Excess water charge regime ‘lopsided’ against low incomes
Christchurch residents who use too much water may soon have to pay extra, in a complex new charging scheme proposed by the city council. Steven Walton reports.
Last year, the city’s highest water user – a single resident in Cashmere – was hit with a $1500 bill for using 10 times more water than the average household.
The Cashmere resident, who lives on a property larger than a quarter of a hectare, was the only person in the city charged extra after using enough water to fill 77 baths a day – nearly 6000 litres per day, on average.
Soon, this resident may be among 20,000 households charged extra by the Christchurch City Council for their water.
The proposed charge is expected to hit the top 20 per cent of the city’s water users.
However, under the controversial and complex proposal it will not necessarily be the city’s top 20 per cent of water users who are charged.
Those who end up getting charged for excess use over their allocation are more likely to be in poorer suburbs, while those living in wealthier homes may find themselves allocated – and paying for – water they do not use.
Our system, now
Those who own more valuable properties pay higher rates. This does not entitle them to enhanced council facilities, better roads, or a more frequent rubbish collection.
Notably, the rates bill includes a specific charge for water infrastructure and delivery. This varies with the value of the home but unlike the rest of the rates bill, the variable water charge correlates to a variable allocation of water.
So a home worth $500,000 pays about $300, as part of their rates, for an allocation of 800 to 900 litres of water each day. A $1 million home pays about $600 to get 1700 litres per day. In most cases, breaching this allocation incurs no extra fee.
The average household in Christchurch uses 540 litres a day, below the lowest daily allocation of 698 litres given to the city’s cheaper homes.
The council is now proposing charging households which use more than 915 litres per day, if they are also breaching their allocation.
Presently, 20 per cent of households in Christchurch use more than 915 litres per day and the council predicts 20,000 people will have to pay the extra charge in the first year, if implemented.
How the charge works
For residents receiving the minimum allocation of 698 litres a day – the proposed excess use charge won’t kick in for them until they start using more than 915 litres on average each day across a full year. So they effectively get more than 200 litres per day for free.
Beyond this level, the charge of
$1.05 for every extra 1000 litres will kick in.
Alicia Ward lives with her husband and four children in one of Christchurch’s poorest suburbs.
The average water use for a single person in Christchurch is about 230 litres a day, which means a household of six people could be expected to use about 1400 litres of water a day.
In Phillipstown, where Ward lives, the average house price is less than $300,000, and her family will be one of many in the suburb with the minimum daily water allocation of
698 litres.
If Ward’s six-person family were typical water users, they would be taking some 500 litres per day more than their permitted maximum and face an extra water charge of about
$180 per year.
By comparison, an average household in Fendalton, worth
$1.1m, using the same 1400 litres would not be charged extra as it would fall below their allocation of
1700 litres per day. The council considers they have already paid for this allocation through the higher water charge in their annual rates bill.
Ward said the excess water charge appeared ‘‘incredibly uneven and not right’’ and ‘‘more brainstorming’’ was needed.
However, the city council does not believe poorer areas will be unfairly affected, pointing out that any household would need to use ‘‘significantly more water’’ than the city’s average to be charged extra.
Councillors weigh in
Councillor Aaron Keown said he was concerned about those in wealthier areas paying significantly more for their water in their annual rates.
‘‘To have such a lopsided charging system makes no sense.’’
He was also concerned hundreds of pensioners in wealthy suburbs charged more than 3 per cent of their household income for water, which would be in violation of United Nations’ guidelines.
For a person living alone with a pension as their only income, their house would have to have a rateable value above $1.1m for this to happen (if they did not have a low income rates rebate).
Meanwhile, Councillor Jake McLellan said it was ‘‘abhorrent’’ that the city allocates more water to those with more expensive properties. He suggested there should be a standard allocation for every household.
‘‘And then if you use too much, you’re then penalised.’’
Those who end up getting charged for excess use over their allocation are more likely to be in poorer suburbs.