Economic Regulation of the Victorian Water Industry: Performance Reporting Framework

1. Economic regulation of the Victorian water industryEssential Services Commission WorkshopPerformance reporting framework7 June 2004

2. Overview • Process to date • Role of performance monitoring • Guiding principles • Working Group process • Draft performance indicators • Summary of key issues • Reporting and auditing • Next steps

3. Consultation process to date • February 2004 – Consultation Paper No.1 • March 2004 – Public Workshop • April to May –Working Group • May 2004 – Consultation Paper No. 2 • June 2004 – Public Workshop

4. Role of performance monitoring • Inform customers • Make comparisons between businesses • Identify baseline performance and measure improvement over time • Inform regulatory standards (or targets) and assess compliance with such standards • Inform the decision making processes of regulatory agencies, water businesses and government

5. Guiding Principles • Performance indicators need to be • Relevant • Meaningful, relate to key issues for both businesses and customers • Defined and collected on a consistent basis • Considered in light of costs associated with collecting information and data • Verifiable • Consistent with other indicators where possible

6. Working Group Process • Working Group representatives included • Melbourne Water, metropolitan water retailers, regional water businesses • Government agencies and departments (EPA, DHS, DSE) • Customer groups (CUAC, St Vincent de Paul) • Working Group • Met five times • Cooperative • Generally, high level of agreement

7. Indicator coverage • Baseline explanatory data • Water and sewerage network reliability and efficiency • Customer responsiveness and service • Affordability • Environmental and conservation initiatives (eg, reuse and recycling) • Water quality

8. Baseline explanatory data • Customer numbers • System length • Water delivered and sewage treated • Population • Number of water and sewage treatment plants

9. Network reliability and efficiency • Frequency, duration, responsiveness to, and rectification of water supply interruptions • Levels of leakage and losses from water supply systems • adoption of IWA leakage index • Sewer blockages and spills, time to contain spills • Greater emphasis on disaggregation of customers experiencing multiple interruptions/blockages • businesses providing this information to WSAA and VicWater

10. Customer responsiveness and service • Customer complaints • Call centre answering times • New measures to monitor the turn around times of • development applications • information statements

11. Affordability • Use of restrictions and legal actions for non payment • Availability of instalment plans • New measures on • the level of applications and approvals for hardship grants • duration of restriction • average debt levels, when restrictions and legal actions were undertaken

12. Environmental and Quality • Environmental • sewage treatment plant compliance • water reuse and biosolids recycling • trade waste critical parameter acceptance • CO2 emissions • Drinking water quality • Population receiving water meeting standards • E. coli • Turbidity

13. Key Issues • Compared to previously reported information, the proposed indicator set shows • increased emphasis on environmental, reuse and recycling, affordability measures, and development activities • greater disaggregating of information on network reliability and complaints • a reduction in a number of performance indicators • greater coordination with various government and regulatory agencies

14. Key issues • Minimising reporting cost • considerable effort to improve reporting arrangement and consistency of information between government agencies • project to establish joint information template • believe most businesses already collect the majority of the information • necessary for managing the business not just regulatory purposes

15. Key issues • Affordability • customer representatives and DHS suggested disaggregation of data between concession & non-concession households • consumption • affordability • Future review • preference for stable indicator set • need to take account of changing events, such as release of White Paper

16. Reporting and Auditing • Reporting arrangements to be similar to those applied to the metropolitan water retailers • information reported in accordance with performance indicators and definitions • quarterly and annual submission of data standardised templates • regulatory audits to verify the accuracy and reliability of reported information • analysis of reported data in annual performance report • before release opportunity for businesses to comment on draft report

17. Next Steps • Indicative Timelines • Working Group meeting (24 June 2004) • Finalise performance indicators (July 2004) • First audits (Aug – Oct 2005) • First Statewide performance report (late 2005) • reporting in Melbourne continues as before