CSS are “a mechanism for customers to be informed about the terms and conditions of their relationship with their service provider, where those terms and conditions are not already documented in a written supply agreement” (see p. 108 Explanatory Notes to the Water Bill). The water industry views transparent development of these standards as essential given the sector's essential nature and status as a natural monopoly.
CSS must be made available to all customers and are required to meet the DERM CSS Guidelines which outline the contents of CSS as follows:
CSS must be provided to but are not approved by the Regulator. The Service Provider must also report annually on the CSS each financial year. Note: CSS are not required for SEQ Distributor Retailers (which use other processes).
CSS are regulated under Chapter 2 of the Water Supply (Safety and Reliability) Act 2008 and regulated by the Department of Environment and Resource Management (DERM).
| Relevant Period
||2000 - present|
|Exemptions||Some small service providers|
| Penalty Provisions
||Not completing, not providing public copies, not reviewing annually, not revising as directed, not reporting annually, not complying with CSS, not complying with or reviewing CSS after notice from the Regulator that a customer complaint had been referred to the Regulator|
|Penalty Units||100 - 500|
A copy of the CSS must be provided to the Regulator but they are not approved (s 115). Copies must also be provided to all customers that do not have a direct service contract with the Service Provider (s. 115). The DERM CSS Guideline states that "a physical copy of the CSS is required to be sent to each customer of the service provider". This can be an unnecessarily onerous requirement given the use of the internet to provide many other legally required reports. A better mechanism would be to provide basic information on rates notices and full CSS documentation via the internet, council offices and on request from customers.
CSS must be reviewed annually (s. 120) and the Service Provider must report on CSS each financial year. However, this report may be combined with other annual reporting requirements (s. 141) including the Council annual report required under section 108 of the Local Government (Finance, Plans and Reporting) Regulation 2010.
There is only one direct penalty associated with CSS (namely not providing an annual report) while other contraventions of the legislation are dealt with through issuing Show Cause Notices and Compliance Notices.
|Not completing or providing copies of CSS
||Notice issued*||s 115|
|Not complying with a SS after notification that a customer complaint was referred to the Regulator
||Immediate Compliance Notice||s 118, 465, 466|
|Not revising a SS after notification a customer complaint was referred to the Regulator||Immediate Compliance Notice||s 119, 465, 466|
|Not reviewing the CSS annually
||Notice issued*||s 120|
|Not providing an annual report against a CSS||500 penalty units||s 141|
|Not complying with a CSS
||Notice issued*||s 117|
* no penalty units are directly associated with contravening these sections of the Act which are instead regulated through a Show Cause Notice (s 464), which can be followed by a Compliance Notice (s 465, 466). Contravening the requirements of a Compliance Notice carries a maximum penalty of 100 penalty units.
CSS are required for each of the Service Provider’s registered services (s. 114) but not for Distributor Retailers (ss. 114(3)) nor when customers are supplied under a direct contract. There are also exemptions for some small service providers (see below). CSS should have been completed by all Service Providers and must be submitted within one year when any new Service Provider is created (s. 115).4
Small service providers (i.e. those with fewer than 1000 connections) are able to apply to the regulator to be exempted from all or part of CSS requirements (s. 146). The Regulator must grant the exemption and notify the provider and the Gazette if “satisfied it is not reasonably practicable for the small service provider to comply with 1 or more of the provisions……because the cost of complying would outweigh the benefits.” (s. 147). More information is available in the DERM Guidelines for Granting Exemptions for Small Service Providers.
CSS are also closely linked with the mandatory requirements for Strategic Asset Management Plans (SAMPs). The DERM CSS Guidelines (p. 2) note that:
4CSS and SAMPs are inter-related. SAMPs require providers to set ‘level of service’ standards and then document and implement a strategy that will ensure those standards are met. A CSS, on the other hand, essentially informs customers who do not have contracts with their service provider of the level of service standards that are detailed in the SAMP. Thus, a CSS is not a separate process for setting level of service standards—it reflects the level of service standards outlined in the SAMP.