Commission on the Reform of Ontario's Public Services

Move towards full cost recovery and user-pay models
The government’s environmental programs are not all run on a full cost recovery basis and
existing fees do not keep pace with the rising costs of program delivery. Where the opportunity
exists and where the beneficiary can be identified, the cost burden of providing these services
should be placed on the beneficiary’s shoulders rather than the public’s.
For example, the government spends about $15 million per year through multiple ministries to
manage water quantity and encourage its efficient use. In Ontario, anyone who takes more
than 50,000 litres of water per day from a lake, river, stream or groundwater source must
obtain a Permit to Take Water from MOE. A permit will not be issued if the proposed watertaking
will adversely affect existing users or the environment. The cost of the permit ranges
from $750 to $3,000, but yields too little annual revenue to offset the cost of the program. 2
More costs could be recovered if the commercial and industrial water users who create the
need for water management programs pay for their use of water. The charge would also
create a financial incentive for companies to use water more efficiently.
Phase 1 of the Water Taking Charges Program, launched in April 2007, established a charge
of $3.71 for every million litres of water taken by high-consumption industrial and commercial
users. Facilities in this category (under the regulations) include beverage producers,
canning/pickling facilities and concrete manufacturers. 3
Phase 2 of the program would expand the charge to include medium-consumption
(e.g., mining, construction, textile, wood production, metal production and recreational
facilities) and low-consumption (e.g., electric power generation) users. 4 This could increase
annual revenue to almost $6 million, with minimal incremental costs to government,
and would recover about 40 per cent of the government’s direct costs on water quantity
management programs.
2 “Permits to Take Water,” Nov. 16, 2010, downloaded from
http://www.ene.gov.on.ca/environment/en/industry/assessment_and_approvals/water_taking/STDPROD_075554.html.
3 “Stewardship, Leadership, Accountability: Safeguarding and Sustaining Ontario’s Water Resources for Future Generations,” Proposal
Paper, Summer 2009, p. 40.
4 Ibid.
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