HANSARD
SITTING CALENDAR
SEARCH
LIVE BROADCAST
Hansard Dynamic Subject Index
Legislative Council - Fifty-First Parliament, Third Session (51-3)
2009-06-17 Daily Xml
Contents
Pdf Xml

WATERWORKS (RATES) AMENDMENT BILL

Final Stages

Consideration in committee of the House of Assembly’s message.

The Hon. P. HOLLOWAY: I move:

That the council do not insist on its amendment.

To briefly summarise the debate as it went previously, as the minister in another place has stated, the only reason water prices currently must be gazetted by 7 December each year is that under the existing act customers have a consumption year that may commence as early as mid-December in the year before prices come into effect. The bill removes the consumption year provisions so that customers pay only a financial year's prices for water use in that financial year. Consequently, the need to gazette prices seven months before they come into effect will no longer exist.

As I previously stated during debate, it is logical for a government to be able to set water prices as part of its normal budget process each year, and 1 June still provides the community with a month's notice of new water prices. Furthermore, 1 June is close to when new prices will apply, making the information more relevant and useful to customers. The effect of the opposition's amendment will be to require prices to be fixed six months before they are to take effect. The minister has already indicated in another place that such a long lead time would be inconsistent with other states, such as New South Wales, Western Australia and Victoria, which generally provide only about four weeks' prior notice.

The purpose of this bill is to enable customers to have greater information and better control over their water use and its cost. By enabling quarterly water use billing, customers will receive more timely information about the amount of water they have used and its cost. Members will be aware that water prices for 2009-10 include a reduction in the fixed annual water supply charge to enable customers to reduce their water bills by being more water wise. The more timely information provided by quarterly water use bills complements that measure. Quarterly water use billing also aids family budgeting by smoothing out water charges over the year, subject to any reasonable pattern in customers' water use.

I understand the Hon. Mark Parnell has tabled an alternative amendment. Given that the issue has been raised that, given there is an election due next year, the price for water should be available this year, I indicate the government will support that amendment, so that should remove any argument about the government doing that. At least with the Hon. Mr Parnell's amendment it would then mean that after that year we would move to the very sensible proposition that water pricing would be set in June each year.

Members interjecting:

The Hon. P. HOLLOWAY: We have not been caught out at all. The principal issue is that for this year we will compromise, and that will remove any argument. If we accept the Hon. Mark Parnell's amendment, we can have a commonsense position thereafter. I indicate we will support that measure.

The Hon. M. PARNELL: I move:

That the Legislative Council no longer insists on its amendment but makes the following amendment in lieu thereof:

Schedule 1, clause 1, page 6, after line 27 [Schedule 1, clause 1]—Insert:

(7) In addition, water rates for the 2010/2011 financial year must be fixed by the minister on or before 7 December 2009 (and section 65CAA(1)(a) of the principal act, as inserted by this act, will not apply with respect to the 2010/2011 financial year).

(8) Subclause (7) does not apply to a charge or rate within the ambit of section 65CAA(1)(b) of the principal act, as inserted by this act.

I have circulated an alternative amendment which has part of the minister's motion in common, that is, that the Legislative Council no longer insists upon its amendment, but with an amendment in lieu thereof.

I have circulated the text of that amendment. It is identical to the amendment that I circulated when the bill was last debated; however, we did not get to discuss this amendment then. I circulated it when we debated the bill but I did not move it because it was effectively pre-empted by the Liberal motion to amend the bill to permanently set the price for water in December.

Very briefly, my proposed amendment is to the transitional provisions of the bill; in fact, it includes what I say is the best of both worlds. We will maintain the old system of setting the water price publicly in December, but after December 2009 we will then move to setting the water price in June.

I put on the record my thanks to the government and to minister Maywald for accepting that this is a good compromise. It does provide the community, before the next election, with an understanding of what water prices will be, but after that it provides for the more consistent approach that the government has outlined in its bill, which is that the price be set each June, to come into effect from July.

The Hon. S.G. WADE: I understand that the government has had discussions with crossbench MPs, so the numbers will not be with the opposition on this occasion, but we would like to reaffirm our commitment to our original amendment. I would like to respond to a couple of points made by both the minister here and the minister in another place.

The minister in the other place suggested that the government does not have the flexibility to use SA Water—she did not use these words, but to summarise—as a milch cow. She said:

In fact, since 2003, the government has operated under a process for setting water prices which ensures that the prices are set consistent with national pricing principles. That process is documented for public scrutiny in the annual transparency statement and is open to independent review by the Essential Services Commission of South Australia.

She concludes by saying:

Quite simply, the government does not have the sort of flexibility in determining water prices that members opposite imply.

I would refer the minister and members of the council to the National Water Commission Report, National Performance Report, Part A: Comparative Analysis. That shows that the dividend payout ratio of major metropolitan water utilities varied between 45 per cent dividend payout ratio to 105 per cent.

All of these agencies operate under the same principles that minister Maywald is suggesting predetermine the government's take. The highest was 105, the lowest was 45. So, far from what minister Maywald might have led members to believe, this is not a formulaic approach which protects the South Australian taxpayer from SA Water being used as a milch cow.

Secondly, I would remind minister Maywald that minister Holloway implored the opposition on the last occasion this matter was before this house, that we should, if you like, keep some budget flexibility up our sleeve to change the rate after we got elected. We on this side of the house are committed to a December price announcement because we believe that we need to be open and transparent.

The main bulk of the minister's contribution in the House of Assembly was actually to regale us with a whole series of practices interstate in terms of what time of the year they made their announcements. What the minister failed to mention was that we are the only state without independent economic regulation price setting. So, of course you can have more confidence in a process which, if you like, has less political accountability if you have less politics in it. I make that point.

Thirdly, during the division at the conclusion of our consideration in this chamber, it was suggested to me that the Liberal opposition was playing politics. In fact, I would put it to the chamber that the Liberal opposition would be playing politics if we had supported Mr Parnell's amendment in the first instance, and therefore we certainly will not be this time.

The reason I make that point is that it would certainly be easier for us to support the Hon. Mr Parnell's amendment so that the only occasion on which our government would need to make a December price announcement is this December (December 2009), because we will not be in government. What we were saying is that we want to be consistent.

Considering that we have fixed terms, we want the government to be accountable for its water price at least three months before the election, not only this election year but every election year. As I said, we do not have the numbers, but we are committed to the original principle of our amendments. We appreciate that we do not have the numbers on the day, but we certainly are pleased that the Legislative Council saw fit to expose the trickery of the government in trying to hide the water price before the next election.

The Hon. P. Holloway's motion carried; the Hon. M. Parnell's amendment carried.

PARLIAMENTARY BUSINESS
MEMBERS
GET INVOLVED
ABOUT PARLIAMENT
VISIT
LEGISLATIVE COUNCIL
HOUSE OF ASSEMBLY
CONTACT