State’s water rort: revealing the reason for the spike in quarterly household bills

Gold Coast ratepayers are paying millions more to the State Government compared to five years ago just to drink their own water. READ PART 1 OF OUR SPECIAL REPORT

GOLD Coast ratepayers are paying $25 million more to the State Government than five years ago just to drink their own water.

A Bulletin investigation shows state bulk water charges have spiked 15.5 per cent since 2016-17. It means the Gold Coast City Council is expected to send $188 million north to William St in Brisbane this financial year for the liquid gold.

STATE’S WATER RORT – SPECIAL ONLINE SERIES

PART 2: Why Coast ratepayers are facing huge water bill spikes

PART 3: Truth behind delays over $500 million recycled water pipeline

Graphic showing breakdown of responsibilities for supply of water from the State and Gold Coast City Council.

Ironically, the water mostly comes from the back yard of Gold Coast ratepayers at the Hinze Dam, which is 92 per cent full.

While the state water bulk will increase another 3.72 per cent for households this year, the council is maintaining a freeze on its pricing component for a sixth year.

“Although the City is the water service provider, State Government Authority Seqwater owns the bulk water supply and manages all major water supply sources in southeast Queensland, including Hinze Dam and the Tugun Desalination Plant,” a council spokesman said.

“The state bulk water charge is the wholesale price that Seqwater charges council for the purchase of drinking water, which is then passed directly through to customers.

“The City has budgeted $188,353,000 in the 2020-21 financial year for the purchase of bulk water — which equates to 60,331 megalitres. However, the total amount the City will pay to the State will fluctuate based on actual water usage.”

The Hinze Dam full after heavy rains. Picture Glenn Hampson.

The Bulletin can reveal council while maintaining no rate increases is facing challenges with its biggest infrastructure project — cracks have occurred in piping being built across the Broadwater to South Stradbroke Island.

Meanwhile, ratepayers are complaining to the Bulletin about a surge in water bill pricing in recent months with increases reaching $200 a quarter.

Water spilling over the Hinze Dam. Picture Glenn Hampson

The state water component again increased to $561, a 3.72 per cent boost. It was 74.12 per cent of the total consumption charge.

The Bulletin asked Seqwater why the different increases in bulk water supply had occurred, ranging from a low of 2 per cent to a 3.72 per cent hike in the next 12 months.

Seqwater says the bulk water price is set by the Queensland Government based on recommendations from the Queensland Competition Authority.

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“This revenue allows Seqwater to operate the SEQ water grid and complete our capital works program and provide a safe, secure water supply,” a Seqwater spokesman said.

“Our capital program includes the maintenance of key Gold Coast-based assets including the Gold Coast Desalination Plant, Hinze and Little Nerang dams and the Molendinar and Mudgeeraba water treatment plants.

The Tugun Desalination Plant on the southern Gold Coast.

The prices for July 1, 2018 to June 30, 2021 were implemented based on recommendations from the QCA, the spokesman said.

On the back of a major public protest in July 2011, the council voted to dump water provider Allconnex at a cost of at least $67 million.

Allconnex was a thought bubble of the Beattie government in 2010 designed to “increase both the quality and the efficiency of water and wastewater services in southeast Queensland”.

But the water retailer sparked public outrage in 2010 when it jacked up Coast water prices by 20 per cent and proposed another rise of 15 per cent.

Then ratepayers began complaining again after council went from biannual to quarterly bills for water. The then Mayor Ron Clarke questioned what the state did with its revenue from selling bulk water.

Gold Coast ratepayers gather at the Gold Coast City Council Chambers at Evandale to protest against water company Allconnex and their unreasonable prices.

He said his decision to support disconnecting Allconnex was on the understanding that revenue would be used to reduce rates.

Explaining the history of the costs, Mr Clarke says: “The State Government charges have been a bone of contention since they were first announced as they came without explanation how they differed between councils and regions.”