The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Government has approved a further $9.7 million subsidy for the Water & Sewerage Corporation for the 2012-2013 fiscal year, with collections from customers down 17 per cent in last year’s second half.

Philip Davis, the Deputy Prime Minister, said that while the additional funds took the Corporation’s total subsidies for the current fiscal year to $29.7 million, this sum was still 14 per cent - $4.9 million - lower than what the Government (Bahamian taxpayer) provided in the 2011-2012 fiscal year.

Addressing the House of Assembly during the Mid-Year Budget debate, Mr Davis, who is also the minister of works and urban development, said Water & Sewerage’s operating revenues for the 2012-2013 financial year were projected to remain flat at $42 million.

“However, collections have continued to present a challenge, which could be attributed to the prevailing economic conditions,” he added. “During July-December 2012, collections declined by 17 per cent to $19million from $23million between January to June 2012.

“Operating expenses between July-December 2012 amounted to $36.7million, and total expenses for the 2012-2013 year are projected to total $74.4million.

“Cost containment efforts being advanced in the second half of this budget period will focus on energy efficiency improvements, improved preventative maintenance and reduction in overtime. Additional cost containment and revenue enhancement initiatives by the Corporation to address revenue shortfall will be considered by the Government for implementation during the 2013-2014 Budget year. It is our hope that these efforts are sustainable”

Mr Davis said Water & Sewerage had reached agreements with the trade unions representing both its line staff and middle managers to switch from the current, expensive defined benefit pension plan schemes to contributory plans. This will mean that the employees themselves have to pay into the pension plan from their salaries, with the Corporation providing a matching contribution, to ensure the cost burden is shared.

The Corporation also replaced 25,000 feet of water pipes on New Providence during the 2012 second half, a project that cost $900,000. This was done to eliminate rusty water and low pressure.