The State Opposition will move to give disgruntled former Essential Services Commission chief executive Paul Kerin a forum to explain why he thinks water bills are too high – but they could just as easily ask former Victorian Premier Jeff Kennett.
Liberal sources said the party is in discussions with Upper House cross-bench MPs to set up a Legislative Council Committee to review water pricing and reform options.
In a statement today, Opposition Leader Steven Marshall said: “The State Liberals are currently exploring options regarding the most effective investigation of the damning revelations of former ESCOSA CEO Paul Kerin.
“The first opportunity will be in Parliamentary question time today. The Premier Jay Weatherill will need to provide honest answers to these critical issues.”
The move follows the public release of Kerin’s resignation letter from March this year where he gives the State Government and its senior bureaucrats a spray.
The letter surfaced after The Advertiser’s Freedom of Information request for the letter to be released.
Kerin wrote to Essential Services Commission of SA (ESCOSA) chairman Paul Walsh the day after Independent MP Geoff Brock secured the future of the Weatherill Government on March 22.
Kerin stated he didn’t want to “waste the next four years of my life”, expressing concern that “the government and its senior bureaucrats have clearly demonstrated they have no genuine interest in reform”.
He had been with ESCOSA since 2011.
At the time of his resignation, which he set at 23 May, ESCOSA issued a statement saying; “Dr. Paul Kerin has resigned as the Chief Executive Officer of the Commission for personal reasons, effective 11 April 2014.
“The Commission thanks Paul for the hard work, dedication and intellectual rigour he has brought to the Commission and his focus on delivering benefits for South Australian consumers.”
Kerin came to the role after a nine-year academic career at Melbourne Business School.
He made his political allegiances and concern about government performance well-known while in that role, writing in February 2009 that “the Rudd Government’s early complacency, which soon morphed into panic, and its ongoing pandering to vested interests will destroy voters’ faith in its economic management credentials”.
“Today’s (mini) budget will hasten the destruction. We’ll soon be pining for a Margaret Thatcher type to fix the mess.”
Kerin wrote: “I’ve always voted Labor in federal elections. But I voted for former Liberal leader Jeff Kennett twice in the 1990s, following Victorian Labor’s gross economic mismanagement. I’m glad I did. Many Victorian traditional Labor voters did likewise.”
In 2007 he wrote about his concern that there were too many layers of government.
“The gains from untangling government are enormous. But to realise them, we must abolish state governments – and beef up local governments,” he said in an opinion piece.
Kerin wanted to make major policy changes to ESCOSA’s role in the setting of water and energy prices – changes that were opposed by the Weatherill Government.
“He wanted to be the policy maker and be the owner of the asset,” Treasurer Tom Koutsantonis told ABC radio today.
The Treasurer said Kerin’s letter was “a political letter; he didn’t want to serve under a Labor Government”.
The relationship between Labor and the ESCOSA chief executive were strained early on.
In June 2012, Paul Kerin announced a massive 18 per cent jump in electricity prices, and blamed the Gillard Labor Government’s carbon tax and the State Labor Government’s solar feed-in tariff.
“That scheme has led to a significant increase in the uptake of solar panels in South Australia and the cost of the scheme is effectively met by all electricity customers through higher network prices,” Kerin said at the time.
Kerin was also keen on reforms to the SA water market.
He advocated for increased competition in water supply – a policy closely aligned to the State Liberals.
Kerin declined all media requests for interview today, saying “the letter speaks for itself”.
So do his previous statements.
Once the Weatherill Government was elected in its own right, as a Rann Government appointee and backer of Kennett-style economics, he was stuck on the wrong side of the equation.
Kerin started as SA’s water price watchdog in April 2011, just as the State’s first – and only – Water Commissioner was walking out the door.
Robyn McLeod, a political appointment in October 2008 with strong Labor connections via her party membership and close friendship with then-PM Julia Gillard, was in charge of developing a policy strategy titled “Water For Good”.
McLeod was closely involved in the 2009 decision to double the capacity of Adelaide’s desalination plant.
The $1.8 billion plant was paid for by massive increases in water bills – the issue at the heart of today’s debate about the cost of water.
In an exclusive interview with InDaily in late 2012, McLeod said the decision to upgrade the plant’s capacity from 50 gigalitre to 100 came at a “miniscule” additional cost.
“I’ve seen the claims that it’s a white elephant – well, just wait till the next drought,” she said.
“With a broad range of options for water supply, Adelaide is now in the best position possible.
“It has an impressive long-term plan based on diversity and the desal plant is a key part of that.
“What really frustrates me about Adelaide is that regardless of what your policy is, people just want to poke holes in it.”
McLeod recalled the decision to double the size of the plant as being based on cost and population projections.
“My recollection is that when we put the 50Gl plant out to tender, we asked the tenderers to also put up a price on a 100GL plant,” she said.
“When the prices came in, the difference between building a 50 and 100GL plant was miniscule.
“I can’t give you the exact amount – that information is confidential advice to Cabinet.
“Aside from the financial cost, the population projections in the 30-year Plan for Greater Adelaide showed population expectations to be the other key driver in the decision.”
She quit her three-year contract in April 2011, six months before it was due to end.
