Treasurer Rob Lucas promises SA Water bills will be slashed from July 1

Households will pay substantially less for water next financial year – and the Treasurer has promised the savings will far outweigh recent hikes in ESL and car registration fees.

SA Treasurer Rob Lucas has revised down SA Water’s regulated asset base, which will mean lower bills for households.

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Treasurer Rob Lucas has promised South Australian households and businesses “significantly cheaper” water bills from July 1.

The State Government has agreed to revise down the regulated asset base (RAB) of SA Water in a move they say will swamp recent price rises for other government services.

It will pave the way for cheaper water bills from next month, but exactly how much remains unclear.

This will not be determined until the Essential Services Commission of SA hands down a decision in coming days.

Mr Lucas would not speculate on the savings but said they would “swamp” recent price hikes his Government has come under fire for in recent weeks, including rising ESL bills and vehicle registrations.

An independent inquiry into water pricing in SA last year found the former Labor government ignored advice and criticism by the Essential Services Commission of SA (ESCOSA) and other stakeholders by deliberately inflating the value of SA Water’s opening RAB by at least $520 million (in 2012 dollars) to $7.77 billion.

The RAB, which reflects the value of SA Water’s economic assets, is important because it is used to set a pricing order.

This in turn sets parameters that must be adopted by ESCOSA in setting its four-year price determination for water bills.

Mr Lucas told The Advertiser the government would revise down the value of SA Water’s RAB by $520 million (in 2012 dollars) – from $7.77 to $7.25 billion – which would result in significantly cheaper bills.

The figure was last year described by independent Water Inquiry chair Lew Owens as “reasonable” and represented a fair balance between the interests of consumers and the government.

“The revised regulated asset base value, together with a lower interest rate environment, will result in significantly lower water prices to customers and lower returns to the budget from 2020-21 onwards,” Mr Owens said.

Average household water bills in SA under Labor rose from $236 in 2001-02 to an estimated $782 in 2017-18 – an increase of 232 per cent.

Mr Lucas said the next SA water regulatory determination would apply from July 1 to June 30, 2024 – and an announcement on that was due in coming days.