Building for the future BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
Barwon Water’s youth and environment ambassador, Kelly Cartwright, at the 2010 Sustainable Home and Garden Expo.
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Contents
About this report 4
Part 1 – About us 5
Part 2 – The year in review 11
Part 3 – Corporate Governance 17
Part 4 – Our performance 29 Financial performance 29 What we do – Operations 35 What we do – Systems and Infrastructure 40 What we do – Environment 46 What we say – Customers and the Community 65 How we behave – Our People 75
Appendix One: Disclosure index 82
2009–2010 Performance Report 83
Annual Financial Statements 89
Appendix Two: Whistleblower Procedures 131
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ABOUT THIS REPORT
This annual report is a summary of programs Our sustainability reporting is combined within the annual report to reflect the ongoing integration of sustainability and initiatives designed to meet key actions, into our everyday business activities and environmental key result areas and performance indicators leadership. set out in our Strategic Intent 2009-2014. Barwon Water is committed to reporting against the Triple Bottom Line, which forms the social, economic Our Corporate Plan also informs our and environmental dimensions of our activities, products and services. operational direction, and is submitted annually to the Minister for Water and the Additional copies Treasurer of Victoria. This annual report is available for viewing or download from our website www.barwonwater.vic.gov.au As part of Barwon Water’s goal to continually improve our environmental performance, we only print limited numbers of the annual report. We encourage those with internet access to view the report online. If you require any additional printed copies, please contact Barwon Water using one of the below methods.
Your feedback Barwon Water welcomes your feedback on our performance and the content of this report. Email: [email protected] Telephone: 1300 656 007 Calling from overseas: +61 3 5226 2500 In writing: PO Box 659, Geelong, Victoria 3220 In person: 61-67 Ryrie Street, Geelong, Victoria
ISSN 1838-2916 (Print) ISSN 1838-2924 (Online)
© Barwon Region Water Corporation 2010. This publication is copyright. No part may be reproduced by any process except in accordance with the provisions of the Copyright Act 1968.
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PART 1
ABOUT US
Barwon Water (Barwon Region Water Our region Corporation) is Victoria’s largest regional Our region of responsibility stretches from Little River and the Bellarine Peninsula in the east to Colac in the west, urban water corporation. Our history dates and from Meredith and Cressy in the north to Apollo Bay back to the establishment of the Geelong on Victoria’s south-west coast. Municipal Waterworks Trust in 1908. Our service area encompasses the following municipalities: The City of Greater Geelong, Borough of Queenscliffe, Barwon Water was constituted in February Surf Coast and Colac Otway shires and part of Golden Plains Shire. A map of our service region is on page 143. 1994. For the 2009-2010 reporting period, Barwon Water operated as a statutory Assets corporation under the Water Act 1989. We manage an asset base of $1.21 billion, including: 10 major reservoirs Barwon Water provides high quality water 11 water treatment plants and sewerage to more than 280,000 nine water reclamation plants permanent residents over 8100 square kilometres. Over the holiday period, two groundwater fields our serviced population can reach 213 pumping stations (52 water; 161 sewerage) 510,000 people. 39 local water storages more than 5700 kilometres of pipes. As a major employer in the region, Barwon Water has more than 400 operational, engineering, strategic planning, financial and administrative employees.
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ABOUT US
Water sources Recycled water Our water is sourced mainly from catchments on the upper All water reclamation plants produce water suitable for Barwon and Moorabool rivers, and from underground recycling. In 2009-2010 the volume of recycled water used aquifers deep below the Otway foothills. was 3017 megalitres, which was 16.0 per cent of the total recycled water produced by Barwon Water. Our target is The Barwon River system, from its Otway Ranges to beneficially reuse 25 per cent of recycled water by 2015. catchment, typically supplies 70 per cent of the water for Geelong, the Bellarine Peninsula and Surf Coast via the Wurdee Boluc Reservoir and water treatment plant. Biosolids The balance is supplied from catchments on the Moorabool Barwon Water reuses 100 per cent of the biosolids River system, which provide water to the Moorabool water produced by our water reclamation plants. treatment plant at She Oaks, north of Lethbridge. In 2009-2010, more than 3000 tonnes of dried biosolids The Moorabool system also provides water to Anakie, were used in accordance with EPA Guidelines to help Staughton Vale, Bannockburn, Gheringhap, Teesdale, produce crops of barley, wheat, and canola, returning Shelford and Inverleigh. valuable nutrients, such as nitrogen and phosphorous, back In 2009-2010, the Barwon Downs borefield is an integral to the soil. See page 37 for more information on biosolids. part of Geelong’s supply, providing around 48.3 per cent of Geelong’s 2009-2010 demand. Future growth The Anglesea borefield helped boost our supplies, Over the coming years we will continue an unprecedented pumping water to Geelong’s Wurdee Boluc Reservoir in program of capital works focusing on water, sewerage and November 2009 and supplied around 6.0 per cent of recycling infrastructure to ensure customers have safe, 2009-2010 usage. reliable and sustainable water to meet future population growth and development. Supplies in the Colac and Otway regions are drawn from five separate sources, all located in the forested catchments of the Otway Ranges. The Colac system provides water to Corporate governance urban and rural districts extending as far north as Cressy. Barwon Water is established under the Water Act 1989. Gellibrand, Aireys Inlet/Fairhaven, Apollo Bay/Skenes From 3 August 2007, the Hon. Tim Holding MP, Minister Creek and Lorne have their own supply systems. for Water, was the responsible Minister. Since 28 July 2004, Barwon Water has operated under Water customers a Statement of Obligations issued by the Minister for Residential customers comprise around 91.7 per cent of Water under section 41 of the Water Industry Act 1994. the customer base, with the industrial and commercial The statement imposes obligations on Barwon Water sectors accounting for the remaining 8.3 per cent. regarding the performance of its functions and exercise Around 34 per cent of metered consumption is attributed of powers. to non-residential customers. Barwon Water is required to monitor compliance with Water reclamation plants the obligations set out in the statement, report on non-compliance, and take remedial action in relation Barwon Water has nine water reclamation plants, which to non-compliance. are all governed by a single EPA Corporate Licence. Black Rock, Anglesea, Apollo Bay and Lorne plants release water On 1 January 2004, the Essential Services Commission through ocean outfalls. Plants at Aireys Inlet, Bannockburn, became the economic regulator of the Victorian water Portarlington and Winchelsea are land-based systems. sector. The Commission’s role encompasses regulation Water from the Colac facility is released into Lake Colac. of prices, service standards and market conduct. See page 17 for information on our corporate governance.
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OUR STRATEGIC INTENT BUILDING FOR THE FUTURE
In 2008, Barwon Water developed the Strategic Intent, our blueprint for the future. It is a rolling five-year plan which encompasses our promise to stakeholders, strategic directions and objectives for our business, and actions for our staff.
The Strategic Intent forms a framework for Barwon Water Our promise to become a high-performance organisation. It outlines our intention to build on our partnerships with the ‘We promise to provide sustainable community and our plans to provide environmental water and sewerage management leadership to ensure a sustainable future for our region. to our community through innovation, A summary version of our Strategic Intent is available for downloading on our website www.barwonwater.vic.gov.au leadership, real community relationships or by phoning 1300 656 007. and a high-performance workforce.’ This annual report is structured around the key actions, key result areas and performance indicators as set out in the Strategic Intent. The chapters are based around the seven strategic directions, or pillars, of this document. These pillars inform what we do, what we say, how we behave and how people experience and feel about us.
What we do Our values 1. Provide environmental leadership 2. Provide long-term water security and Respect reliable sewerage systems High performance 3. Provide high-quality and affordable water and sewerage services Innovation Relationships What we say Leadership 4. Communicate, listen, engage and educate our community and stakeholders
How we behave 5. Build a high-performance organisation
How people experience and feel about us 6. Achieve a reputation for excellent customer service and stakeholder relationships 7. Build trust through performance, education, consultation and engagement
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OUR Plan on a page
Our promise We promise to provide sustainable water and sewerage management to Our our community through innovation, leadership, real community Promise relationships and a high performance workforce.
Respect High Performance Innovation Relationships Our Leadership Our Customer/ Behaviour Stakeholder Expectation
How people What we do What we say How we behave experience us and feel about us
Communicate, Achieve a reputation Provide listen, engage Build a high for excellent environmental and educate performance customer service leadership our community organisation and stakeholder and stakeholders relationships
Build trust through Provide long-term performance, water security and education, reliable sewerage consultation and systems engagement
Provide high-quality and affordable water and sewerage services
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Message from OUR Roger Lowrey chairman Chairman
Barwon Water’s commitment to long-term water security took a giant leap forward in 2009-2010. The start of operations at the Anglesea borefield, solid The Northern Water Plant and a new high-tech recycled progress on the Melbourne-Geelong Interconnection and water plant at Black Rock are the foundations on which advanced planning for the Northern Water Plant heralded Barwon Water will boost recycled water use. Indeed, the significant milestones in guaranteeing water for the future. Black Rock facility will break new ground in promoting water sensitive communities through the region’s first These ‘new water solutions’ were among key actions in the dual pipe scheme at Armstrong Creek. visionary Central Region Sustainable Water Strategy, which set the direction for providing water for communities, But this is just the beginning of the recycled water business, industry and the environment to the year 2055. revolution, with other schemes and other options under review. Barwon Water has accelerated these initiatives to the extent we are well placed to accommodate forecast The corporation also is undertaking innovative research growth in a sustainable, cost-efficient and environmentally into sewer mining, aquifer storage and recovery and responsible way. stormwater harvesting. All present Barwon Water with leadership opportunities in sustainable water management. But while these ‘big ticket’ items in Barwon Water’s record capital investment program are crucial to the region Underpinning all the initiatives, investigations and overall, there are a raft of other smaller - but equally research is a commitment by Barwon Water to meet the important - projects that will benefit local communities. present and future needs of the community. The actions we are taking are detailed in this report. A new water storage for Apollo Bay, connecting Meredith to the Geelong system, supply improvements to Colac, In closing, I acknowledge the support and encouragement a new sewerage scheme for Birregurra and substantial of the State and Federal Governments and the co-operation infrastructure upgrades on the Bellarine Peninsula are of the various agencies. examples of our promise to provide safe and reliable I thank my fellow Directors for their guidance and the services. management team for its continuing commitment to The corporation will continue to invest heavily in capital excellence. The Board and I are also conscious of the projects in a diversified approach to water security. Our valuable contribution of employees across all areas $766 million capital works program over coming years is of the business. testament to that. In accordance with the Financial Management Act 1994, But we are also focused on other options that will allow I am pleased to present the Barwon Region Water us to meet the demands and challenges ahead. Corporation’s annual report for the year ending 30 June 2010. Recycled water in particular will play an increasingly critical role in supply security. The most emphatic message coming out of Barwon Water’s 2010 customer perception survey was support for recycled water, with a staggering 94 per cent of participants favouring recycled water for non-drinking purposes. This was a clear endorsement of the corporation’s strategy package for managing water resources. Roger Lowrey Chairman
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Message from OUR Michael Malouf MANAGING Managing Director DIRECTOR
Barwon Water’s blueprint for the future, the Strategic Intent, began delivering real results in 2009-2010. The Strategic Intent is the corporation’s promise to The partnership ticks all the boxes in terms of meeting our customers and employees to provide sustainable water Strategic Intent and will lead to better outcomes for the and sewerage management to the community through community and Barwon Water. innovation, leadership, real community relationships The corporation’s commitment to environmental leadership and a high-performance workforce. was expressed through its first Greenhouse Strategy, While there were key achievements across all areas of launched in September 2009. The strategy commits the business, the focus was firmly on water security for Barwon Water to aspirational targets of zero net emissions the future. by 2018 and 75 per cent renewable energy use. A new water source, the Anglesea borefield, came online Communication and engagement with customers and in November and is already boosting supplies. stakeholders was increased significantly during the year in line with one of the major objectives articulated in the Fast-tracked in response to reduced rainfall and population Strategic Intent. growth, it is expected to deliver an average up to 7000 million litres a year to the greater Geelong community. Similarly, a second customer perception survey was conducted to gauge progress on the 2008 survey, The borefield, along with other major new water projects particularly in relation to Barwon Water’s performance the Melbourne-Geelong Interconnection and Northern and future planning. While results were generally on a Water Plant, will provide an additional 75 per cent of par with the earlier feedback, there was increasing current demand within five years. These three projects awareness of Barwon Water’s long-term vision for alone will guarantee we cater for development in one of securing the region’s water supply. the fastest growing areas in Victoria and address the potential impacts of climate change. Our cultural change program continued to gain momentum and will help meet our strategic objective to build a high The Melbourne-Geelong pipeline project will be completed performance organisation. by the end of 2011 while the Northern Water Plant will be commissioned in mid-2012. The foundations laid through the Strategic Intent, from water security and environmental sustainability to While these projects are stand-outs, they are just part innovation and community engagement, will ensure of an unprecedented investment in capital projects over Barwon Water shows strong leadership in meeting the coming years. challenges ahead. New water, sewerage and recycled water infrastructure I thank the Board, management and employees for their will ensure we meet community expectations, continue ongoing support and commitment as we continue to to deliver quality services and comply with regulatory deliver our strategic objectives. requirements. This investment is already benefitting our community; the Anglesea borefield, for example, was a major factor in easing restrictions in the Geelong region in early 2010. Many of the projects that will meet forecast growth and development are being delivered through a new partnership with the private sector, known as the Barwon Water Alliance. The Alliance, a first for Barwon Water, has been established to ensure the successful delivery of a capital Michael Malouf works program triple that of our normal investment. Managing Director
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PART 2
THE YEAR IN REVIEW
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KEY DATES AND HIGHLIGHTS
July 2009 February 2010 Organisational values launched Laundries Water Efficiency Program launched Site selected for Birregurra water reclamation plant Meredith pipeline project begins $10 million Federal Government funding officially $3.5 million project to cover the Queenscliff announced for Black Rock recycled water plant basins completed
August 2009 March 2010 $3 million major sewer pipeline constructed between Water restrictions eased to Stage 3 in greater Geelong Barwon Heads and Black Rock water reclamation plant Sustainable Home and Garden Expo attracts more than Victorian Premier John Brumby officially opens the 12,000 people Barwon Water Alliance Community and Stakeholder Water Forum held focusing on alternate water sources September 2009 Barwon Water becomes first Business Associate Strategic Intent launched at the first in a series of partner in Alcoa Make An Impact Program water forums First Greenhouse Strategy launched May 2010 Leadership Water Forum, Expert Advisory Panel and Barwon Water welcomed the announcement of funding Aquifer Storage and Recovery (ASR) research project in the State Budget for a new government office announced complex in Geelong October 2009 Tenders for the supply of pipes open for the Melbourne-Geelong Interconnection Stage 4 daylight saving water restrictions begin $12 million project to double Torquay’s water supply June 2010 capacity approved Essential Services Commission approves new water November 2009 and sewerage charges First Barwon Water scholarship winners Annual Report wins gold at Australasian begin internships Reporting Awards Anglesea borefield comes online WaterSecure Home program extended across the region following successful pilot program in Geelong $4.7 million Painkalac Reservoir upgrade approved Tenders open for main construction contract December 2009 for the Melbourne-Geelong Interconnection Colac pressure reduction trial leads to 38 per cent reduction in bursts and leaks Northern Water Plant pilot trial begins
January 2010 Make A Splash community competition to design Barwon Water’s new brand launched
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AT A GLANCE
At a glance
2009-10 Change 2008-09 Change 2007-08 Change 2006-07 Change 2005-06 Change (%) (%) (%) (%) (%) Population served (water) 281,087 1.7 276,260 1.4 272,477 -1.1 275,433 1.6 271,000 2.2 Population served 254,917 1.8 250,454 1.5 246,799 -1.0 249,247 1.6 245,413 2.2 (sewerage) Connected properties 135,066 1.6 132,905 1.8 130,568 2.7 127,168 1.7 125,041 2.0 (water) Connected properties 121,054 1.5 119,223 1.9 116,963 2.7 113,935 1.7 112,062 1.9 (sewerage) Water treatment plant 30,583 -5.9 32,493 2.0 31,867 -4.5 33,381 -18.6 41,013 4.0 volumes (megalitres) Water reclamation plant 19,325 1.4 19,061 -8.3 20,806 1.0 20,596 -13.9 23,910 -3.9 volumes (megalitres) Employee numbers 404* 8.0 374 * 4.2 359*‡ 11.8 375* 4.2 360* -0.6 Number of days lost 72 -57.4 169 38.5 122 306.7 30 -79.9 149 19.2 to injury Total revenue ($'000) 139,918 10.0 127,236 15.5 110,177 3.3 106,689 0.7 105,957 3.6 Net operating result (before income tax) 18,159 27.0 14,299 120.2 6,493 -28.1 9,030 -27.8 12,506 11.3 ($'000) Total assets ($'000) 1,206,538 6.0 1,138,245 6.6 1,067,453 4.3 1,023,831 3.2 992,125 1.1 Capital expenditure 94,318 9.2 86,357 48.4 58,190 25.3 46,451 37. 3 33,824 -18.5 ($'000)
Notes * Measured as full-time equivalent (FTE) employees. ‡ The Australian Bureau of Statistics (ABS) develops and maintains standard occupation coding structures for labour market analysis. The primary ABS occupation coding structure is known as ANZSCO (Australian and New Zealand Standard Classification of Occupations). Barwon Water utilises ANZSCO as its occupational reporting model.
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AT A GLANCE
Regional metered water consumption (megalitres)
2009-10 Change 2008-09 Change 2007-08 Change 2006-07 Change 2005-06 % % % % Apollo Bay 218 7.9 202 1.6 198 -23.6 260 -9.4 286.2 Aireys Inlet 96 -5.0 101 0.9 100 -37.7 161 -6.8 172.3 Anglesea 285 -1.0 288 2.0 283 -11.2 319 -25.3 426.5 Bellarine Peninsula 3,437 -2.1 3,512 3.7 3,388 -8.7 3,710 -26.4 5,041.1 Colac 2,629 -8.3 2,866 -5.1 3,021 -13.2 3,480 -5.3 3,673.5 Geelong urban 19,807 -6.2 21,114 -1.2 21,024 -3.5 21,785 -18.9 26,878.9 Lorne 291 -2.3 298 27.9 311 -7. 3 336 -0.3 336.4 Skenes Creek 26 0.0 26 -6.4 28 -10.8 31 0.0 31.4 Torquay 1,124 -2.3 1,151 12.8 1,021 -13.0 1,173 -27. 3 1,613.6 Total 27,913 -5.6 29,558 0.97 29, 374 -6.0 31,255 -18.7 38,459.9
Bellarine Peninsula: Barwon Heads, Bellarine, Breamlea, Clifton Springs, Curlewis, Drysdale, Indented Head, Mannerim, Marcus Hill, Ocean Grove, Point Lonsdale, Portarlington, Queenscliff, St Leonards, Swan Bay, Wallington. Geelong urban includes: Anakie, Avalon, Balliang, Bamganie, Bannockburn, Batesford, Birregurra, Fyansford, Gheringhap, Inverleigh, Leopold, Lethbridge, Little River, Marshall, Maude, Meredith, Modewarre, Moorabool, Moriac, Mount Moriac, Murgheboluc, She Oaks, Shelford, Staughton Vale, Sutherlands Creek, Teesdale, Thompson, Winchelsea, Wurdiboluc.
Residential and non-residential metered water consumption
2009-10 Residential Non-residential District Number1 Volume Number1 Volume Total Average annual consumed2 consumed2 consumption consumption3 (ML) (ML) (ML) (ML) Geelong & district 111,771 16,353 9,735 7,879 24,233 25,024 Colac & district 6,384 1,656 1,095 1,304 2,960 3,201 Apollo Bay/Skenes Creek 2,014 176 170 120 296 286 Lorne 2,205 200 154 90 291 300 Aireys Inlet/Fairhaven 1,492 123 46 10 134 138 Total 123,866 18,510 11,200 9,403 27,913 28,948
1. This is the total number of properties connected to Barwon Water’s water supply service. 2. Metered consumption excludes non-revenue water. 3. Average calculated over three years.
Non-revenue water
Total Non-revenue water (ML) 2009-10 2008-09 2007-08 2006-07 2005-06 Barwon Water Service Region 2,670 2,935 2,494 2,128 2,553
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AT A GLANCE
Availability of water services
Area Estimated Total number Estimated Total number Population Properties permanent of properties permanent of properties Increase increase population served (1) connected (2) population served (1) connected (2) (%) (%) at 30/6/2010 at 30/6/2010 at 30/6/2009 at 30/6/2009 Geelong (3) 174,666 76,399 172,061 75,486 1.5 1.2
Townships Leopold/Drysdale/ 23,207 8,961 22,585 8,698 2.8 3.0 Clifton Springs Portarlington/Indented Head/ 6,949 6,057 6,894 5,894 0.8 2.8 St Leonards Queenscliff/Point Lonsdale 4,506 3,668 4,474 3,632 0.7 1.0 Ocean Grove/Barwon Heads 17,268 9,030 17,014 8,817 1.5 2.4 Torquay/Jan Juc 14,587 7,555 14,131 7,285 3.2 3.7 Anglesea 2,541 3,060 2,533 3,045 0.3 0.5 Winchelsea 2,065 921 2,046 910 0.9 1.2 Birregurra 677 330 675 329 0.3 0.3 Otway Region (4) 20,532 13,560 20,344 13,423 0.9 1.0 Other Areas (5) 14,089 5,525 13,503 5,386 4.3 2.6 Total 281,087 135,066 276,261 132,905 1.7% 1.6%
(1) Excludes holiday residents and visitors. (2) Includes all customer groups (ie. residential, commercial & industrial). (3) Includes Geelong urban area, Lara, Batesford, Waurn Ponds, Fyansford and adjoining semi-rural development. (4) Otway Region includes the towns of Colac, Lorne, Aireys Inlet, Apollo Bay, and surrounding regions. (5) Includes all other townships and rural areas within Barwon Water’s District.
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AT A GLANCE
Availability of sewerage services
Area Estimated Total number of Estimated Total number of Population Properties permanent properties permanent properties Increase increase population connected (2) population connected (2) (%) (%) served (1) at 30/6/2010 served (1) at 30/6/2009 at 30/6/2010 at 30/6/2009 Geelong (3) 170,271 73,403 167,475 72,535 1.7 1.2
Townships Leopold/Drysdale/ 21,596 8,123 20,997 7,898 2.8 2.8 Clifton Springs Portarlington/Indented Head/ 6,607 5,537 6,555 5,387 0.8 2.8 St Leonards Queenscliff/Point Lonsdale 4,466 3,536 4,438 3,507 0.6 0.8 Ocean Grove/Barwon Heads 17,064 8,721 16,831 8,539 1.4 2.1 Torquay/Jan Juc 13,939 7,111 13,499 6,891 3.3 3.2 Anglesea 2,532 2,990 2,524 2,976 0.3 0.5 Winchelsea 1,436 596 1,410 590 1.8 1.0 Otway Region (4) 17,006 11,037 16,724 10,900 1.7 1.3 Total 254,917 121,054 250,455 119,223 1.8 1.5
(1) Excludes holiday residents and visitors. (2) Includes all customer groups (ie. residential, commercial and industrial). (3) Includes Geelong urban area, Lara, Waurn Ponds & Bannockburn. (4) Otway Region includes the towns of Colac, Lorne, Aireys Inlet, Apollo Bay and surrounding regions.
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PART 3
CORPORATE GOVERNANCE
Role of the Board The Board is responsible for the overall corporate governance of Barwon Water, including strategic direction, establishing goals for management, and monitoring the achievement of those goals to optimise performance within the parameters of the organisation’s broader obligations. Barwon Water is subject to the Water (Governance) Act 2006.
Board composition The Board comprises a non-executive Chairman, six non-executive Directors and a Managing Director. The non-executive Chairman and non-executive Directors are appointed by the Minister for Water. The Managing Director is appointed by the Board in accordance with the Water (Governance) Act 2006.
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CORPORATE GOVERNANCE
Board meetings Capital Works Committee Board meetings are scheduled monthly. Additional The Capital Works Committee, comprising non-executive meetings are convened as circumstances warrant. Directors, is responsible for overseeing the capital works Minutes of meetings record Board decisions. delivery process. The committee reviews capital works objectives, delivery strategies, scope, timing and budgets. The Managing Director and General Managers attend Board meetings. The General Manager Finance and Members/Directors: Administration is also the Company Secretary, providing Robyn Batten (Committee Chair) advice to the Board on governance matters. John Bugg The Board has three sub-committees: Audit and Risk Claire Higgins Management Committee; Capital Works Committee; and Diane James Executive Remuneration Committee. Each Board sub- Des Powell committee has its own Board-approved charter and reports to the Board following each meeting. Ethical standards The Board acknowledges the need for, and continued Audit and Risk Management Committee maintenance of, the highest standards of corporate The Audit and Risk Management Committee comprises a governance practice and ethical conduct by all Directors, non-executive Chairman and four non-executive Directors. employees and contractors. The Board has a Meetings are held quarterly and at any other time as comprehensive governance framework that seeks to requested by a member of the committee or the internal or ensure high standards of ethical behaviour through external auditor. The committee liaises with the internal adoption of policies supported by specific awareness and auditor and external auditor to evaluate the adequacy and compliance programs. effectiveness of the overall governance framework. Performance evaluation During the 2009-2010 reporting year, the committee addressed facilitating risk management across the The Board has established a formal process to review its organisation, reviewed and approved the risk register own performance, its committees and individual Directors and strategies to address risks, monitoring action plans consistent with the Governance Guidelines issued by the and risk levels. Department of Sustainability and Environment and State Services Authority. Members/Directors: John McDonald (Committee Chair) Independent advice John Bugg Individual Directors have access to independent advice Claire Higgins from a range of services. Diane James Des Powell Code of Conduct Executive Remuneration Committee The Public Service Code of Conduct has been issued to Barwon Water employees with the objective of promoting The Executive Remuneration Committee comprises the among employees a spirit of service to the community. non-executive Chairman and two non-executive Directors. It emphasises the principles of merit, responsible The committee reviews remuneration arrangements and management, management competence and efficiency and terms of employment for the General Management team maintaining appropriate standards of integrity and conduct. and succession planning.
Members/Directors: Roger Lowrey (Committee Chair) John McDonald Robyn Batten
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BOARD DIRECTORS
Roger Lowrey Chairman Michael Malouf MANAGING DIRECTOR BA (Hons), DipEd BEng (Civil), MBA, LGE, FIPAA, FAICD, FIEAust, CPEng Appointed to Board: October 2003 EngExec Appointed to Board: September 2007 Roger Lowrey has a Bachelor of Arts (honours) degree from the University of Melbourne. He has worked Michael Malouf is Managing Director of Barwon Water. He extensively across both the public and private sectors in is also a member of the Board of Directors. the education, emergency services, planning, small business, aviation and finance industries. For the past 15 Michael’s previous positions include General Manager years he has worked in the finance industry specialising in Property & Leasing at Pratt Holdings, Chief Executive of superannuation, industrial law and human resource Carlton Football Club and Chief Executive at Melbourne management. City Council, City of Greater Geelong, City of Wyndham and City of Melton. Roger has been a Barwon Water Director since 2003 and was Chair of the Audit Committee in 2007. He became Michael is currently a Member of the Committee for Chairman of Barwon Water on 1 January 2008. Geelong, G21 Geelong Region Alliance, Geelong Manufacturing Council, Deakin University Engineering Roger grew up in Winchelsea and has lived in Geelong and Advisory Board, Deakin University Geelong Community the surrounding district most of his life. His personal Leaders Group, IWA Executive Council, Chair of the interests include his family, horse racing, writing, cooking Australian Division of the WateReuse Association, a and the Geelong Football Club. Director of St Laurence Community Services and a Member of the Victorian Regional Development Australia John McDonald Deputy Chairman Barwon South West Committee. LS, MAdmin (Monash) Diane James Appointed to Board: October 2003 GAICD John McDonald is a Licensed Surveyor and has a Master Appointed to Board: October 2006 of Administration degree from Monash University. He has worked in the Water Industry in Victoria for over 50 years. Diane James has chaired a number of state and federal Since retiring from full-time employment, John has bodies involved in coastal and oceans management. She maintained an active involvement in Water Management chaired the Victorian Coastal Council, leading the and Natural Resource Management as a Board member of development of the Victorian Coastal Strategy and the Barwon Water for the last seven years and as a Board Coastal Spaces policy, and was a leading campaigner for member and Community representative on the the introduction of Victoria’s world-first system of marine Corangamite Catchment Management Authority over the national parks. last 10 years. Diane is also a board member of the Environment Protection Authority and St Laurence Community Services. In the private sector, Diane runs a company that markets and exports a product for children with disabilities. She is nearing completion of a Graduate Certificate in Innovation and Entrepreneurship.
