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Former SA Water boss to investigate water pricing

The State Government has appointed a former chairman of the board of SA Water to conduct an independent inquiry into the authority’s pricing methods.

Jun 28, 2018, updated Jun 28, 2018
SA Water's headquarters in Victoria Square.

SA Water's headquarters in Victoria Square.

The former head of SA Water’s board, Lew Owens, will lead an independent inquiry into the complex methodology that determines South Australian household water bills.

In 2015 during Owens’ tenure, then-Opposition Leader Steven Marshall announced the Liberal Party’s push for an independent inquiry into water prices.

The Liberal Party accused the Weatherill Government of using SA Water as a “cash cow” by over-valuing assets in order to “artificially inflate” the price of water around the same time.

Treasurer Rob Lucas argues Owens is “uniquely” qualified for the job because he has been both head of SA Water and head of its regulator, the Essential Services Commission of SA (ESCoSA).

Owens is also a former CEO of ETSA Utilities.

Lucas said Owens therefore understands both the complexities of water pricing and consumer protection.

“He’s been on both sides,” Lucas told InDaily.

“He understands those consumer protection (requirements and) he understates the cost base of SA Water.”

Lucas said the accusation his was levelling about water prices in 2015 was about the Weatherill Government’s “use” of SA Water assets, rather than the conduct of SA Water itself, which was directed by Government.

The Treasurer stressed that Owens’ inquiry would not directly set water prices, but rather inform guidelines for setting water prices between 2020 and 2024.

Lucas said in a statement this morning that the Government was pleased with Owens’ appointment to “this new and important role which will provide valuable independent advice to Government on the complex methodology used to determine what South Australians pay every time they turn on the tap”.

“Mr Owens has considerable experience in this space over many years, as a regulator and corporate leader, and we look forward to him hitting the ground running,” Lucas said.

“The Marshall Government will do what we can to ease cost-of-living pressures for all South Australians, that’s why we’re slashing ESL bills and announced payroll tax cuts for all small businesses, and this is yet another example of that commitment.”

The Government says average household water bills have increased by more than 230 per cent since 2001-02 – from $236 to about $782 this financial year.

Owens’ inquiry will examine SA Water’s starting regulated asset base value, the methodology used to determine its weighted average cost of capital, among other factors affecting the prices paid by consumers.

It is due to report its findings in July next year.

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