The Local Government Association of Tasmania (LGAT) and the TasWater Owners Group, whilst acknowledging the need to deal with the issue of delivering potable water throughout Tasmania as a matter of priority, are “shocked at the unilateral decision by TasWater to slash annual distributions to owner councils to $20 milion without consultation,” said LGAT President, Mayor Doug Chipman.
These comments come in the wake of a decision by the Board of TasWater to adopt a revised investment plan which will see the resolution of boil water alerts or public health alerts in Tasmania within two years, as well as addressing key vulnerabilities in a number of other drinking water systems.
Under the TasWater plan, Owner Councils’ annual distribution cap will be reduced from $30 million to $20 million for seven years from July 2018, in order to raise $70 million to help fund the initiative.
Councils had previously agreed to a proposal to forgo increases in future dividend payments over 10 years, subject to the State and Federal Governments also agreeing to contribute to the infrastructure programme.
Mayor Chipman said it was extremely disappointing that both the State and Federal Governments had chosen not to partner with councils in accelerating TasWater’s capital program as initially proposed. “This would have had far greater community benefit than the proposal now being put forward by TasWater.
“The decision by TasWater will have a significant impact on the Local Government sector.
“The dividends received from TasWater were used by councils to provide the day-to-day services and infrastructure our communities need, whilst keeping rates at a sustainable level.
“The loss of these funds will mean many councils will need to either raise additional rates to cover the shortfall, or to cut services, neither of which is a desirable outcome.”
The Owners Representative Group Spokesperson, Mayor David Downie says the proposal by the TasWater Board would now need to be discussed with councils across the sector.
