No rise for water delivery

June 29, 2017

Murray Irrigation Limited’s water delivery charges will remain unchanged in the next financial year.

Company board chairman Bruce Simpson said it was decided at a recent board meeting, in light of positive signs that the company’s past financial woes are on the mend.

However, charges relating to asset management will still be increased for the next 12 months.

‘‘The board met on Thursday, June 15 when a key outcome was the approval of a three-year budget and a strategic roadmap for the company’s approach to fees and pricing, capital and operational expenditure, as well as cost saving measures to 2020,’’ Mr Simpson said.

‘‘The board acknowledged that after a lot of hard work, the company was now close to break-even at the 650 gigalitre water delivery benchmark.

‘‘The board wants water delivery charges kept as low as possible to encourage the use of water in our system and to ensure landholders can be competitive in the water market.’’

Mr Simpson said the planned increases to the asset management fee components were in recognition of the company’s capital reserves being historically under-funded.

He said it was ‘‘important to maintain a prudent level’’.

‘‘In that context, a 15 per cent increase will be applied to the fixed asset component of fees incorporating the Asset Management Renewal Reserve (AMRR) portion of the Delivery Entitlement (DE) fee and the outlet fee.

‘‘I am sure that the decision regarding the water delivery charges will be welcomed by customers which together with the Compliant Meter Credit and resource distribution decisions announced last month will give growers added confidence as we head into the 2017/18 irrigation season.’’

To ensure the company focuses on its water delivery role, the board also approved a change to its operating model, which is still being finalised.

‘‘Murry Irrigation is entering a challenging and exciting phase of bringing one of the nation’s largest agriculture infrastructure programs online from October.

‘‘More information on the change will be available in the coming months, but in summary, the changes will create a greater level of accountability and efficiency by separating the company’s principal activities into three separate entities — water delivery, asset management and investment.’’

Summary of changes to the company’s Fees and Prices Schedule:

■ Change to business operating model;

■ Fixed and variable usage charges will remain unchanged at 2016/17 levels;

■ Government charges have changed quite significantly after the recent IPART determination;

■ DE-AMRR fee increase by 60 cents;

■ Outlet fee will be allocated to AMRR and will increase by 15 per cent;

■ Removal of early payment discount.

‘‘These changes support the company’s core function — to deliver water efficiently and effectively to irrigators,’’ Mr Simpson said.

More in Southern Riverina News
Login Sign Up

Dummy text