WATER PRICES: Lachlan Millar at an irrigation pump station for the Nogoa Mackenzie water supply scheme.
WATER PRICES: Lachlan Millar at an irrigation pump station for the Nogoa Mackenzie water supply scheme.

Central Highlands irrigation prices inflated, MP says

MEMBER for Gregory Lachlan Millar accused the State Government of trying to prop up its budget by inflating water prices for irrigation farmers in the Nogoa Mackenzie water supply scheme.

By the independent Queensland Competition Authority's recommendations, SunWater will charge its 'medium priority' Central Highlands irrigation customers $12.22 a megalitre in the 2020-21 financial year, whereas the Fairbairn Irrigation Network will charge $6.64 a megalitre.

Mr Millar said SunWater's prices were intentionally higher than it needed to be.

"SunWater is not even attempting to charge cost-reflective pricing for our water. It is blatantly charging farmers on the Central Highlands double," he said.

"That is about $500,000 being ripped out of our local economy every year. The community can't afford it and farmers can't afford it.

Mr Millar said he would prefer a private business take over the administration of water services.

"It is a legalised version of robbing Peter to pay Paul," he said. "The rate of return on agricultural production is tough at the best of times.

"There are high inputs, especially when you look at what farmers are paying for on-farm electricity to pump. Then there are fuel costs and fertiliser and chemical costs.

"All of these affect the competitiveness of our products on international markets."

The QCA recommends irrigation water prices to be charged by Sunwater every five years.

Its pricing principles state the need to account for overhead, maintaining pipes and equipment, and administration and management expenses.

Natural Resources Minister Dr Anthony Lynham said that irrigation prices will be frozen at their current prices and dam safety costs would be absorbed as part of the State Government's COVID-19 spending.

"The government will monitor conditions over the next 12 months before it re-assesses prices for 2021-22 year," he said.

"The $12.22 per megalitre price was implemented a year ago and reflects the costs of getting water to farmers in the Nogoa Mackenzie water scheme.

"The price reflects some level of cost recovery associated with running and maintaining the pipes, channels and pumps which form the Nogoa Mackenzie water scheme.

"What would these farmers be paying a foreign-owned private operator once Mr Millar had privatised their water scheme?"