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BOARD DIRECTORS
John Bugg Des Powell BComm, DipEd (Melb), ACE (Bristol UK), MEd Admin (New Appointed to Board: October 2007 England), FACE, FAPPA, GAICD Des Powell has held a range of senior executive Appointed to Board: October 2006 management roles in both the private and public sectors John Bugg was formerly the Head of Junior School at in Australia and Asia. He operates his own consultancy Geelong Grammar Highton and Essendon Grammar business with clients across a range of industries, School, Melbourne. including transport, logistics, education and natural resources. He was elected to the Borough of Queenscliffe Council in March 1997, and was Mayor from 1998-2001 and 2004- Des holds a number of positions, including Director 2005. He has been an active member of several regional of Goulburn-Murray Water, Deputy Chair of Port of and local community committees. Melbourne, Chair Edmund Rice Education Australia, and has been Chairperson Alpine Resorts Co-ordinating John was a member of the Geelong Regional Library Council since April 2010. Corporation from 1997 until 2006 and for some of that time held the position of Chairman. Robyn Batten He was also a trustee of the Geelong Regional Performing BSW, MSW, MBA, Dip AICD Arts Centre from 1998 to 2006 and a Board member Appointed to Board: October 2006 of G21. Over the past 20 years, Robyn Batten has held executive Claire Higgins management positions in local government and health and is currently the Executive Director of Uniting Aged BComm, FCPA, FAICD Care. Through these roles and membership of other Appointed to Board: October 2007 Boards, Robyn has developed significant experience Claire Higgins has extensive governance, management, in corporate governance, risk management, strategic finance and accounting experience with major Australian planning and change management. and international corporate entities. Robyn has trained as a nurse and social worker and holds In addition, Claire holds various Board positions with a Bachelor of Social Work, Master of Social Work, Master Victorian statutory entities. Claire is married with two of Business Administration and Diploma from the daughters and lives in the Surf Coast Shire. Australian Institute of Company Directors.
2009-2010 BOARD AND COMMITTEES OF THE BOARD ATTENDANCE
Board meetings Audit and Risk Executive Remuneration Capital Works Committee Management Committee Committee meetings meetings meetings Roger Lowrey 14 of 14 **3 of 5 1 of 1 **3 of 3 John McDonald 13 of 14 5 of 5 1 of 1 *2 of 3 Michael Malouf 13 of 14 *** *** *** Diane James 13 of 14 4 of 5 * 3 of 3 John Bugg 13 of 14 5 of 5 * 2 of 3 Claire Higgins 14 of 14 4 of 5 * 3 of 3 Des Powell 14 of 14 5 of 5 * 3 of 3 Robyn Batten 12 of 14 * 1 of 1 3 of 3
* Indicates non-member of committee ** Indicates ex-officio member of committee *** Managing Director is ex-officio on all subcommittees
PAGE | 20 PAGE | 21 BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
corporate structure
Board
Audit and Risk Executive Capital Works Management Remuneration Committee Committee Committee
Internal Auditor Managing Director Media Relations D Davie M Malouf G Vincent
Finance & Customers and Capital Projects Strategy & Organisational Administration/ Water Systems Communication & Greenhouse Technology Development Co. Secretary C Bicknell L Muñoz P Northey J Adamski L Hunter M Watson
Corporate marketing, Accounts payable Management and Asset design Asset management Innovation communications & event service operation of water & construction strategy Cultural change management Asset accounting catchments and Engineering project Capital works planning Business improvement storages Education/schools function management Economic regulation Employee relations programs Optimisation of Company secretarial Alliance interface Geospatial services Recruitment Customer call service water treatment and & governance Information & Learning and centres (incl. 24 hour distribution systems Corporate business Strategic sustainability communications development emergencies and service planning Water quality monitoring management technology Occupational health faults response) Management and Facilities services Triple Bottom Line and Integrated Management and safety Water/sewerage operation of sewerage life cycle assessment Financial/statutory Systems: Health and Remuneration services connections reporting systems Greenhouse strategy Safety, Environmental, Customer billing Fleet services Optimisation of sewage and reporting Quality and Risk services treatment and recycled Insurance services Environmental planning Management Development services water production Management accounting Spatial data acquisition Library Water conservation Management of trade and supply Pricing policy Printing services waste collection and services Surveying Regulation interface Procurement treatment Metering policy Mapping Strategic Intent & operations Property management Management of recycled Cartography coordination Planned and reactive Records management water and biosolids from CAD application support Strategic planning maintenance Stores sewage treatment Strategic sustainability Tax management Natural resource management services Treasury management Water conservation planning Water recycling policy & planning Water resource planning Water & sewerage system planning Water Plan preparation & monitoring
PAGE | 20 PAGE | 21 BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
MANAGEMENT sYSTEM
Integrated Management System Audits Barwon Water’s Integrated Management System (IMS) In addition to the external audits, quality management continues to be the framework of policies, processes and (including water quality using HACCP principles), procedures that define, control and improve the environmental management and OHS management, the organisation’s performance relating to customer certified components of the organisation’s IMS are subject satisfaction, environmental management, and the health to internal compliance reviews. and safety of employees and members of the public. External audits are conducted by a third-party certification Barwon Water is committed to the continued improvement body. The quality, environmental and OHS management and maintenance of its IMS by: system components of the organisation’s IMS are subject to an extensive triennial recertification audit and aligning commitments and objectives with the surveillance audits in other years. Strategic Intent Programmed internal reviews are scheduled to provide identifying improvement and streamlining a broad overview of activities and processes. Both internal opportunities through a broad consultation process and external audits determine the effectiveness of the with employees, contractors and external parties IMS, whether the organisation is meeting its stated implementing changes based on external influences performance objectives, and opportunities to improve and best practice capabilities the IMS as part of the continual improvement process. having open conversations with all stakeholders about system improvement opportunities and implementing suggestions implementing new programs addressing incidents and implementing programs to improve safety performance protecting and enhancing the quality of water delivered to customers assessing sustainability options at both the planning and operational phase to minimise the organisation’s environmental footprint performing regulatory compliance reviews relating to water quality, Occupational Health and Safety (OHS) and environment, and establishing actions to address any deficiencies using effective technology to manage risk, and identifying opportunities and implementing new technology to improve performance ensuring continuity of critical business services and recovery of normal operations in emergencies through plans consistent with the Australian Inter-Service Incident Management System (AIIMS) promoting awareness of quality issues, environmental and health and safety risks among employees, contractors, customers and stakeholders.
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KEY LEGISLATIVE COMPLIANCE REQUIREMENTS
Barwon Water operates under the provisions of the Water Environment Protection Act 1970 Act 1989 and the Water (Governance) Act 2006. Under these Acts, Barwon Water must provide, manage, operate Environmental regulations have a significant effect on the and protect water supply and sewerage systems, including operation and maintenance of Barwon Water’s sewerage collection, storage, treatment, transfer and distribution. system. The suite of environmental requirements include the Environment Protection Act 1970 and the associated Other key regulatory provisions relating to water regulations, state environment protection policies, waste resources are the: discharge licences, protocols and guidelines for Catchment and Land Protection Act 1994: Barwon environmental management. Water’s catchments are gazetted Special Water Supply The Environment Protection Act 1970 covers operation and Catchments under this Act maintenance of sewerage systems to prevent pollution of Statement of Obligations: Sets out Barwon Water’s land and/or waterways and objectionable odours, and also obligations to government as shareholder to undertake requires diligent response to incidents such as blockages, actions contained in the Statement pump breakdowns and pipe failures if they occur. Bulk Entitlements: Barwon Water’s right to harvest water Other regulatory environmental instruments include: from waterways is detailed in the Bulk Entitlement Guidelines for Environmental Management: Guidelines Conversion Orders. These orders are made as per the established by the EPA under the Environment Protection requirements of Part 4, Division 1 of the Water Act 1989 Act 1970, include: and cover 10 waterway systems throughout Barwon Water’s district. Within the orders are requirements Guidelines for Environmental Management: on Barwon Water to manage, monitor and report on Use of Reclaimed Water 2003 system storage levels, inflows to the system, diversions Guidelines for Environmental Management: Sustainable from the waterway and maintenance of passing flows Re-use of Biosolids – Land Application 2004. at the diversion point. There is also an obligation to manage and report on the environmental impact of State Environment Protection Policies: Subordinate diversion works. legislation made under the Environment Protection Act 1970. The SEPP – Waters of Victoria (clause 35) Safe Drinking Water Act 2003 addresses avoidance or minimisation of pollution This Act and associated regulations require through sewer overflows, leakages and collapses to Barwon Water to: protect beneficial uses.
make provision for the supply of safe drinking water EPA Waste Discharge Licences: Barwon Water holds by preparing and implementing plans to manage risks a Corporate Licence which details the environmental in relation to drinking water and some types of performance conditions for each of our nine water non-potable water reclamation plants. The corporate licence also includes have those plans audited by approved auditors a sustainability commitment which outlines Barwon Waters commitment to actions to reduce our corporate specify drinking water quality standards impact on the environment, beyond our licensed sites. publicly disclose water quality information. In compliance with the Safe Drinking Water Act 2003, Barwon Water has undertaken risk assessments for all of the catchments, treatment plants and reticulation systems that form the water supply chain to Barwon Water customers.
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KEY LEGISLATIVE COMPLIANCE REQUIREMENTS
Essential Services Legislation (Dispute Essential Services Commission Resolution) Act 2000 Barwon Water is subject to regulation by the Essential Barwon Water participates in a dispute resolution scheme Services Commission for pricing and service standards. approved by the Essential Services Commission to resolve customer complaints. Risk attestation I, Roger Lowrey, certify that the Barwon Region Water State Government Dividend Corporation has risk management processes in place Barwon Water is required to pay a dividend in accordance consistent with the Australian/New Zealand Risk with a determination of the Treasurer of Victoria made Management Standard and an internal control system under the Public Authorities (Dividends) Act 1983. is in place that enables the executive to understand, The Minister for Water recommends to the Treasurer manage and satisfactorily control risk exposures. the amount of any dividend to be paid by Barwon Water. The Audit and Risk Management Committee verifies this The Treasurer will then issue a formal determination of assurance and that the risk profile of the Barwon Region the dividend payment. Water Corporation has been critically reviewed within the last 12 months. Financial Management Compliance Framework (FMCF)
Developed by the Department of Treasury and Finance as a mechanism for government to monitor, review and enforce its legislative and regulatory financial Roger Lowrey management structure (Financial Management Package). Chairman 11 August 2010
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ACCESS TO INFORMATION
Victorian Information Privacy Act 2000 Statement of availability of Barwon Water complies with the information privacy other information principles set out under the Victorian Information Privacy The following information is available from Barwon Water Act 2000. on request, subject to the Freedom of Information Act 1982. Barwon Water’s Customer Charters and Personal Privacy a statement that declarations of pecuniary interests Charter refer to our commitment to protect the privacy of have been duly completed by all relevant officers customers. We ensure the information we hold is protected and we actively prevent any unauthorised details of shares held by a senior officer as nominee or access to, and improper use of, customer information. held beneficially in a statutory authority or subsidiary A copy of Barwon Water’s Personal Privacy Charter can be details of publications produced by the entity about viewed at www.barwonwater.vic.gov.au. itself, and how these can be obtained details of changes in prices, fees, charges, rates and Freedom of Information Act 1982 levies charged by the entity Barwon Water has a comprehensive website that satisfies details of any major external reviews carried out the information needs of many individuals. However, on the entity Barwon Water is also committed to ensuring information is accessible to customers in compliance with the Freedom details of major research and development activities of Information Act 1982. undertaken by the entity Access to documents held by Barwon Water can be details of overseas visits undertaken including a obtained by writing to the Freedom of Information summary of the objectives and outcomes of each visit Manager (PO Box 659, Geelong 3220) and including details of major promotional, public relations and payment of the $23.40 ($23.90 as from 1 July 2010) marketing activities undertaken by the entity to develop application fee. community awareness of the entity and its services More information or a FoI application form is available at details of assessments and measures undertaken to www.barwonwater.vic.gov.au/foi. improve the occupational health and safety of employees Ten Freedom of Information requests were received during a general statement on industrial relations within the the year. Full access was granted to eight applications, one entity and details of time lost through industrial was not proceeded with and one is still in progress at the accidents and disputes close of the financial year period. a list of major committees sponsored by the entity, the purposes of each committee and the extent to Full access granted 8 which the purposes have been achieved. Partial access granted 0 Not proceeded with 1 Continuing 1
Responses were prepared within the statutory reporting period of 45 days.
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ACCESS TO INFORMATION
Financial Management Act 1994 Infrastructure assets - application of Other information as required under the Financial FRD 121 Management Act 1994, but not specifically referred to, Infrastructure Assets (Water/Rail) (FRD 121) recognises the has been retained by the Accountable Officer and is initial workload and heavy demand on resources within a available to the Minister, Members of Parliament and relatively tight timeframe for implementation, and the public on request. therefore provides transitional exemption. The transitional This information includes: pecuniary interests of relevant exemption relates to the application of the revaluation officers; shares held by a senior officer; details of Barwon model at the entity reporting level for 2008-2009, and Water publications; changes to fees and charges; major following Ministerial direction this has been extended to external reviews carried out on Barwon Water; research the 2009-2010 financial year. This exemption has not and development activities; overseas visits; major extended to the preparation of whole of government promotional, public relations and marketing activities; financial reports. assessments and measures to improve the occupational For the financial year ending 30 June 2010, Barwon Water health and safety of employees; and major sponsorships. has complied with FRD 121 and associated Ministerial Directives. During the 2009-2010 financial year, an interim infrastructure asset revaluation was performed, and this has been utilised as the basis for consolidation into the whole of government financial reports. Planning has commenced, in association with the Valuer- General Victoria to finalise the comprehensive revaluation in 2010-2011 to ensure ongoing compliance with these directives. Whilst not only meeting compliance requirements, the revaluation will provide useful data to assist asset management practices.
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OTHER ACTS
Building Act 1993 Whistleblowers Protection Act 2001 Barwon Water maintained its buildings in accordance with The Whistleblowers Protection Act 2001 came into effect the Building Act 1993. Workplace improvements undertaken on 1 January 2002. during the 2009-2010 financial year included the following: The Act encourages and facilitates disclosures of improper or corrupt conduct by public officers and public bodies. Ryrie Street complex The Act provides protection to ‘Whistleblowers’ who make Alterations to fifth floor to accommodate changes disclosures in accordance with the Act and establishes a brought about by organisational restructure system for the matters disclosed to be investigated and Develop iCentre (innovation catchment area) on first appropriate action taken. floor concourse Whistleblowers may be members of the public Major refurbishment of fourth floor office space to or employees. accommodate additional staffing requirements There were no disclosures under the Act in 2009-2010. Enhanced security and access by automating all roller Barwon Water’s Whistleblowers Procedures are detailed doors at rear of complex in Appendix Two, beginning on page 131. Other minor alterations across office complex.
South Geelong complex Alterations to water reclamation area, on the first floor South Geelong, to accommodate additional staffing requirements Develop iCentre (innovation catchment area) in meeting rooms on first floor. Other minor alterations across office complex.
Miscellaneous Additional alterations and refurbishment of property located at 155 Mercer Street Geelong to accommodate the Barwon Water Alliance.
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APPLICABLE POLICIES
Victorian Industry Participation Policy Act 2003 The Victorian Industry Participation Policy Act 2003 The outcomes reported by contractors under VIPP included: requires public bodies and departments to report on the local content contributed 86 per cent of the total value implementation of the Victorian Industry Participation of the contracts Policy (VIPP). 12 full-time equivalent jobs. Contracts commenced during 2009-2010: The following benefits to the Victorian economy in terms Barwon Water commenced 14 contracts during 2009-2010, of skills and technology transfer included: totalling $122.56 million in value to which the VIPP applied. All of the contracts were in regional Victoria. supply chain management The commitments by contractors under VIPP included: pipe relining local content contributed 76 per cent of the pipe manufacture and transportation total value of the contracts pipe laying, boring & pipe coating 99 full-time equivalent jobs. bore drilling and installation. The following benefits to the Victorian economy in terms of skills and technology transfer included: National Competition Policy Competitive neutrality seeks to enable fair competition water treatment technology between government and private sector businesses. construction and commissioning pump stations Any advantages or disadvantages that government businesses may experience, simply as a result of construction and commissioning treatment plants government ownership, should be neutralised. Barwon construction and commissioning pipelines Water continues to implement and apply this principle in its business undertakings. thermal sludge drying technology bore drilling and installation.
Contracts completed during 2009-2010: During 2009-2010 Barwon Water completed 13 contracts, valued at $26.07 million, to which the VIPP applied. All of the contracts were in regional Victoria.
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PART 4
OUR PERFORMANCE FINANCE
Our strategic direction Financial summary Barwon Water’s financial performance to 30 June 2010 ‘We will deliver financial performance in was an excellent result. Despite the ongoing drought and accord with the approved corporate business the subsequent reduction in water consumption, and therefore revenue, we achieved an operating surplus plan while ensuring long-term financial higher than targeted. sustainability.’ The reduction in water consumption assisted in reducing costs, along with outstanding program management and an innovative focus that is continuing to drive organisational efficiencies, leading to operational savings – and helping to provide an improved result against our target. The 2009-2010 year saw a record level of capital investment undertaken by the business. This meant significant investment in long-term water supply solutions including the commissioning of the Anglesea borefield and recycled water infrastructure, and the ongoing maintenance and replacement of our water and wastewater networks.
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FINANCE
Challenges overcome Major changes or factors affecting Key to the financial success of Barwon Water over the performance 2009-2010 financial year was to ensure we mitigate the Barwon Water’s financial position remains strong given offsets of the global financial crisis (GFC) on all facets the challenges faced, including ongoing dry conditions of the organisation. and the current economic climate. An operating surplus A major focus was obtaining new funds for capital works (before income tax) of $18.2 million was achieved, higher at a competitive price for now and in the future. That is, than the target of $16.6 million. ensuring our funding needs throughout the GFC period Revenue received from customers was $6.2 million lower had minimal impact on our longer-term viability. than target. The ongoing drought and Stage 4 restrictions continuing in areas across our region has seen our Significant changes in financial position community embrace water conservation measures. Barwon Water achieved a record level of capital investment The subsequent reduction in revenue has been offset in 2009-2010, totalling $94.3 million, which is an increase by savings in operational costs. of $8 million from the previous year. Our promise of These savings have been driven by reduced water volumes providing sustainable water and sewerage services providing savings in electricity, materials and chemicals throughout the region saw expenditure on the following utilised in our water and sewage systems. Operational key projects: efficiencies were also seen in infrastructure maintenance $14.2 million for the new Anglesea borefield along with an organisational focus on innovation leading business process improvements and cost savings. $8.6 million for recycled water infrastructure, including $7.7 million for the Northern Water Plant Events subsequent to balance date $5.3 million on the Melbourne-Geelong No material events have occurred after balance date. Interconnector pipeline $28.7 million investment in sewerage infrastructure $12.8 million on major water transfer and distribution projects $18.3 million on other water infrastructure projects The funding required for the capital investment included $35.7 million generated from operations of the business, government grants of $7.5 million and new borrowings of $39.3 million. Consequently, borrowings increased to $185.3 million at the end of June 2010. All financial ratios are within acceptable ranges, with interest coverage dropping slightly to 260 per cent, compared to 285 per cent in the previous year. Debt to equity along with debt to total assets ratios both increased in 2009-2010 to 19.8 per cent and 15.4 per cent respectively.
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FINANCE
Financial summary
Year/Revenue 2009-10 Change 2008–09 Change 2007–08 Change 2006–07 Change 2005–06 Change $’000 % $’000 % $’000 % $’000 % $’000 % Total revenue 139,918 10.0 127,236 15.5 110,177 3.3 106,689 0.69 105,957 3.6 Total expenses 121,759 7.8 112,937 8.9 103,684 6.2 97,659 4.50 93,451 2.7 Net operating result 18,159 27.0 14,299 120.2 6,493 -28.1 9,030 -27.79 12,506 11.3 (before tax) Total assets 1,206,538 6.0 1,138,245 6.6 1,067,453 4.3 1,023,831 3.20 992,125 1.1 Total liabilities 274,698 21.2 226,594 32.4 171,105 27.6 134,054 17.48 114,108 2.9
Five-year composition of revenue
Year/Revenue 2009-10 Change 2008–09 Change 2007–08 Change 2006–07 Change 2005–06 Change $’000 % $’000 % $’000 % $’000 % $’000 % Tariff usage charges 53,779 7.4 50,082 4.3 48,006 –0.2 48,102 –9.5 53,146 12.2 Tariff service charges 65,275 15.7 56,432 34.1 42,092 9.7 38,363 9.5 35,028 11.2 Sundry revenue 6,175 -38.8 10,084 -10.3 11,243 -10.6 12,572 139.4 5,251 1.1 Capital contributions 14,689 38.1 10,638 20.4 8,836 15.5 7,652 –38.9 12,532 –31.1 Totals 139,918 10.0 127,236 15.5 110,177 3.3 106,689 0.7 105,957 3.6
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FINANCE
CApital expenditure
Item 2009-10 Change 2008–09 Change 2007–08 Change 2006–07 Change 2005–06 Change $’000 % $’000 % $’000 % $’000 % $’000 %
Water supply Headworks 25,575 -2.4 26,196 67.2 15,669 34.9 11,615 115.7 5,385 192.2 Water treatment and quality 3,379 -40.2 5,650 –15.3 6,674 118.4 3,055 –0.9 3,084 55.6 Major transfer and 12,775 -13.2 14,724 98.2 7,429 67.1 4,445 56.7 2,836 –74.1 distribution Reticulation 8,881 1.9 8,711 54.2 5,650 22.5 4,614 34.4 3,432 9.7 Total water 50,610 -8.5 55,283 56.1 35,423 49.3 23,730 61.0 14,739 –17.6
Sewerage Water reclamation 1,281 -8.8 1,404 –79.2 6,745 49.8 4,502 34.5 3,347 –44.0 and disposal Main sewers 20,408 26.0 16,191 200.3 5,391 –15.9 6,409 5.6 6,070 –6.7 Reticulation and other 7,056 30.0 5,429 134.1 2,318 –45.4 4,250 75.7 2,419 –32.8 Total sewerage 28,745 24.8 23,024 59.3 14,455 –4.7 15,162 28.1 11,837 –26.4
Recycled water Total recycled water 8,580 994.9 784 50.2 521 236.8 154 –48.1 298 53.6
Other works and services Building 448 -6.7 480 –9.3 528 31.0 403 –41.4 688 53.8 Corporate information 2,271 6.5 2,131 –4.7 2,236 –9.6 2,473 46.3 1,690 –12.7 Other corporate 3,665 -21.3 4,656 –7. 3 5,024 11.0 4,525 –1.0 4,569 –7.7 Total other works 6,383 -12.2 7,267 –6.7 7,789 5.2 7,403 6.5 6,949 –5.3 Total 94,318 9.2 86,357 48.4 58,190 25.3 46,451 37. 3 33,824 –18.5
The $25.57 million spent on water headworks A significant increase in investment in Recycled Water projects included: infrastructure including: $14.16 million for the ongoing construction of new $7.72 million for the Northern Water Plant Anglesea borefield $0.61 million for the commencement of the $5.33 million for the new Melbourne-Geelong Black Rock Recycled Water Plant Interconnection pipeline $0.25 million for the commencement of infrastructure $1.95 million for the Painkalac Reservoir to service Armstrong Creek. embankment upgrade The $28.74m Investment in sewerage infrastructure $1.59 million for the Colac Pipeline Replacement. included: The $12.78 million spent on major transfer and $10.89 million to upgrade the sewer system distribution projects included: in Ocean Grove and Barwon Heads $4.84 million for Bellarine transfer main stage 5A $3.7 million for Leopold to Geelong rising $1.5 million for Meredith water supply improvements. main replacement $3.1 million fore sewer rehabilitation works. Other major water infrastructure projects included: $4.6 million for mains replacements $1.66 million for Armstrong Creek Boundary Rd feeder main $1.4 million for Winchelsea feeder main replacement.
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FINANCE
Consultants costing in excess of $100,000 in 2009-2010 The total number of major consultancies engaged for the year was 10, with a total value of $10,423,491.61. See table below for details:
Name of consultant Particulars of project * Total project Total Future $ 2009–10 commitment $ $ Kellogg Brown & Root Design and/or project management for: 7,688,699.40 5,245,163.81 1,090,118.72 Pty Ltd Melbourne-Geelong Interconnection, Bellarine transfer main, Lovely Banks to Montpellier basins pump station investigations, PDI, Ocean Grove rising main, Jan Juc high level water supply system, Indented Head feeder main Sinclair Knight Merz Design services for: 6,181,427.97 2,040,002.20 1,199,152.95 Armstrong Creek water, sewer & recycled water, Armstrong Creek ASR investigations, Birregurra sewerage scheme, Wye River & Separation Creek sewerage schemes, Colac water supply augmentation, resource allocation model review for Geelong system, Allen Dam upgrade, Cowies Creek pump station, Black Rock Treatment Plant, Pettavel Basin augmentation GHD Pty Ltd (excludes Design, construction assistance & MAP support for: 8,317,999.55 1,982,884.43 519,580.27 project work under Anglesea borefield, ASR investigations, Western Barwon Water Alliance) Geelong Sewerage Study, Main Outfall Sewer Duplication investigations, Armstrong Creek Odour Control Options Report, Spring Creek Water/Sewer Aurecon Australia Northern Water Plant Design, Black Rock Recycled 87,525.04 - Pty Ltd Water Plant Functional Design 287,525.04 Diverse Resources Group Armstrong Creek ASR Investigations 249,215.00 249,215.00 - Currie & Brown Independent Estimator Services, PDI Project 137,315.00 137,315.00 - (Australia) Pty Ltd Management Design Fee Review, Melbourne Interconnection Advice PricewaterhouseCoopers Recycled Water Business Model, TechnologyOne 134,245.79 134,245.79 - Financial System Post Implementation Review Pollution Solutions & Wurdee Boluc WTP Lime Clarification Detailed Design, 728,763.00 129,305.10 - Designs Pty Ltd Biosolids Drying Facility Technical Advice Minter Ellison Biosolids Management Project Review Fees, Northern 110,713.30 110,713.30 - Water Plant Advice, Melbourne Interconnection Advice Hydro Tasmania Renewable Resources Project Planning, West Barwon 107,121.94 107,121.94 - Mini Hydro Investigations
Notes: All figures are exclusive of GST * Includes the total cost of the contract for a project, which may include costs other than consultants.
Consultants costing less than $100,000 in 2009-2010
Number of consultants engaged Total cost of engagements 111 $1,952,346.37
Contracts entered into greater than $10 million in 2009-2010 No contracts greater than $10 million were entered into.
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FINANCE
Key actions
Objectives Actions
Ensure responsible Barwon Water has maintained a focus on responsible financial management during 2009-2010. and sustainable Major areas of focus include just-in-time funding, maximisation of cash flow management and treasury borrowing of new funds in an efficient manner for the medium-term and long-term financial management viability of the organisation.
Implement a new The ECM system was introduced to Barwon Water during 2009-2010. The system provides a full Enterprise Content document management capability encompassing emails, office products, correspondence, plans, Management (ECM) drawings management systems and workflow technology. system The ECM provides improved access to information, business process improvement, risk reduction and integration of various business systems resulting in improved and responsive customer service provision.
Customers benefit from online property statements being available to conveyancers and solicitors.
Barwon Water engineering plans and drawings are now also fully digitised and version-controlled, providing for online access to key asset installations and onsite access to engineering data. This initiative provides a valuable platform for risk minimisation and enables significant productivity improvements in both reactive and proactive maintenance.
Replace our Throughout the year, we began to replace the existing financial management system with a state of financial the art financial management reporting, budgeting and procurement systems, together with a full management suite of financial modules to meet statutory requirements and assist all areas of the organisation system to meet key actions under the corporate Strategic Intent.
Future challenges Significant challenges facing the Finance and Administration Group over the coming years will include: providing key business improvements utilising the recent investment in technology responsible funding of our significant capital works plan ensuring the organisation’s medium- to long-term financial sustainability enhancing procurement outcomes to deliver significant business benefits maximising our existing facilities and our return on surplus assets.
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PART 4
OUR PERFORMANCE WHAT WE DO OPERATIONS
Our strategic direction Barwon Water’s goal is to ensure all water and sewerage systems and services, including significant infrastructure ‘We will operate and maintain sustainable, assets, are efficient, effective and meet legal and high quality and affordable water and government requirements and community expectations. sewerage systems and services’. The combination of climate change, population increase and future development will continue to offer great challenges to our water and sewerage operations. Through this, we plan to maintain and deliver high quality water and sewerage to meet the needs of our customers. To achieve our goals, we have developed a resources plan that delivers asset renewal, maintenance and operating requirements as set out in our Water Plan 2008-2013. Barwon Water is always reviewing processes and systems to ensure all minor capital projects, asset renewal, maintenance and operating works are undertaken efficiently and effectively, and ensuring that our asset management policies and programs are leading edge and protect the integrity of the asset base. We are also developing a strategy to deliver innovative, modern services in billing, metering, connections, developer services and customer relationships.
