South Australian tourism minister John Rau brushed aside the fate of tourism businesses in remote communities when asked in parliament how he expects a small remote tourism business to absorb massive increases in electricity bills.

Tourism businesses in remote towns like Coober Pedy were given just four days notice that their electricity prices would more than double.

SA minister for energy Michael O’Brien was forced to admit that he did not know businesses in remote areas were given such short notice that their power prices would more than double: “I was actually unaware of the shortness of time that was given over to those consumers,” he said in parliament.

“It is embarrassing that the cost of electricity more than doubles and the minister is so out of touch he is unaware of how much notice was given to the consumers,” shadow treasurer Iain Evans said. “In one case, the power bill will increase from around $320,000 to over $700,000 per year. How does the minister expect this remote tourism business to recover the extra $380,000 a year – over $1000 a day extra cost?

Managing director of the Opal Inn accommodation group, Robert Coro, confirmed he had calculated he would now be paying $700,000 per year for electricity, up from $320,000. “I’m seriously considering whether it’s worth my while to stay open,” he said.

“I’m supposed to somehow in a matter of one month initiate price rises to compensate for 130% in power and 25% in water. This is ridiculous.”

But Mr O’Brien says the South Australian government will not back away from an increase in outback electricity prices. Authorities have cited the rising costs of electricity supply and increased grid prices.

Business owners warn outback tourism will suffer and say it could force people to move away from outback areas. Mr O’Brien said he did not believe the rise would close businesses.

“There is an element of personal choice in all of this. Some people have made a decision that they’re going to set up businesses in Coober Pedy or they’re going to live in Coober Pedy and there are costs associated,” he said.

“The state government is subsidising their decision to operate businesses to the tune of $5.5 million a year. When all said and done, if there wasn’t a subsidy they would be having to find an additional $5.5 million. The taxpayers of South Australia are effectively underwriting the cost of running their businesses.”

Coober Pedy mayor Steve Baines, says the increase doesn’t make any sense.

“Given that the Flinders and Far North generated $176 million worth of income just in tourism last financial year which resulted in $19.5 million worth of GST income to the state, I really can’t see the sense in this decision.”

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