Water in the red
By Jane Ross
SOUTH Gippsland Water ended the last financial year with a loss of $288,000.
When the $100,000 profit that the authority had budgeted for is taken into account, the loss is closer to $400,000.
Its causes are complex said managing director Steve Evans, but they include borrowings for capital works and reduced water consumption.
The good news is there’s no plan at this stage to recoup the money from increased tariffs.
Mr Evans said South Gippsland Water is a $22 million-a-year business which “is fairly well on budget” so far this year and the 2008/09 loss should not cause any long term problems.
Times have changed since the debt-free days demanded by the Kennett Government after the forced merger of water boards.
Tariffs are now set by the Essential Services Commission with input from individual water authorities.
The tariffs are set for a five year period but can, on application, be altered. South Gippsland Water has three years of the current five-year agreement to go.
While some other Victorian rural water groups are having to meet deficits through raised tariffs, Mr Evans said South Gippsland has not reached that stage.
He said the authority relied on income from its customers, particularly through water usage. Consumers are no longer on the tight water restrictions of recent years but their willingness to reduce water consumption has stayed with them.
That’s a good thing from a water conservation point of view said Mr Evans, but it’s had an impact on income.
The authority’s capital works include ongoing pipe upgrades and a $16 million sewerage scheme for Poowong, Loch and Nyora. The $5 million pipe between Wonthaggi’s Lance Creek Reservoir and the desalination plant site at Williamsons Beach is not included because it is being paid for by the desalination project. Mr Evans said the pipe is not finished yet, but South Gippsland Water has been reimbursed for the work so far.
He said his staff are preparing financial documentation to present to the authority board when it meets in three weeks’ time.
“Board members already know the situation but we need to confirm that.”
Meanwhile, an annual independent survey has shown that 98 per cent of South Gippsland Water customers were satisfied with the service provided by authority staff.
“One of the best results was in managing service difficulties and faults, with 100 per cent of customers satisfied,” said Mr Evans.
The survey also found that 99 per cent of customers whose properties were connected to the authority’s wastewater services, were satisfied with those and 98 per cent were content with their water supply.
“The past year has been a challenge in terms of securing supply and ensuring quality,” said Mr Evans. “It is heartening to see that our customers have benefited from our efforts.”
The telephone survey involved more than 400 customers in 15 towns across 10 water supply districts.
Mr Evans said South Gippsland Water excelled in a number of areas, notably in how it treated and disposed of trade waste and overall satisfaction.
Survey results are used to focus on areas needing improvement.
The authority has undertaken regular customer satisfaction surveys since 1999.
Short URL: http://www.thestar.com.au/?p=133