PAGE | 34 PAGE | 35 BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
WHAT WE DO OPERATIONS
Our promise to customers Bulk water entitlements Barwon Water’s Customer Charter sets out a clear The Department of Sustainability and Environment’s commitment to our customers about the level of service (DSE) Guidelines for the Development of Bulk Entitlement they can expect from us and what happens if we don’t Metering Programs were released in October 2009. The deliver on these standards. guidelines require Barwon Water to prepare a metering program for all our bulk water entitlements to be One such commitment is that they should not expect more submitted to the Water Minister by 6 November 2010. than five unplanned service interruptions to water supply in any 12-month period and if this happens then they will Barwon Water has 10 surface water bulk entitlements automatically receive a rebate of $65 on their account. and one groundwater bulk entitlement for the Anglesea borefield. During 2009-2010, 12 properties received the above rebate. This is an improvement on previous years and an indication As per government guidelines, we have prepared a that the mains replacement program is effectively metering program which satisfies the following critical targeting problem areas. requirements. One rebate was also paid to honour our commitment that Listing of all bulk entitlements. there should be no more than three sewer spills onto a Identification of bulk entitlement obligations. customer’s property in any 12-month period. Identification of locations of bulk entitlement Our Customer Charters are available for viewing or obligations. download from our website www.barwonwater.vic.gov.au or by calling us on 1300 656 007. Description of individual measurement arrangements, including individual measurement points, meter reading Water quality arrangements, and accuracy and calibration. Barwon Water protects the health of customers by providing Description of data management. drinking water that meets stringent bacteriological and Measurement risks management, including meter physical standards. maintenance, back-up systems and quality assurance. Water quality risk management is an essential component Determination of compliance with relevant bulk of our water treatment and supply practices, ensuring our entitlement obligations, and information-sharing and customers receive water that is 100 per cent safe and stakeholder consultation. aesthetically pleasing. See pages 52 to 57 for more information on our bulk The Department of Health, under the Safe Drinking Water water entitlements. Act 2003 and the Safe Drinking Water Regulations 2005, regulates our drinking water quality. To meet the requirements of the Act, we choose to be certified in both ISO 9001 and HACCP (Hazard Analysis Critical Control Point) management systems.
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WHAT WE DO OPERATIONS
Reliability of water and sewerage services Recycled water Despite the impacts of climate change, Barwon Water has Barwon Water continues to supply Class C recycled water continued to achieve steady improvement in the reliability to 34 customers for the production of flowers, turf, grapes of our water and sewer networks. We are successfully and lucerne, and irrigation of sports ovals and golf courses meeting tightening annual targets in the areas directly throughout the Geelong region. affecting our customers, namely water supply interruptions Class C recycled water is delivered through a separate and sewer blockages or spills. purple pipe system, and is only suitable for certain types These positive results have primarily been achieved through of agricultural irrigation and sports grounds. the ongoing influence of water main replacements and A number of other customers, including councils and planned sewer maintenance and rehabilitation programs. VicRoads, access recycled water standpipes at Black Rock, In addition, efforts made in the areas of resource Colac and Anglesea through a permit system. management and data collection have resulted in improved About 16.0 per cent (3017 megalitres) of the treated water field crew response and asset repair times, which provides produced from the water reclamation plants was reused as immediate benefit to our customers. recycled water. Responses to water bursts and leaks have significantly Barwon Water has set a target to recycle 25 per cent of improved this year, with all figures well below target and treated water available by 2015. better than 2008-2009. The time taken to restore water supply to customers after unplanned interruptions has also improved on the 2008-2009 result. Biosolids Barwon Water reuses 100 per cent of the biosolids Containment of sewer spills within five hours is another produced by our water reclamation plants. area of improvement this year, although the average time to attend sewer spills or blockages has increased slightly. Since 2004, we have operated a biosolids recycling facility This is still an excellent result, well below target. at Melbourne Water’s Western Treatment Plant. During this period more than 320,000 tonnes of biosolids have been dried for use as a soil conditioner on broadacre farms in the Balliang region. During 2009-2010 more than 3000 tonnes of dried biosolids were used in accordance with the requirements of the EPA Guidelines for Biosolids Land Application, to help produce crops of barley, wheat, and canola, returning valuable nutrients back to the soil. More information about Biosoilds can be found on page 44.
PAGE | 36 PAGE | 37 BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
Key performance indicators
Water quality Service reliability: Water Barwon Water remains compliant with the water quality Unplanned interruptions standards detailed in the table in Schedule 2 of the Safe During 2009-2010, we reduced the number of unplanned Drinking Water Regulations 2005. interruptions per 100 kilometres of water mains - from To ensure we provide drinking water that is safe and 25 to 21 interruptions. This is well below our target of 30, satisfies requirements for taste and appearance, a holistic an excellent result aided by relatively favourable stable approach is used. This is underpinned by: ground conditions during the year, the ongoing impact of the water mains replacement program along with a a risk management procedure that ensures acceptable program to install valves at strategic locations to reduce water quality in water supply catchments, treatment the number of properties affected by main failures. and distribution The replacement program specifically targets water an established regular monitoring program that verifies mains in poor condition. During 2009-2010, we replaced acceptable water quality is delivered to customers 19 kilometres of water mains pipes. an ‘open book’ approach to reporting water quality As a proportion of total properties supplied, only 14.4 information to the public. percent experienced unplanned interruptions during the year – down from 17 per cent in 2008-2009 and again The number of water quality complaints remained low in below our target of 21 per cent. 2009-2010, with 2.33 water quality complaints per 1000 properties during the year. The expansion of the closed Barwon Water also reduced the average duration of storage system program together with the revised and unplanned water supply interruptions to 106.1 minutes, targeted mains cleaning programs continues to improve easily meeting our target of 115 minutes – a target which customer satisfaction. is tighter than in previous years. We have continued a trend towards reduced interruption Water quality results data summary times since 2006-2007, with fewer total interruptions and for 2009-2010 an ongoing focus on improving the efficiency of repairs.
Water quality Actual Target Number of management system - samples services standards Water quality complaints 2.33 5.00 n/a per 1000 connections Samples with zero E.coli 99.91% 98.00% 2,268 Turbidity* < 5 NTU 99.91% 98.00% 2,268 Treatment by-products 100.00% 100.00% 1,370
* In the above table, turbidity results are expressed as NTU (Nephelometric turbidity unit). Turbidity is a measurement of the light scattering property of water, and the degree of scattering is dependent on the amount, size and composition of the suspended matter – ie. a measurement of particles in water.
PAGE | 38 PAGE | 39 BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
Key performance indicators
Service reliability: Sewerage Containment of overflows from reticulation and branch sewers Blockages Percentage of Priority 1 and Priority 2 sewer spills Prolonged dry conditions increase the risk of ground contained within five hours movement, which can result in structural damage to pipes
and increased tree root intrusion as trees search for No. Spills Contained Target Actual Variance sources of water. Despite this, we successfully achieved the (%) (%) annual target of less than 44 blockages per 100 kilometres Priority 1 44 44 100 100 0 of sewer pipe (2009-2010 result was 40.7), through the Priority 2 349 348 97 99.7 2.7 implementation of comprehensive planned maintenance and rehabilitation programs. Total 393 392 - - 99.75
In 2009-2010, Barwon Water completed approximately Performance around the containment of sewer spills has 140 kilometres of planned sewer main clearing (hydraulic been excellent this year with both targets being met. Every jetting, cutting and eduction), 60 kilometres of planned priority 1 spill was contained, with only one priority 2 spill chemical root treatment and 16.6 kilometres of lining. not contained within the target time for the whole year. Overflows The number of sewer overflows is largely related to the number of sewerage system blockages. The implementation of comprehensive planned maintenance and rehabilitation programs successfully mitigated the number of sewerage system blockages, thereby mitigating the potential for overflows. Our result of 17 spillages per 100 kilometres of sewer main was below our target of 22.2.
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PART 4
OUR PERFORMANCE WHAT WE DO SYSTEMS AND INFRASTRUCTURE
Our strategic direction To ensure Barwon Water’s record capital investment program of more than $766 million over the coming years ‘We will ensure sustainable long-term water is delivered in accordance with the current Water Plan, security and reliable systems by delivering responsibility rests with our Capital Projects and all capital projects in the Water Plan and the Greenhouse Group. Melbourne-Geelong Interconnection within With the task of managing major projects as well agreed timelines and budgets’ as management of the new Barwon Water Alliance partnership, the group works to ensure all capital projects are delivered on time, on budget and according to business requirements. The group also is responsible for implementing Barwon Water’s environmental leadership agenda, as detailed in our Strategic Intent. More detailed reporting on Barwon Water’s environmental performance can be found on pages 46-64.
Building for the future Barwon Water maintains a strong in-house capacity to manage the delivery of major capital projects, replacement programs and corporate works. This capacity includes areas of project management, asset planning, spatial information, and property, safety and environmental support services.
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WHAT WE DO SYSTEMS AND INFRASTRUCTURE
Barwon Water Alliance Water security With Barwon Water facing a period of significant growth in – diversifying our water supply capital expenditure, decisive action was required to We are in the process of connecting to new and diverse maximise our ability to deliver the capital program while water sources that are less reliant on seasonal rainfall and achieving the best value for money for customers. surface water flows. This strategy includes connecting to After a comprehensive review of the full-range of delivery the Victorian water grid via the Melbourne-Geelong options, Barwon Water’s Board determined to establish an Interconnection, as well as a number of other major alliance with private design and construction partners to initiatives, outlined below. deliver the bulk of capital program. Anglesea borefield The Barwon Water Alliance, a partnership between Barwon Geelong’s newest water source – the Anglesea borefield Water, design consultants GHD P/L and contractors John – began operating in November 2009. Holland, commenced operation in July 2009 and will deliver up to 150 projects worth around $400 million over Hailed as a stand-out project despite a number of delivery the next five years. In addition to delivering capital projects challenges, the borefield is crucial to securing the region’s in an efficient and cost-effective manner, the Barwon water needs. Water Alliance has key objectives in minimising It will provide an average up to 7000 million litres a year. environmental impacts, improving stakeholder consultation This represents about 20 per cent of current demand in and increasing the skills of Barwon Water project the greater Geelong area. managers and local contractors. Total project cost is expected to be $58 million, $16 million In 2009-2010, the Barwon Water Alliance delivered below budget. $38 million worth of projects in its establishment year, compared to an initial target of $23 million. Key projects The Anglesea borefield coming on line was a significant commenced in the Alliance’s first year included factor in the decision to ease water restrictions to Stage 3, enlargement of the Painkalac Reservoir spillway at Aireys announced by the Hon. John Brumby, Premier of Victoria Inlet, replacement of Geelong’s largest sewerage pump and the Hon. Tim Holding MP, Minister for Water, at the station at Cowies Creek, North Geelong, fast-tracking a pre-treatment plant site on 19 February 2010. new water supply connection to Meredith, commencing works at Armstrong Creek and construction of several new sewerage assets arising out of the Bellarine Sewerage Management Strategy. Currently, 80 staff are employed by the Barwon Water Alliance, around a third of whom are from Barwon Water. The Alliance’s works program for 2010-2011 has increased substantially to $85 million, providing significant opportunities for local contractors to perform the work under the Alliance’s project management.
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WHAT WE DO SYSTEMS AND INFRASTRUCTURE
Recycled water planning recycled water will free up the equivalent of water used In August 2009 we finalised our Future Direction for in 10,000 homes each year. Recycled Water paper. The five categories driving the The Federal Government has committed $20 million to the future directions are outlined below. project and the State Government $9.2 million. Barwon Proactively develop recycled water markets. Water will contribute $16 million while Shell will invest $45 million. Strengthen community and stakeholder support for recycled water. Construction is scheduled to begin in the late 2010, with commissioning of the facility expected to be completed Provide foundation recycled water infrastructure. by mid-2012. Be innovative and contribute to the shaping of government policy. Black Rock Recycled Water Plant Barwon Water will start construction of a new recycled Enhance recycled water distribution network. water plant at the Black Rock environmental precinct in A number of objects and indicative priority actions were late 2010. also developed under each future direction. The Black Rock Recycled Water Plant will provide Major recycled water actions initiated in 2009-2010 high-quality recycled water for water sensitive urban include: development, industry, community recreational facilities detailed design and pilot trials started on the Northern and agriculture. Water Plant Featuring state-of-the-art technology, it will be capable detailed design started on the Black Rock Recycled of producing both Class A and Class C recycled water. Water Plant Construction of the plant is expected to be completed in late 2011, with commissioning completed in early 2012. business case approved to construct the Western Edge The project will be implemented in stages to meet demand. Recycled Water Plant The Federal Government’s long-term Water for the Future significant progress on the design of dual pipe schemes initiative has kick-started the $20 million first stage of the at Armstrong Creek Fyansford and Torquay project, with $10 million funding supplied under the progressed the sewer mining project with Curlewis National Water Security Plan for Cities and Towns. Golf Club Stage one will service greater Geelong’s first residential ASR research drilling commenced at Anglesea and recycled water scheme at Armstrong Creek. Recycled Armstrong Creek. water is expected to be available to homes in the development from mid-2013. Barwon Water will continue to implement recycled water projects inline with the Future Directions for recycled The Black Rock Recycled Water Plant is planned to water paper and convert the paper into a strategy and ultimately supply 2400 megalitres per year of Class A action plan over the coming year. recycled water to Armstrong Creek as well as up to 3600 megalitres per year of moderate-salinity Class C recycled Northern Water Plant water for use by existing and new irrigation customers. It will also result in the stage reduction of treated water To be built on industrial land beside the Shell Geelong discharged into Bass Strait and significantly boost the Refinery, the $90 million Northern Water Plant will recycle value of Black Rock as an environmental precinct. sewage and trade waste from homes and industry across Geelong’s northern suburbs. Melbourne-Geelong Interconnection While most of the Class A recycled water will be used by In June 2007, the Victorian Government released Our Shell, the resource will also be used to irrigate sports fields Water Our Future – The Next Stage of the Government’s at Stead Park. Water Plan. A key element of the plan is expansion of The refinery currently uses about 5.0 per cent of Geelong’s Victoria’s water grid, including a link between Melbourne total annual consumption. Replacing drinking water with and Geelong to be completed by the end of 2011.
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WHAT WE DO SYSTEMS AND INFRASTRUCTURE
The Melbourne-Geelong Interconnection involves Catering for growth and development construction of a 59km pipeline from Cowies Hill, west Geelong is Victoria’s largest regional city and its fastest of Werribee, to Barwon Water’s storage basins at Lovely growing region. Residential and commercial building Banks. The estimated cost of the project is $137.9 million, activity is at record levels, reflecting an annual regional with the Victorian Government contributing $20 million. population growth rate of around 1.7 per cent (based on The pipeline will have the capacity to deliver up to 16,000 Barwon Water’s water system connections figures and megalitres a year - equivalent to half of Geelong’s current Australian Bureau of Statistics data). annual usage. A bulk entitlement will be granted entitling A substantial increase in our capital works program over Barwon Water to a share of the total Melbourne water the next five to six years prompted Barwon Water to supply volumes. develop a delivery strategy in late 2008 to guarantee The Melbourne-Geelong Interconnection, Anglesea successful completion of our infrastructure and renewal borefield, Northern Water Plant and Black Rock Recycled projects while maximising value for money. The following Water Plant combined will provide an additional 75 per cent major projects form a significant portion of our capital of greater Geelong’s current demand. This will ensure expenditure program over this time. a secure and sustainable water supply to meet the significant forecast growth in the region. Armstrong Creek Barwon Water is investing $160 million in trunk Aquifer Storage and Recovery (ASR) infrastructure over 10 years in the Armstrong Creek urban growth area. The 2350 hectare development area south of To provide a diversified and sustainable water delivery Geelong is to accommodate 22,000 residential lots and model to combat changing climate and population growth, 55,000 people when fully developed. Barwon Water is aiming to close the loop on urban water management, through greater use of recycled water. The infrastructure will include one of Australia’s largest Aquifer Storage and Recovery (ASR) provides a logical dual pipe water supply networks. High quality Class A and vital opportunity to maximise recycled water use. water will be created from sewage flows received at the ASR is a method of storing water underground, treating Black Rock Water Reclamation Plant, some 14 km from it via natural processes and reclaiming it for later use. Armstrong Creek. This water will be transferred back to Armstrong Creek and used for toilet flushing, garden The initial research involves the use of drinking water only, watering, car washing and sports and recreational fields. but long-term possibilities include storing and recovering It is expected that use of Class A recycled water will reduce both recycled water and storm water. demand for drinking water by up to 50 per cent. Barwon Water has commenced an ASR research program which includes four sites across the Geelong area. Torquay/Jan Juc Surf Coast Shire is documenting a growth management The water sources for these ASR schemes could include plan for Torquay and Jan Juc that will underpin recycled water from Barwon Water’s water reclamation development for the next 30 years. Around 210 hectares plants, urban stormwater or excess surface water during in North Torquay has now been rezoned for residential times of high rainfall. If the research shows ASR to be development and 7000 people are planned to be housed viable, the possible end use of the stored water will vary. over the coming 10 years. The research program is being overseen by an independent Barwon Water is supporting a dual pipe network in North expert advisory panel, established in 2009. The seven Torquay with Class A recycled water to be piped from the member group has been selected for their extensive skills Black Rock Water Reclamation Plant. Planning is underway and expertise and will provide Barwon Water a diverse for a recycled water pipeline and tank that will be an range of perspectives on ASR, sustainable water supply extension to the transfer pipeline servicing Armstrong Creek. and the environment. The panel members have international, national and local industry experience. Barwon Water is investing some $50 million in trunk infrastructure over 10 years to support water, sewerage and recycled water development in North Torquay, Spring Creek, Torquay and Jan Juc.
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WHAT WE DO SYSTEMS AND INFRASTRUCTURE
Other development projects: Water supply and sewerage Fyansford: new infrastructure and a new water system improvement: reclamation plant. Recent and ongoing improvement projects include: Point Lonsdale: construction and upgrade of sewer service basins lining and covering pump stations and pipes. Geelong and Colac fluoridation Drysdale-Clifton Springs: water and sewerage system upgrades. reservoir embankment upgrades Ocean Grove: upgrades and extensions to existing Meredith water supply water and sewerage infrastructure. Cowies Creek sewer pump station upgrade. Bannockburn/Teesdale/Inverleigh: infrastructure to support water, sewerage and Class C recycled water Other initiatives capacity increase and a new tank at Bannockburn. Barwon Water is also building a new 250-megalitre water Biosolids storage basin, with associated pipelines and pump station, for Apollo Bay, Marengo and Skenes Creek to eliminate the Thermal dryer at Black Rock need for water summer restrictions. Construction of the In August 2007 we entered a Partnerships Victoria $16 million project will take place between 2012 and 2014. 20-year design-build-finance-operate contract with We are also investing around $22 million of renewal and Plenary Environment (Barwon) Pty Ltd for the provision of replacement programs to ensure existing headwork biosolids management services. channels and pipelines, mainly located in the Otway Construction of a new biosolids thermal dryer at Black Ranges catchment, remain operational and effective. Rock commenced in October 2008, following VCAT and Supreme Court challenges to the Works Approval issued by the EPA. The thermal dryer is expected to be completed in early 2011 and once built, we will no longer need to transport biosolids to the Western Treatment Plant. Construction had progressed in accordance with the Works Program until late September 2009 when Barwon Water was notified that faults had been detected in the imported dryer trays. The trays were removed and are being rectified locally and reinstalled. Full operation of the dryer is expected in early 2011. The biosolids thermal drying facility will be the largest of its kind in Australia and will allow Barwon Water to continue to beneficially reuse 100 per cent of the biosolids produced from its plants.
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WHAT WE DO SYSTEMS AND INFRASTRUCTURE
Key actions
Objectives Actions
Meet ESC and DHS All water and sewerage service performance indicators were successfully achieved. requirements for All regulatory drinking water requirements were achieved. water and sewerage service standards as EPA licence compliance was 100% for all nine water reclamation plants in 2009-10. set out in the Water Plan. Meet drinking water quality standards and EPA licence conditions
Implement Central During 2009-10 Barwon Water made significant progress toward implementing key actions from the Region Sustainable government’s Central Region Sustainable Water Strategy (2006). Water Strategy Construction of Anglesea borefield was completed in late 2009 (Action 4.15). actions Five bores were operating as at 30 June 2010. Detailed design has begun for the Northern Water Plant (Action 4.12). Barwon Water will reinstate a weir on Dewing Creek to provide a 700 million litre boost to greater Geelong’s water supply system (Action 4.16). Investigation of the Newlingrook groundwater aquifer is no longer required (Action 4.14), as a result of the Melbourne-Geelong Interconnection pipeline going ahead, as required by Our Water Our Future – The Next Stage of the Government’s Water Plan (2007). Aquifer Storage and Recovery (ASR) research (Action 4.13) has progressed as follows: On-ground works began at the Anglesea ASR project in November 2009. The drilling of six research bores were completed as at 30 June 2010. The desktop review on the suitability of aquifers in both Armstrong Creek and Fyansford was completed and approved by the Board in March (Armstrong Creek) and June (Fyansford) 2010. A proposal has been developed by consultants on behalf of Barwon Water, City of Greater Geelong for a desktop investigation into ASR in Northern Geelong.
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PART 4
OUR PERFORMANCE WHAT WE DO ENVIRONMENT
Our strategic direction Our business is inextricably linked to the natural environment and our activities can have direct and indirect environmental ‘We will become an environmental leader impacts. Through our Strategic Intent, we are committed to in our community’ becoming an environmental leader in our community. In 2009-2010 we have continued to develop and implement a wide range of programs and initiatives to enhance our performance in the area of environmental sustainability, including: implementing a comprehensive greenhouse gas abatement strategy developed a Water Quality Protection Policy that applies to declared water supply catchments in the Barwon and Otway Coast basins continued to work with community and Landcare organisations via partnerships for healthy catchments and waterways reinvigorated our staff Green Team to drive personal behaviour change towards environmental sustainability continued emphasis on leadership in environmental planning and management to facilitate avoidance of impacts and minimisation of environmental risks from the siting, design and construction of new infrastructure. Outlined opposite are the areas we are targeting to proactively manage our key environmental impacts and become a more environmentally sustainable business.
PAGE | 46 PAGE | 47 BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
WHAT WE DO ENVIRONMENT
Water Energy Water efficiency begins in the bulk water supply system, Water is a heavy substance and requires a lot of energy to with considerable investment in channel lining to prevent move around. Barwon Water is a large user of electricity seepage as well as lining and covering of storage basins and as such a comprehensive energy management through the system. A pressure reduction program has program is being implemented across the business to been implemented to not only save energy but also save improve energy efficiency, designed to save money and water by reducing the incidence of pipe bursts and also help curb greenhouse gas emissions. excessive consumption. Barwon Water has been a leader in developing programs to Greenhouse gas emissions promote water conservation behaviour amongst residential Barwon Water is continuing to implement a comprehensive and business customers, with a range of initiatives marketed range of actions to reduce emissions through our under the WaterSecure banner of initiatives. See page 49 Greenhouse Strategy. for more information on our water conservation measures. Waste Catchments and waterways Our Trade Waste Program encourages compliance by Barwon Water harvests water from various Declared Water customers in relation to disposal of inappropriate Supply Catchments (DWSCs), supplying drinking water to a substances into the sewer and supports businesses to community of more than 280,000 permanent residents. adjust their practices to be more sustainable. Late in 2009, Most of these DWSCs are located within national parks, but we received Waste Wise re-certification for our main Ryrie some areas are in privately managed freehold land. and Lonsdale Street offices. We have also implemented a comprehensive waste recycling system in offices and We have a vested interest in ensuring the protection and/ depots including polystyrene recycling. or rehabilitation of waterways within these catchments. The development of catchment policies helps to guide future use and development, while our continued support Materials and procurement for Landcare networks and the Corangamite Catchment Barwon Water has joined EcoBuy which promotes Management Authority (CCMA) is strengthening sustainable procurement across government and business. collaborative community partnerships for waterway We have developed a Sustainable Procurement Policy and restoration in critical catchment areas. will be rolling this out across the business to reduce the environmental and social risks associated with the Biodiversity purchase of goods and services. As a significant landowner/manager and major infrastructure provider, managing impacts on the region’s native biodiversity is an important environmental aspect of Barwon Water’s activities. This year we updated our Biodiversity Asset Register which provides an accurate record of all known biodiversity assets on Barwon Water land. This essential resource is used for planning, designing and constructing water and sewage infrastructure in an environmentally sensitive manner and is supported by an Environmental Planning Procedure for capital works infrastructure projects to minimise risks to biodiversity from construction processes. See page 58 for details on The Victorian Biodiversity Strategy.
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WHAT WE DO ENVIRONMENT
Our Water Our Future Water recycling Water conservation All our water reclamation plants produce Class C recycled Providing a safe and reliable water supply to Barwon water, suitable for re-use. In 2009-2010 the volume of Water customers is a continuing and significant challenge. recycled water used was 3017 million litres, 16.0 per cent Average stream flows have reduced over the past 10 to 15 of total recycled water produced. The target set by years, providing less water than has been historically Barwon Water is 25 per cent re-use by 2015. available. We have commenced detailed design of the new Population growth is also ongoing, particularly in the $20 million recycled water plant at Black Rock. The Federal coastal townships where growth rates are expected to Government will kick-start the staged construction of the remain high for some time. These scenarios mean that project by contributing $10 million. The plant will produce Barwon Water must do more with less to ensure that the Class A recycled water suitable for residential use and also management of available water resources is sustainable. improve the quality of Class C recycled water for industry, All the elements of our water conservation programs irrigation and sports grounds. The new plant is expected detailed in the current Water Supply Demand Strategy to be operational in early 2012 and will service the new (2007-2012), summarised below, have been made available residential suburb of Armstrong Creek. to the community. Detailed design and planning is also in progress for the As expected, uptake of the different programs by Northern Water Plant at the Shell Geelong Refinery in customers has varied as behaviour patterns and Corio. The new treatment and recycling facility will replace commercial factors change. drinking water used by the refinery with high quality Class A recycled water, equivalent to 5.0 per cent of Geelong’s Recently revised water usage projections confirm that the drinking water use. The plan will also supply Class A combination of conservation programs and water irrigation water to the Stead Park Sports Complex. restrictions play an important role in meeting our usage targets of 25 per cent reduction by 2015, and 30 per cent The project is a collaborative partnership between Barwon reduction by 2020. Water, State and Federal Governments and Shell Australia. As data collection is vital to water use planning, Barwon Water is partnering in an information gathering exercise focusing on end-use at a household level. This will greatly improve the basis for demand projection estimates, and help target the next suite of water conservation programs.
Treatment methods and re-use
Water reclamation plant Treatment method Volume treated Recycled water (ML) use (%) Aireys Inlet Lagoon 138.85 100.00 Anglesea Oxidation ditch, sand filtration, UV disinfection 277.12 34.20 Apollo Bay Activated sludge (IDEA), UV disinfection 468.71 3.20 Bannockburn Lagoon 92.18 100.00 Black Rock Activated sludge (IDEA), submarine outfall 15,965.00 16.07 Colac Activated sludge/ SBR (BNR), UV disinfection 1,515.09 1.44 Lorne Activated sludge (IDEA), UV disinfection 288.92 5.19 Portarlington Lagoon 505.36 100.00 Winchealsea Lagoon 73.35 100.00
PAGE | 48 PAGE | 49 BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
WHAT WE DO ENVIRONMENT
Sustainable water strategies Water tanks Input into the Western Region Sustainable Water Strategy Collecting rainwater from the roof is an effective way of has continued over the past 12 months with raw data conserving water. Barwon Water offers a range of tanks and system modelling provided to the Department of to our customers for outside use, toilet flushing and/or Sustainability and Environment. More recently, a response laundry use. was developed for formal input on the draft strategy A licensed plumber visits the customer’s property to discuss document. tank size, materials, possible locations, roof catchment opportunities, current water practices, costs and Further work will be required to confirm a feasible maintenance. This advisory service is free. All customers implementation plan which will be developed over the are offered a 12-month interest free payment period. coming months. A Plumbing Industry Commission certificate is issued for all plumbing works completed. Water Supply Demand Strategy (2012-2017) Since the program commenced, just over 900 customers The Water Supply Demand Strategy sets out Barwon have installed rainwater tanks provided through Water’s plan to meet the challenges of scarce water Barwon Water. resources over the next 50 years. It includes the impact of climate change and outlines a significant commitment Showerhead exchange to water conservation. Barwon Water offers a showerhead exchange program to Augmentation of the various water supply systems will be encourage customers to replace their old inefficient units necessary to meet demand, and the options, which are for a new water-saving showerhead. consistent with government water resource planning, are Customers can bring their old showerheads (up to two per described. customer) into any of our offices. Work has commenced on the next Water Supply Demand This program has been running since October 2006, with Strategy (2012-2017), which will develop important more than 10,500 showerheads exchanged - an average information required for the next Water Plan (2013-2018), of approximately 245 per month. and involve all service areas within the Barwon Region. WaterSecure Business Water conservation programs The WaterSecure Business program was launched in 2007 to assist non-residential customers reduce water WaterSecure Home consumption. The program assists businesses to measure WaterSecure Home was introduced as a pilot program water consumption across their site/s and recommends in July 2008. a variety of short and long-term conservation measures that may be suitable. Barwon Water relaunched WaterSecure Home to all of our residential customers in April 2010, with some The program provides information, assistance with enhancements. sourcing and applying for grants, and facilitates the sharing of knowledge between businesses. The following Under the new program, a licensed plumber will: targeted programs have been implemented to assist undertake a water audit focusing on water use, specific sectors improve water efficiency: appliances and fittings/fixtures Water efficient cooling tower program supply and install up to two water efficient Air conditioning cooling towers account for around showerheads 30 per cent of many businesses’ total water use. check for and repair up to five minor leaks This program provides businesses with a way to monitor the direct consumption for individual cooling towers. provide the customer with advice and written material It comprises a site survey at a business to assess the on water conservation. cooling tower system for water efficiency, and assistance to manage water conservation. Subsidies from Barwon Water and the State Government mean our customers pay only $30 for the service, which The program has so far resulted in 75 check meters being is valued at $180. installed at 19 businesses in the Barwon Water region.
