WHEN Central Highlands Water released its proposed 2013-18 water plan on May 31, it included a one-off 8.5 per cent price hike in the 2013-14 financial year.
Yesterday, that price rise came under the microscope at an Essential Services Commission meeting into the five-year plan.
Resident John Barnes, who was also formerly the CHW board chairman, questioned the hike at the public meeting at Ballarat Lodge.
“Why is it 8.5 per cent in the first year?” Mr Barnes said.
CHW chief executive officer Paul O’Donoghue said a decade of drought had resulted in large amounts of debt, an increase in service standards and the need to build and support infrastructure.
“It will flatten out the business model and absorb business growth,” Mr O’Donoghue said. “It’s one rise and that’s it for five years.”
Price rises in the final four years of the plan would be confined to the Consumer Price Index.
Mr O’Donoghue also pointed out CHW still had one of the lowest proposed tariff rises in Victoria, with a 34 per cent hike tipped for metropolitan Melbourne.
Mr Barnes said the CHW environmental contribution paid to the state government was also rising.
“I believe it is changing substantially,” Mr Barnes said.
Mr O’Donoghue said it was rising from 1.95 per cent of total income to 2.5 per cent and went into a specific fund for environmental projects.
But Moorabool Shire mayor Pat Toohey said he wanted more clarity around the fund.