QFF CONDEMNS ARBITRARY PRICE HIKES

QUEENSLAND’S major irrigation industries have been side-swiped by a State Government decision to arbitrarily increase water charges for many regions of the State.

QFF CEO Dan Galligan said that many of Queensland’s 5000 irrigators awoke to news this morning that water charges would increase by $2 per megalitre plus CPI.

“Irrigation water prices are currently the subject of an intensive review,” Mr Galligan said. “This announcement is part of that, but it goes against the grain of the entire process. It pre-empts the entire investigation.

“The Government has conceded that determining water prices is a very difficult task, and has granted an extra year of time to get things right, which itself creates significant uncertainty for irrigators. But the government has also thrown in an arbitrary price increase that defies the logic of the entire process.

“The very point of the extension is to determine fair and sustainable prices. With these figures plucked seemingly from thin air, irrigators are quickly losing faith in the process.”

The current price hikes are linked to a 12-month delay in determining new water prices for SunWater irrigation customers.

“The only reason for the delays is the very poor quality of plans prepared by SunWater and released to QCA in January. With these extra charges to flow directly to SunWater, it is like giving your child a treat for bad behaviour and wondering why they repeat the behaviour in the future. Government and water users have paid out millions of dollars to SunWater over the last ten years so that SunWater can improve its reporting process and yet we are still struggling to get enough data from them to do a comprehensive pricing review. Questions need to be asked, not rewards handed out.”

Also of major concern is current government policy that water prices cannot decrease. This decision means that the announced a $2 per Ml “temporary” increase, becomes permanent according to the current policy. QFF recognises the difficulties the government budget is facing but deplores this action.

Mr Galligan said that this decision will be a heavy blow to many irrigators recovering from extensive floods, rains, and cyclones. “It has been a very tough year for the intensive agriculture sector in Queensland in 2011. Many farmers have suffered massive losses, and these price hikes from the Government are badly timed and ill considered.

“This decision will prompt a loss of faith in the QCA process by all SunWater customers across the state who have put in significant effort into the QCA process and in the submissions to QCA.”