PAGE | 48 PAGE | 49 BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
WHAT WE DO ENVIRONMENT
Laundries water efficiency program Summer awareness campaign This program identified cost effective water saving Over the holiday periods – and particularly over the hot alternatives for commercial laundries and businesses with summer months – our permanent population of around onsite washing machines. 280,000 residents increases to more than 510,000 people. The $1 million program, funded by the Department of This substantial population increase has a significant Sustainability and Environment, was being delivered in impact on demand for our drinking water resources. partnership with Barwon Water and other water As a result, Barwon Water has developed a widespread businesses across Victoria. summer campaign across our region to remind visitors Around 44 individual laundries have so far participated that ‘saving water is just as important when on holidays’. in the program. This includes educating holiday-makers about the restrictions in place wherever they are staying, and to be mindful of their water-use habits. During the 2009-2010 WaterMAP summer, our youth and environment ambassadors Joel Through the State Government’s water management Corey (Geelong AFL player) and Kelly Cartwright action plan (WaterMAP) program, Barwon Water has (Paralympian) helped us to deliver this important message continued to promote water conservation and water through newspapers, billboards, advertising in visitors efficiency to our large business customers. guides, posters and in-room cards for accommodation In 2009-2010, 129 businesses were required to submit providers. a WaterMAP and all were received. Catchment management and river health Each WaterMAP customer is assigned a dedicated Water Conservation Officer who provides assistance in all areas Barwon Water harvests water from within the catchments of water conservation. of Barham, Barwon, Gellibrand, Moorabool and St George Rivers, and Painkalac Creek. Water is harvested from WaterMAP customers continue to utilise the recently Declared Water Supply Catchments (DWSCs), supplying introduced web-based application to complete reporting drinking water to a community of over 280,000 requirements and view consumption data. permanent residents. A majority of these DWSCs are The WaterMAP program is now in its third year and a located within the publicly managed Great Otway National detailed review of the program has showed positive water Park, with privately managed freehold land also covering efficiency achievements, including the following results: a significant proportion of DWSCs. After the first year, participants achieved 7.6 per cent We have a keen interest in ensuring the protection and/or water savings, with a further 3.2 per cent reduction rehabilitation of waterways within these catchments, in consumption the following year in accordance with the priorities established in the Corangamite Regional Catchment Strategy and the In the three years since its inception, 59 per cent of Corangamite River Health Strategy. participating customers have achieved the recommended 10 per cent reduction in water use. As part of our commitment to ensuring the sustainable management of the region’s water catchments, we continue 2009-2010 saw the launch of the first round of Barwon to support partnership programs specifically for Water’s Grant Program, aimed at providing WaterMAP environmental activities within catchment areas. customers with financial assistance to implement water conservation projects. The Grant Program was available The table opposite demonstrates the extent of Barwon to businesses participating in the WaterMAP program. Water’s financial commitment to these partnerships Over $350,000 was awarded to eight businesses to help during 2009-2010. implement a wide variety of water efficient projects.
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WHAT WE DO ENVIRONMENT
Community environmental partnership programs and funding
Program Partner Focus 2009-10 funding Landcare Network Partnerships Southern Otway Landcare Network Barham River DWSC $35,000 Landcare Network Partnerships Dept. of Primary Industries Moorabool River DWSC $35,000 Landcare Network Partnerships Upper Barwon Landcare Network Upper Barwon DWSC $35,000 River Health Partnership Corangamite CMA Waterway health in priority $70,000 waterway reaches Corangamite Region Waterwatch Corangamite CMA Waterway health education $70,000 General environmental support Various Catchment protection and awareness
Corangamite CMA river health partnership In the 2009-2010 financial year Barwon Water contributed a total of $70,000 to 13 river health projects (which had a total value of $175,000 excluding landholder contributions) under the Barwon Water–Corangamite CMA River Health Agreement. The projects included the Upper Barwon (Pennyroyal and Matthews Creeks), Moorabool, Gellibrand and Barham catchments. Works included weed control, erosion control, willow removal, riparian revegetation, stream bank stabilisation, stock exclusion fencing, and installation of a fishway. Works were funded by Barwon Water, the Corangamite CMA, and landholders, and involved coordination efforts by Landcare.
PAGE | 50 PAGE | 51 BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
WHAT WE DO ENVIRONMENT
Environmental flows Bulk entitlements 2009-2010 bulk entitlement performance A bulk entitlement is a legal right to water granted by the An overall compliance of 98 per cent* was achieved Minister for Water under the Water Act 1989. Bulk during 2009-2010 for the numerous daily extraction entitlements are commonly held by water corporations limits and passing flows across the 10 bulk in Victoria with objectives to: entitlements. Minor non-compliances were recorded for passing flows at some sites due to the difficulty in provide authorities with a clearly defined property setting releases to match stream flows. This was right to water particularly evident during low inflows over summer provide authorities with flexibility to manage within or following rain showers. Variations were normally their entitlements less than 10 per cent and in all instances the amount of water passed in the longer term was well in excess provide a basis for sharing limited water resources, of environmental requirements. These difficulties protecting the entitlements of other users and have been noted, and measures to address them will protecting in-stream values be identified as part of the process of developing a facilitate water trading between user groups to ensure new Metering Program for all Barwon Water’s bulk appropriate redistribution over time of finite water entitlements. resources * This was an actual calculation based on the number of days allow specific entitlements for environmental purposes. compliant across all bulk entitlements versus the total number of days in the period. Barwon Water operates under 10 surface water bulk entitlements covering the Barwon, Moorabool, Gellibrand, St Georges, Painkalac and Barham river systems. Each entitlement provides clear direction on the amount and rate of water that can be harvested each year and the amount that must be passed to the environment for river health. The bulk entitlements require annual reporting of water taken and this information is provided in the following tables. As mentioned, our bulk entitlements contain provisions on minimum passing flows and maximum daily extractions for our waterways.
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WHAT WE DO ENVIRONMENT
Bulk entitlements 2009-2010
Bulk Entitlement (Aireys Inlet) Conversion Order 1997
14.1 (d) - Painkalac Reservoir storage volume at 30/6/10 335.90 ML – 63.3% AHD Level 28.36m 14.1 (e) - Volume taken 2009-2010 172.57 ML 14.1 (f) - Approval, amendment and implementation of programs for making Refer to Part 4: ‘Bulk Water Entitlements’. For more allowances, environmental obligations and metering information about our metering programs, see page 36. No transfers, amendments or new entitlements under this order
Bulk Entitlement (Apollo Bay–Skenes Creek) Conversion Order 1997 / Bulk Entitlement (Apollo Bay) Amendment Order 2003
11.1 (e) - Volume diverted 2009-2010 (West Barham diversion) 331.4 ML 12.1 (d) - Volume pumped 2009-2010 (Barham River) 71.79 ML 12.1 (c) - Approval, amendment and implementation of programs Refer to Part 4: ‘Bulk Water Entitlements’. For more for making allowances, environmental obligations and metering information about our metering programs, see page 36. No transfers, amendments or new entitlements under this order
Bulk Entitlement (Colac) Conversion Order 1997 / Bulk Entitlement (Colac) Amendment Order 2003
12.1 (c) - Volume and level of storages at 30/6/10 Olangolah Reservoir 152 ML – 100% AHD Level 344.32m West Gellibrand Reservoir 1,856 ML – 100% AHD Level 342.05m 12.1 (d) - Volume taken 2009-2010 4,020 ML No transfers, amendments or new entitlements under this order
Bulk Entitlement (Gellibrand) Conversion Order 1997
11.1 (b) - Volume taken 2009-2010 20.96 ML 11.1 (c) - Approval, amendment and implementation of programs Refer to Part 4: ‘Bulk Water Entitlements’. For more for making allowances, environmental obligations and metering information about our metering programs, see page 36. No transfers, amendments or new entitlements under this order
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WHAT WE DO ENVIRONMENT
Bulk entitlements 2009-2010
Bulk Entitlement (Lal Lal Barwon) Conversion Order 1995
19.1 (f) - Storage volume in Barwon Water’s capacity share of reservoir at 30/6/10 730 ML – 3.84% 19.1 (g) - 2009-2010 flow into Barwon Water’s capacity share of reservoir 649 ML 19.1 (h) - 2009-2010 releases to West Moorabool River at specified Point A (reservoir outlet) 410 ML 19.1 (i) - Volume taken under Lal Lal entitlement at specified Point B (She Oaks diversion weir) 0 19.1 (j) - Surplus Water • Available 0 • Released 0 19.1 (k) - 2009-2010 volume taken other than at specified Point B (Pumped at Meredith offtake after 95 ML Lal Lal releases) 19.1 (l) - 2009-2010 losses debited to Barwon Water’s capacity share of reservoir 382 ML 19.1 (m) - Losses from releases between specified points A and B N/A 19.1 (n) - Approval, amendment and implementation of programs for making allowances, Refer to Part 4: ‘Bulk Water environmental obligations and metering Entitlements’. For more information about our metering programs, see page 36. 19.1 (o) - Transfer of part of bulk entitlement (Central Highlands Water) 0 19.1 (p) - Any bulk entitlement or licence in respect of the waterway temporarily or permanently 300 ML transferred to the authority with respect to the reservoir - 300 ML purchased from Goulburn system by Barwon Water and transferred to Central Highlands Water. CHW then allocated 300 ML of its Lal Lal Reservoir storage to BW 19.1 (q) - Any amendment to this bulk entitlement Nil 19.1 (r) - Any new bulk entitlement granted to the authority with respect to its entitlement to a share Nil of reservoir capacity 19.1 (s) - Any failure by the authority to comply with any provision of this bulk entitlement See above note on 2009-2010 bulk entitlement performance. 19.1 (t) - Any existing or anticipated difficulties experienced by the authority in compiling with this bulk entitlement and any remedial action taken or proposed by the authority
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Bulk entitlements 2009-2010
Bulk Entitlement (Lorne) Conversion Order 1997
14.1 (d) - Allen Reservoir storage volume at 30/6/10 222 ML - 100% AHD Level 120.19m 14.1 (e) - Volume taken 2009-2010 343.81 ML 14.1 (f) - Approval, amendment and implementation of programs for making allowances, Refer to Part 4: ‘Bulk Water environmental obligations and metering Entitlements’. For more information about our metering programs, see page 36. No transfers, amendments or new entitlements under this order
Bulk Entitlement (Meredith) Conversion Order 1995
11.1 (e) - Volume taken 2009-2010 (Pumped from run of river) 35.43 ML 11.1 (d) - Approval, amendment and implementation of programs for making allowances, Refer to Part 4: ‘Bulk Water environmental obligations and metering Entitlements’. For more information about our metering programs, see page 36. No transfers, amendments or new entitlements under this order
Bulk Entitlement (She Oaks) Conversion Order 1995
13.1 (d) - Storage volume at 30/6/10 19 ML – 100% Gauge Level m (AHD not available) 13.1 (e) - Volume taken 2009-2010 0 13.1 (f) - Volume taken in past 3 years (2007-2008 to 2009-2010) 0 13.1 (g) - Approval, amendment and implementation of programs Refer to Part 4: ‘Bulk Water for making allowances, environmental obligations and metering Entitlements’. For more information about our metering programs, see page 36. No transfers, amendments or new entitlements under this order
Bulk Entitlement (Upper Barwon System) Conversion Order 2002
West Barwon Reservoir Wurdee Boluc Total Barwon Borefield Reservoir 15.1 (d) - Storage volume at 4,307 – 20% 21,699 – 57% 26,006 – 44% - 30/6/10 (ML) 15.1 (e) – Volume taken - - 27,278 12,692 2009-2010 (ML) No transfers, amendments or new entitlements under this order
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WHAT WE DO ENVIRONMENT
Bulk Entitlement (Upper East Moorabool System) Conversion Order 1995 / (Upper East Moorabool System) Conversion Amendment Order 2004
Korweinguboora Bolwarra Weir Bostock Reservoir Upper Stony Creek Lower Stony Creek Reservoir Reservoirs Reservoir 14.1 (d) - Storage volume 504 – 24.1% 113 – 100% 1,698 – 22.8% 934 – 25.2% 87 – 32.6% at 30/6/10 (ML) 14.1 (e) - Volume taken - - - 320 - 2009-2010 (ML)
14.1 (f) - The approval and amendment and implementation of programs Refer to Part 4: ‘Bulk Water Entitlements’. For more approved under sub clause 12.2 and 12.3 information about our metering programs, see page 36. 14.1 (g) - Any temporary or permanent transfer of all or part of this bulk Nil entitlement 14.1 (h) - Any bulk entitlement or licence in respect of the waterway Nil temporarily or permanently transferred to the authority with respect to the system 14.1 (i) - Any amendment to this bulk entitlement Nil 14.1 (j) - Any new bulk entitlement granted to the authority with respect to Nil the system 14.1 (k) - Any failure by the authority to comply with any provision of this bulk See above note on 2009-10 bulk entitlement performance. entitlement 14.1 (l) - Any existing or anticipated difficulties experienced by the authority in compiling with this bulk entitlement and any remedial action taken or proposed by the authority
Notes: 1. Information supplied refers to volume in megalitres unless stated otherwise. 2. References (e.g. 14.1 (d)) relate to clause numbers in Bulk Entitlement Order. 3. Telemetry data has been used (final figures from Thiess yet to be submitted). 4. Lal Lal data highlighted in red are estimates until all data has been submitted from CHW.
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WHAT WE DO ENVIRONMENT
Groundwater bulk entitlements The Bulk Entitlement (Anglesea Groundwater) Order 2009 authorises Barwon Water to take up to 35,000 ML of groundwater from the Lower Eastern View Formation in any five year period. The Order was made on 30 June 2009.
Bulk Entitlement (Anglesea Groundwater) Order 2009
16.1 (a) - Annual amount taken in 2009-2010 1,651 ML 16.1 (b) - Any amendment to this Order Nil 16.1 (c) - Any failure by Barwon Water to comply with this Order The Order requires Barwon Water to implement a monitoring and assessment program approved by the Minister. The approved program required groundwater observation bores P14 and P15 and a regional network of survey marks to be installed by 30 June 2010. Due to delays in approvals from the relevant land managers, these assets had not been installed by the due date.
Groundwater licence The Barwon Downs groundwater borefield at Gerangamete Natural resource management alliance has been a vital resource during the drought, supplying Barwon Water is part of a regional alliance of agencies around 45 per cent of Geelong’s demand over the past with a mutual interest in the emerging natural resource three financial years. management issue of Inland Acid Sulphate Soils. We have There are six production bores within the borefield along been active participants in developing a scientific with a primary treatment plant and pump station to assessment of the extent of this issue in the Corangamite transfer water into the inlet channel to Wurdee Boluc region as a first step in identifying ways to manage Reservoir. There are also 50 monitoring bores that provide potential future risks. important data on how the groundwater is responding to pumping. The conditions under which groundwater can be extracted are specified in the Gerangamete groundwater licence 2009-2010 groundwater performance issued by Southern Rural Water in 2004. The licence is In 2009-2010, the total volume extracted was valid for 15 years and includes extensive monitoring and 12,692 ML which is well within the annual cap of reporting requirements to ensure the borefield is operated 20,000 ML. During this period, total daily and in a sustainable manner. These include caps on daily, annual extractions from the six bores were within annual and 10-year extractions along with monitoring licence caps, although one of the bores slightly of water level decline, surface settlement, salinity, and exceeded its maximum daily limit (12 ML/day) on impacts on local waterways. 24 occasions. On each occasion, the limit was breached by less than 0.2 ML/day and total extraction from the borefield for the day was still well below the cap. Groundwater levels remained above critical limits during this period.
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WHAT WE DO ENVIRONMENT
Victorian Biodiversity Strategy Biodiversity enhancement As a manager of significant areas of land and as a major Strategies, plans and investigations from the national infrastructure and service provider across the region, to local level reflect the context for biodiversity managing impacts on native biodiversity is an important management in the environment in which Barwon environmental aspect of Barwon Water’s activities. Water functions. We continue to participate in these Barwon Water has continued to implement policies and initiatives where appropriate, an example being the procedures to protect, enhance and restore biodiversity, development of the Victorian Biodiversity Strategy consistent with the Victorian Biodiversity Strategy and 2010-2015. Native Vegetation Framework. To facilitate protection and enhancement of Barwon We are in the process of developing our own Biodiversity Water’s significant biodiversity assets, we recently Strategy to guide our efforts in this area. commenced development of a new Biodiversity Conservation Program. Biodiversity protection We continue to support broader activities for A major achievement for biodiversity conservation this biodiversity enhancement through our Landcare year was legal agreement for the transfer of over 1000 partnerships, such as: hectares of Barwon Water land at Lower Stony Creek - pest, plant and animal management Reservoir to the Brisbane Ranges National Park. - erosion control works Our Landcare partnerships continue to support - land management planning increased protection of riparian environs and habitat - community empowerment. remnants, through landholder engagement, support and on-ground projects. Biodiversity restoration Procedures, training and support for environmental Barwon Water’s Community Tree Propagation Centre planning and management of capital works projects (the ‘nursery’) continues to provide facilities for the use continue to facilitate avoidance and minimisation of of community groups. Through the centre, native plants risks to biodiversity from the siting, design and are produced for use in revegetation projects focusing construction of new infrastructure. on catchment and biodiversity restoration. An update of the Barwon Water Biodiversity Asset Our partnerships with Landcare organisations continue Register was completed in February 2010. The register to support progressive restoration of biodiversity details biodiversity assets present on Barwon Water’s values in catchment areas. Over the past 12 months land and is a valuable tool for planning and conducting these Landcare partnerships have supported significant our activities while avoiding and minimising impacts outcomes for biodiversity, including revegetation works on biodiversity. involving almost 90,000 native plants across an area totalling 50 hectares. There has been no known change to recorded threatened species in the regions where Barwon Water During 2009-2010 the nursery produced 70,849 plants operates. with the assistance of more than 1,000 community members, supporting more than 40 local Landcare, school and community groups.
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WHAT WE DO ENVIRONMENT
Community partnerships Barwon Water has continued to employ a full-time team of people with disabilities from Karingal Landcare. The six employees and a supervisor assist Barwon Water in establishing and maintaining environmental works at many of our sites including Black Rock and Bannockburn Water Reclamation plant. In addition to employing the Landcare team, Barwon Water has continued to host a second group of people from Karingal who assist fortnightly in nursery duties and tree planting.
Water consumption This is the fifth year Barwon Water has officially measured employee office water consumption for three of our sites/ offices. We have reduced employee office water consumption at major offices by 60 per cent since 2005-2006, due to changes in staff water use behaviour and changes to the air conditioning systems. Usage figures for other Barwon Water sites are difficult to determine and compare, as measurements include operational consumption as well as employee water use. The below table shows the past year’s water consumption for the three measured office sites.
Corporate water consumption
2009-10 Location Total full-time Office space (m2) Water consumption kL/FTE Water consumption equivalent (kL) by office space employees (l/m2) 40-44 Lonsdale Street 154 1,740 279 1.82 160.3 (South Geelong) 61-67 Ryrie Street 151 4,500 1,051 6.98 233.6 33 Bromfield Street 4 190 14 3.50 73.7 Total 308 6,430 1,344 4.36 209.02
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WHAT WE DO ENVIRONMENT
Our Greenhouse Strategy Alternative Energy Barwon Water is committed to reducing our contribution Continued to operate the Black Rock wind turbine, of greenhouse gases to the atmosphere and as a result we contributing to an estimated reduction in greenhouse have set a long-term aspirational target to achieve zero gas emissions of 76.9 carbon dioxide equivalent tonnes net emissions by 2018 (Scope 1 and 2 emissions only). (tCO2-e). Through our Greenhouse Strategy, launched in 2009, we Installing solar and/or mini hydro powered telemetry are investigating and implementing a range of abatement stations to monitor surface water flows at more remote opportunities based on the programs outlined in the EPA’s sites within the water catchments. Carbon Management principles. Continued operating the Solar Bee, a high-tech solar powered stainless steel floating pond and reservoir Key greenhouse actions aerator at several of our water storage basins. During 2009-2010 Barwon Water implemented the following actions in line with each abatement program: Investigation into a mini-hydro power station at West Barwon Reservoir. Measure and manage Sequestration and offsets Initiated comprehensive energy and emissions In 2010, Barwon Water investigated the potential management database to enhance data collection, sequestration value of its plantations as a source of collation, analysis and reporting. carbon offsets and also investigated the dynamics of the Submitted inaugural emissions and energy report to voluntary carbon offset market. We will continue to the Commonwealth Government under the National monitor these abatement options as the national policy Greenhouse and Energy Reporting Act. context in the greenhouse area evolves. Developed an innovative data access tool for spatially linking asset and energy data, the SEED System, Spatial Energy and Emissions Data.
Avoidance Implemented the Carbon Accounting Procedure. Implemented a carbon awareness program for project managers.
Reduction Switch off campaign to encourage staff to switch off monitors and lighting at the end of the working day. Replacement of Archimedean screw pumps as Black Rock water reclamation plant with submersible pumps – saving approx. 285,000kWh/year. Converted diffusers at Colac WRP to more efficient diffusers, resulting in large efficiencies – preliminary energy reduction of 1.2MWh/day.
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WHAT WE DO ENVIRONMENT
Greenhouse gas emissions The 2009-2010 greenhouse gas emission results in this section have been calculated using the methods described in the National Greenhouse and Energy Reporting Act (NGER). All results are calculated using actual data, with the exception of June 2010 electricity consumption, for which estimates have been used. Actual data for this period was not available within the timeframes for this report. These results are denoted by an asterisk (*).
Greenhouse gas emissions are measured in CO2-equivalent
tonnes (tCO2-e).
Greenhouse gas emissions by business area
^Scope 1 and 2 only Greenhouse gas emissions^ by business area (tCO2-e) 2005-06 2006-07 2007-08 2008-09 2009-10 Water treatment and supply 10,492 14,061 13,938 13,899 14,029* Sewerage treatment and management 41,177 39,844 35,790 34,319 34,285* Transport 1,378 1,360 1,554 1,332 1,335* Offices 3,267 2,834 2,812 2,934 2,699*
Total CO2 emissions 53,314 58,099 54,094 52,485 52,348*
TOTAL Greenhouse gas emissions by source (tCO2-e) 60,000 Soda Ash
50,000 Nitrous Oxide
40,000
-e) Methane 2 30,000 tCO ( Electricity 20,000
10,000
0 2005-06 2006-07 2007-08 2008-09 2009-10
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WHAT WE DO ENVIRONMENT
Greenhouse gas emissions - breakdown by use (tCO2-e)
2005-06 2006-07 2007-08 2008-09 2009-10 Electricity 36,846 38,469 37,416 36,756 35,875* Natural gas 146 141 158 193 164* Liquid fuel (transport) 1,378 1,360 1,554 1,331 1,564* Methane 10,550 11,183 10,326 11,264 10,312* Nitrous Oxide 7, 392 6,944 4,629 2,709 4,431* Soda Ash 2 2 11 4 1*
Total CO2 emissions (scope 1 & 2 only) 56,314 58,099 54,094 52,257 52,348*
Greenhouse gas emissions associated with waste disposal
Yearly Landfill (Kg) Recycling (Kg) tCO2-e Ryrie Street Offices 4,435.60 9,032.40 4.44 Lonsdale Street Offices 3,120.00 10,821.20 3.12 Lonsdale Street Workshops 2,199.60 - 2.20 Lonsdale Street Stores 161.20 104.00 0.16 Alliance Offices 2,251.60 1,424.80 2.25 Total 12.17
Energy use per employee
Office Energy use/ employee (MJ/FTE) South Geelong office (including stores) 36,268 Ryrie Street office 29,120 Alliance building 23,289 Colac Office 19,198
Office paper This is the first year Barwon Water has reported our office paper use. It will form the baseline for future measurements, as we aim to reduce office paper consumption.
Total A4 Employees A4 equivalent equivalent reams reams per full time employee 3,921 331.6 11.8
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WHAT WE DO ENVIRONMENT
Green Team ECC Chairperson’s message Our staff members are committed to environmental This year the work of the Environmental Consultative sustainability in their day-to-day work. The Green Team Committee has had an emphasis on water supply and is a staff led whole-of-business action group which on the protection of water quality. encourages and supports individuals and groups to adopt The members of the ECC had input into the Barwon Water more environmentally sustainable behaviour and Catchment Protection Policy for the Otway Coast, Barwon initiatives in the workplace. and Gellibrand Catchments and into the Guidelines for During 2009-2010 the Green Team implemented or Planning Permit Applications in catchment areas. assisted with: Presentations by the Corangamite Catchment Barwon Water becoming the first Associate Partner Management Authority and the various Landcare groups of Alcoa and Greening Australia’s Make An Impact that are part of Barwon Water’s Landcare Partnership program Program highlighted Barwon Water’s commitment to supporting community groups involved in sustainable achieving Waste Wise re-certification for Ryrie management of the region’s water catchments. and Lonsdale St offices The question of environmental flows continued to engage implementing a comprehensive waste recycling system the ECC, with presentations and discussions on the in offices and depots, including polystyrene recycling release of water for environmental and other purposes developing an action plan for Waste Wise certification under Bulk Entitlement arrangements and on negotiations for Wurdee Boluc water treatment plant and Black Rock by Barwon Water with Central Highlands Water to develop water reclamation plant a summer flow strategy for the Upper Moorabool River. signing up to EcoBuy, which promotes sustainable The ECC members took part in a facilitated discussion procurement across government and business on sustainable urban water management at the regional, suburb/development and household scales, contributing, implementing the Urban Orchard staff-run fruit and in doing so, to Barwon Water’s position paper on this topic. vegetable exchange The ECC was kept up to date with the progress being introducing an annual sustainability competition called made in the several Aquifer Storage and Recovery the Golden Palm. investigations currently underway to obtain a clear understanding of the potential for ASR at Anglesea, Environmental Consultative Committee Armstrong Creek, Fyansford and North Geelong. Established in 2001 to improve liaison with the region’s The ECC also looked at the progress of the Anglesea peak environmental groups, Barwon Water’s Environmental Borefield Project, the update of the Environmental Consultative Committee (ECC) provides feedback and Management System, the management of toxins in the advice on activities or policies that may have environmental sewerage system, and the Alliance Environmental impacts. The committee helps ensure Barwon Water is Management Policy. responsive to the environmental concerns and values of the community. The committee comprises an independent Susan Howells chairperson and representatives from a number of local Chairperson environmental groups.
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WHAT WE DO ENVIRONMENT
Key actions
Objectives Actions Implement a Through our Greenhouse Strategy, launched in 2009, Barwon Water is investigating and implementing greenhouse a range of abatement opportunities based on the programs outlined in the EPA’s Carbon Management emissions policy principles. for all assets and In 2009-10, we put into practice a number of actions in line with our abatement programs. These included: operations that places Barwon developing an independently approved auditing process for measuring our greenhouse emissions Water in the top 10 against other water companies of Australian water companies implementing a customer education campaign linking water conservation with energy use
developing a greenhouse gas emissions inventory for our major water supply and reclamation plants. During 2009-10, we conducted several major feasibility assessments for other abatement measures that will have significant impact on reducing greenhouse gases. We also began to liaise with contractors to establish formal processes for Barwon Water to obtain relevant greenhouse gas emissions data. Continue our Barwon Water supports partnership programs specifically for environmental activities within catchment commitment areas. This includes: to ensuring the sustainable Landcare Network Partnerships Program management Corangamite Region Waterwatch Partnership - to support the highly successful Waterwatch program of the region’s water catchments Waterway Health Strategy Partnership by expanding our community General environmental support. environmental partnerships Develop a sustainable Barwon Water has developed a sustainable procurement policy and guidelines, incorporating procurement policy environmental sustainability. The policy incorporates best practice from government and industry sectors to incorporate and has been piloted for stationery purchases prior to the extended organisational rollout. sustainable principles Complete Green Barwon Water re-established the Green Team in May 2009. It comprises employees from across the Team Action Plan organisation who act as ‘champions’ to drive internal change. Green Team actions implemented during and implement 2009-10 included: individual actions to encourage becoming the first Associate Partner of Alcoa and Greening Australia’s Make An Impact program environmentally receiving Waste Wise re-certification sustainable behaviour and implementing the Urban Orchard, a staff-run fruit and vegetable exchange. initiatives across the workforce
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PART 4
OUR PERFORMANCE WHAT WE SAY CUSTOMERS AND THE COMMUNITY
Our strategic direction ‘We will build trust and achieve a reputation for excellent customer service and stakeholder relations. We will listen, engage and educate our customers, community and stakeholders’.
