WRITTEN QUESTIONS
9th Assembly
The Power and Water Corporation does not recover the full cost associated with providing water and sewerage services in the Northern Territory. As a commercial entity, it is appropriate for Power and Water to progressively move towards earning a commercial return in its water and sewerage businesses. This will require a combination of efficiency improvements, which Power and Water is already endeavouring to achieve, tariff increases over time and appropriate levels of Community Service Obligation (CSO) funding.
Power and Water’s costs generally increase in line with the Consumer Price Index (CPI). The 2.5 per cent increase in water and sewerage charges on 1 January 2003 was necessary to ensure that Power and Water’s water and sewerage revenue increases in line with costs. Accordingly, the increase will only be sufficient to maintain the level of cost recovery around present levels. On this basis, the tariff increase is soundly justified.
If Power and Water does not continue to demonstrate progress in meeting this target, part of the Territory’s annual NCP payments could be put at risk.