But Mr Barr hinted reductions to water charges would not be as great as the 16.9 per cent the Independent Competition and Regulatory Commission recommended in February.

Mr Barr told a Legislative Assembly hearing on Monday it was also unlikely the impact of the ICRC's determination on the ACT budget would be known before the assembly passed the budget in August. In February, the regulator recommended steep cuts to water and sewerage charges that would have reduced average household bills by $230 a year.

ACTEW argued aggressively against the cuts and called instead for a 6 per cent increase. The regulator had been due to deliver its determination last week, but delayed until the end of June after a request from the ACT government.

Mr Barr told an estimates hearing on Monday the price proposal from the regulator last week had changed ''dramatically'' from its draft determination.

He added this latest proposal could change again before the final determination is made by the end of June.

The Treasurer told The Canberra Times Canberrans could still expect a cut to their annual water bills.

''I think you can sum it up by saying that there will be a reduction in prices, it's just a question of what the extent of that is and that needs to be determined,'' Mr Barr said.

''There's still variables on that including what the government's position is on return on equity.''

Mr Barr said the regulator and ACTEW had been negotiating since the draft determination and the ''wide divergence'' between the ICRC's original proposal and ACTEW's call for a 6 per cent price increase.

''I think it would be fair to say they're getting closer together,'' he said.

The Treasurer said ACTEW had also reached agreement with the ICRC to reduce its capital and operational costs.

Mr Barr said the government and the ICRC were still discussing whether the government's return on equity from its $1 billion investment in ACTEW would remain at 10 per cent, as proposed in the draft, or slightly less.

Mr Barr told the estimates hearing the ACT auditor-general's annual review of ACTEW's finances would take place before the impact on the budget was known. The Treasurer said it was ''some months potentially'' before the budget would be updated.

Opposition treasury spokesman Brendan Smyth warned last week that price cuts could jeopardise the surpluses the government has forecast for 2015-16 and 2016-17.

''If the outcome is, as Mark Sullivan predicted, that there will be no dividends for years, you don't intend to modify your budget then?'' he asked.

Mr Barr replied, ''That's a hypothetical question.''

He said there would be a subsequent review of water prices in two years that would affect the out years of the 2013-14 budget.

ICRC senior commissioner Malcolm Gray told the estimates committee he hoped the commission would make its final determination early next week.