South Australians are a step closer to seeing real savings on their water bills, following a Draft Determination by the Essential Services Commission of South Australia (ESCOSA).
It proposes reduced drinking water and sewerage revenues for SA Water over the next four years, while maintaining its existing service and safety levels for households and businesses.
The commission's Draft Determination, released today, proposes an 18 per cent ($547 million) reduction in drinking water revenue, and a 13 per cent ($164 million) cut in its sewerage revenue during the period 1 July, 2020 to 30 June, 2024 - largely due to significantly lower financing costs for the utility.
ESCOSA said, at these levels, SA Water would still have enough revenue to fund efficient operations, finance prudent long-term investments and meet health, safety, environmental and customer service standards.
Treasurer Rob Lucas welcomed the Draft Determination as a 'first step' in a longer and more detailed process that will ultimately deliver lower water bills for South Australians.
"For far too long now, hardworking South Australian families and businesses have been paying through the nose every time they turn on the tap – because of the shameful deceit of the former Labor government," said Mr Lucas.
"An independent inquiry into Water Pricing in SA last year, found the former Labor government deliberately inflated the value of SA Water's opening regulated asset base (RAB) by at least $520 million (in 2012 dollars) to maximise profits and protect government revenues, driving up water bills.
"Labor ignored criticism and advice of ESCOSA and other stakeholders, and arrogantly pushed ahead with inflating the RAB knowing full-well the hip pocket pain it would inflict on consumers."
ESCOSA will take submissions on its Draft Determination until mid-April, after which the Final Determination will be released in late May.
Before the Government finalises decisions on SA Water prices for 2020-24, the following decisions have to be taken:
· Government direction to SA Water detailing activities the Government requires SA Water to perform within its allowable revenue base, community service obligations such as state-wide pricing as well as costs SA Water is required to pay, such as water planning and management fees.
· Government sets water industry licence fees
· Government sets the value of the Regulated Asset Base (RAB) for SA Water
· ESCOSA releases Final Determination for regulatory period 2020-24