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WHAT WE SAY CUSTOMERS AND THE COMMUNITY
Our customers and the community are at the heart of Social sustainability everything we do. This section of the Annual Report outlines our performance in the areas of customer Customer Consultative Committee service and social sustainability. Chairperson’s message Listening to our customers Barwon Water’s Customer Consultative Committee (CCC) is a key mechanism for stakeholder engagement and 2010 customer survey feedback. The CCC also provides a direct link between the Board, customer base and consumer advocacy groups. Customer feedback received through our 2008 Customer Perception Survey helped to inform the development of Membership of the CCC is drawn from across all customer our Strategic Intent (2008-2013). categories: domestic, business, rural and welfare. A strong theme emerged indicating that we needed to The committee met five times in 2009-2010, and faced improve the way we communicate to our customers. some considerable challenges on a number of key issues, As a result, we undertook a number of initiatives during including: 2009-2010 including: The Melbourne-Geelong Interconnection project. introducing more plain English into our written Apollo Bay Off-Stream Storage project. communication Greenhouse Strategy and its associated launching a new, user friendly website communications plan. increasing our community engagement Fluoride – for Geelong and Colac. launching the Sustainable Home and Garden Expo Future directions for recycled water. developing our new brand. Northern Water Plant. In February 2010, we conducted a second perception Barwon Water Alliance. survey. While we achieved minor improvements in some areas, feedback from residential customers remained Sustainable Home and Garden Expo. generally the same as in 2008. Water Forums. Our business customers, however, were less satisfied with Anglesea borefield. our performance than they were previously. Their feedback identified a real need to build closer Barwon Water’s Hardship Policy. partnerships with them, to encourage better water The new Barwon Water ‘brand’. management and to pursue innovative approaches to relationship building in our service region. Anne Fairbairn Some notable results from the 2010 survey included: Independent Chairperson Customer Consultative Committee 81 per cent of residential customers are ‘extremely’ or ‘somewhat’ satisfied with water quality support for reducing restrictions has increased by 24 per cent since 2008, with 54 per cent of our community supporting a reduction 76 per cent of our customers would take up recycled water if it was offered as an option. We plan to again formally ask our customers for their feedback in 2012.
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Management of social and economic impacts Government Utility Relief Grants scheme Assisting customers experiencing financial hardship State Government Utility Relief Grants (URGs) are offered Barwon Water works with customers who are unable to to eligible Barwon Water customers. A total of 140 grants meet payment in full by the due date. We tailor account were issued this year – up from 76 in 2008-2009. payment options, assisting customers to pay their accounts over time. Flexible payment plan – Arrange & Save During 2009-2010, Barwon Water introduced a new During the 2009-2010 billing cycle, we provided the program to assist some of our most disadvantaged following assistance measures: customers experiencing financial hardship. In less than a customers were granted extensions of time to pay their year, 65 customers are participating in the Arrange & Save account. The short-term extension of time assists program. At 30 June 2010, 60 per cent of participating customers with short-term cash flow issues to pay their and eligible customers had received at least one credit to account, without penalty. their account.
Installment plans were offered to assist customers Helping our customers save water to pay their account, usually over a six- or 12-month period. Installments are agreed to by Barwon Water The Water Wise program is a State Government initiative and each customer and can opt to pay weekly, aimed at reducing water bills for eligible concession card fortnightly or monthly, depending on the their holders. Barwon Water provides the service of a registered individual circumstances. While installment plans are plumber to conduct a free water audit, including repairs active, no penalties or referral for debt collection apply. and/or replacement of inefficient water fittings. The Water Wise program is valued at up to $500. Water Wise is a Customers also chose to pay their bills through joint initiative between the Department of Human Centrepay – a Centrelink program where payments are Services and Barwon Water. By 30 June 2010, 353 Water made directly to Barwon Water by Centrelink on behalf Wise audits had been completed. of the customer. The State Government’s Water Smart Gardens and Homes Concession cards Rebate Scheme offers customers rebates on items such as rainwater tanks, tank-to-toilet connections, greywater Barwon Water has a high proportion of customers in systems, dual-flush toilets, water-saving showerheads, receipt of Government concession cards. Around 33 per trigger nozzles, flow-control devices and mulch. cent of our total customer base are eligible for government concession. This figure has increased 2.0 per cent since Aged debtor management 2008-2009. Barwon Water’s actions in assisting customers Eligible concession cards include Centrelink pension and experiencing financial hardship has contributed to a health care cards and Department of Veteran’s Affairs reduction in the percentage of customers with debt Gold cards. exceeding 60 days. Keeping the 60+ day debt down is important for the financial situation of Barwon Water and Medical concessions all customers. We support a number of customers with special medical needs through State Government dialysis concessions. In addition, we match the State Government Grant, and offer a concession for other medical conditions that require higher than usual water consumption. Medical concessions totalled $8508 during the year, with 29 per cent of this amount contributed directly by Barwon Water.
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Community Service Obligations – summary
Community Service Provided 2009-10 2008-09 Pension and health concessions $6,791,170 $5,872,272 Utility Relief grants $39,829 $22,279 Dialysis rebates (State Government) $6,077 $4,717 Barwon Water medical rebates $2,431 $2,772 Barwon Water Arrange & Save $285 $0 Water and Sewer Rebates $422,130 $407,485 Water Wise rebates $155,348 $3,804 Water Smart Gardens & Homes Rebates $329,120 $311,780 Total $7,746,390 $6,625,109
External complaint resolution Barwon Water is a member of the Energy and Water Ombudsman Victoria scheme (EWOV), an independent dispute resolution scheme approved by the Essential Services Commission to resolve customer complaints.
EWOV case handling statistics
Barwon Water Barwon Water Overall water Overall water cases cases industry cases industry cases 2009-10 2008-09 2009-10 2008-09 Enquiries (all classifications) 72 72 1,608 1,358
Complaints investigated (all levels) 16 9 268 181 (all levels) Barwon Water Total 88
Observation Through an improved escalation process, continued vigilance and additional empowerment of employees, Barwon Water has successfully maintained a low level of complaints to the Energy and Water Ombudsman Victoria. Barwon Water has a 21 per cent share of the Regional Urban Water Authority sector and recorded 16.7 per cent of all RUWA contacts with the EWOV. Barwon Water has a 7.4 per cent share of the combined metropolitan and Barwon region customer base, and recorded 6.5 per cent of EWOV contacts. As at 30 June 2010, Barwon Water has one complaint remaining under investigation.
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Internal complaint resolution A complaint is a written or verbal expression of dissatisfaction about an action, proposed action or failure to act by Barwon Water, employees or contractors.
Complaint 2009-10 % of Total 2008-09 % of Total 2007-08 % of Total Water quality 314 51 278 56 315 60 Billing 18 3 16 3 16 3 Sewerage 96 16 92 18 84 16 Water reliability (including water 28 5 34 7 21 4 pressure and other) Other (including Affordability) 152 25 78 16 92 17 Total 608 498 528
Observation While water quality complaints represent over 50 per cent of internal complaints, they remain low, with 2.33 water quality complaints per 1000 properties. The expansion of the closed system program together with the revised targeted mains cleaning programs help to improve customer satisfaction.
Types of complaints received
Water quality 51 Billing 3 Sewerage 16
Water Reliability 5 Other 25
Our major customers by volume
Volumetric range (ML per year) No. of customers 50–99 10 100–199 4 200–299 6 300–399 0 400–499 0 500–749 0 750–1000 0 >1000 1 Total no. customers 21
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Major customer participation in water Listening to and consulting our community conservation programs Driven by feedback from customers and stakeholders, community engagement is a key strategic focus for Name of customer Water conservation Barwon Water, and this is reflected in our Strategic Intent. program developed A key objective is to ensure we consult with and listen to our community on all major planning matters, increase Alcoa of Australia Pty Ltd Yes education and awareness of our activities and provide Barro Group Pty Ltd Yes honest feedback about our performance. Barwon Health Yes Community and stakeholder engagement is a cornerstone Barwon Health - The Geelong Hospital Yes of our capital investment program, helping us to develop Belenee Pty Ltd Yes a shared vision for our region. Blue Circle Cement Yes At the very inception of a major project or initiative, Bonlac Foods Limited Yes community and stakeholder engagement planning takes place at a strategic level. Bulla Cream Co Pty Ltd Yes Major projects are supported by media communications Crf Foods (Colac-Otway) Pty Ltd Yes and the engagement process may also include a variety of Cuteri Investments Pty Ltd Yes community events such as open houses, information Ep Robinson Pty Ltd Yes kiosks, forums and exhibitions. Ford Motor Company Of Australia Yes We also seek feedback throughout the implementation Forest Street Pty Ltd Yes process of any project. Geelong Grammar School Yes Northern Water Plant Godfrey Hirst Australia Pty Ltd Yes Barwon Water undertook extensive community Jp Morgan Trust Australia Ltd Yes engagement relating to the design of the Northern Water Mc Herd Pty Ltd Yes Plant near the Shell Geelong Refinery. Malteurop Australia Pty Ltd Yes Rohm & Haas Aust Yes Other major projects The Melbourne-Geelong Interconnection, the Anglesea Shell Refinery Pty Ltd Yes borefield, the Armstrong Creek development and the new Toll GeelongPort Yes Black Rock Recycled Water Plant are other projects in which Barwon Water is playing a leading role in engaging stakeholder and community groups throughout the region.
Regional water forums During 2009 we launched a series of regional water forums focusing on capital investment in alternative water supply options. The forums provide a platform to engage stakeholders and the wider community in water sustainability issues and to challenge current perceptions surrounding groundwater and recycled water. They also expose stakeholders and the wider community to the opinions of independent scientific experts and promote transparent discussion. Ultimately, the forums underpin our Strategic Intent pillar of communicating, listening, engaging and educating our communities and stakeholders and will be used to inform our Water Supply Demand Strategy in 2013.
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Reporting on our progress Community partnerships In November 2009, we launched our first quarterly Karingal Landcare e-newsletter to customers (delivered by email), supported Barwon Water has continued to employ a full-time Karingal by advertisements in local newspapers. The new format Landcare team. The six employees and supervisor assist replaces the old biannual ‘bill-insert’ newsletter, helping us Barwon Water in establishing and maintaining to communicate more regularly to a broader audience by environmental works at many of our sites including Black utilising both mainstream and online media, while reducing Rock and Bannockburn Water Reclamation plant. overall cost and minimising impact on the environment. In addition to employing the Landcare team, we host a Our new customer website was completely rebuilt during second group of special needs people from Karingal who 2009-2010 with intuitive navigation, up-to-date content, assist fortnightly in nursery duties and tree planting. and a strong focus on capital projects and our future vision - including a high-profile version of our Strategic Corangamite Waterwatch Intent. It is focussed heavily on customer needs, easy Barwon Water supports Corangamite Waterwatch access to important information, and two-way feedback financially via an annual sponsorship of $70,000. and communication with our customers. The following activities were undertaken in 2009-2010 as part of the sponsorship arrangement. Investing in our community Development of a joint primary school student We want to establish a presence in our community and community calendar. increase grass roots community education and awareness Waterwatch schools education program. about water and about our activities. Attending the Sustainable Home and Garden Expo and Barwon Heads Festival of the Sea. Education program Training teachers to use water testing kits. Barwon Water’s education officer works with both primary and secondary school students. During 2009-2010, 62 Coordinating volunteer water monitors to provide tours of our assets were conducted, involving more than river health management data. 1200 students. Encouraging participation in Saltwatch Week, Schools Tree Day and National Water Week activities. Sites visited included: Community engagement activities at the Marine West Barwon Reservoir Discovery Centre and with Coast Action/Coastcare. Wurdee Boluc and Colac Water Treatment Plants Sponsorship Anglesea and Black Rock Water Reclamation Plants. Sponsorship and promotion is a key element of Barwon A total of 18 school visits were also undertaken, with the Water’s communication strategy, but is conditional upon education officer speaking to a total of 657 students at careful assessment of the associated benefits to the their schools during the year. community and Barwon Water. A major aspect of our sponsorship program was in-kind Sustainable Home and Garden Expo support for a broad range of local events and More than 12,000 visitors flocked to Geelong’s waterfront organisations. Sponsorship was spread widely across on the Labour Day long weekend for Barwon Water’s community, corporate, arts and culture, educational and inaugural Sustainable Home and Garden Expo. environmental activities. Visitors were there to seek ways to incorporate Sponsorship statistics sustainability into their everyday lives. During 2009-2010, Barwon Water donated the following: Feedback was very positive, with exhibitors and visitors 800ml drink bottles - 8377 alike keen to sign on for future events. 750ml drink bottles - 20,365 We are already busy planning for a bigger and better Expo Glass bottles - 1500 in 2011. Water fountain bookings - 48 events
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Drought Response Plan Barwon Water uses the Drought Response Plan as a The communications strategy has been particularly management tool to ensure security of water supply to effective in achieving significant savings in water customers during drought and when storages are consumption. Geelong’s water consumption under Stage 4 depleted. water restrictions has consistently been at or below the level forecast. Following are the three key elements of the plan: Restrictions were used in the following systems to Restriction rule curves manage supply: These are developed for each water supply system to guide the introduction of water restriction stages 1. Water restrictions invoked – greater Geelong water depending on the time of year and the volume of water in supply system storages. They are also used in conjunction with weather a. In accordance with Drought Response Plan trigger forecasts to guide decisions on lifting restrictions. curves, the Barwon Downs borefield was activated on 28 April 2006. Except for a few days when there was Water restrictions by-law sufficient surface water to operate the Wurdee Boluc This is a state-wide set of rules that establish the Inlet Channel at capacity, it has operated continuously, allowable uses for water through the various stages of delivering between 33 and 43 megalitres per day. restrictions. These rules provide Barwon Water with the b. Following the Drought Response Plan, Stage 1 water power to ensure water use is controlled during drought. restrictions were introduced on 1 July 2006, Stage 2 on The four stages of water restrictions focus on outdoor 16 September 2006, Stage 3 on 1 November 2006, and water use and restrict activities such as garden watering, Stage 4 on 9 December 2006. filling of pools and spas and car-washing. c. Stage 4 water restrictions – Daylight Saving were introduced on 27 October 2007. The daylight saving Communications strategy restrictions exemption allowed residents to water trees Designed to keep the community informed on the status and gardens or top-up existing swimming pools fitted of water supplies and encourage water conservation. with a pool blanket, for one hour twice weekly. An The strategy involves: allocation of 500 million litres of water was granted for community sports grounds. Other bans under Stage 4 briefings to key stakeholders, including local Members water restrictions remained. In December 2007, of Parliament, sporting clubs, Geelong Chamber of Barwon Water extended Stage 4 Daylight Saving Commerce, the Environmental Consultative Committee exemptions to permanent caravan park residents and and Customer Consultative Committee car wash operators. an advertising campaign using print and radio media d. Stage 4 water restrictions – Winter were introduced media releases and media conferences from 5 April 2008 to 5 October 2008. Similar to Daylight Saving restrictions, the exemption allows brochures and signage minimal garden watering, turf watering, provides an customer mail out - customers received a letter allocation to community sports grounds and ensures advising of the level of water restriction being the continued operation of commercial car washes. implemented and a brochure explaining the restrictions Stage 4 water restrictions – Winter ended on 30 October 2008. website updates. e. Stage 4 water restrictions – Daylight Saving were During the current drought, Barwon Water has effectively introduced 1 November 2008 until 5 April 2009. managed water supply to various communities by consistent application of the Drought Response Plan. Water f. Stage 4 water restrictions – Winter were introduced on restrictions were introduced in accordance with the plan 6 April 2009 until 1 November 2009. and applications for exemptions have been considered g. Stage 4 water restrictions - Daylight Saving were and responded to in accordance with the by-law. introduced on 1 November 2009 until 28 February 2010.
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2. Stage 4 water restrictions lifted – greater Geelong Barwon Water publications, such as water supply notices water supply system and fact sheets on Barwon Water proposals, advise customers of the availability of the interpreter service. Stage 3 water restrictions where introduced on 1 March Works notices are translated into Croatian, Dutch, Greek, 2010. Exemptions were allowed for sportsgrounds, German, Italian, Polish and Vietnamese. planting drought tolerant turf, commercial pools, and elderly and disabled customers were permitted a variation Barwon Water is an equal opportunity employer and does of residential watering times. not discriminate based on cultural background or ethnicity.
3. Stage 2 water restrictions lifted – Apollo Bay Young people In accordance with the Drought Response Plan trigger In addition to our comprehensive Schools’ Education curves, water restrictions were introduced as follows: Program, Barwon Water actively encourages work experience for secondary students and vacation a. Apollo Bay – Stage 2 on 1 November 2009. Apollo Bay employment for students studying at universities and required Stage 2 restrictions over the holiday and TAFE colleges. Five vocational students participated in summer tourist seasons because of limited capacity summer internships during 2009-2010. of the pipeline and storage basin at Marengo. Two tertiary students participated in vacation employment b. Apollo Bay moved from Stage 2 water restrictions in 2009-2010 and three secondary students undertook to Permanent Water Saving Measures on 1 May 2010. work experience.
4. Permanent water saving measures invoked – Lorne, Two Deakin University Engineering students from the Colac, Aireys Inlet and Fairhaven Geelong region were provided with Barwon Water Scholarships that included $5000 per annum towards These towns have been under Permanent Water Saving their studies and a work placement for the duration of Measures for the whole of the 2009-2010 financial year. their course. Valuing diversity Barwon Water provides traineeships in the following areas: Call Centre, Customer Service, Corporate Services and The State Government values the state’s cultural diversity as Field Maintenance. an economic, social and cultural asset of great importance. Barwon Water is committed to improving the quality of Indigenous people service delivery to a culturally and linguistically diverse The Aboriginal Heritage Act 2006 introduced a new community and providing a discrimination-free work place. requirement to prepare a Cultural Heritage Management Plan if all or part of the activity is listed as high impact, Cultural diversity resulting in significant ground disturbance, or is an area More than 40 per cent of Victorians having either been of cultural heritage sensitivity, which has not been subject born overseas or have at least one parent born overseas. to significant ground disturbance. Around 10 per cent of our customers speak a language Barwon Water will continue to work closely with other than English at home. Prominent languages include indigenous people on projects that may have cultural and Croatian, Serbian, Vietnamese and Greek. heritage impacts. Barwon Water is committed to ensuring the region’s ethnic groups have access to information on water and sewerage services, and we make every attempt to comply with all principles and guidelines under the Multicultural Victoria Act 2004. Customers requiring assistance have access to a free interpreter service. A pool of employees, who speak languages other than English, also are available to act as interpreters.
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Aboriginal archaeology Heritage and archaeological surveys are undertaken in the On major construction projects, which may impact on initial stages of any Barwon Water project. archaeological sensitive areas, Barwon Water may enter into a Memorandum of Understanding (MOU) with the If the survey identifies issues, the local indigenous people relevant Aboriginal co-operative. The intent of the MOU are notified. In certain circumstances, a site monitor is to set out the agreed principles for the management representing the Aboriginal community may be engaged of Aboriginal cultural heritage (archaeological sites) to observe works and provide expert advice as required. during construction. Key Aboriginal groups are the Wathaurong Aboriginal Co-operative and the Framlingham Aboriginal Trust. Key actions
Objectives Actions
Communicate During 2009-10, we supported this strategy through the following actions: Barwon Water's Strategic Intent Developed a public summary version of our Strategic Intent which is available from our website and vision to Launched an all new website, designed with our customers and stakeholders in mind. It is dynamic, Barwon Water's easy to follow and clearly communicates our vision, strategies and achievements people and our community Launched a new quarterly e-newsletter, supported by mainstream media advertising, to provide our customers with an update on the progress of our major projects and programs. This replaces our old ‘bill insert’ newsletter.
Ensure that During 2009-2010 we: external communication is Initiated a program to review our customer and community correspondence to ensure it is consistent, meaningful, clear clear and uses plain English. This is progressing and constructive Developed a web-based interface to inform customer of planned outages, while also ensuring all web content is meaningful, concise and clear.
Undertake regular In early 2010 we conducted our second customer survey, asking about our customers’ experiences with customer and Barwon Water and their knowledge of water issues. stakeholders It showed some improvement over our 2008 performance, but also highlighted several areas requiring surveys to continued work. identify needs and expectations and measure perceptions
Meet government All customer charters are available from our website www.barwonwater.com.au expectations or by calling 1300 656 007. in a vigorous and transparent manner by meeting the customer services criteria of the Statement of Obligation and the benchmark Customer Charter
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Our strategic direction How we compare ‘We will build a high-performance Barwon Water, along with 12 other regional water authorities, participated in the 2010 People Matter staff organisation’. survey. The survey collects data on employee perceptions of the values and principles underpinning our workplace culture. Ours was specifically related to the water industry. The survey measures four aspects of culture including values, principles, workplace wellbeing and commitment and our future. Barwon Water achieved a response rate of 55 per cent with 207 employees taking the opportunity to have their say, with the following outcome highlights: 97% of respondents are aware of Barwon Water’s values 93% feel good about the future of our organisation 90% understand Barwon Water’s business direction. We also achieved high responses in our commitment to health and safety, matching services to customer needs and achieving customer satisfaction.
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Growing our people Innovation iCatch Cultural change iCatch is Barwon Water’s innovation program, designed All employees participated in cultural change workshops, to promote, foster and recognise innovation within the which focussed on: organisation. As at 30 June 2010, iCatch was on track creating high performance to achieve, and most likely exceed our targets as follows: living our values understanding self Indicator Actual Annual (30 June) target valuing differences Ideas 183 200 assisting staff through change Innovations 102 40 creating enjoyable working environments. Savings – $2,181,236 $500,000 as result of innovation Performance management % of employees recognised 40 30 Barwon Water has developed a new performance Recognition posters 31 25 management system, known as the Performance Plan and Staff newsletter articles 40 40 Review (PPR). The PPR was designed to ensure that individual employee goals, activities and outputs are consistent with the organisation’s goals and objectives. The search for continual improvement within Barwon Water has driven the iCatch Committee to evaluate the Pilot mentoring program program by reviewing best practice innovation programs across like industries. Barwon Water introduced a pilot mentoring program in 2009, supporting 10 formal mentoring relationships To assist the iCatch Committee in their role of facilitating over a nine-month period. Around 60 per cent of innovation and working with employees on their ideas, the participants have since assumed new roles within committee completed two half day innovation workshops Barwon Water, a third of whom are currently involve in March. in the Barwon Water Alliance. Rewarding our people As part of the 2008 Enterprise Agreement negotiations it was agreed that a salaries and wages review would be conducted during the term of the agreement. The aim of the salary and wages classification framework review was to support the Strategic Intent direction of creating a high performance organisation through a remuneration framework that is relevant, equitable and transparent. The draft framework was presented to the Barwon Water Board in June 2010 and will be considered by staff during the 2011 Enterprise Agreement negotiations.
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Young people Emergency planning Barwon Water is an active participant in training and work In response to the tragic fires of Black Saturday in experience for secondary students and vacation February 2009, an increased level of preparedness was employment for students studying at universities and evident for the 2009-2010 fire season. There is a history TAFE colleges. of wildfires in the region and there are 16 high risk towns within the service area. During 2009-2010: A ‘Fire Emergency Management Plan’ was developed that Five vocational students participated in summer addressed the following three key elements. internships. Employee Safety Two tertiary students participated in vacation employment. Asset Protection Three secondary students undertook work experience. Communications Two Deakin University Engineering students were In addition to these internal activities Barwon Water awarded Barwon Water Scholarships. worked closely with CFA and local government Municipal Emergency Management Planning Committees in the Barwon Water provided traineeships in the call centre, preparation of Township Protection Plans and customer services, corporate services and field consideration of Neighbourhood Safer Places – Places of maintenance. Last Resort across the region. Health, safety and the environment Fortunately there were no serious fires in the region and our plans will continue to be reviewed to ensure they We are committed to safety, and our Strategic Intent provide an adequate response to the fire risk. has a key action for General Managers and department managers to undertake safety conversations. Other initiatives The safety conversations require the leadership group During 2009-2010 we also introduced active recording to visit Barwon Water sites and facilities and speak to and reporting of lead indicators including near miss employees about the suitability of tools and equipment, events, hazard reports, workplace inspections and safety work environment, hazards and controls, and training related innovations – iCatch’s. requirements. Proactive incident and injury management has also been Strong leadership is the key to effective safety culture. a focus during 2009-2010 to reduce the number of lost It begins at the top, by not only endorsing a safety culture time injuries. The preventative measures implemented but embracing it through sincerity and actions. Through have included manual handling reviews and increasing the site visits and conversations, the leadership team has presence in the field to actively encourage safe behaviours. established relationships with employees and encouraged open communication to action areas of improvement Future challenges opportunity. The focus areas for 2010-2011 include:
Employee assistance program updating the injury management policy to reflect the changes in the new Accident Compensation Act 2009 Barwon Water recently engaged the services of Converge International to provide an employee assistance program updating the fatigue management rules to be applied across the organisation. This confidential service is free of at Barwon Water charge to all employees and their families and is provided developing drug and alcohol testing guidelines as part of Barwon Water’s commitment to assist our employees in managing their health and wellbeing. enhancing the internal training program promoting safety through increasing awareness of Barwon Water safety programs and systems.
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Gender participation in the workforce Future challenges Barwon water again increased female participation in our Ageing workforce workforce to 28 per cent in 2009-2010. One new female The Organisational Development Group is committed to department manager joined the Barwon Water meeting the challenges of an ageing workforce. As part of management team during the year, thereby increasing the this commitment we are placing more structure and rigour female representation in management to 24 per cent. around the management of incapacitated employees and An emphasis on flexible work practices has continued to currently developing a policy to better manage the ‘fitness support our commitment to being an equal opportunity for duty’ of our workforce. employer of choice. This new emphasis is designed to ensure organisational needs continue to be met without endangering the mental Employment and Conduct Principles and physical health of our employees. Barwon Water complies with the Public Administrators Act 2004. Employees are selected solely on the basis of Enterprise agreement relative ability, knowledge and skills in fair and open Barwon Water’s current Enterprise Agreement expires competition that ensures equal opportunity. Promotion on 1 March 2011. The Organisational Development Group and advancement within Barwon Water must be from is coordinating negotiations with relevant unions and qualified individuals selected in fair and open competition, an Enterprise Agreement Consultative Committee solely on the basis of relative ability, knowledge and skills (EACC) has been created to facilitate negotiations. measured in relation to the position involved. This committee comprises OD staff, employee & management representatives and organisers from the All employees receive fair and equitable treatment ASU and APESMA. without regard to race, colour, sex, sexual preference, age, physical or mental disability, pregnancy, religion, political In line with the Fair Work Act 2009, the relevant award opinion, national extraction or social origin. conditions have transitioned to a new modern award, the Water Industry Award 2010. This award will be used as the Harassment, bullying and discrimination basis for our negotiations with employees. Harassment, Bullying and Discrimination Policy This policy supports the right of all people to work in an environment free from harassment, bullying and discrimination. Behaviour to the contrary will result in disciplinary action or dismissal. Barwon Water provides fully trained contact officers to provide information, support and advice to employees seeking assistance regarding harassment, bullying or equal employment opportunity (EEO).
Ethical employment and subcontracting policy Departments are required to ensure all tenderers identify the use of sub-contractors or third parties that would be employed under conditions of employment or rates of pay that might be considered exploitative, or outside the norm within their industry sector, due to the ethnic, economic, social, or other situation of the groups concerned. Contracts will not be entered into with the tenderers where any such instances of possible exploitation or underpayment arrangements are identified.
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Occupational health and safety Injury statistics
Lost time accidents Injuries – body part and cause summary
2005-06 9 All injuries - body part
2006-07 9 Back 17 2007-08 11 Shoulders/Arms 6 2008-09 14 Hand 6 2009-10 4 Ankle 2 Face/Head 3 Barwon Water achieved a 71 per cent improvement in lost time injuries (LTIs) – reducing from 14 to 4 during 2009- Hip/Leg 5 2010 – through the implementation of a manual handling Eye 3 risk review, suitable duties register, proactive return to Internal (hernia) 1 work plans, and encouraging hazard/near miss reporting. Psychological 1
Number of days lost due to accidents All injuries - case summary 2005-06 149 2006-07 30 Cause 2007-08 122 Manual handling 12 2008-09 169 Muscular strain/stress 7 2009-10 72 Slips/trips 5 Hitting objects 4 The ‘average days lost’ performance was within target Burns/blister/abrasion 3 until May 2010. Injuries occurring in April 2010 and June 2010 resulted in the target being exceeded. An early Chemical exposure 3 return to work program has been further enhanced to Mechanical vibration 3 proactively manage this area of the health and safety. Bites/stings 2 Vehicle accident 2 Fall from height 2 Mental stress 1 Other 2
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Employment statistics
2010 Casual Part-time Full-time Total (Headcount) Total (%) 2010 FTE 2010 2010 Female 3 35 82 120 28% 105.63 Male 3 6 294 303 72% 298.23 Total 6 41 376 423 100% 403.86
2009 Casual Part-time Full-time Total (Headcount) Total (%) 2010 FTE 2010 2010 Female 3 29 70 102 26% 90.47 Male 1 5 281 287 74% 283.42 Total 4 34 351 389 100% 373.89
Notes: • Excludes external contractors/consultants and temporary staff employed by employment agencies. • Includes seven (7) State Government appointed Board Directors. • Additional employees have been recruited to assist with the development and implementation of the Corporations’ extensive capital works projects. • FTE means full-time employee equivalent.
