Treasury moves to reduce MU debt

Tynwald to be asked for £95m debt reduction

The Isle of Man Government is to shave £95 million from the Manx Utilities debt in exchange for a freeze in water and sewerage rates for the next year.

The MUA currently has a loan of £278 million from Treasury and has a further £260 million debt in bonds.

The Authority will also be asked to establish a new pricing structure that more accurately reflects the cost of service delivery.

The proposals will be put to Tynwald members this month now that an independent review by National Economic Research Associates has been completed.

The consultants reported Manx Utilities current financial plan would keep them on track to pay off borrowing on time but identified concerns about the burden on customers paying higher bills.

Under the new plan, consumers will be shielded from big increases in charges for electricity, water and sewerage.

The MUA is to provide a new long-term pricing strategy within the next year while the Manx Government carries out a review of the rating system.