Apples and apples

I’ve noticed that over the last few months that people often say “that [x] will be more expensive” than Emu Swamp Dam.  Always a fascinating concept when no-one yet knows how much Emu Swamp Dam will cost.

But leaving that aside how do we know that we’re comparing apples with apples?  You can only compare the relative costs of different infrastructure options if you know:

• How much of the cost will be paid by Council

• How much of the cost will be financed by way of loans or grants from the State and Federal governments

• What the interest rate on any loan will be

This becomes very important when you then weigh up various options depending on which ones may be eligible for loan and/or grant funding.

In Emu Swamp Dam, the State and Federal governments have provided financial support for a private dam for irrigators. There is no reason they would not also provide support for urban water infrastructure.  In fact the Toowoomba-Wivenhoe pipeline was funded approximately 2/3 by the State Government and 1/3 funded by a 20 year State government loan to the Toowoomba Regional Council (TRC).  This was a $180m project and, 10 years down the track, water rates in the TRC are the same as in SDRC.

And a cost that is often overlooked is the ongoing annual cost.  In the case of Emu Swamp Dam this starts at an estimated $238,860 per annum.  Unlike the loan to TRC for its pipeline, these annual payments continue forever and, in the nature of such things, can only go up.

Of course, it is very hard as a ratepayer to work out the bottom line cost of any option.  To understand whether SDRC’s participation in Emu Swamp Dam makes financial sense, we need clarity not only on the initial capital costs being taken on and the annual costs going forward, but also on how those costs compare with the alternatives. This is yet another reason why Council must commit to community information sessions in Warwick and Stanthorpe on the Council’s involvement in Emu Swamp Dam.