Shapira deems water prices illogical
Rates have risen 30% since January 2010 reform, says state comptroller, but lack research and reasoning.
Reservoir routes Photo: Ronit Svirsky, KKL-JNF
Domestic water tariffs are unjustifiably high and require much more
comprehensive investigations before fixing them at the current rate, State
Comptroller Yosef Shapira argued in his latest report.
comptroller reviewed the Water Authority method of setting rates for water and
sewage – rates that since a reform in January 2010 have risen by 30 percent,
without proper research and reasoning, according to the report. Based on the
reform, local authorities also have had to build their own water
The domestic consumer water tariff is determined in a
two-pronged fashion – a lower rate for a basic amount of water use and a higher
rate for water consumed beyond that amount. However, the process for determining
what the basic amount should be is flawed and has not undergone thorough
examinations of factors that affect national per capita consumption, according
to Shapira. Consequently, there was no solid basis for determining the basic
amount was 2.5 cubic meters of water for a year and a half beginning in January
2010, or the determination of 3.5 cubic meters per capita per month in July
2011, he explained.
By completion of the audit in November 2011, the
Finance Ministry had not yet determined an arrangement on the matter of
increasing discounts for vulnerable populations, such as the poor, the disabled
and the elderly. In March 2012, the Finance Ministry approved about NIS 42
million, and the Water Authority said it was preparing to implement the decision
in July 2012.
As far as the water companies are concerned, by November
2011, 137 authorities combined efforts to form 52 local water companies, and 48
authorities still needed to do so. A goal of the Water Authority is having local
authorities consolidate such companies – create 13 for the remaining 48, for
example, which could save the country NIS 500m. and potentially reduce prices by
7%, according to a report generated by an external adviser to the Water
Authority. However, a year has passed since the expert submitted the report and
the Water Authority’s council has not brought up the matter for discussion,
In response to the report, a Water Authority statement
welcomed what the office deemed a “thorough, insightful work,” but explained
that the authority has already begun to identify many of the deficiencies cited
in the report and is working to repair the vast majority.
special needs population, the Water Authority adopted the Finance Committee’s
decision and will be doubling the amount of people eligible for the discounts to
250,000, according to the statement.
As far as the domestic water prices
are concerned, the layout of determining rates in 2010 changed from being a
result of agreements at a discussion table to relying on a professional economic
model, the Water Authority explained. Aiming to minimize rates as much as
possible, the authority conducts regular tests and also accounts for the costs
associated with service providers, according the statement.
authority is actively working to prevent the rise of water prices and aspires
even to lower it, with great effort and by coping with increases in electricity
and energy costs, which influences the price of water,” the Water Authority