Independent Water Pricing Inquiry

The Hon. J.A. DARLEY (14:41): My question is to the Treasurer. In view of the fact that the parliament is considering the establishment of a productivity commission, why did the government recently appoint Mr Lew Owens to conduct an independent water pricing inquiry?

The Hon. R.I. LUCAS (Treasurer) (14:41): As I have discussed with the honourable member, that is indeed a very apt question. The government did consider the possibility of delaying the implementation of the promised independent water inquiry, which we promised to undertake within 100 days. In the end, having considered that, we rejected that particular option, because it is critical for the reasons I outlined, I think, either yesterday or Tuesday in terms of the timing of the water pricing review by ESCOSA.

It is important for this particular inquiry into the regulated asset base and the weighted average cost of capital to be conducted as expeditiously as possible to inform the government and in particular myself as Treasurer as to what the potential guidelines for ESCOSA should be in terms setting water pricing for 2020 to 2024. I think as indicated in that answer, ESCOSA has already commenced that work now in terms of the readiness for that.

It was an issue that we did consider, but I think as we are seeing through the debate in the house, there's every prospect that the passage of the productivity commission might be delayed for some time and might not even pass the parliament. There have been some attitudes, I understand, expressed by some members of parliament and political parties which would indicate that they are not entirely supportive of the government's proposition for a productivity commission.

The government cannot be assured that the bill will go through or indeed will go through in the form that the government would wish it to go through. There is this vexed question of whether we delay the implementation of a necessary independent water commission inquiry, which is necessary, and wait for the parliament to decide on whether there will be a productivity commission and what the nature and flavour of it would be.

So, it is a very sensible question, as I indicated to the honourable member in a prior conversation that the member put to me as Treasurer and to the government, but in the end we made the judgement that it was too important to delay the potential water commission inquiry and wait, with a potential delay, for a productivity commission establishment. For those reasons, we have decided to proceed with the independent water commission inquiry with the appointment of Mr Owens.