State Government can’t be trusted to run TasWater



Mayor of Brighton

TASMANIANS are currently being bombarded by a wave of propaganda from the State Government and business groups such as the Property Council, Tasmanian Chamber of Commerce and Industry and other vested interests attempting to persuade them that the proposed takeover of TasWater will benefit the community.

But public be warned. This is a clear case of spin over substance.The Government continues to refuse to release its financial modelling or its plans which it says will enable it to complete TasWater’s upgrading of its infrastructure 12 to 18 months earlier than the current schedule. And its ability to legislate to take over the water and sewerage business without the agreement of all the 29 owner councils is in serious doubt based on legal advice from a leading Tasmanian lawyer.

Yes, the Government is promising that increases in water and sewerage charges in the immediate future will be a little lower, but at what cost? A $160 million hit on the state budget and additional and unnecessary borrowings of $600 million with resulting interest and repayments that will have to be met by taxpayers in the years ahead.

This is not the State Government’s money, but taxpayers – the same taxpayers who are the customers of TasWater and who may benefit by being charged a few dollars less for water and sewerage over the next few years, but who will pay dearly in extra state taxes or reduced services in the future.

It is a case of the Government attempting to woo the public with low prices before the next election then let future governments and future generations wear the problem.

This is crass politics at its worst and nothing short of a State Government grab for a business that Treasurer Peter Gutwein himself has valued at $3 billion, yet offers to pay only six cents in the dollar to take ownership.

TasWater is owned by Brighton and the other 28 Tasmanian councils and each has a considerable investment in the corporation – an investment funded by ratepayers over the years who paid for the water and sewerage infrastructure transferred when TasWater was created.

Long-range financial projections show that TasWater will generate significant returns in the future, particularly when the current 10-year upgrading program is completed.

These returns are needed by Brighton and the other councils to fund roads, footpaths, community health facilities, parks and recreation areas and other services vital to our community’s well-being.

But the Treasurer wants to get his greedy hands on this money.

You only have to examine the current State Government’s performance in relation to its own Government Business Enterprises (GBE) to judge.

There’s also the $80 million taken from the TT-Line to prop up the budget bottom line, the cross subsidisation between TasNetworks and Hydro and the $30 million taken from TasNetworks to prop up Forestry Tasmania.

This Government is a serial raider of GBE funds to suit its own political purposes and there’s every reason to believe it would treat a TasWater GBE in the same manner. The losers would not only be TasWater and councils, but also Tasmanian taxpayers and the community.

Local Government is best placed to own and oversee TasWater, with the corporation directed by an experienced Board of Directors and run by an expert team of professional managers.

Tasmanians are well aware that with GBEs, the public has very little hope of influencing outcomes, they’re not as accountable to community as TasWater is under the present structure. I seriously doubt that councils, on behalf of ratepayers, will have ready access to TasWater should it become a Government GBE, answerable only to the Minister.

Under the current TasWater ownership, financial distributions flow through to every council, with funds spent fairly and evenly throughout Tasmania. As well, TasWater’s development priorities are determined on the basis of need and professional engineering considerations, not political desires.

If the Government takes over, the politicians will decide where that money is spent and it’s likely it will lead to unsavoury pork-barrelling to curry political favour, particularly in the approach to state elections.

Local Government is the sector closest to the community and it best knows and understands the community’s needs. This is particularly relevant in the provision of water and sewerage services, which is a fundamental requirement of all communities.