposed 31 per cent price spike in 2017, would be on top of increases in bulk water prices of almost 50 per cent for Redland over the past three years.

Mayor Karen Williams said the report’s recommendations were good news for water users who would benefit with incremental rises and not a massive 31 per cent spike in 2017.

She said the draft report justified the council overcharging for water in the past two years and vindicated council’s approach to water smoothing in its 10-year water strategy.

“By putting away a little bit extra now, it will offset this future rise in state government bulk water costs,” she said.

“The state controls bulk water costs, not councils, which is why we are focusing on keeping all other costs down that are in our control, including passing on some of the lowest headline rates increases in SEQ for the last three years.”

However, Cr Williams was unable to rule out whether the bulk water price would fall in Redland if the city’s high average daily water consumption of 231L per person dropped.

The QCA is calling for submissions on the report and is likely to conduct another review after 2018 as future demand became clearer and further cost savings identified.

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