Anzsco
2010 2009 Occupation classification Headcount Headcount Managers 27 27 Professionals 132 112 Technicians and trade workers 86 85 Clerical and 81 72 administrative workers Machinery operators and 29 31 drivers Labourers 68 62 Total 423 389
Notes: • The Australian Bureau of Statistics (ABS) develops and maintains standard occupation coding structures for labour market analysis. • The primary ABS occupation coding structure is known as ANZSCO (Australian and New Zealand Standard Classification of Occupations). • Barwon Water utilises ANZSCO as its occupational reporting model. • Board Directors are included in the ANZSCO classification of ‘Managers’
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Key actions
Objectives Actions
Undertake a In February 2010 we conducted our second employee Organisational Alignment Survey, which assists comprehensive staff Barwon Water to gain a better understanding of our people’s perceptions, feelings and beliefs about their survey to determine workplace. We also undertook the State Government’s People Matter survey, which compares our own the current employees’ views with those of our industry peers. organisational Both surveys have helped us to develop and agree on behaviours which support previously established alignment and values. They have also helped inform the next version of the Strategic Intent. identify actions required to build a Platform for High Performance Organisation (PHPO)
Embed values and In July 2009 we launched our new values of Leadership, Respect, High Performance, Innovation and behaviours in Relationships across the organisation via a number of internal events. Our values perform a vital role in Barwon Water defining the culture of Barwon Water. Our values are included in our Strategic Intent.
Promote and foster After a successful first year, ouriCatch innovation catchment program has developed and grown, iCatch within with our targets well on the way to being exceeded by 30 June 2010. We have so far adopted innovations Barwon Water which have helped to save more than $2 million over the year. Our next step is to review best practice of innovation programs across like industries to further enhance and develop iCatch.
Ensure leading We have implemented a number of programs during the year to support this goal including: Health Safety and recently launching a health a wellbeing program, focusing on physical, social, emotional and financial Environment (HSE) wellbeing performance and meet all legal and began an undertaking for General Managers and department managers to initiate safety conversations social requirements across the organisation recently engaging the services of Converge International to provide an employee assistance program across Barwon Water.
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APPENDIX ONE: The 2009-2010 Annual Report of the Barwon Region Water Disclosure Corporation is prepared in accordance with all relevant Victorian legislation. This index has been prepared to facilitate identification of the authority’s compliance with Index statutory disclosure requirements.
Legislation Requirement Page reference Ministerial Directions Report of Operations – FRD Guidance
Charter and purpose FRD 22B Manner of establishment and the relevant Ministers 5-6, 124 FRD 22B Objectives, functions, powers and duties 5-6, 17-21 FRD 22B Nature and range of services provided 5-6, 35
Management and structure FRD 22B Organisational structure 21
Financial and other information FRD 10 Disclosure index 82 FRD 12A Disclosure of major contracts 33 FRD 15B Executive officer disclosures 126 FRD 22B Operational and budgetary objectives and performance against objectives 10, 29-32, 34-35, 38-39, 45, 59-62, 64, 74, 81 FRD 22B Employment and conduct principles 78 FRD 22B Occupational health and safety policy 77-79 FRD 22B Summary of the financial results for the year 29-31 FRD 22B Significant changes in financial position during the year 30 FRD 22B Major changes or factors affecting performance 30 FRD 22B Subsequent events 30, 127 FRD 22B Application and operation of Freedom of Information Act 1982 25 FRD 22B Compliance with building and maintenance provisions of Building Act 1993 27 FRD 22B Statement on National Competition Policy 28 FRD 22B Application and operation of the Whistleblowers Protection Act 2001 27, Appendix 2 (p131-140) FRD 22B Details of consultancies over $100,000 33 FRD 22B Details of consultancies under $100,000 33 FRD 22B Statement of availability of other information 25 FRD 25 Victorian Industry Participation Policy disclosures 28 FRD 29 Workforce Data disclosures 80 FRD 121 Infrastructure Assets (Water/Rail) 26 SD 4.5.5 Risk management compliance attestation 24 SD 4.2(g) General information requirements 25 SD 4.2(j) Sign-off requirements 9, 86, 128
Legislation Freedom of Information Act 1982 25 Building Act 1993 27 Whistleblowers Protection Act 2001 27, Appendix 2 (p131-140) Victorian Industry Participation Policy Act 2003 28 Financial Management Act 1994 26, 93 Multicultural Victoria Act 2004 73
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2009-2010
PERFORMANCE REPORT
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PERFORMANCE REPORT 2009-10
FINANCIAL PERFORMANCE INDICATORS 2008-09 2009-10 2009-10 2009-10 Note Actual Actual Target Variance Long-term profitability (return on assets) A 2.0% 2.5% 2.0% 23.5% Owner's investment (return on equity) B 1.1% 1.4% 1.1% 24.5% Long- term financial viability (debt to assets) A 12.8% 15.4% 12.5% 22.7% Liquidity and debt servicing (interest cover) 2.85 times 2.60 times 2.69 times 3.5% Immediate liquidity and debt servicing (cash cover) C 5.78 times 4.49 times 5.02 times 10.5%
Operating Efficiency Indicators Water Supply Bulk $262.00 $318.00 $322.00 1.2% Water Supply Reticulation $1,193.00 $1,355.00 $1,305.00 3.8% Water Supply Treatment $230.00 $231.00 $230.00 0.4% Sewerage Reticulation $1,009.00 $942.00 $912.00 3.3% Sewerage Treatment $747.00 $832.00 $833.00 0.1%
SERVICE DELIVERY PERFORMANCE INDICATORS 2008-09 2009-10 2009-10 2009-10 Note Actual Actual Target Variance
Water indicators Number of Customers Receiving 5 Unplanned Interruptions in the Year D 19 13 186 93.0% Average Duration of Unplanned Water Supply Interruptions (minutes) E 109.3 106.1 115 7.7% Average Duration of Planned Water Supply Interruptions (minutes) E 186.8 192.3 230 16.4% Unplanned Water Supply Interruptions Restored within 5 Hours 96.4% 96.5% 96.0% 0.5%
Sewer indicators Sewer Spills from Reticulation and Branch Sewers - Priority 1 (number) F 30 44 46 4.3% Sewer Spills from Reticulation and Branch Sewers - Priority 2 (number) F 336 349 463 24.6% Sewage Spilt from Emergency Relief Structures and Pumping Stations G N/A N/A N/A N/A Sewerage Spills Contained within 5 Hours - Priority 1 100% 100% 100% 0.0%
Customer complaints indicators Water Quality Complaints (per 1,000 Customers) H 2.129 1.290 N/A N/A Water Supply Reliability Complaints (per 1,000 Customers) H 0.031 0.040 N/A N/A
Sewerage Service Quality & Reliability Complaints (per 1,000 Customers) H 0.322 0.036 N/A N/A Affordability Complaints (per 1,000 Customers) H 0.023 0.010 N/A N/A Billing Complaints (per 1,000 Customers) H 0.123 0.130 N/A N/A Pressure Complaints (per 1,000 Customers) H 0.161 0.140 N/A N/A Sewage Odour Complaints (per 1,000 Customers) H 0.383 0.036 N/A N/A Other Complaints (per 1,000 Customers) H 1.807 1.140 N/A N/A
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PERFORMANCE REPORT 2009-10
ENVIRONMENTAL PERFORMANCE INDICATORS
2008-09 2009-10 2009-10 2009-10 All systems combined Note Actual Actual Target Variance Re-use Indicators Effluent Re-use (% by volume) I 16.9% 16.03% NA NA Biosolids Re-use (% by dry mass) J 112.4% 55.0% 100% 45.0%
Sewage Treatment Standards Number of Analyses Complying with Licence Agreements as % of Samples 100.0% 100.0% 100.0% 0%
2009-10 Actual 2008-09 Actual Water Reclamation Plants Effluent Biosolids Number of Analyses Complying with Effluent Biosolids Re-use (% by Re-use (% by Licence Agreements as % of Samples Re-use (% by Re-use (% by volume) dry mass) volume) dry mass) Aireys Inlet 100.0% N/A Corporate Licence now applies - no 100.0% N/A compliance samples for lagoon plants. Anglesea 34.2% 100.0% 100.0% 47.2% 100.0% Apollo Bay 3.2% 100.0% 100.0% 3.8% 100.0% Bannockburn 100.0% N/A Corporate Licence now applies - no 100.0% N/A compliance samples for lagoon plants. Black Rock 16.1% 48.0% 100.0% 16.2% 114.0% Colac 1.4% 100.0% 100.0% 1.9% 100.0% Lorne 5.2% 100.0% 100.0% 5.5% 100.0% Portarlington 100.0% N/A Corporate Licence now applies - no 100.0% N/A compliance samples for lagoon plants. Winchelsea 100.0% N/A Corporate Licence now applies - no 100.0% N/A compliance samples for lagoon plants.
Notes: A Impact of lower average asset base due to the planned asset revaluation now to be booked in 2010-11. B Impact of lower average equity base due to the planned asset revaluation now to be booked in 2010-11. C Impact of lower than planned water consumption resulting in reduced volume revenue, while debtors increased marginally. D Water main replacement program and other proactive improvements as well as favourable climate conditions are resulting in lower interruptions. E Emphasis on process review to improve efficiency of response and rectification of service following an interruption to water supply, including implementation of level 1 supervisory response and problem diagnosis for reactive cases. F Barwon Water implemented an internally developed asset management system, which risk-ranks the Corporation’s reticulation sewerage pipes and determines maintenance and rehabilitation requirements. These maintenance and rehabilitation programs were implemented accordingly. G The volumes of sewage split during incidents cannot be determined with a reasonable level of accuracy, and consequently results are unable to be reported, and targets set. Barwon Water actively manage sewage infrastructure to reduce the risk of incidents of sewer spills occuring, and have processes for containment when an event occurs. H Target not required in ESC Final Determination. I Barwon Water has set a target to recycle 25 per cent of treated water available by 2015. Interim targets are not applicable and projects to meet the 2015 target are currently underway. J The biosolids re-use figure, measured as actual processed biosolids applied to land, is below 100% for this year with a stock of biosolids to be processed, dried and applied to land. This land-application short-fall will be applied to land in 2010-11.
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Performance statement for 2009-10
In our opinion, the accompanying Statement of Performance of Barwon Region Water Corporation in respect of the 2009-2010 financial year is presented fairly in accordance with theFinancial Management Act 1994. The statement outlines the relevant performance indicators as determined by the responsible Minister, the actual results achieved for the financial year against pre-determined performance targets and these indicators, and an explanation of any significant variance between the actual results and performance targets. As at the date of signing, we are not aware of any circumstance which would render any particulars in the Statement to be misleading or inaccurate.
R Lowrey Chairman
M Malouf Managing Director (Accountable Officer)
Dated this 11th day of August, 2010
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VAGO Victorian Auditor-General’s Office
INDEPENDENT AUDITOR’S REPORT
To the Board Members, Barwon Region Water Corporation
The Statement of Performance The accompanying statement of performance for the year ended 30 June 2010 of Barwon Region Water Corporation comprises the statement, the related notes and the statutory certification.
The Board Members’ Responsibility for the Statement of Performance The Board Members of Barwon Region Water Corporation are responsible for the preparation and the fair presentation of the statement of performance in accordance with the Financial Management Act 1994. This responsibility includes establishing and maintaining internal controls relevant to the preparation and fair presentation of the statement of performance that is free of material misstatement, whether due to fraud or error.
Auditor’s Responsibility As required by the Audit Act 1994, my responsibility is to express an opinion on the statement of performance based on the audit, which has been conducted in accordance with Australian Auditing Standards. These Standards require compliance with relevant ethical requirements relating to audit engagements and that the audit be planned and performed to obtain reasonable assurance whether the statement of performance is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the statement of performance. The audit procedures selected depend on judgment, including the assessment of the risks of material misstatement of the statement of performance, whether due to fraud or error. In making those risk assessments, consideration is given to the internal control relevant to the entity’s preparation and fair presentation of the statement of performance in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the overall presentation of the statement of performance. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.
Matters Relating to the Electronic Presentation of the Audited Statement of Performance This auditor’s report relates to the statement of performance published in both the annual report and on the website of Barwon Region Water Corporation for the year ended 30 June 2010. The Board Members of Barwon Region Water Corporation are responsible for the integrity of the website. I have not been engaged to report on the integrity of the website. The auditor’s report refers only to the statement named above. An opinion is not provided on any other information which may have been hyperlinked to or from these statements. If users of this statement of performance are concerned with the inherent risks arising from electronic data communications, they are advised to refer to the hard copy of the audited statement of performance to confirm the information included in the audited statement of performance presented on the Barwon Region Water Corporation website.
Level 24, 35 Collins Street, Melbourne Victoria 3000 Telephone 61 3 8601 7000 Facsimile 61 3 8601 7010 Email [email protected] Website www.audit.vic.gov.au
Auditing in the Public Interest
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Independent Auditor’s Report (continued)
Independence The Auditor-General’s independence is established by the Constitution Act 1975. The Auditor-General is not subject to direction by any person about the way in which his powers and responsibilities are to be exercised. In conducting the audit, the Auditor-General, his staff and delegates complied with all applicable independence requirements of the Australian accounting profession.
Auditor’s Opinion In my opinion, the statement of performance of Barwon Region Water Corporation in respect of the 30 June 2010 financial year presents fairly, in all material respects, and in accordance with the Financial Management Act 1994.
MELBOURNE D D R Pearson 11 August 2010 Auditor-General
Level 24, 35 Collins Street, Melbourne Victoria 3000 Telephone 61 3 8601 7000 Facsimile 61 3 8601 7010 Email [email protected] Website www.audit.vic.gov.au
Auditing in the Public Interest
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2009-2010
ANNUAL FINANCIAL STATEMENTS
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FINANCIALS
COMPREHENSIVE OPERATING STATEMENT FOR THE YEAR ENDED 30 JUNE 2010
2010 2009 NOTE $’000 $’000 Revenue from operating activities Service charges 65,264 56,432 Usage charges 49,056 45,637 Tradewaste charges 4,734 4,445 Government contributions 374 2,210 Developer contributions 14,689 10,638 Other 5,782 7,719 Interest 62 218 3 139,961 127,299
Revenue from non-operating activities Net gain/(loss) on non-financial assets 8.4 (634) (574) Other revenue 591 511 (43) (63) Total revenue 139,918 127,236
Expenses
Direct operating 29,992 32,355 Administration 12,435 11,025 Borrowing costs 4 11,419 7,958 Depreciation and amortisation 8.3 29,989 28,337 Employee benefits 33,331 28,760 Environmental contribution 4,416 4,416 Bad and doubtful debts 169 72 Finance charges 8 14 Total expenses 121,759 112,937 Net result before tax 18,159 14,299 Income tax expense 5 5,470 4,316 Net result for the period 17 12,689 9,983
Other comprehensive income Net gain/(loss) on revaluation of property, plant & equipment 0 0 Net change to the fair value of available for sale assets 0 0 Income tax relating to components of other comprehensive income 0 0 Total other economic flows - other non-owner changes in equity 0 0 Total comprehensive income for the period 12,689 9,983
The accompanying notes form part of these accounts.
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FINANCIALS
BALANCE SHEET AS AT 30 JUNE 2010
2010 2009 NOTE $’000 $’000 Assets Current assets Cash and cash equivalents 6 5,770 12,415 Receivables 7 20,181 19,291 Inventories 1,292 1,313 Prepayments 771 446 Total current assets 28,014 33,465
Non-current assets Deferred tax assets 5 3,446 2,901 Receivables 7 54 63 Property, plant and equipment 8 1,171,614 1,098,316 Intangible assets 9 3,410 3,500 Total non-current assets 1,178,524 1,104,780 Total assets 1,206,538 1,138,245
Liabilities Current liabilities Payables 10 27,004 25,504 Interest bearing liabilities 11 20,850 5,000 Employee entitlements 13 7,667 6,839 Provisions 13 3,173 2,329 Total current liabilities 58,694 39,672
Non-current liabilities Payables 10 369 822 Deferred tax liabilities 5 50,661 44,646 Interest bearing liabilities 11 164,470 141,020 Employee entitlements 13 504 434 Total non-current liabilities 216,004 186,922 Total liabilities 274,698 226,594
Net assets 931,840 911,651
Equity Reserves 15 5,662 5,662 Contributions by owners 16 402,529 395,029 Accumulated funds 17 523,649 510,960 Total equity 931,840 911,651
The accompanying notes form part of these accounts.
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FINANCIALS
STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2010 2010 2009 NOTE $’000 $’000 Total equity at beginning of financial year 911,651 896,348 Total comprehensive income for the year 12,689 9,983 Total recognised income and expense for the period 12,689 9,983 Contributed capital 7,500 5,320 Total equity at end of financial year 931,840 911,651
The accompanying notes form part of these accounts.
Cash flow STATEMENT FOR THE YEAR ENDED 30 JUNE 2010 2010 2009 NOTE $’000 $’000 Inflows Inflows (Outflows) (Outflows) Cash flows from operating activities Payments Employees (32,211) (27,684) Suppliers (58,592) (56,500) Interest and other costs of finance (10,276) (7,411) Environmental contribution (4,416) (4,232)
Receipts Service, usage and tradewaste charges 118,002 104,824 Interest 63 224 Non-government contributions 3,959 2,848 Government contributions 374 1,980 GST received from the ATO 12,014 11,618 Other 6,772 8,710 Net cash provided by operating activities 19 35,689 34,377
Cash flows from investing activities Payments for purchase of property, plant and equipment (90,390) (76,494) Proceeds from sale of property, plant and equipment 1,256 1,293 Net cash used in investing activities (89,134) (75,201)
Cash flows from financing activities Government contributions 7,500 7,370 Proceeds from TCV loans 44,300 45,000 Refinanced maturing TCV loans (5,000) (5,000) Net cash provided by (used in) financing activities 46,800 47,370 Net increase/(decrease) in cash held (6,645) 6,546 Cash and cash equivalents at beginning of year 12,415 5,869 Cash and cash equivalents at end of year 5,770 12,415
The accompanying notes form part of these accounts. PAGE | 92 PAGE | 93 BARWON WATER ANNUAL REPORT 2009-2010 BARWON WATER ANNUAL REPORT 2009-2010
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Notes to the Financial Statements 1.6. Critical Accounting Estimates The preparation of financial statements is in conformance 1. Statement of Accounting Policies with Australian Accounting Standards which requires the This Financial Report of Barwon Region Water Corporation use of certain critical accounting estimates. It also is a general purpose financial report that consists of a requires management to exercise its judgment in the Comprehensive Operating Statement, Balance Sheet, process of applying the entity’s accounting policies. Statement of Changes in Equity, Cash Flow Statement and notes accompanying these statements. The general 1.7. Financial statement presentation purpose financial report complies with Australian Barwon Water has applied the revised AASB 101 accounting standards, other authoritative pronouncements Presentation of Financial Statements which became of the Australian Accounting Standards Board, effective on 1 January 2009. The revised standard Interpretations and the requirements of the Financial requires the separate presentation of comprehensive Management Act 1994 and applicable Ministerial Directions. income and a statement of changes in equity. All non- owner changes in equity and total comprehensive income 1.1. Accrual Basis are now presented in the Comprehensive Operating In accordance with the Financial Management Act 1994, Statement. As a consequence, Barwon Water had to the accrual basis of accounting has been used with change the presentation of its financial statements. revenues and expenses recognised as earned or incurred. Comparative information has been re-presented so that it is also in conformity with the revised standard. 1.2. Historical Cost The financial statements have been prepared on a historical 1.8. Revenue Recognition cost basis, with the exception of certain non-current assets which, as noted, are at valuation. 1.8.1. Water Usage and Sewer Disposal Charges Revenue is brought to account when services have been 1.3. Rounding provided or when a rate/tariff is levied or determined. The amounts shown in the financial statements are Water usage and sewer disposal charges (including expressed to the nearest thousand dollars. tradewaste charges) are recognised as revenue when the services are provided. Meter reading is undertaken 1.4. Comparative Amounts progressively during the year. An estimation, calculated by Unless otherwise stated, all accounting policies applied multiplying the number of days since the last reading by are consistent with those of the prior year. Comparatives each property group’s average service usage, is made at are adjusted where necessary to enhance comparability the end of each accounting period in respect of meters in conformity with any changes in presentation and which have not been read at balance date. disclosure. 1.8.2. Government Contributions 1.5. Classification between Current and Non-Current Government grants and contributions are recognised as In the determination of whether an asset or liability is operating revenue on receipt or when an entitlement is current or non-current, consideration is given to the time established, whichever is the sooner, and disclosed in the when each asset or liability is expected to be realised or Comprehensive Operating Statement as government paid. The asset or liability is classified as current if it is contributions. However, grants and contributions received expected to be turned over within the next 12 months, from the Victorian State Government, which were originally being the Corporation’s operational cycle with the appropriated by the Parliament as additions to net assets exception of employee benefits (refer Note 1.21). or where the Minister for Finance and the Minister for Water have indicated are in the nature of owners’ contributions, are accounted for as Equity – Contributions by Owners.
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1.8.3. Developer Contributions/Fees Paid by Developers 1.9. Depreciation and Amortisation Water infrastructure assets built by developers in new Where assets have separate identifiable components land subdivisions that, on completion, are provided to the that have distinct useful lives and/or residual values, Corporation or fees paid by developers to connect new a separate depreciation rate is determined for each developments to the Corporation’s existing water supply component. and sewerage systems are recognised as revenue when Land is not depreciated. Depreciation on other assets is the contributions are received. calculated using the straight line method to allocate their Developer contributed assets are recognised on the issue cost or revalued amounts, net of their residual values, by Barwon Water of the relevant declaration of serviced over their estimated useful lives, commencing from the areas. The value of these assets is based on fair value. time the asset is held ready for use. The assets residual Fair value is determined based on a replacement cost values and useful lives are reviewed and adjusted, matrix that allows for various asset types, locations and if appropriate, at each balance sheet date. depths. The fair value of these assets is recognised as Depreciation rates within each asset class are consistent revenue in the accounts when the Corporation gains with the previous year and fall within the following ranges: control of the assets.
1.8.4. Sale of Non-Current Assets Depreciation In accounting for the sale of non-current assets, the net Property, Plant and Equipment Class Ranges (%) position is reflected in the revenue from non-operating activities section of the Comprehensive Operating Buildings 1.25-15.00 Statement. Infrastructure - distribution 1.25-15.00 Infrastructure - 1.25-15.00 harvesting and major transfer Infrastructure - reserves and river 1.25-15.00 Infrastructure - quality 1.25-15.00 Infrastructure - collection 1.25-15.00 Infrastructure - treatment and disposal 1.25-15.00 Plant, equipment and other 1.25-27.00 Intangible assets 20.00-27.00
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1.10. Borrowing Costs 1.13. Environmental Contributions Borrowing costs are recognised as expenses in the period The Water Industry (Environmental Contributions) Act in which they are incurred. Borrowing costs include 2004 amended the Water Industry Act 1994 to make interest on bank overdrafts and short-term and long-term provision for environmental contributions to be paid by borrowings, amortisation of discounts or premiums water supply authorities. The Act establishes an obligation relating to borrowings, amortisation of ancillary costs for authorities to pay into the consolidated fund annually in incurred in connection with the arrangement of accordance with a pre-established schedule of payments, borrowings and finance lease charges. which sets out the amounts payable by each Corporation. The first four year schedule of payments ended on 1.11. Website Costs 30 June 2008, with a revised schedule now applying Costs in relation to websites controlled by the Corporation to 30 June 2012. are charged as expenses in the period in which they are incurred unless they relate to the acquisition of an asset, The purpose for the environmental contribution is set out in which case they are capitalised and amortised over in the Act and the funding may be used for the purpose of their period of expected benefits. Generally, costs in financing initiatives that seek to promote the sustainable relation to feasibility studies during the planning phase management of water or address water-related initiatives. of a website, and ongoing costs of maintenance during the The environmental contributions are disclosed separately operating phase are considered to be expenses. Costs within expenses. incurred in building or enhancing a website, to the extent that they represent probable future economic benefits 1.14. Cash and Cash Equivalent Assets controlled by the entity that can be reliably measured, For the purposes of the Cash flow Statement, cash and are capitalised as an asset and amortised over the period cash equivalents include cash on hand, deposits held at of the expected benefits. call with financial institutions, other short-term, highly liquid investments with original maturities of three months 1.12. State Government Dividend or less that are readily convertible to known amounts of Barwon Water is required to pay a dividend in accordance cash and which are subject to an insignificant risk of with a determination of the Treasurer of Victoria made changes in value and bank overdrafts. Bank overdrafts are under the Public Authorities (Dividends) Act 1983, based shown with interest bearing liabilities on the Balance Sheet. on a prescribed percentage of the previous financial year’s reported net profit. 1.15. Receivables Trade receivables are recognised initially at fair value An obligation to pay a dividend only arises after (which equates to cost) and subsequently measured at consultation with the Minister for Water and the Treasurer, amortised cost, less provision for impairment. Trade and a formal declaration is made by the Treasurer. receivables are due for settlement no more than 30 days Although this process has not yet been completed on the from the date of recognition for tariff and sundry debtors. 2009-2010 result at the reporting date, the Board’s preliminary dividend estimate in respect of 2009-2010 Collectability of trade receivables is reviewed on an is $2,012,000 (2008-2009 estimate was $943,000 which ongoing basis. Debts which are known to be uncollectible was not declared payable). are written off. A provision for impairment is established when there is objective evidence that the Corporation will not be able to collect all amounts due according to the original terms of receivables. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. The amount of the provision is recognised in the Comprehensive Operating Statement.
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1.16. Inventories 1.17.2. Revaluations Inventories comprise stores and materials used in the Land and buildings are revalued with sufficient regularity construction of new works and for the repair and to ensure that the carrying amount of each asset does not maintenance of existing assets. All inventories are valued differ materially from its fair value. This revaluation at the lower of cost and net realisable value. Costs are process normally occurs every five years. Revaluation assigned to inventory quantities on hand at balance date increments or decrements arise from differences between on a weighted average cost (WAC) basis. Inventories an asset’s depreciated cost or deemed cost and fair value. include goods held for distribution at no or nominal cost in Where the assets are revalued, the revaluation increments the ordinary course of business operations. are credited directly to the asset revaluation reserve except to the extent that an increment reverses a prior 1.17. Recognition and Measurement of Assets year decrement for that class of asset that had been Property, plant and equipment represent non-current recognised as an expense. In this case, the increment is assets comprising land, buildings, water, sewerage and recognised as revenue up to the amount of the expense. drainage infrastructure, heritage assets, plant, equipment and motor vehicles, used by the Corporation in its Revaluation decrements are recognised as an expense operations. Items with a cost or value in excess of $1,000 except where prior increments are included in the asset and a useful life of more than one year are recognised as revaluation reserve for that class of asset in which case an asset. All other assets acquired are expensed. the decrement is taken to the reserve to the extent of the remaining increments. 1.17.1. Valuation of Non-Current Physical Assets Within the same class of assets, revaluation increments Land and buildings are measured at the amounts for and decrements within the year are offset. which assets could be exchanged between knowledgeable Buildings were last revalued at 1 July 2004 to align with willing parties in an arm’s length transaction. the transition date for adoption of Australian equivalent Crown land is measured with regard to the property’s Australian Accounting Standards. Freehold land owned by highest and best use after due consideration is made for Barwon Water and Crown land controlled by Barwon Water any legal or constructive restrictions imposed on the was valued at 30 June 2007 in accordance with AASB 116 asset, public announcements or commitments made in ‘Property, Plant and Equipment’ and FRD 103 ‘Non-Current relation to the intended use of the asset. Theoretical Physical Assets’ by Shane Irwin, AAPI, Certified Practising opportunities that may be available in relation to the asset Valuer, Landlink Property Group. are not taken into account until it is virtually certain that the restrictions will no longer apply. 1.17.3. Repairs and Maintenance Routine maintenance, repair costs and minor renewal Plant, equipment, vehicles and infrastructure assets are costs are expensed as incurred. Where the repair relates measured at cost less any accumulated depreciation and to the replacement of a component of an asset and the any accumulated impairment losses. Infrastructure assets cost exceeds the capitalisation threshold, the cost is may comprise substructures or underlying systems to capitalised and depreciated. facilitate the harvesting, storage and transfer of water to meet customer needs. They also include infrastructure assets that underlie sewage and drainage systems.
