Councils have been told they must be prepared to do more to address issues relating to water and sewage infrastructure, after receiving no funding guarantees from the newly elected federal government.
Local Government Minister Peter Gutwein spoke to delegates at the Local Government Association of Tasmania’s (LGAT) annual conference on Wednesday, and said state government can not be expected to bridge the $400 million dollar gap over ten years.
A $1.8 billion water and sewerage plan was on the table to help fix the state’s ailing infrastructure.
Councils had already agreed to forego $82 million of dividend payments over the next decade, if the state and federal governments agreed to contribute the $400 million.
“Under that plan, councils would continue to benefit from around $300 million in returns over the period, while retaining around $80 million within TasWater for reinvestment,” Mr Gutwein said.
“It is disappointing that over the eight years since the water and sewerage reform process began, many of these issues that confronted the system back in 2008 still remain.”
Mr Gutwein said he had always been of the view that TasWater could use its balance sheet more effectively.
President of LGAT, Clarence Mayor Doug Chipman, said all involved in local government recognise it is a long term investment.
“We believe the problem is bigger than just local government by itself… I think it’s important to note that even if councils forego their dividends, the costs of providing service and maintenance in municipal area still costs money,” he said.
George Town Mayor Bridget Archer said councils may have capacity to be less reliant on TasWater dividends without having to increase rates, once feasibility studies had been completed on shared services and increasing efficiencies.
“If you could get the stars to align in that way maybe there would be potential for councils to have confidence to invest back into tasWater in the way of foregoing more dividends,” she said.