Water Journal : Water Journal March 2011
awa news in the sector. One of the matters discussed was the potential for institutional changes to foster competition and improve service to customers. Clearly, these are issues that also trouble those who work within the sector. While institutional and governance reform was only ranked as the seventh most important issue currently facing the sector in the Survey, it was the issue respondents felt was dealt with least well, with only 12 per cent of respondents feeling it was addressed 'quite well' (no-one said it was being dealt with 'very well') and 86 per cent of respondents saying it was dealt with 'not very well' (53 per cent) or 'not at all well' (33 per cent). The basic models of reform have been amalgamation of smaller utilities and disaggregation of larger authorities, generally along functional lines (such as bulkwater supply, distribution and retail). Respondents generally perceive significant value in the amalgamation of smaller entities, with 76 per cent saying such a trend is 'very beneficial' or 'quite beneficial' (and those living in regional centres who might be expected to work for smaller organisations reporting even greater benefit). However, 46 per cent, when asked what the benefits of disaggregation were, responded 'very few, it would be better if utilities remained integrated'. Disaggregation is more strongly supported in Victoria, a state in which disaggregated bulkwater/retailer functions have been in place in many areas for some time, and less strongly supported in Queensland where such reforms represent a new approach. But the messages appear clear: disaggregation is to be approached cautiously and, when implemented, needs to be explained and seen to be producing early, tangible benefit. In as much as institutional reforms are discussed in 2011, sector leaders need to exercise skill in designing approaches that are cost-effective, retain skills to the industry and corporate memory, and improve outcomes. Challenges Ahead The three-to-five-year horizon will be challenging in the Australian water sector. There will be considerable pressure to change the focus of reform. Even if flood management does not remain the priority, it will remain on the agenda and significant investment might be expected. This investment could become more strategic if integrated in a framework of adaptation to climate change and even more so if notions of creating more sustainable cities are adopted. While it is hard to imagine that levels of investment committed to desalination plants and other diversification strategies over the past five years will be maintained, the need to invest in adaptation/mitigation/sustainability initiatives may take up some of the slack. Of course, this might pose financial challenges. If the focus of reform does change, a threat may be posed to some reforms currently underway, particularly in the Murray-Darling. If we are going to create a sustainable future, however, a continued push to deal with the over-allocation problems in the Murray-Darling and in catchments across the country, should not be subsumed by an attitude that because we presently have water, we always will. 2011 will also see a renewed push to make the sector more open to competition and produce greater value for consumers. The Productivity Commission's report into urban water may stimulate discussion on this topic and pose challenges for regulators, governments and industry leaders. Whatever the course charted, it will be important that we do not 'reform for reform's sake'. Adaptation to circumstances is, of course, prudent and wise. The Australian water sector will face particular challenges, however, in ensuring that the range of needed and strategic reforms is not replaced by a focus only on immediate need. Now available - The 4630 Chlorine Analyzer System A fully integrated system. Ideal for all water applications. Contact Us: T. 02 9502 8000 or 1300 130 149 F. 02 9502 8090 E. firstname.lastname@example.org www.georgfischer.com.au Special Offer Conditions apply. Call our office for further details. Clear | Safe | Clean For every purchase of the 4630 Chlorine Analyzer, during the promotional period, you will receive a double pass to your closest main city's water attraction. The attractions are available in Sydney, Brisbane, Townsville, Melbourne, Adelaide, Perth and Auckland. For the period February 1 to April 30, 2011.
Water Journal April 2011