The Premier’s recent statement allowing the newly created water authorities to return where they came from, i.e. the Councils, will have no effect on water prices.
This is because the increases proposed by the new water authorities reflected the high bulk water changes imposed by the State Government – and they will not change under the “return to Councils” scheme.
The bulk water charges are based on repaying $7bn with interest over 20 years, to pay for the “water grid” for south-east Queensland. This is supposed to insure against drought by interconnecting the Gold Coast to Brisbane and the Sunshine Coast. The bulk charge is $1.57 per kilolitre, and rising in successive years.
But why 20 years, when water supply infrastructure (the desalination plant and interconnecting pipe work) have an economic life of at least 50 years?
Minister Robertson says it’s because the government wants to minimise interest charges and not delaying these charges for the next generation to pay. That’s an honourable objective but what if the outcome is to increase water charges in the Gold Coast, for example by 15% in year one? That unfairly hits existing users, who happen to be today’s voters. Not a politically savvy policy.
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