State’s water reform: hidden costs will hit hard
  • Friday 15 April 2011

Sunshine Coast Mayor Bob Abbot said today that council has some hard decisions to make in the wake of the State Government’s back flip on water reform.

The Mayor made these comments following today’s special council meeting where councillors discussed the changes announced by the State Government to the Water Distributor-Retailer arrangements in South East Queensland.

“There are a number of significant financial implications now facing our council and community as a result of Premier Anna Bligh’s announcement to cap water prices and dismantle the recently established water businesses,” Cr Abbot said.

“Council supports lowering the costs of water and will continue do everything it can to get the lowest possible water prices for ratepayers.

“The Premier’s proposed cap on water prices contains no commitment to reduce bulk water charges, which are the major driver of water price increases.

“Consumers have been misled as capping water prices will not keep prices down when the State Government’s bulk water charges will continue to skyrocket in the coming years.”

Finance and Business Portfolio Councillor Chris Thompson said council has determined that financial analysis of this announcement needs to be undertaken with a detailed report prepared for presentation back to council.

“There is a need for council to undertake a thorough review of the implications from the potential change in water arrangements,” Cr Thompson said.

“This will require significant effort to meet the 1 July 2011 response date indicated by the State Government and also ensure we are in a position to make the best decisions for our community.

“The process and costs of dismantling the recently established water business and then rebuilding another one will be significant – opting out of Unitywater will not be a cheap and easy exercise.

“If council were to proceed with water and sewerage services being returned there will be a need for a due diligence process followed by a significant implementation period, and it is extremely difficult to estimate the direct and indirect costs associated with this process without a thorough review being undertaken.”

Cr Abbot said it is disappointing that all South East Queensland councils are still waiting for more details to be provided by the Premier.

“An urgent request for all Mayors to meet with the Premier is being facilitated through the South East Queensland Council of Mayors so we can discuss the consequences of this policy announcement,” Cr Abbot said.

“Councils are now placed in a very difficult position due to the Premier’s lack of consultation on this important issue.

“It is unacceptable that councils are being pushed to make a decision prior to any legislation being drafted or put to Parliament for debate.

“There are more questions than answers and until we see more detail the Premier’s announcement does nothing to address the long-term spiraling cost of water.”