Question Time

WATER BILLING

Mr HAMILTON-SMITH (Waite—Leader of the Opposition) (14:14): My question is to the Treasurer. Has the government's water bills overcharging backflip caused a flow-on funding shortfall for the desalination plant planned for 2012-13, and, if so, how will the government fund the revenue forgone as bill payers receive refunds? Page 9 of the government's 2008-09 transparency statement states that in order to fund the desalination plant, 'A longer term in principle revenue direction to 2012-13 has been based on water and wastewater price increases of similar magnitude as in 2008-09.' Water bill increases are planned each year from now and flow on from the initial increase. The opposition is advised that the flow-on effect of the government's revenue miscalculations may create a shortfall of up to $172 million by 2012-13.

The Hon. K.O. FOLEY (Port Adelaide—Deputy Premier, Treasurer, Minister for Industry and Trade, Minister for Federal/State Relations) (14:15): If that is the best an opposition can come up with—as all the media that were with me at the press conference on Monday heard (a 50 to 55 minute press conference), I answered that question on a number of occasions, and volunteered the answer. It will not affect it. We have made it very clear that the cost of the desalination plant will be offset by water pricing increases, and not a dollar more will be taken to general revenue; a quarantined account will be made available. At this stage, we are not aware of the final cost of the desalination plant. Why? Because we have not gone to tender. We have an approximate cost, obviously. Consultants have given us what we can expect to be the range of costs and we have factored that into our understanding of what the cost will be. Once we know exactly what the cost is, that cost recovery will be met from price increases in water over a five year period.

As I have said often at press conferences and in response to earlier questions from the media, in reality this is a timing issue, and the fact is—

Mr Williams interjecting:

The SPEAKER: Order!

The Hon. K.O. FOLEY: No, look, there will be more to be said about the desalination plant in the near future. We are moving very swiftly to get the desal plant operational and the revenue that—

Mr Williams interjecting:

The SPEAKER: Order, member for MacKillop!

The Hon. K.O. FOLEY: As I said from the outset, I was expecting the revenue to be raised from 1 July 2008. The fact that some revenue has been accounted for earlier in the cycle—which I am advised is about $10 million—that will not affect the funding of the desal plant. We have already said whatever the desal costs is what we will be raising from water price increases to cover it. So your question is three days old and it really demonstrates to me that you have no idea about how government operates.