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Legislative Council - Fifty-Second Parliament, Second Session (52-2)
2012-07-19 Daily Xml
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WATER PRICING

The Hon. M. PARNELL (14:56): I seek leave to make a brief explanation before asking the Minister for Agriculture, Food and Fisheries, representing the Treasurer, questions about water pricing.

Leave granted.

The Hon. M. PARNELL: Last week, ESCOSA revealed that the state government has removed the power of the Essential Services Commission to set water prices for households for the next three years. In responding to the stripping away of the price-setting powers, SACOSS Director, Ross Womersley, said:

This is completely surprising and somewhat perplexing. On the day ESCoSA alarmingly confirms South Australia has the highest prices for overall water bills (60% higher on average [than in other jurisdictions]), the highest water supply charges (130% higher on average), and the highest usage charges (36% higher on average) from across Australia, we are...told the Treasurer has issued a separate Pricing Order which effectively means ESCoSA will have no price setting role until after the first price determination period.

What this means is responsibility will stay within the control of the Government and SA Water, and it's in this context that over the last 3 years we have seen some of the steepest rises in water prices ever.

Mr Womersley went on to say:

The Government has benefited through direct inflows of $100s of millions of dollars to the budget in the last few years from SA Water. Does this mean they fear an independent examination of current prices might result in ESCoSA concluding water is currently overpriced?

He goes on to say:

The Government needs to explain why we have the highest prices in the nation and the desalination plant can only be a part of the reason, as most other states have similar obligations around desalination capacity. Moreover, in taking away the role of the regulator, the Government also needs to explain to the South Australian public how it intends to control prices going forward. We have heard loose commitments to keeping price increases in line with general CPI from Premier Weatherill and Minister Caica, but in removing the regulators role like this, we are now on a slippery slope.

SACOSS calls on the Government to immediately issue a statement confirming it will commit to reducing prices as soon as the full cost of the desalination plant has been recovered. Furthermore, given the absence of an independent regulator, SACOSS additionally seeks a written commitment affirming the Government's position that it will keep price rises to within CPI during the 2013-16 period. Water is an essential service and all South Australians should be protected from paying unreasonable and unfair prices now and into the future.

My questions of the minister are:

1. Why does South Australia have the highest water prices in the nation?

2. How does the government intend to control prices in line with the general CPI?

3. Will the government confirm that it will reduce prices as soon as the full cost of the desalination plant has been recovered and, if not, why not?

The Hon. G.E. GAGO (Minister for Agriculture, Food and Fisheries, Minister for Forests, Minister for Regional Development, Minister for Tourism, Minister for the Status of Women) (14:59): I thank the honourable member for his most important questions. I will refer them to the relevant ministers in another place and bring back a response. It may be that the questions range across a number of portfolios, but I will let those ministers squabble amongst themselves as to who wants to provide the answers.

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