Central Highlands Water receives notification of the funding offer for the Ballarat leg of the Goldfields Superpipe.

Central Highlands Water has received formal notification of the broad conditions of the $31M funding offer from the Commonwealth Government (via the National Water Commission) toward the cost of the Ballarat leg of the Goldfields Superpipe.

The funding is not a capital grant toward the $180M costs of the project. It is to help meet the additional revenue requirement arising from the Goldfields Superpipe project. It is the equivalent of the interest payments that would be payable if Central Highlands Water take out an additional $90M borrowings on the Superpipe project.

This would mean the local contribution toward the cost of the project would go from $20M (as originally proposed by then Premier, Steve Bracks, when responding to the Prime Minister’s request to nominate the highest priority Victorian water projects for Commonwealth Government support) to $110M local contribution.

The Board of Central Highlands Water has considered the offer from the National Water Commission and resolved as follows:

1. That the Board notes the offer of a $31M transitional grant from the Commonwealth Government to Victoria for the Ballarat leg of the Goldfields Superpipe.

2. That the Board advise the Victorian Minister for Water of its position on the following:

a. The $31M benefits Central Highlands Water customers and believes the offer should be accepted.

b. Central Highlands Water customers would be better served by a capital grant of $90M.

c. The major disadvantage of the transitional $31M compared to a $90M capital grant is the level of borrowings this pushes Central Highlands Water into, and the tariff impacts this will have in year six, and thereafter.

d. The offer of a transitional grant to Central Highlands Water is inconsistent with all other known offers for infrastructure funds under the Water Smart Australia program, and singles out Central Highlands Water customers unfairly.

e. Assurance be sought from the Federal Opposition that accepting the $31M offer now would not deter them from honouring their $90M offer if they were to win government (by converting the transitional grant to a capital grant and making up the remainder to $90M capital) and that the National Water Commission be requested to allow for this possibility.

Central Highlands Water Chairman John Barnes says he has written today to the Victorian Water Minister, Tim Holding, advising him of the above Board resolution.