Water prices set too high

Victoria’s independent economic regulator has rejected price increases sought by Melbourne’s four water businesses.

Credit: Aerial footage of desal plant by THEISS, all other work my own.

On Tuesday, the Essential Services Commission released its draft review of water prices in Victoria. The Commission’s Chairperson, Dr Ron Ben-David, said that businesses proposed that household water and sewerage bills would rise by about one-third over the next five years.

Last year in Melbourne, water customers had among the highest annual increases (15%) in their water and sewerage bills, with bills for Yarra Valley Water, South East Water and City Water increasing by $147, $107 and $104 respectively.

What will YOUR water bill be? | Infographics

Data source: Essential Services Commission

The Essential Services Commision will set the final price. The Commission analysed plans and found the water companies were over-estimating their energy, parts and maintenance costs.

Ron Ben-David, CEO of the Essential Services Commission, said, “We’ve gone through the water plans very, very carefully and we’ve found savings worth a few hundred million dollars, and that gets reflected back in the lower prices, which is why we announced that we haven’t accepted the proposed $300 dollar increases.”

The culprit: Desal
The water companies and the Commission agree that the major reason for the increase is the cost of the Wonthagee Desalination Plant.

Dr Ben-David stated “The Commission is not satisfied that Melbourne Water has adequately supported its claim that it must fully pass through its desalination costs to customers in order to avoid adverse impacts on service delivery and its financial position.”

Hear more of Ron Ben-David's interview below:

Peter Walsh, Victoria's Minister for Water, agreed that the Labor-initiated is costly:

"If not for the desalination plant costs, an average bill may only have increased about $50 next year."

Jon Lenders, shadow Minister for Water, said that other costs were involved:

"Victorians  over  the  last  year have paid more in State Government water taxes, water dividends and other water charges than they will pay for the Desalination Plant."

Data from the Auditor-General shows that the desal plant costs Victoria $1.81 million dollars per day. Water dividends amount to around $925,500 per day.

Helping Victorians pay: Guaranteed Service
Regardless of the reason, the result is that all Melburnians will be paying higher water prices. “We certainly do appreciate that even though $200 is better than $300, $200 is really a lot," said Mr Ben-David.


The Commission has set aside $5 million in a virtual ‘safety net’ to protect customers in hardship.

All urban water businesses were obliged to assist customers in financial hardship.

Wanted: Community input
The commission wants public input before the final prices are set. Public meetings will be held in Melbourne (April 30), Sunbury (April 30) and Frankston (May 1).

Details on public meetings are available on www.esc.vic.gov.au, along with instructions for written submissions.

    New prices will take effect July 1, 2013.

Hepatitis C explainer

Infographic I made during my ABC work experience about Hepatitis C.

Family fight where pokies prosper

In the past five years, instances of family violence have increased by fifty per cent across Victorian communities, from an average of 5.5 to 8.3 per thousand people. Recently-released data from the Victorian Commission of Gambling and Liquor Regulation indicates family violence rates may be linked to pokies.

More pokies, more crime
Across the state, economic losses at electronic gaming machines have declined slightly in the past year, likely the result of Victoria’s ATM ban in pokies clubs. But community-level data from 2012 highlights a more sobering story: there is a higher rate of violence in communities with higher gambling losses per person. On average, communities with low pokies losses reported about seven instances of family violence per thousand people. On the other hand, communities with high losses reported an average of ten instances per thousand people. The difference may seem small, but it is enough people to fill two Rod Laver arenas.

Communities that spend more on pokies (per person) experience, on average, higher rates of family violence. Medians based on data from: Victoria Police and Victorian Commission of Gambling and Liquor Regulation

Although the Commission data does not state that pokies directly cause violence, a report from the Victorian Auditor-General’s Office found that “gambling can lead to family dysfunction and domestic violence including spouse and child abuse.” A separate Department of Justice report stated gambling was second only to drug use in its connection to crime. In the report, researchers found the link between pokies and crime remained positive and significant even after taking other factors—such as the size of the Local Government Area and wealth—into account.

Reverend Tim Costello, AO and member of Enough Pokies in Castlemaine (EPIC) agrees there is a link between pokies and family violence. He said that the gambling machines are “like locusts in a tree. It just strips the whole orchard bare…I’ve sat with families who have been utterly ruined.”

Click on each Local Government Area for population, family violence and pokies spending rates in 2012. The darker shading represents higher net pokies expenditures per adult.

Local community victorious over pokies

Last Thursday, the Victorian Civil and Administrative Tribunal (VCAT) upheld an appeal from the Mount Alexander Shire Council and EPIC, agreeing that installing 65 new pokies would have "a negative impact on the community".

Mr. Costello was pleased with EPIC's victory. "It stops the tide of the pokies lobby getting whatever it wants against community opinion and concerns,’’ Mr Costello said.

Political donations drive policy
The gaming lobby has been working hard to prevent pokies profits from dipping any further. The lobby has argued it makes a vital contribution to the state's economy. Vegas Poker Machines CEO, Mr. Ian Goldfingers said, “Our company alone has provided over 1,300 jobs in Victoria.” 

According to the 2012 Australian Electoral Commission (AEC) data, the company Vegas Poker Machines was the largest Liberal Party donor during the 2011-2012 fiscal year.  

The AEC numbers showed the hospitality and gaming industry donated nearly three-quarters of a million dollars to politicians, accounting for one-fifth of all political donations in 2012. Andrew Norton of the Grattan Institute wrote that "...the main industry players for 2011-12 were industry groups involved in pokies regulation and the carbon tax." 

Powered by Tableau

Source: Australian Electoral Commission

Despite spending by the gaming lobby, legislation was passed in 2012 to ban ATMs and install pre-committment technology across Victoria. The Department of Justice plans to publish a follow-up report in 2018, after laws have taken full effect.

 Pokies, Family Violence and Political Donations: An Explainer

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Think you can do something with these numbers? The raw data for this article is public. 
See anything interesting? Contact squirrel.main @ gmail.com.


Author disclaimer: Squirrel Main holds stock in Vegas Poker Machines. Also, the data and companies in this article are fictitious creations for a University assignment.

1920's gangster Squizzy Taylor wore pink pyjamas

Learn about Squizzy's pyjamas and more in the article that I wrote for Melbourne's Herald-Sun.

http://www.heraldsun.com.au/news/true-crime-scene/leslie-squizzy-taylor-dies-in-gunfight-after-dominating-melbournes-underworld-in-the-1920s/story-fnat7jnn-1226504054049