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Pressure on ACT water bills

Date

Peter Jean

Canberra residents will find out on Tuesday how much more they may have to pay for water and sewerage services as ACTEW Water seeks to progressively recover a revenue shortfall in excess of $200 million.

The ACT Independent Competition and Regulatory Commission will on Tuesday morning release a draft report and proposed price direction on water and sewerage services until 2018.

Depending on the factors used by the commission to make its decision, water prices could increase by up to 55 per cent.

But if lost revenue was recovered over decades instead of a shorter period of time, most households could face much smaller price hikes.

A decision will be made in time for price changes to come into force at the beginning of July.

In submissions lodged with the commission last year, ACTEW sought to recover a revenue shortfall of $238 million caused by the climactic extremes of a drought followed by floods. The government-owned corporation recommended that a revenue cap be set, with water prices adjusted more frequently to ensure it recovered reasonable costs.

17 comments

  • 'Shortfall caused by ' . . . a drought followed by floods.' This is Australia - droughts and flooding rains - so we should not be gouged for this corporations's poor planning around same. And, if they had not released so much of Our water down river, we would not have suffered so badly in the drought. This is just another reason why essential services should not be corporatised (for profit).

    Commenter
    Mardi
    Location
    Tuggeranong
    Date and time
    February 26, 2013, 7:25AM
    • ACTEW 's nickname should be "Oliver." ... always wanting more. Use water, they'll charge you. Don't use water (at their request), they'll charge you more. But, not to worry - our Green Labor Government will save us. Oops, sorry - they're too busy thinking up new taxes & charges and ways to drastically increase existing ones. Pensioners, the low-paid, etc must be really enamoured with ACTEW - Gordon Gekko certainly is.

      Commenter
      Lefty
      Location
      Melba
      Date and time
      February 26, 2013, 7:41AM
      • "a revenue shortfall of $238 million caused by the climactic extremes of a drought followed by floods"??? Nothing to do with the $34 million dollar blow out they had building the new dam that was supposed to be finished mid 2011 but is only now starting to hold water? Yet another price increase for something that literally falls from the sky of all by itself.

        Commenter
        J72
        Date and time
        February 26, 2013, 7:46AM
        • When this trend towards the "corporatisation" of government utilities started happening I wondered how they would cope with normal market forces and general economic and environmental conditions. Every other business has to deal with these ups and downs and can't go cap in hand to an authority and request compulsory prices increases. If the executives running places like ACTEW Water can't manage their business profitably then sack them and find some who can. Otherwise what incentive is there to deliver value for money when they know they can just continue gouging the public?

          Commenter
          Mick
          Date and time
          February 26, 2013, 7:52AM
          • Typical ACTEW. Run by amateurs who think the only way to make $200M is through price rises. Watch their failure to pay % increase.

            Commenter
            The Word
            Location
            Canberra
            Date and time
            February 26, 2013, 7:58AM
            • ACTEW rakes in tens of millions for the ACT government every year (IICR about 80+ million) so it's unlikely the Commission will deny them the increases they want. Sure, to be viable it does need to make a profit but let's keep things in perspective - its only purpose should be to serve society, not make gouging profits at society's expense. That an essential service can be run for such large profits is inherently immoral but the unfortunate reality is no political party (except maybe the Greens) would take action to stop price gouging on water utilities.

              Commenter
              yumq
              Location
              Reid
              Date and time
              February 26, 2013, 8:33AM
              • Stop whinging ACTEW uses a chunk of the money you pay for water and electricity to sponsor the aptly named Raiders and Brumbies. In fact the Brumbies may well be double dipping as you also give them money via UC.

                All electricity, water bills and rates (and parking fees) should itemise how much of you money is given away.

                Commenter
                stoney
                Date and time
                February 26, 2013, 8:46AM
                • Here we go again ACTEW doing what it does best ripping the people of the A.C.T of with excessive fee's and charges providing what can only be descibed as an adequate utility service SHAME ACTEW SHAME!

                  Commenter
                  DROID71
                  Date and time
                  February 26, 2013, 8:50AM
                  • I agree with yumq (except for the Greens statement). Putting this into some kind of context after Sydney Water's statements last week that the boom/bust approach to water managment has failed seems to suggest that someone at ACTEW is not listening to market realities.

                    I have a full tank, a pump and rain. All I need is a bit more plumbing and I will turn off the water supply - how will that affect ACTEW's bottom line when we all start doing that?

                    Commenter
                    Outraged of Palmerston
                    Date and time
                    February 26, 2013, 9:00AM
                    • "All I need is a bit more plumbing and I will turn off the water supply - how will that affect ACTEW's bottom line when we all start doing that?"

                      Funny you should ask - part of the reason (other than the cost blowout from the Cotter Dam - which was actually caused because it rained too much during construction) that prices are being hiked is also because it has been raining too much and people have been using less water on their gardens. And thus a massive revenue shortfall.

                      So, if everyone starts switching to on-site tanks and reduces their water use even further, ACTEW will have to raise prices again to cover the shortfall. The funny thing is that this will encourage even more people to switch to tanks.

                      However it's not all ACTEW's stupidity - the decision to enlarge the Cotter came about because of the extended drought that Canberra was in prior to it raining again. So it was a sensible decision in the long run as no doubt there will be another drought on the horizon.

                      Commenter
                      Bretto Spaghetto
                      Date and time
                      February 26, 2013, 10:29AM

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