China News Service, August 6th. According to the website of the National Development and Reform Commission, the National Development and Reform Commission and the Ministry of Housing and Urban-Rural Development have recently revised and issued the "Urban Water Supply Price Management Measures" and the "Urban Water Supply Pricing Cost Supervision and Examination Measures" (hereinafter referred to as the "Two "Methods").
The relevant person in charge of the National Development and Reform Commission answered reporters' questions on the revision of the two "Measures."
According to the person in charge, on December 23, 2020, the General Office of the State Council forwarded the National Development and Reform Commission and other departments’ "Opinions on Cleaning up and Regulating the Charges for the Urban Water Supply, Power Supply, Gas and Heating Industry to Promote High-quality Development of the Industry" (State Council Letter [2020] 129 No., hereinafter referred to as the "Opinions"), requires speeding up the establishment and improvement of a price mechanism based on "permitted costs plus reasonable benefits", which is conducive to stimulating the improvement of water supply quality and promoting water conservation.
The current "Urban Water Supply Price Management Measures" was issued in 1998, and individual clauses were revised in 2004; "Urban Water Supply Pricing Cost Supervision and Review Measures (Trial)" was issued and implemented in 2011.
The implementation of the two measures has played a positive role in guiding local governments to regulate urban water supply price management.
However, with the deepening of urban water supply price reforms in recent years, the original water price composition, classification, and price setting and adjustment procedures are no longer in line with the development and changes of the situation. Especially in the price supervision of water supply monopoly links, more clear pricing methods need to be proposed. .
In order to speed up the establishment and improvement of a pricing mechanism centered on “permitted costs plus reasonable returns”, improve the scientific, refined, and standardized level of urban water supply price supervision, and promote high-quality development of the industry, the National Development and Reform Commission and the Ministry of Housing and Urban-Rural Development have discussed the original Some methods have been revised, public opinions have been solicited, and two "Methods" have been issued recently after the revisions have been perfected.
What are the main contents of the two "Measures"?
The person in charge stated that the "Measures for the Management of Urban Water Supply Prices" clarified the pricing principles, pricing methods, and price adjustment procedures for urban water supply prices, as well as water price classification, pricing methods, and standardization of service charges by water supply companies.
The main content includes four aspects.
The first is to verify the price of urban water supply in accordance with the "permitted cost plus reasonable profit" method.
Set the price of urban water supply, based on cost supervision and review, determine the allowable income through the approved cost and the income of the supervisory permission, determine the water supply price based on the approved water supply, and take overall consideration of the development needs of the local water supply business, promote water conservation, social affordability, and services Factors such as quality.
The second is to simplify the classification of water prices and clarify the pricing method.
Urban water supply is divided into three categories: residential water, non-residential water, and special water according to the nature of use. Residential water is subject to a tiered water price system, and non-residential water is subject to an over-quota and progressive increase system.
The third is to standardize the price setting and adjustment procedures and strengthen information disclosure.
To request the establishment of residential water price levels or pricing mechanisms, hearings shall be conducted in accordance with the relevant provisions of price hearings, and information shall be disclosed.
The fourth is to standardize service charges and improve service quality.
Clarify that the water quality and pressure of the water supply should meet the standards set by the state.
Except for the construction and installation project fees entrusted by users, water supply companies shall not abuse their monopoly position to collect fees for opening water supply accounts, connection fees, and capacity expansion fees.
The person in charge pointed out that the "Measures for the Supervision and Examination of the Pricing Cost of Urban Water Supply" clarified the composition of pricing costs and the method of verification.
The main content includes two aspects.
One is to clarify the scope of the cost composition of urban water supply pricing.
In accordance with the principles of legality, relevance, and rationality, the pricing cost of urban water supply includes fixed asset depreciation, intangible asset amortization, and operation and maintenance fees, and specific provisions are made for items included in pricing costs.
The second is to clarify pricing costs and effective asset verification methods.
Refine and clarify the audit standards for depreciation of fixed assets, raw water costs, material costs, power costs, labor costs, etc., and make clear provisions on the scope of effective assets that can be accrued benefits and their verification methods. Establish an incentive and restraint mechanism to control the leakage rate of the pipe network.
What are the highlights of the two revised Measures?
The person in charge pointed out that the two "Measures" adhere to the problem orientation, insist on equal emphasis on incentives and constraints, and build a long-term mechanism through system construction. There are four main highlights.
One is to establish an incentive and restraint mechanism to promote cost reduction and efficiency enhancement of water supply enterprises.
In terms of labor cost assessment, an upper limit standard for the number of employees in water supply enterprises has been set; in terms of pipeline network leakage assessment, a pipeline network leakage rate control standard has been set.
The part of the water supply company that exceeds the prescribed standard shall not be included in the water supply pricing cost; if it is lower than the prescribed standard, it shall be calculated according to the prescribed standard.
The revised measures also added binding indicators such as water supply companies' own water consumption rate.
The establishment of incentive and restraint mechanisms is conducive to solving the problem of "whipping fast cattle", encouraging water supply companies to streamline personnel, reducing pipe network leakage rates, tapping potential, strengthening cost control, improving production and operation efficiency and market competitiveness, and promoting industry growth Quality development.
The second is to properly control the excessively advanced construction of water supply capacity.
Considering factors such as seasonal fluctuations in water demand and urban development needs, the water supply design capacity should have a reasonable degree of redundancy. However, excessive and advanced construction of water supply facilities also brings about problems such as idle fixed assets. The revised method appropriately increases the load on water supply. The rate of assessment standards is not only conducive to ensuring the safety of urban water supply, but also conducive to restraining over-advanced construction.
The third is to establish a mechanism to reasonably determine the rate of return on water supply with reference to market interest rates.
It is clear that the allowable rate of return for water supply companies is determined based on the rate of return on equity capital and the rate of return on debt capital. The rate of return on equity capital is determined based on the 10-year treasury bond yield plus no more than 4 percentage points. The rate of return on debt capital is determined based on the interest rate quoted in the loan market. Attract social capital to enter, and promote the healthy and sustainable development of the water supply industry.
The fourth is to establish a regular checking mechanism and compensation mechanism for water supply prices.
Clarify that the urban water supply price supervision cycle is 3 years in principle. If an upstream and downstream linkage mechanism such as the water supply price and the raw water price is established, the supervision cycle can be extended appropriately.
Considering the local economic and social development level and user affordability and other factors, if the water supply enterprise is unable to achieve the permitted income due to the inadequate price adjustment, the local people's government shall provide corresponding compensation.
Regarding how the two "Measures" are implemented, the person in charge said that the revisions of the two "Measures" will help to further standardize the management of urban water supply prices, protect the legitimate rights and interests of both water supply and water use, and promote the healthy development of urban water supply undertakings, saving and protecting Water resources.
Taking into account the vastness of our country, the large differences in water resources endowment conditions, economic development levels, and social affordability in different regions, the two "Measures" set framework requirements for the improvement of the urban water supply price mechanism, and some specific parameter settings and indicators Assessments and other areas need to be further refined and clarified in light of local conditions, and localities should formulate specific measures or implementation rules.