DEPARTMENT OF THE ENVIRONMENT
APPROVE THE DRAFTING OF A WATER RESOURCES (CHARGES) ORDER 2011
Public Item
Purpose of the Report
The purpose of this report is to request that the Minister approve the drafting of a revised Water Resources (Charges) Order 2011 by the Law Draftsman.
Background
Under Article 25 of the Water Resources (Jersey) Law 2007 (The Law), the regulator (defined under Article 1 as the Minister of Planning and Environment) may prescribe;
- Article 25(1)(a) - ‘charges that shall be payable to the regulator by applicants, licensees and proposed transferees, in respect of applications for the grant, variation, transfer and revocation of licences’.
- Article 25(1)(b) - ‘charges that shall be payable to the regulator periodically by licensees’.
In addition, Article 25(2) states that ‘in prescribing charges under this Article, the regulator shall have regard to the amounts that are needed to meet the regulator’s expenditure in carrying out functions under this Law’. The user pays principle was therefore already accepted by The States under this legislation. This principle is reiterated in Article 5(1)(c) of the Law which requires that in carrying out functions under this Law the regulator shall have regard to a cost principle by which the costs of managing and regulating the abstraction or impounding of water are borne by the persons who abstract or impound it.‘
Water Resources registrations apply predominantly to the abstraction of water for the domestic supplies of households, which are totally exempt from the licensing provisions of the Law and hence there are no charges associated with registrations. Charges are only levied on Water Resources abstraction licences.
The Water Resources (Charges) (Jersey) Order 2009 came into force on 21 September 2009. The charges specified in this order are banded according to the maximum volume of water that is licensed for abstraction in any 24 hour period. This allowed the licence charges to be invoiced and collected in preparation for the Water Resources (Jersey) Law 2007 to come fully into force on 1 January 2010.
Discussion
The Water Resources (Jersey) Law 2007 requires that the overall cost needed to meet the regulator’s expenditure in carrying out functions under this Law will be borne by the user. This principal has been adhered to since the Law came fully into force.
It had been anticipated that there would be about 120 licences when the law came into force, but a total of 150 licences were applied for during 2009 and charges were set accordingly at an appropriate rate to cover the estimated 2010 expenditure. By the end of 2010, mainly due to a very dry spring prompting a significant number of additional applications, an additional 50 licences had been issued bringing the total to 200 licences. The additional licence charge income was sufficient to meet increased expenditure in 2011 and it was not necessary to increase the licence charges for that year.
Eleven additional abstraction licence applications have been submitted in 2011 but the increased income from these licences will not be sufficient match the estimated 2.5% increase in expenditure for managing and regulating the Island’s water resources under the Law. It is therefore proposed that water abstraction licence charges be increased by 2.5%, in keeping with all other fees and charges administered by the Department of the Environment.
The proposed revised Water Resources abstraction licence charges to be levied for 2012 are shown in Table 1, together with the 2009/2010 charge rates for comparison. It is estimated that the revised charges will result in a total potential income of £116,706.
Conclusion
It is necessary to bring this Order into force by 30 September 2011, in order that invoices for charges payable under the Order can be issued by the end of October 2011 and paid by applicants by 31 December 2011.
Recommendation
That the Minister agrees the revised charges for water abstraction licences as detailed in Table 1 and requests that a Water Resources (Charges)(Jersey) Order 2011 be drafted by the Law Draftsman.
Written by: | Hydrogeologist, Department of the Environment |
| |
Approved by: | Assistant Director, Environmental Protection |
| |
Attachments:
Table 1. Proposed licence water abstraction licence charges for 2010
21 June 2011
Table 1. Water abstraction licence bands and charges
Charge band | Licensed abstraction volume range (m3 per 24 hour period) | 2010/2011 licence charge | Revised 2012 licence charge |
Jersey Water | Not applicable | £99,040 | £101,516.00 |
A | between than 15 and 100 | £40.00 | £41.00 |
B | between 101 to 250 | £80.00 | £82.00 |
C | More than 250 | £120.00 | £123.00 |
L:\WRS\Water Resources Law\Ministerial decisions\WR MD-PE-2009-xxxx Draft Water Resources (Licence Fees) Order v2.doc