In south-east Queensland, the cost of accessing mains water is more than double what people connected to Sydney Water pay.
For Gold Coast residents, these fixed charges are on top of usage fees that are higher than many other metropolitan areas in Australia.
Bond University commercial litigation lawyer and Assistant Professor Victoria Baumfield has studied water costs in south-east Queensland and put together a chart comparing the region to other parts of the country.
Ms Baumfield found that water connection fees were at least $120 a year more for residents in south-east Queensland than those using Sydney Water.
Additionally, Gold Coast residents pay $3.90 per kilolitre for water usage whereas Sydney Water customers pay $2.04 per kilolitre.
Victorian residents pay starting rates between $2.40 and $2.60 per kilolitre with water providers Yarra Valley Water, South East Water and City West Water.
The water providers in Melbourne all have a tiered charge system with the highest water costs between $3.80 and $4.27.
Businesses hit by increasing costs
Gold Coast business owner Linda Brown runs a family daycare centre from her home in Elanora on the southern end of the city.
Water is essential to her work and is one of her biggest expenses.
“[I use] lots of water cleaning the bedsheets with my washing machine,” Ms Brown said.
“I do lots of washing and mopping [where the children play] to make sure the areas are clean. We do go through a lot of water.”
Ms Brown has had to start making changes to try to cut her rising water bills.
“Now we’re looking at sending laundry home to be washed instead of doing it on the premises, and we’re limiting the water play activities,” she said.
High costs triggered by drought
Ms Baumfield said the Gold Coast’s high water rates started with a drought in the region in the mid-2000s.
“The south-east Queensland region had combined water levels down to as low as approximately 17 per cent. People were asking ‘Why is it we don’t have enough water?’.”
Ms Baumfield said part of the problem was that individual councils own and run water infrastructure.
“We didn’t have pipes that could move water from the Hinze Dam up to Brisbane if people needed the water,” she said.
“There was also the question of ‘Do we need to start producing recycled water?’ using water-producing assets that don’t depend on rain,” she said.
Pipes and a desalination plant at Tugun were built quickly and the Queensland government took over water infrastructure to create a regional network.
High spending results in high debt
Ms Baumfield said the issue with creating the new water infrastructure was the scale of the spending.
“The Queensland Audit Office has criticised the amount of money that was spent on the desalination plant, claiming we overspent by hundreds of millions of dollars,” she said.
“They claim we overspent on building a recycled water facility.
“When you take all the spending on water infrastructure, which ended up being close to $9 billion, and you add the fact we moved to a policy of cost-reflective pricing — where the public has to pay the full amount – that leads to very high bills for individual water consumers.”
Ms Baumfield said the scale of the debt was so large that SEQ Water had not been making full loan repayments for the past decade.
“What they have been doing is capitalising those unpaid interest amounts onto the principal of the debt.
“A debt that was initially around $9 billion has become close to $10 billion because they were tacking on the interest. So we’re now paying interest on interest.”
She said water bills would continue to rise for Gold Coast residents and businesses as SEQ Water pays off the multibillion-dollar debt.
Queensland Natural Resources Minister Anthony Lynham declined to speak to the ABC.
In a written statement, the minister said that an independent regulator had investigated SEQ Water prices and recommended fair and efficient prices from July this year until 2021.
The minister said the Queensland government was considering these recommendations.
He defended SEQ Water’s debt handling and said consecutive governments had endorsed its decision to increase water prices across 10 years instead of significantly hiking prices in 2008.