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1.17.4. Impairment of Assets 1.17.5. Assets (or disposal groups) Held for Sale Intangible assets with indefinite lives are tested annually A disposal group is a group of assets to be disposed of, as to whether their carrying value exceeds their by sale or otherwise, together as a group in a single recoverable amount. All other assets are assessed annually transaction. Assets (or disposal groups) are classified for indicators of impairment, except for: as held for sale and stated at the lower of their carrying amount and fair value less costs to sell, if their carrying inventories amount will be recovered principally through a sale deferred tax assets transaction, rather than through continuing use. This condition is regarded as met only when the sale is highly financial instrument assets. probable and the asset (or disposal group) is available for If there is an indication of impairment, the assets immediate sale in its present condition. concerned are tested as to whether their carrying value exceeds their recoverable amount. Where an asset’s 1.18. Intangibles carrying amount exceeds its recoverable amount, the Intangible assets represent identifiable non-monetary difference is written-off by a charge to the Comprehensive assets without physical substance. Intangible assets are Operating Statement except to the extent that the write- recognised at cost. Costs incurred subsequent to initial down can be debited to an asset revaluation reserve acquisition are capitalised when it is expected that amount applicable to that class of asset. additional future economic benefits will flow to the The recoverable amount for most assets is measured at Corporation. the higher of depreciated replacement cost and fair value Amortisation is allocated to intangible assets with finite less costs to sell. Recoverable amount for assets held useful lives on a systematic basis over the asset’s useful primarily to generate net cash inflows is measured at the life. The amortisation period and method are reviewed at higher of the present value of future cash flows expected each balance date. In addition, an assessment is made at to be obtained from the asset and fair value less costs to each reporting date to determine whether there are sell. It is deemed that, in the event of the loss of an asset, indicators of impairment. If so, the assets concerned are the future economic benefits arising from the use of the tested as to whether their carrying value exceeds their asset will be replaced unless a specific decision to the recoverable amount. contrary has been made. ‘Software and software development costs’ are the only An impairment loss on a revalued asset is recognised intangible assets currently recognised by the Corporation. directly against any revaluation reserve in respect of the These assets are both acquired and internally generated same class of asset to the extent that the impairment loss and have a finite useful life. They are measured at cost does not exceed the amount in the revaluation reserve for less accumulated amortisation (calculated on a straight that same class of asset. line basis) less any accumulated impairment losses. These A reversal of an impairment loss on a revalued asset is assets are reviewed annually for indicators of impairment. credited directly to equity under the heading revaluation reserve. However, to the extent that an impairment loss on 1.19. Payables the same class of asset was previously recognised in the These amounts represent liabilities for goods and services Comprehensive Operating Statement, a reversal of that provided to the Corporation prior to the end of the impairment loss is also recognised in the Comprehensive financial year, which are unpaid at financial year-end. The Operating Statement. amounts are unsecured and are usually paid within 30 days of recognition.
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1.20. Interest Bearing Liabilities 1.21.2. Long Service Leave Borrowings are initially recognised at fair value, net of Current Liability – unconditional LSL (representing seven* transaction costs incurred. Borrowings are subsequently or more years of continuous service) is disclosed as a measured at amortised cost. current liability even where the Corporation does not expect to settle the liability within 12 months because Interest bearing liabilities in the Balance Sheet are it does not have the unconditional right to defer the classified as current liabilities unless the Corporation has settlement of the entitlement should an employee take an unconditional right to defer settlement of the liability leave within 12 months. for at least 12 months after the balance sheet date. The components of this current LSL liability are 1.21. Employee Benefits measured at: present value – component that the Corporation does 1.21.1. Wages and Salaries, Annual Leave and Sick Leave not expect to settle within 12 months Liabilities for wages and salaries and annual leave, expected to be settled within 12 months of the reporting nominal value – component that the Corporation date, are recognised in employee benefit liabilities in expects to settle within 12 months. respect of employees’ services up to the reporting date Non-Current Liability – conditional LSL (representing less and are measured at the amounts expected to be paid than seven* years of continuous service) is disclosed as a when the liabilities are settled, at their nominal values. non-current liability. There is an unconditional right to Employee benefits, which are not expected to be settled defer the settlement of the entitlement until the employee within 12 months, are measured as the present value of has completed the requisite years of service. Conditional the estimated future cash outflows to be made by the LSL is required to be measured at present value. entity, in respect of services rendered by employees up to the reporting date. Sick leave entitlements are of a In calculating present value, consideration is given to non-vesting nature and are paid upon a valid claim by an expected future wage and salary levels, experience of employee. employee departures and periods of service. Expected future payments are discounted using market yields at the Regardless of the expected timing of settlements, reporting date on national government bonds with terms liabilities in respect of employee benefits are classified as to maturity and currency that match, as closely as a current liability, unless there is an unconditional right to possible, the estimated future cash outflows. defer the settlement of the liability for at least 12 months * In accordance with Barwon Region Water Corporation Enterprise after the reporting date, in which case it would be Agreement 2008. classified as a non-current liability. 1.21.3. Superannuation The amount charged to the Comprehensive Operating Statement in respect of superannuation represents the contributions made by the Corporation to the superannuation plan in respect to the current services of Corporation staff. Superannuation contributions are made to the plans based on the relevant rules of each plan.
1.21.4. Employee Benefit On-Costs Employee benefit on-costs, including payroll tax and worker’s compensation, are recognised and included in employee benefit liabilities and costs when the employee benefits to which they relate are recognised as liabilities.
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1.22. Segmented Financial Data 1.23. Commitments In accordance with directions made by the Minister for Commitments include operating, capital and other Water pursuant to Section 51 of the Financial outsourcing commitments arising from non-cancellable Management Act 1994, the Corporation must provide contractual or statutory sources and are disclosed at their disclosure of financial information on the retail business nominal value. function dissected into services by way of note to the financial statements (refer Note 21). The recycled water 1.24. BOO (Build, Own and Operate) Schemes services of the Corporation are required to be disclosed The Corporation has entered into contractual arrangements from 2010. This segment has previously been incorporated with a third party to build, own and operate a biosolids in the wastewater segment therefore no comparative data drying facility at the Black Rock water reclamation plant. is available. The contractor will lease land from Barwon Water to build the thermal drying plant and will operate the facility for Barwon Water does not have a material wholesale segment twenty years in exchange for a stream of payments. of business. As Barwon Water is classified as a not-for- At the end of the contract period, the assets will be profit reporting entity, the requirements of AASB 114 decommissioned and removed by the contractor and the ‘Segment Reporting’ are not applicable. Disclosure of site returned to Barwon Water at no cost to Barwon Water. wholesale operations, however is provided in the notes to At 30 June 2010, the facility was still in the construction the accounts (refer Note 20). phase, and payments to the contractor for the operation A description of the products and services pertaining to of the facility had not commenced. Future contractual each segment is as follows: commitments are disclosed in Note 18.
retail – treatment and supply of high quality water 1.25. Income Tax collection, treatment and disposal of sewerage, The Corporation is subject to the National Tax Equivalent provision of recycled water services Regime (NTER), which is administered by the Australian wholesale – harvesting and collection of water. Taxation Office. Allocation of assets, liabilities, revenues and expenditure The income tax expense or revenue for the period is the to the wholesale operations of Barwon Water has been tax payable on the current period’s taxable income based made on the following basis: on the national corporate income tax rate of 30 per cent adjusted by changes in deferred tax assets and liabilities revenue – based on known non-government attributable to temporary differences between the tax contributions and other revenues bases of assets and liabilities and their carrying amounts in the financial statements and to unused tax losses. water sales revenue – the transfer price has been set according to the average price per megalitre as derived Deferred tax assets and liabilities are recognised for in the corporate plan on the basis of full cost recovery. temporary differences at the tax rates expected to apply This methodology ensures that the wholesale division when the assets are recovered or liabilities are settled, is sustainable based on those tax rates which are enacted or substantially enacted. The relevant tax rates are applied to expenditure – allocated on direct cost basis for the cumulative amounts of deductible and taxable wholesale activities carried out by the Corporation and temporary differences to measure the deferred tax asset separately disclosed within the Corporation’s general or liability. No deferred tax asset or liability is recognised ledger and an allocation of indirect costs in relation to these temporary differences if they arose in non-current assets – apportioned on the basis of a transaction, other than a business combination, that at the time of the transaction did not affect either accounting wholesale and retail non-current assets profit or taxable profit or loss. Deferred tax assets are investments and borrowings – apportioned based on recognised for deductible temporary differences and the operational requirements incorporating direct and unused tax losses only if it is probable that future taxable allocated revenue and expenditure, combined with the amounts will be available to utilise those temporary capital works investment requirements. differences and losses. The residual assets, liabilities, revenues and expenditure Current and deferred tax balances attributable to amounts relate to retail operations of Barwon Water. recognised directly in equity are also recognised directly in equity.
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1.26. Goods and Services Tax Payables Revenues, expenses and assets are recognised net of the Payables are recognised when Barwon Water becomes amount of goods and services tax (GST), except where the obliged to make future payments resulting from the amount of GST incurred is not recoverable from the purchase of goods and services. Australian Taxation Office (ATO). In these circumstances, the GST is recognised as part of the cost of acquisition of Financial Liabilities the asset or as part of an item of the expense. Receivables Borrowings are initially recognised at fair value, net of and payables are stated inclusive of GST. transaction costs incurred, and are subsequently The net amount of GST recoverable from, or payable to, measured at amortised cost using the effective interest the ATO is included as a current asset or liability in the rate method. Balance Sheet. 1.27.3. Fair Valuation Cash flows arising from operating activities are included in the Cash Flow Statement on a gross basis. The GST The fair value of financial instruments traded in active component of cash flows arising from investing and markets is based on quoted market prices at the balance financing activities, which are recoverable from, or sheet date. The quoted market price used for financial payable to, the ATO, are classified as operating cash flows. assets held by Barwon Water is the current bid price. The carrying value less impairment provision of trade 1.27. Financial Instruments receivables and payables is a reasonable approximation of their fair values due to the short-term nature of trade 1.27.1. Recognition receivables. The fair value of financial liabilities for Financial instruments, incorporating financial assets and disclosure purposes is estimated by discounting the financial liabilities, are recognised when Barwon Water future contractual cash flows at the current market becomes a party to the contractual provisions of the interest rate that is available to Barwon Water for similar instrument. Trade date accounting is adopted for financial financial assets. assets that are delivered within timeframes established by marketplace convention. The carrying amounts and aggregate net fair values of financial assets and financial liabilities at balance date Initial measurement of financial instruments is at fair have been provided in Note 12. value plus transaction costs where the instrument is not classified as at fair value through profit or loss. 1.28. New Accounting Standards and Interpretations Transaction costs related to instruments classified as at Certain new accounting standards and interpretations fair value through profit or loss are expensed to profit or have been published that are not mandatory for the loss immediately. Financial instruments are classified and 30 June 2010 reporting period. As at 30 June 2010, the measured as set out below. following standards and interpretations had been issued 1.27.2. Classification and Measurement but were not mandatory for financial year ending 30 June 2010. The Corporation has not and does not intend to Financial Assets adopt these standards early. Cash and cash equivalents include cash on hand and deposits held at call with financial institutions and are recorded at fair value.
Loans and Receivables Trade receivables, loans and other receivables are recognised initially at fair value and subsequently measured at amortised cost, less provision for impairment.
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Standard/ Summary Applicable for Impact on financial statements Interpretation annual reporting periods beginning on or after AASB 2009-5 In May 2009, the AASB issued a number 1 January 2010 The entity does not expect that any Further Amendments of improvements to existing Australian adjustments will be necessary as a to Australian Accounting Standards. The entity will result of applying the revised rules. Accounting apply the revised standards from 1 July Standards arising 2010. from the Annual Improvements Project [AASB 5, 8, 101, 107, 117, 118, 136 & 139] AASB 2009-8 The amendments made by the AASB to 1 January 2010 Not applicable. Amendments to AASB 2 confirm that an entity receiving Australian goods or services in a group share-based Accounting payment arrangement must recognise an Standards – Group expense for those goods or services Cash-Settled regardless of which entity in the group Share-based settles the transaction or whether the Payment transaction is settled in shares or cash. Transactions They also clarify how the group share- [AASB 2] based payment arrangement should be measured, that is, whether it is measured as an equity- or a cash-settled transaction. AASB 2009-10 In October 2009 the AASB issued an 1 February 2010 The entity has not made any such Amendments to amendment to AASB 132 Financial rights issues, therefore the amendment Australian Instruments: Presentation which will not have any effect on the financial Accounting addresses the accounting for rights issues statements. Standards – that are denominated in a currency other Classification of than the functional currency of the issuer. Rights Issues Provided certain conditions are met, such [AASB 132] rights issues are now classified as equity regardless of the currency in which the exercise price is denominated. Previously, these issues had to be accounted for as derivative liabilities. The amendment must be applied retrospectively in accordance with AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors. AASB 9 Financial AASB 9 Financial Instruments addresses 1 January 2013 The entity is yet to assess its full Instruments and the classification and measurement of impact. However, initial indications are AASB 2009-11 financial assets and is likely to affect the that it may affect the entity’s Amendments to entity’s accounting for its financial assets. accounting for its available-for-sale Australian The standard is not applicable until 1 financial assets, since AASB 9 only Accounting January 2013 but is available for early permits the recognition of fair value Standards arising adoption. gains and losses in other from AASB 9 comprehensive income if they relate to equity investments that are not held for trading. Fair value gains and losses on available-for-sale debt investments, for example, will therefore have to be recognised directly in profit or loss.
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Revised AASB 124 In December 2009 the AASB issued a 1 January 2011 The requirements of the standard have Related Party revised AASB 124 Related Party been applied and as such the related Disclosures and Disclosures. It is effective for accounting party disclosures now do not include AASB 2009-12 periods beginning on or after 1 January transactions with other Victorian Amendments 2011 and must be applied retrospectively. Government controlled entities. to Australian The amendment removes the requirement Accounting for government-related entities to disclose Standards details of all transactions with the government and other government- related entities and clarifies and simplifies the definition of a related party. AASB Interpretation AASB Interpretation 19 clarifies the 1 July 2010 It is not expected to have any impact on 19 Extinguishing accounting when an entity renegotiates the entity’s financial statements since it financial liabilities the terms of its debt with the result that is only retrospectively applied from the with equity the liability is extinguished by the debtor beginning of the earliest period instruments and issuing its own equity instruments to the presented (1 July 2009) and the entity AASB 2009-13 creditor (debt for equity swap). It requires has not entered into any debt for equity Amendments to a gain or loss to be recognised in profit or swaps since that date. Australian Accounting loss which is measured as the difference Standards arising between the carrying amount of the from Interpretation 19 financial liability and the fair value of the equity instruments issued. AASB 2009-14 In December 2009, the AASB made an 1 January 2011 The entity does not make any such Amendments to amendment to Interpretation 14 The Limit prepayments. The amendment is Australian on a Defined Benefit Asset, Minimum therefore not expected to have any Interpretation Funding Requirements and their impact on the entity’s financial – Prepayments of a Interaction. The amendment removes an statements. Minimum Funding unintended consequence of the Requirement interpretation related to voluntary prepayments when there is a minimum funding requirement in regard to the entity’s defined benefit scheme. It permits entities to recognise an asset for a prepayment of contributions made to cover minimum funding requirements.
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2. Financial risk management objectives and policies
Barwon Water’s activities expose it to a variety of financial Barwon Water has minimal exposure to interest rate risk risks: market risk, credit risk and liquidity risk. This note through its holding of cash assets and other presents information about Barwon Water’s exposure to financial assets. each of these risks and the objectives, policies and processes for measuring and managing risk. Foreign exchange risk Barwon Water’s overall risk management program focuses Barwon Water has no exposure to changes in the foreign on the unpredictability of financial markets and seeks to exchange rate. minimise potential adverse effects on the financial performance of Barwon Water. Barwon Water uses Other price risk different methods to measure different types of risk to Barwon Water has no significant exposure to other which it is exposed. These methods include sensitivity price risk. analysis in the case of interest rate, other price risks and ageing analysis. Market risk sensitivity analysis is provided in Note 2.2.
Risk management is carried out by the Strategy and b) Credit risk Technology Department under policies approved by the Credit risk is the risk of financial loss to Barwon Water Board of Directors. The Finance Department identifies, as a result of a customer or counterparty to a financial evaluates and hedges financial risks in close co-operation instrument failing to meet its contractual obligations. with Barwon Water’s operating units. The Board provides Credit risk arises principally from Barwon Water’s written principles for overall risk management, as well receivables and financial assets available for sale. as policies covering specific areas, interest rate risk, credit risk, use of derivative financial instruments and Barwon Water’s exposure to credit risk is influenced by the non-derivative financial instruments and investment individual characteristics of each customer. The receivable of excess liquidity. balance consists of a large number of residential and business customers which are spread across a diverse 2.1. Risk Exposures range of industries. Receivable balances are monitored on The main risks Barwon Water is exposed to through its an on-going basis to ensure that exposure to bad debts is financial instruments are as follows: not significant. Barwon Water has in place a Billing and Collection Policy for the collection of overdue receivables. a) Market risk An analysis of the ageing of Barwon Water’s receivables at Market risk is the risk that changes in market prices will reporting date has been provided in Note 7. affect the fair value or future cash flows of Barwon Water’s financial instruments. Market risk comprises of foreign c) Liquidity risk exchange risk, interest rate risk and other price risk. Barwon Liquidity risk is the risk that Barwon Water will not be able Water’s exposure to market risk is primarily through interest rate risk, there is no exposure to foreign exchange risk and to meet its financial obligations as they fall due. Barwon insignificant exposure to other price risks. Water’s policy is to settle financial obligations within 30 days and, in the event of dispute, make payments Objectives, policies and process used to manage these within 30 days from the date of resolution. risks are disclosed in the paragraphs below: Barwon Water manages liquidity risk by maintaining Interest rate risk adequate reserves, banking facilities and reserve borrowing facilities by continuously monitoring forecasts Barwon Water’s exposure to market interest rates relates and actual cash flows and matching the maturity profiles primarily to Barwon Water’s long-term borrowings and of financial assets and financial liabilities. funds invested on the money market. Barwon Water’s financial liability maturities have been The Corporation minimises its exposure to interest rate disclosed in Note 12. changes on borrowings by holding fixed rate debt with an even spread of maturity profiles, at Board approved limits.
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2.2. Fair value measurements 2.3. Market Risk Sensitivity Analysis The fair value of financial assets and financial liabilities The sensitivity analysis below has taken into consideration must be estimated for recognition and measurement or past performance, future expectations, economic forecasts for disclosure purposes. and management’s knowledge and experience of the As of 1 July 2009, Barwon Water has adopted the financial markets. Barwon Water believes that a movement amendment to AASB 7 Financial Instruments: Disclosures of 1% in interest rates is reasonable over the next 12 months. which requires disclosure of fair value measurements by Barwon Water’s exposure to interest rate movements has level of the following fair value measurement hierarchy: been calculated as outlined below: i) quoted prices (unadjusted) in active markets for cash and cash equivalents – average cash balance held identical assets or liabilities (level 1) during year for actual number of days cash held in ii) inputs other than quoted prices included within level 1 TCV 11am facility at 1% interest rate movement, and that are observable for the asset or liability, either interest bearing liabilities – total known maturing directly (as prices) or indirectly (derived from prices) borrowings and anticipated new borrowings for level 2), and following year at 1% interest rate movement. iii) inputs for the asset or liability that are not based on observable market data (unobservable inputs) (level 3). The following tables present Barwon Water’s assets and liabilities measured and recognised at fair value at 30 June 2010. Comparative information has not been provided as permitted by the transitional provisions of the standard.
Level 1 Total At 30 June 2010 $’000 $’000
Financial assets Cash and cash equivalents 5,770 5,770
The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading and available-for-sale securities) is based on quoted market prices at the end of the reporting period. The quoted market price used for financial assets held by the group is the current bid price. These instruments are included in level 1.
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Market Risk Sensitivity Analysis
30 June 2010 30 June 2009 Interest rate risk Interest rate risk -1% +1% -1% +1% Carrying Carrying amount Result Equity Result Equity amount Result Equity Result Equity $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Financial assets Cash and cash 5,770 (2) (2) 2 2 12,415 (12) (12) 12 12 equivalents Receivables 20,235 0 0 0 0 19,354 0 0 0 0 Financial liabilities Payables 27, 373 0 0 0 0 26,326 0 0 0 0 Interest bearing liabilities 185,320 1,680 1,680 (1,680) (1,680) 146,020 561 561 (561) (561) Total increase/(decrease) 1,678 1,678 (1,678) (1,678) 549 549 (549) (549)
3. Revenue 2010 2009 $’000 $’000
Revenue Water service charges 16,938 14,628 Water usage charges 45,434 42,410 Sewerage service charges 48,326 41,804 Sewage disposal charges 3,622 3,227 Tradewaste charges 4,734 4,445 Government contributions 374 2,210 Other services rendered 5,782 7,719 Future capital works contributions 3,421 2,485 Developer contributed assets 11,268 8,153 Interest received/receivable 62 218 139,961 127,299
Revenue from non-operating activities Net gain/(loss) on non-financial assets (634) (574) Rent 591 511 (43) (63) Total revenue 139,918 127,236
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4. Borrowing costs expense 2010 2009 $’000 $’000 Interest on fixed borrowings 10,181 7,253 Interest on 11am borrowings 52 32 Financial accommodation levy 1,186 673 Total borrowing costs 11,419 7,958
5. National equivalent income tax
5.1. Prima Facie Income Tax Expense on Pre-Tax Accounting Profit Reconciles to the Income Tax Expense in the Accounts as follows: 2010 2009 $’000 $’000
Income tax expense Current tax (6,288) (11,317) Deferred tax 11,758 15,633 Under/(over) provided in prior years 0 0 5,470 4,316
Income tax expense is attributable to: Surplus from continuing operations 5,470 4,316 Aggregate income tax expense 5,470 4,316
Deferred income tax/(revenue) expense included in income tax comprises: Decrease/(increase) in deferred tax assets (545) (27) (Decrease)/increase in deferred tax liabilities 12,304 15,660 11,759 15,633
5.2. Reconciliation of Income Tax Expense to Prima Facie Tax Payable 2010 2009 $’000 $’000 Operating result from continuing operations before income tax expense 18,159 14,299 18,159 14,299 Tax at the Australian tax rate of 30% (2009 30%) 5,448 4,290
Tax effect of amounts which are not deductible/(taxable) in calculating taxable income: Entertainment/sundry 15 26 Under/(over) provision in prior years 7 0 Income tax expense 5,470 4,316
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5.3. Amounts Recognised Directly in Equity 2010 2009 NOTE $’000 $’000 Aggregate current and deferred tax arising in the reporting period and not recognised in net operating result but directly debited or credited to equity: Net deferred tax - debited/(credited) directly to equity 15 0 0
5.4. Deferred Tax Assets 2010 2009 $’000 $’000 The balance comprises temporary differences attributable to: Amounts recognised in operating statement Provisions and accrued expenditure not deductible 3,446 2,901 Other 0 0 Tax losses 84,998 78,710 88,444 81,611
Movements Opening balance at 1 July 81,611 70,266 Credited/(charged) to the operating statement 545 28 Under/(over) provided in prior years 0 0 Tax losses 6,288 11,317 Closing balance at 30 June 88,444 81,611
Deferred tax asset to be recovered after more than 12 months 85,178 78,841 Deferred tax asset to be recovered within 12 months 3,266 2,770
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5.5. Deferred Tax Liabilities 2010 2009 $’000 $’000 The balance comprises temporary differences attributable to: Amounts recognised in operating statement Depreciation 100,529 91,500 Expenditure capitalised 17,958 14,490 Other 2,500 2,694 Amounts recognised in equity Asset revaluations 14,672 14,672 135,659 123,356
Movements Opening balance at 1 July 123,356 107,695 Credited/(charged) to the operating statement 12,303 15,661 Under/(over) provided in prior years 0 0 Credited/(charged) to equity 0 0 Closing balance at 30 June 135,659 123,356
Deferred tax liability to be recovered after more than 12 months 132,961 120,723 Deferred tax liability to be recovered within 12 months 2,698 2,633
5.6. Financial Statement Classification 2010 2009 $’000 $’000 Deferred tax asset closing balance 88,444 81,611 Less accumulated tax losses offset against deferred tax liability (84,998) (78,710) Deferred tax asset per financial statements 3,446 2,901 Deferred tax liability closing balance 135,659 123,356 Less accumulated tax losses offset against deferred tax asset (84,998) (78,710) Deferred tax liability per financial statements 50,661 44,646
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6. Cash and cash equivalent assets 2010 2009 $’000 $’000 Cash on hand 8 8 Cash at bank 5,193 2,965 Investments at call - TCV 569 9,442 Total cash and cash equivalent assets 5,770 12,415
6.1. Reconciliation to Cash at End of Year 2010 2009 $’000 $’000 The above figures are reconciled to cash at the end of the financial year as shown in the Cash Flow Statement, as follows: Balances as above 5,770 12,415 Balances as per Cash Flow Statement 5,770 12,415
7. Receivables 2010 2009 $’000 $’000
Current Tariff and sundry 11,015 10,158 Accrued charges 9,356 9,227 Provision for impaired receivables (190) (95) Other receivables - 1 20,181 19,291
Non-current Other receivables 54 63 54 63
Total receivables 20,235 19,354
Non-current receivables comprise scheme debtors not due within 12 months.
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a) Provision for impaired receivables b) Fair value and credit risk As at 30 June 2010, current receivables of Barwon Water Due to the short-term nature of the current receivables, with a nominal value of $193,241 (2009: $96,503) were their carrying value is assumed to approximate their impaired. The amount of the provision was $190,000 fair value. (2009: $95,000). The individually impaired receivables relate mainly to disconnected tenant debt which is not 2010 2009 secured against the property. It was assessed that it is Carrying Fair Carrying Fair unlikely the impaired receivables will be recovered. amount value amount value The ageing of these receivables is as follows: Non-current receivables 2010 2009 $’000 $’000 Scheme debtors 54 54 63 63 (non-current) Over 6 months (190) (95)
The maximum exposure to credit risk at the reporting date is the higher of the carrying value and fair value of each class of receivables mentioned above. Barwon Water does As at 30 June 2010, trade receivables of $2,842,570 not hold any collateral as security. (2009: $2,359,655) were past due but not impaired. These relate to a number of independent customers for whom there is no recent history of default. The ageing analysis of these receivables is as follows:
2010 2009 $’000 $’000 30 to 90 days 2,026 1,687 90 to 150 days 165 301 Over 150 days 652 372 2,843 2,360
Movements in the provision for impaired receivables are as follows: 2010 2009 $’000 $’000 Opening balance at 1 July (95) (95) Provision for impairment (168) (72) recognised during the year Receivables written off during 73 72 the year as uncollectable Closing balance at 30 June (190) (95)
The creation and release of the provision for impaired receivables has been included in “other expenses” in the Comprehensive Operating Statement. Amounts charged to the provision account are generally written off when there is no expectation of recovering additional cash.
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8. Property, plant and equipment
8.1. Classes of Property, Plant and Equipment Details Wholesale Retail 2010 2009 $’000 $’000 $’000 $’000 Land At fair value 30/6/07 7,844 46,643 54,487 54,745 At cost 0 1,654 1,654 1,654 Total land 7,844 48,297 56,141 56,399 Buildings At fair value 1/7/04 814 10,733 11,547 11,547 At cost 78 4,414 4,492 4,018 Less accumulated depreciation 302 2,459 2,761 2,264 Total buildings 590 12,688 13,278 13,301 Infrastructure - water distribution At cost 2,825 539,163 541,988 496,697 Less accumulated depreciation 468 99,137 99,605 89,891 Total water distribution 2,357 440,026 442,383 406,806 Infrastructure - water harvesting and major transfer At cost 146,539 13,724 160,263 129,398 Less accumulated depreciation 28,408 1,598 30,006 26,811 Total water harvesting and major transfer 118,131 12,126 130,257 102,587 Infrastructure - reserves and river improvements At cost 349 55 404 404 Less accumulated depreciation 194 16 210 192 Total reserves and river improvements 155 39 194 212 Infrastructure - water quality At cost 1,937 71,959 73,896 68,823 Less accumulated depreciation 725 15,210 15,935 14,193 Total water quality 1,212 56,749 57,961 54,630 Infrastructure - sewer collection At cost 0 364,137 364,137 337,545 Less accumulated depreciation 0 71,416 71,416 63,887 Total sewer collection 0 292,721 292,721 273,658 Infrastructure - sewer treatment and disposal At cost 0 123,391 123,391 122,205 Less accumulated depreciation 0 25,899 25,899 23,228 Total sewer treatment and disposal 0 97,492 97,492 98,977 Plant, equipment and other At cost 2,294 37,662 39,956 37,949 Less accumulated depreciation 1,502 26,477 27,979 25,244 Total plant, equipment and other 792 11,185 11,977 12,705 Capital works in progress At cost 14,682 54,528 69,210 79,041 Total capital works in progress 14,682 54,528 69,210 79,041 Total property plant and equipment 145,763 1,025,851 1,171,614 1,098,316 Land was valued at 30 June 2007 and buildings were valued at 1 July 2004.
