No rise for wa­ter de­liv­ery

Southern Riverina news - - NEWS -

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 Com- pli­ant 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.

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