Page 3619 - Week 08 - Friday, 24 August 2012
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people now will pay dearly for their commitment to conserving water. They will pay dearly for sacrificing their gardens, their sporting ovals and their schools.
The plot of the ACT Labor government for retrospective revenue recovery amounts to a retrospective tax on the people of Canberra. Actew Corporation do not need this retrospective revenue recovery. The government simply want Actew to take this revenue recovery straight to their bottom line so that they can pay a higher dividend.
Madam Deputy Speaker, here is something for you to watch: in foisting this retrospective tax onto the people of Canberra, this ACT Labor government will hide behind the regulator. The ACT Labor government will hide behind Actew. It will level all the blame against Actew and the ICRC. The ACT Labor government will say it has no control over how Actew runs its business or how the ICRC sets its prices. It has done that in the past. But you watch the dividends it collects—all at the expense of the people of the ACT, all as a result of a retrospective tax.
Budget paper 4 tells the story. Actew’s forecast profit for 2011-12 is just over $101 million. By 2015-16, this profit is forecast to increase to almost $184 million. All of this will be paid to the ACT government either by income tax equivalent payments or by dividend payments. That is an increase of 82 per cent over five years—82 per cent. As Ms Burch would say, it is not 100 per cent, but it is still a pretty significant increase.
Once again this ACT Labor government is emptying the wallets of the people of Canberra. Furthermore, if you will pardon my cynicism, if the ICRC allows this retrospective revenue recovery tax through higher water prices, here is another prediction: that retrospective tax will not be a one-off. It will become part of the base price for water and will continue to be included in the future price of water, which will have an ongoing effect. All of this is just another hit to the cost of living in this town, perpetrated and perpetuated by a government of waste, wrong priorities and economic mismanagement.
While we are on the subject of water pricing, and to save time later, I will touch on the five-year price pass set down by the ICRC. I consider Actew Corporation has made a point of some merit in terms of smoothing out the pricing process so that it is done annually. We are expecting an 82 per cent increase in profits for Actew over the next five years. Part of this relates to the recovery of the major water security projects. Even though these costs in total have blown out by nearly 230 per cent, it is quite reasonable as long as it is done across multiple generations so as to spread the recovery over the life of the assets, which are long-lived assets.
The other issue that I want to touch on, which also relates to water, is the issue concerning secondary water use and the ICRC’s report on secondary water use. It is interesting to note that the government has become, lately, an advocate for cost-benefit analyses when we look at secondary water use. The ICRC’s draft report on secondary water use said:
… the Inner North pilot stormwater reticulation trial needs to be fully evaluated.
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