Auckland City Council
Media release

15 May 2008

Auckland City Council helps to keep water prices affordable

As part of its commitment to keep water as affordable as possible, Auckland City Council has proposed to help keep any required increases in water prices to the level of council’s inflation over the next three years.

“We know people are concerned about the rising price of water, and we know that people want to see water price rises kept to the minimum level necessary to fund a first-class water and wastewater network,” says Deputy Mayor, David Hay.

“By capping water price increases to the council’s rate of inflation, we aim to give people consistency and surety that their water prices will not skyrocket.

“The council is working across a number of areas to balance the costs of wholesale water and wastewater services, and the need to fund improvements to water infrastructure with what people think is a reasonable price to pay for water,” says Mr Hay.

For example, the council has been working with bulk water and wastewater treatment provider, Watercare, and the other shareholding councils in the region to negotiate a loan guarantee. This would have a significant impact on Watercare’s bulk water and wastewater charges to Metrowater and thereby reduce Metrowater’s yearly price increases.

As part of its draft annual plan, the council has proposed three options for the annual payment it receives from Metrowater because this payment has an impact on water prices.

The options are to continue it, remove it over time or cancel the payments now.

This payment is used by the council to pay for much-needed improvements to the stormwater system.

Cancelling the payments now would mean property rates would have to increase to cover the difference, or more projects in the city would have to be cancelled or deferred.

“The approach we are supporting is to reduce the annual payments over time while keeping water price increases to the level of council’s inflation This will help balance the need to maintain water affordability and the need to minimise the impact on ratepayers of reduced annual payments,” says Mr Hay.

The council has advised Metrowater of its preferred proposal to enable Metrowater to advise their customers well in advance of any change in prices.

The draft annual plan is available for public feedback until 20 May. Visit www.aucklandcity.govt.nz for feedback forms and more information.

ENDS

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