Legislative Council upholds polluter-pays principle for sewage services

The Legislative Council, on 16 May 2007, reaffirmed its support for the application of the polluter-pays principle to sewage services by endorsing a ten-year schedule of increases in the Sewage Charge (SC).

The current SC rate is $1.2 per cubic metre of water supplied. There will be an increase of 9.3% in the rate on 1 April 2008 ($1.31 per cubic metre) and subsequently on the same date in each of the following nine years, reaching $2.92 on 1 April 2017. The average SC bill for domestic accounts will increase from about $11 per month at present to about $12 per month following the first increase in 2008/09, and eventually reach a level of about $27 per month in 2017/18.

The Government will invest about $20 billion in new sewage treatment and other sewerage facilities over the coming ten years. The approval of the schedule of increases means that we will be heading towards the mid-term objective of recovering 80% of the recurrent costs of the SC in about a decade's time, taking into account both existing projects as well as major facilities in the pipeline, including Stage 2A of the HATS. The Legislative Council's support for the 10-year increment scheme clearly demonstrates the community's long-term commitment to improving the water environment in Hong Kong, with the polluter-pays principle rightly placed as a cornerstone in the foundation of our sewage services strategy. The legislature also endorsed a proposal to reduce costs relating to reassessment under the Trade Effluent Surcharge (TES) scheme, thus providing more incentive for restaurants and other TES establishments to adopt pollution reduction measures.

Following the approval of the 10-year increment scheme, the Legislative Council will continue to play a key role in monitoring the sewage services. The Government will provide annually to the Environmental Affairs Panel of the Legislative Council a summary of the Sewage Services Operating Accounts and the projection for the following financial year for monitoring. In addition, a mid-term review of the sewage charge will be conducted in 2011, which will take into account the actual cost recovery rates of the SC, savings and efficiency measures adopted and planned by the Drainage Services Department, an assessment of the prevailing economic impact of the SC, and a progress report and draft implementation plan for Stage 2B of HATS.

The Government will also pursue the preparatory steps for securing the site for constructing Stage 2B of HATS. This will include resolution of the planning, interface and development issues concerned with dual use of the site with a view to completing the statutory planning procedures for an amendment of the zoning plan by around the latter part of 2010. In 2010/11 the Government will conduct a comprehensive review of the optimal timing for the implementation of Stage 2B of HATS to provide biological treatment for all the HATS effluents. In the review, we will take into account all the relevant planning parameters including trends in water quality, population growth and sewage flow build-up, and pay heed to the aspirations of the community for a cleaner harbour and the need to continue to adhere to the polluter-pays principle.