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8.2. Movements during the reporting period
Carrying Transfers amount at between 1 July Additions Disposals Revaluation Asset Classes Depreciation Total $’000 $’000 $’000 $’000 $’000 $’000 $’000
2009-10 Land 56,399 0 (258) 0 0 0 56,141 Buildings 13,301 0 5 0 474 (502) 13,278 Water distribution 406,806 38 (542) 0 45,928 (9,847) 442,383 Water harvesting and 102,587 0 0 0 30,865 (3,195) 130,257 major transfer Reserves and river 212 0 0 0 0 (18) 194 improvements Water quality 54,630 0 0 0 5,073 (1,742) 57,961 Sewer collection 273,658 63 22 0 26,539 (7,561) 292,721 Sewer treatment and 98,977 0 0 0 1,186 (2,671) 97,492 disposal Plant, equipment and other 12,705 3,486 (1,117) 0 335 (3,432) 11,977 Capital works in progress 79,041 100,569 0 0 (110,400) 0 69,210 1,098,316 104,156 (1,890) 0 0 (28,968) 1,171,614
Carrying Transfers amount at between 1 July Additions Disposals Revaluation Asset Classes Depreciation Total $’000 $’000 $’000 $’000 $’000 $’000 $’000
2008-09 Land 55,727 0 (45) 0 717 0 56,399 Buildings 13,314 2 0 0 480 (495) 13,301 Water distribution 394,749 3,994 (94) 0 17,606 (9,449) 406,806 Water harvesting and 101,970 10 1 0 3,382 (2,776) 102,587 major transfer Reserves and river 230 0 0 0 0 (18) 212 improvements Water quality 48,796 3 0 0 7,496 (1,665) 54,630 Sewer collection 266,019 3,812 (192) 0 11,133 (7,114) 273,658 Sewer treatment and 99,433 0 0 0 2,197 (2,653) 98,977 disposal Plant, equipment and 13,701 1,304 (1,537) 0 2,716 (3,479) 12,705 other Capital works in progress 41,391 82,132 0 0 (44,482) 0 79,041 1,035,330 91,257 (1,867) 0 1,245 (27,649) 1,098,316
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8.3. Depreciation/Amortisation charge for the year 2010 2009 $’000 $’000 Depreciation - Buildings 502 495 Depreciation - Infrastructure water distribution 9,847 9,449 Depreciation - Infrastructure water harvesting and major transfer 3,195 2,776 Depreciation - Infrastructure reserves and river improvements 18 18 Depreciation - Infrastructure water quality 1,742 1,665 Depreciation - Infrastructure sewer collection 7,561 7,114 Depreciation - Infrastructure sewer treatment and disposal 2,671 2,653 Depreciation - Plant, equipment and other 3,432 3,479
Depreciation for year 28,968 27,649 Amortisation - Intangible assets 1,021 688
Depreciation/amortisation for year 29,989 28,337
8.4. Profit/(Loss) on Disposal of Property, Plant and Equipment 2010 2009 $’000 $’000 Proceeds on sale of property, plant and equipment 1,256 1,293 Less written down value 1,890 1,867
Net profit(/loss) on disposal (634) (574)
9. Intangible assets Carrying amount Transfers between at 1 July Additions Asset Classes Amortisation Total $’000 $’000 $’000 $’000 $’000
2009-10 Cost 8,139 0 2,361 0 10,500 Less: Accumulated amortisation (6,259) 0 0 (1,021) (7,280)
Net carrying amount 1,880 0 2,361 (1,021) 3,220 Software development 1,620 931 (2,361) 0 190 (work in progress)
Total intangible assets 3,500 931 0 (1,021) 3,410
Carrying amount Transfers between at 1 July Additions Asset Classes Amortisation Total $’000 $’000 $’000 $’000 $’000
2008-09 Cost 6,895 0 1,244 0 8,139 Less: Accumulated amortisation (5,571) 0 0 (688) (6,259)
Net carrying amount 1,324 0 1,244 (688) 1,880 Software development 1,899 965 (1,244) 0 1,620 (work in progress)
Total intangible assets 3,223 965 0 (688) 3,500
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10. Payables 2010 2009 $’000 $’000
Current Trade creditors 5,419 19,162 Accrued expenses 19,332 3,117 Other creditors 2,253 3,225 Total current payables 27,004 25,504
Non-Current Other creditors 369 822
Total payables 27,373 26,326
11. Interest bearing liabilities 11.1. Details of Barwon Water’s borrowings at balance date are as follows: 2010 2009 $’000 $’000
Current - Secured Treasury Corporation of Victoria 20,850 5,000 Total current interest bearing liabilities 20,850 5,000
Non-Current - Secured Treasury Corporation of Victoria 164,470 141,020
Total interest bearing liabilities 185,320 146,020
All interest bearing liabilities have been transacted with the approval of the Treasurer of Victoria and hence are subject to Statutory Guarantee by the State of Victoria in accordance with the Borrowing and Investment Powers Act 1987. As a result all interest bearing liabilities are classified as secured.
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12. Financial instruments
12.1. Interest Rate Risk Exposures The following table sets out Barwon Water’s exposure to interest rate risk, including the contractual repricing dates and the effective weighted average interest rate by maturity periods. Exposures arise predominantly from liabilities bearing variable interest rates as Barwon Water intends to hold fixed rate liabilities to maturity.
30 June 2010 Fixed interest maturing In Floating Non interest 1 year or Over 1 to Over 2 to Over 3 to Over 4 to Over 5 interest rate less 2 years 3 years 4 years 5 years years bearing Total $ $ $ $ $ $ $ $ $
Financial assets Cash and cash 5,770 0 0 0 0 0 0 0 5,770 equivalents Receivables 0 0 0 0 0 0 0 20,235 20,235 Total financial assets 5,770 0 0 0 0 0 0 20,235 26,005
Financial liabilities Payables 0 0 0 0 0 0 0 27, 373 27, 373 Interest bearing (9,300) (11,550) (12,000) (14,500) (13,970) (14,000) (110,000) 0 (185,320) liabilities/borrowings Total financial liabilities (9,300) (11,550) (12,000) (14,500) (13,970) (14,000) (110,000) 27, 373 (157,947) Net financial assets/ (3,530) (11,550) (12,000) (14,500) (13,970) (14,000) (110,000) 47,608 (131,942) liabilities Weighted average 2.95% 5.20% 5.18% 5.17% 6.34% 6.45% 6.50% interest rate
30 June 2009 Fixed interest maturing In Floating Non interest 1 year or Over 1 to Over 2 to Over 3 to Over 4 to Over 5 interest rate less 2 years 3 years 4 years 5 years years bearing Total $ $ $ $ $ $ $ $ $
Financial assets Cash and cash 12,415 0 0 0 0 0 0 0 12,415 equivalents Receivables 0 0 0 0 0 0 0 19,354 19,354 Total financial assets 12,415 0 0 0 0 0 0 19,354 31,769
Financial liabilities Payables 0 0 0 0 0 0 0 (26,326) (26,326) Interest bearing 0 (5,000) (11,550) (12,000) (12,000) (13,970) (91,500) 0 (146,020) liabilities/borrowings Total financial liabilities 0 (5,000) (11,550) (12,000) (12,000) (13,970) (91,500) (26,326) (172,346) Net financial assets/ 12,415 (5,000) (11,550) (12,000) (12,000) (13,970) (91,500) (6,972) (140,577) liabilities Weighted average 5.26% 6.28% 5.63% 5.18% 5.18% 6.34% 6.55% interest rate
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12.2. Fair Valuation The carrying amounts and fair values of financial assets and financial liabilities at balance date are:
2010 2009 Carrying amount Fair value Carrying amount Fair value $’000 $’000 $’000 $’000
Financial assets Cash and cash equivalents 5,770 5,770 12,415 12,415 Receivables 20,235 20,235 19,354 19,354 Total financial assets 26,005 26,005 31,769 31,769
Financial liabilities Payables (27,373) (27,373) (26,326) (26,326) Interest bearing liabilities/borrowings (185,320) (195,524) (146,020) (149,819) Total financial liabilities (212,693) (222,897) (172,346) (176,145)
Cash, cash equivalents and non-interest bearing financial assets and financial liabilities are carried at cost which approximates their fair value. The fair value of other financial assets and financial liabilities is based upon market prices, where a market exists or by discounting the expected future cash flows at current interest rates.
13. Provisions
13.1. Employee Benefits
Opening balance Additional Balance at 2009-10 at 1 July provisions raised Amounts used 30 June $’000 $’000 $’000 $’000 Short-term employee benefits 1,888 2,011 (1,622) 2,277 Long-term employee benefits 5,385 928 (419) 5,894 Total employee benefits 7,273 2,939 (2,041) 8,171
Short-term employee benefits are comprised of annual leave entitlements, and long-term employee benefits comprised of long service leave entitlements.
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2010 2009 $’000 $’000 Current 7,667 6,839 Non-current 504 434 Total employee entitlements 8,171 7,273
The aggregate employee entitlement liability consists of: Provisions for employee entitlements: Annual leave 2,277 1,888 Long service leave 5,894 5,385 8,171 7,273
13.2. Short-term Provisions
2010 2009 $’000 $’000
Current liabilities Other 3,173 2,329 Total current provisions 3,173 2,329
Opening balance at 1 July 2009 2,329 2,832 Additional provisions raised during year 1,708 1,540 Amounts used (864) (2,043) Balance at 30 June 2010 3,173 2,329
In accordance with AASB 137 ‘Provisions, Contingent Liabilities and Contingent Assets’ a provision has been established for the further treatment and processing of stored biosolids consistent with EPA licensing requirements.
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14. Superannuation Barwon Water makes employer superannuation The Fund’s liability for accrued benefits was determined in contributions in respect of most employees to the Local the 30 June 2008 actuarial investigation pursuant to the Authorities Superannuation Fund (the Fund). The Fund has requirements of Australian Accounting Standard AAS25 two categories of membership, each of which is funded as follows: differently. 31 Dec 08 The Fund’s accumulation category, Vision Super Saver, $’000 receives both employer and employee contributions on a Net Market Value of Assets 3,630,432 progressive basis. Employer contributions are normally Accrued Benefits (per accounting standards) 3,616,422 based on a fixed percentage of employee earnings (9% Difference between Assets and 14,010 required under Superannuation Guarantee Legislation). Accrued Benefits No further liability accrues to the employer as the Vested Benefits 3,561,588 superannuation benefits accruing to the employees are represented by their share of the net assets of the Fund. The Fund’s Defined Benefit Plan is a multi-employer The financial assumptions used to calculate the Accrued sponsored plan. As the Fund’s assets and liabilities are Benefits for the defined benefit category of the Fund were: pooled and are not allocated by employer, the Actuary is unable to allocate benefit liabilities, assets and costs Net Investment Return 8.50% pa between employers. As provided under AASB 119, Barwon Water does not use defined benefit accounting for these Salary Inflation 4.25% pa contributions. Price Inflation 2.75% pa Barwon Water makes employer contributions to the defined benefit category of the Fund at rates determined by the Trustee on the advice of the Fund’s Actuary. On the basis of the results of the most recent full actuarial investigation conducted by the Fund’s actuary as at 31 December 2008, the Trustee has determined that the current funding arrangements are adequate for the expected Defined Benefit Plan liabilities. Barwon Water makes employer contributions to the Fund’s Defined Benefit Scheme at rates determined by the Fund’s Trustee. The rate is currently 9.25% of members’ salaries (9.25% in 2008-2009). In addition, Barwon Water reimburses the Fund for the difference between resignation and retrenchment benefits paid to employees. Employees are also required to make member contributions to the Fund. As such, assets accumulate in the Fund to meet member benefits, as defined in the Trust Deed, as they accrue. During 2009-2010, Barwon Water was not required to make any payments to the Fund in respect of retrenchment increments ($0 in 2008-2009). Barwon Water’s liability to the Fund as at 30 June 2010, including retrenchment increments, accrued interest and tax is $0 ($0 in 2008-2009).
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14.1. Superannuation Contributions Contributions by Barwon Water to the above superannuation boards for the financial year ended 30 June 2010, are detailed below: Type of scheme Rate 2010 2009 $’000 $’000 Vision Super Defined Benefits 9.25% - 18.25% 1,456 1,452 Vision Super Accumulation Plan 9.00% 1,307 1,079 Emergency Services & State Super Defined Benefits 14.40% - 17.2% 23 21 Other Funds Accumulation Plan 9.00% 132 49
There were no contributions outstanding or loans issued from either of the above schemes at 30 June 2010.
15. Asset revaluation reserve 2010 2009 $’000 $’000 Opening balance at 1 July 5,662 5,662 Increase/decrease in statement of financial position on revaluation of land 0 0 Tax effect of revaluation of assets 0 0 Closing balance at 30 June 5,662 5,662
16. Contributions by owners 2010 2009 $’000 $’000 Contributed capital at 1 July 395,029 389,709 Capital transactions with the State in its capacity as owner arising from: - Northern Water Plant 6,000 1,000 - Black Rock Recycled Water Plant 1,500 0 - Melbourne-Geelong Interconnection 0 3,000 - Fluoridation - Geelong Supply 0 720 - Birregurra Sewerage Scheme 0 600 7,500 5,320 Contributed capital at the end of the year 402,529 395,029
State of Victoria capital contributions were received for key project milestones in relation to the Northern Water Plant and Black Rock Recycled Water Plant. In addition, government contributions were received and recognised in the Comprehensive Operating Statement – refer Note 3.
17. Accumulated funds 2010 2009 $’000 $’000 Accumulated funds at beginning of year 510,960 500,977 Result after Income Tax 12,689 9,983 Accumulated funds at the end of the year 523,649 510,960
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18. Commitments Outstanding contractual commitments for major works, services and materials entered into and not provided for in the Balance Sheet at 30 June 2010, amount to $293,907,000 (2009 $274,255,000) exclusive of GST.
2010 2009 2010 2009 $’000 $’000 $’000 $’000 BOO commitments Total BOO (build, own and operate) expenditure for a biosolids drying facility where the contractor will lease land from Barwon Water to build the thermal drying plant and will operate the facility for 20 years in exchange for a stream of payments, contracted for at balance date but not provided for in the accounts: Net Present Cost Nominal Cost - Not later than 1 year 2,070 5,833 2,188 6,087 - Later than 1 year but not later than 5 years 30,383 28,444 37,006 36,110 - Later than 5 years 80,175 65,606 185,433 178,247 Total BOO commitments 112,628 99,883 224,628 220,444
Capital commitments Total capital expenditure contracted for the construction of water, sewerage and drainage infrastructure at balance date but not provided for in the accounts: - Not later than 1 year 58,858 18,865 - Later than 1 year but not later than 5 years 30 2,089 - Later than 5 years 0 0 Total capital commitments 58,888 20,954
Operating commitments Total operating expenditure contracted for at balance date but not provided for in the accounts: - Not later than 1 year 1,296 9,246 - Later than 1 year but not later than 5 years 263 10,363 Total operating commitments 1,559 19,609
Environmental commitments Total environmental expenditure contracted for at balance date but not provided for in the accounts: - Not later than 1 year 4,416 4,416 - Later than 1 year but not later than 5 years 4,416 8,832 Total environmental commitments 8,832 13,248
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19. Notes to the cash flow statement
19.1. Reconciliation of Net Cash provided by Operating Activities to Net Profit/Loss 2010 2009 $’000 $’000 Net Profit after income tax 12,689 9,983
Changes in assets and liabilities Increase/(decrease) in employee provision 898 578 Increase/(decrease) in other provisions 845 (504) Increase/(decrease) in bad debts provision 95 0 Decrease/(increase) in receivables (978) (1,847) Increase/(decrease) in accrued interest receivable 1 6 Decrease/(increase) in stock 21 (19) Decrease/(increase) in prepayments (325) 66 Increase/(decrease) in creditors/accrued expenses (2,920) 677
Add/(less) non-cash flows in net profit Depreciation and amortisation 29,989 28,337 (Profit)/Loss on disposal of property, plant and equipment 634 574 Non-cash capital contributions (10,730) (7,790) Income tax expense 5,470 4,316
Net cash provided by operating activities 35,689 34,377
19.2. Financing Facilities Barwon Water has an overdraft facility of $100,000. The facility is subject to annual review by its bankers and at 30 June 2010, the amount of credit unused was $100,000. At 30 June 2010, Barwon Water had fully drawn firmly committed long-term financing facilities of $185,320,000 (2009 $146,020,000).
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20. Wholesale and retail operations
20.1. Financial Statement Extracts Wholesale Retail 2010 2009 2010 2009 $’000 $’000 $’000 $’000
Revenue Water sales 14,563 13,725 0 0 Other revenue 47 43 124,051 110,774 Contributions 117 106 14,946 12,742 Unallocated revenue 0 0 1,396 4,145 Total revenue 14,727 13,874 140,393 127,661
Expenses Direct operating 5,693 4,743 39,568 41,612 Water purchases 0 0 14,563 13,725 Depreciation 3,714 3,282 26,209 24,993 Administration 4,045 3,783 25,662 21,305 Financing 1,153 1,060 10,443 6,984 Environmental contribution 0 0 4,416 4,416 Unallocated expenses 0 0 1,495 1,333 Total expenses 14,605 12,868 122,356 114,368
Result-Profit/(loss) 122 1,006 18,037 13,293 Property, plant and equipment (including intangibles) 145,763 142,898 1,029,261 958,918 Other assets 479 652 31,035 35,777 Total assets 146,242 143,550 1,060,296 994,695 Borrowings 44,073 37,553 141,247 108,467 Capital Investments (7,137) (25,498) (83,253) (50,996) Grants received for capital purposes 0 0 7,500 7, 370
Upon consolidation of the two segments (wholesale and retail) internal transactions are eliminated, namely water sales revenue of $14,563,000 and water purchases expenses of $14,563,000.
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20.2. Reconciliation of Segmented Extracts to Comprehensive Operating Statement
2010 2009 $’000 $’000
Revenue Retail revenue 140,393 127,661 Wholesale revenue 14,727 13,874 Less wholesale water sales (14,563) (13,725) Less loss on sale of assets (634) (574) Less wholesale profit on sale of assets (5) 0 Total revenue per Comprehensive Operating Statement 139,918 127,236
Expenses Retail expenses 122,356 114,368 Wholesale expenses 14,605 12,868 Less retail water purchases (14,563) (13,725) Less loss on sale of assets (634) (574) Less wholesale profit on sale of assets (5) 0 Total expenses per Comprehensive Operating Statement 121,759 112,937
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21. Operating results of retail services The revenue from and operating results of services within Retail Operations are:
Water Wastewater Recycled Water Total 2010 2009 2010 2009 2010 2009 2010 2009 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Operating Revenue Tariff Revenue Tariff income 62,373 57,038 51,947 45,031 0 0 114,320 102,069 Trade waste 0 0 4,734 4,445 0 0 4,734 4,445 Interest Revenue 0 0 0 0 0 0 0 0 Contributions 5,708 7,360 9,238 5,382 0 0 14,946 12,742 Other Revenue 2,617 2,063 2,281 2,197 99 0 4,997 4,260 70,698 66,461 68,200 57,055 99 0 138,997 123,516
Less expenses Direct operating 17,776 18,003 21,678 23,609 114 0 39,568 41,612 Water purchases 14,563 13,725 0 0 0 0 14,563 13,725 Depreciation 14,230 13,634 11,902 11,359 77 0 26,209 24,993 Administration 13,146 11,228 10,804 10,077 1,712 0 25,662 21,305 Financing 5,830 3,904 4,613 3,080 0 0 10,443 6,984 Environmental Contribution 2,340 2,340 2,076 2,076 0 0 4,416 4,416 67,885 62,834 51,073 50,201 1,903 0 120,861 113,035 Service result 2,813 3,627 17,127 6,854 (1,804) 0 18,136 10,481 Plus Unallocated Revenue 1,396 4,145 Less Unallocated Expenses (1,495) (1,333) Surplus from retail operations 18,037 13,293
In accordance with directions made by the Minister for Water, the Recycled Water Services of the Corporation for 2009-2010 are separately disclosed in the Retail Services disclosure note. This segment has previously been incorporated in the Wastewater segment; no comparative data is available.
22. Responsible person related disclosures
22.1. Responsible Persons The responsible persons (Directors) of Barwon Region Water Corporation at any time during the reporting period were: The relevant Minister and Directors of Barwon Region Water Corporation are deemed to be responsible persons Michael Malouf (Accountable Officer) by ministerial direction pursuant to the provisions of the Roger Lowrey (Chairperson) Financial Management Act 1994. John McDonald (Deputy Chairperson) Robyn Batten The responsible persons (Minister) of Barwon Region John Bugg Water Corporation during the reporting period was the Claire Higgins (term ended 30/06/2010) Hon. T Holding MP, Minister for Water (1 July 2009 to Diane James 30 June 2010). Des Powell (term ended 30/06/2010)
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22.2. Remuneration of Responsible Persons The remuneration of the responsible persons (Minister) is shown in the financial statements of the Department of Premier and Cabinet. Other relevant interests are declared in the Register of Members’ Interests which each member of the Parliament completes.
2010 2009 $’000 $’000
Income received, or due and receivable, by responsible persons of Barwon Water 668 617 and related parties. The number of responsible persons of Barwon Water whose income from Barwon Water and related parties was within the specified bands are as follows:
Total Remuneration Base Remuneration $ $ 2010 2009 2010 2009 30,000 - 39,999 6 6 6 6 60,000 - 69,999 0 1 0 1 70,000 - 79,999 1 0 1 0 300,000 - 309,999 0 0 0 1 320,000 - 329,999 0 0 1 0 340,000 - 349,999 0 1 0 0 370,000 - 379,999 1 0 0 0 Total Numbers 8 8 8 8
Total Amount $667,861 $616,985 $622,094 $574,691
The retirement benefits paid by Barwon Water in connection with the retirement of responsible persons of the Corporation amounted to $0.
22.3. Other Transactions of Responsible Persons and their Related Entities During the year transactions occurred between Barwon Water, responsible persons and their related entities. The transactions were those of a normal customer/supplier relationship.
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22.4. Executive Remuneration
2010 2009 $’000 $’000
Income received, or due and receivable, by executives of Barwon Water and related parties 3,022 2,591 whose income was at least $100,000. The number of executives of Barwon Water whose income from Barwon Water and related parties was within the specified bands are as follows:
Total Remuneration Base Remuneration $ $ 2010 2009 2010 2009 100,000 - 109,999 0 0 1 2 110,000 - 119,999 1 3 6 5 120,000 - 129,999 6 5 2 4 130,000 - 139,999 2 4 3 2 140,000 - 149,999 2 2 0 1 150,000 - 159,999 1 0 0 0 170,000 - 179,999 1 0 2 1 180,000 - 189,999 0 1 0 3 190,000 - 199,999 1 0 5 0 200,000 - 209,999 0 3 0 0 210,000 - 219,999 5 0 0 0 Total Numbers 19 18 19 18
Total Amount $3,022,411 $2,590,918 $2,774,253 $2,411,075
23. Auditor’s remuneration 2010 2009 $’000 $’000
Amounts received, or due and receivable, by the Victorian Auditor-General for 70 67 auditing the accounts.
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24. Contingent assets/contingent liabilities
24.1. Rainwater Tank Rebate Scheme – Contingent Liability A development has commenced which requires the installation of rainwater tanks by customers on lots in a new subdivision in the Geelong region. Barwon Water is offering a rainwater tank rebate scheme to customers who install a rainwater tank. A contingent liability resulted on finalisation of the development agreement. The duration of the development activity will span a number of years with the value of the contingent liability dependant on the size of rainwater tank installed and number of lots allocated at each stage of the subdivision. As at 30 June 2010, the rebate scheme will extend to 580 lots; 97 lots were taken up with the maximum rebate available of $3,193 per lot.
2010 2009 $’000 $’000
Rainwater tank rebate (maximum customer claims) 483 525
$’000 $’000 Total estimated contingent liabilities $1,542 $1,490
25. Events subsequent to balance date No material events have occurred after balance date.
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BARWON REGION WATER CORPORATION
Statutory Certificate We hereby certify that the financial statements of Barwon Region Water Corporation have been prepared in accordance with the provisions of the Financial Management Act 1994 and applicable Australian Accounting Standards, Interpretations and other mandatory professional reporting requirements. In our opinion: a) the financial statements present fairly the financial transactions during the reporting period and the financial position as at 30 June 2010; b) the financial statements are prepared in accordance with the standing direction 4.2 and applicable Financial Reporting Directions under the Financial Management Act 1994; and c) the financial statements comply with applicable Australian accounting standards and other mandatory professional reporting requirements and interpretations. At the date of signing the financial statements, we are not aware of any circumstances which would render any particulars included in the statements misleading or inaccurate.
R Lowrey Chairman
M Malouf Managing Director (Accountable Officer)
M Watson Chief Finance & Accounting Officer Dated this 11th day of August, 2010
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VAGO Victorian Auditor-General’s Office
INDEPENDENT AUDITOR’S REPORT
To the Board Members, Barwon Region Water Corporation
The Financial Report The accompanying financial report for the year ended 30 June 2010 of Barwon Region Water Corporation which comprises the comprehensive operating statement, balance sheet, statement of changes in equity, cash flow statement, a summary of significant accounting policies and other explanatory notes to and forming part ofthe financial report, and the statutory certificate has been audited.
The Board Members’ Responsibility for the Financial Report The Board Members of Barwon Region Water Corporation are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and the financial reporting requirements of the Financial Management Act 1994. This responsibility includes: • establishing and maintaining internal controls relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error • selecting and applying appropriate accounting policies • making accounting estimates that are reasonable in the circumstances.
Auditor’s Responsibility As required by the Audit Act 1994, my responsibility is to express an opinion on the financial report based on the audit, which has been conducted in accordance with Australian Auditing Standards. These Standards require compliance with relevant ethical requirements relating to audit engagements and that the audit be planned and performed to obtain reasonable assurance whether the financial report is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The audit procedures selected depend on judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, consideration is given to the internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of the accounting policies used, and the reasonableness of accounting estimates made by the Board Members, as well as evaluating the overall presentation of the financial report. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.
Level 24, 35 Collins Street, Melbourne Victoria 3000 Telephone 61 3 8601 7000 Facsimile 61 3 8601 7010 Email [email protected] Website www.audit.vic.gov.au
Auditing in the Public Interest
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VAGO Victorian Auditor-General’s Office
Independent Auditor’s Report (continued)
Matters Relating to the Electronic Presentation of the Audited Financial Report The auditor’s report relates to the financial report published in both the annual report and on the website of Barwon Region Water Corporation for the year ended 30 June 2010. The Board Members of Barwon Region Water Corporation are responsible for the integrity of the web site. I have not been engaged to report on the integrity of the website. The auditor’s report refers only to the statements named above. An opinion is not provided on any other information which may have been hyperlinked to or from these statements. If users of this report are concerned with the inherent risks arising from electronic data communications, they are advised to refer to the hard copy of the audited financial report to confirm the information included in the audited financial report presented on the Barwon Region Water Corporation website.
Independence The Auditor-General’s independence is established by the Constitution Act 1975. The Auditor-General is not subject to direction by any person about the way in which his powers and responsibilities are to be exercised. In conducting the audit, the Auditor-General, his staff and delegates compiled with all applicable independence requirements of the Australian accounting profession.
Auditor’s Opinion In my opinion, the financial report presents fairly, in all material respects, the financial position of Barwon Region Water Corporation as at 30 June 2010 and its financial performance and cash flows for the year then ended in accordance with applicable Australian Accounting Standards (including the Australian Accounting Interpretations), and the financial reporting requirements of the Financial Management Act 1994.
MELBOURNE D D R Pearson 11 August 2010 Auditor-General
Level 24, 35 Collins Street, Melbourne Victoria 3000 Telephone 61 3 8601 7000 Facsimile 61 3 8601 7010 Email [email protected] Website www.audit.vic.gov.au
Auditing in the Public Interest
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APPENDIX TWO:
Barwon water whistleblower procedures
1. Statement of support to complainants 3. Objects of the Act Barwon Water is committed to the aims and objectives of the The Whistleblowers Protection Act 2001 commenced operation on Whistleblowers Protection Act 2001 (the Act). It does not tolerate 1 January 2002. The purpose of the Act is to encourage and improper conduct by its employees, officers or members, nor the facilitate the making of disclosures of improper conduct by public taking of reprisals against those who come forward to disclose such officers and public bodies. The Act provides protection to conduct. complainants who make disclosures in accordance with the Act, and establishes a system for the matters disclosed to be investigated Barwon Water recognises the value of transparency and and rectifying action to be taken. accountability in its administrative and management practices, and supports the making of disclosures that reveal corrupt conduct, conduct involving a substantial mismanagement of public resources, 4. Definitions of key terms or conduct involving a substantial risk to public health and safety or Three key concepts in the reporting system are improper conduct, the environment. corrupt conduct and detrimental action. Definitions of these terms Barwon Water will take all reasonable steps to protect people who are set as follows. make such disclosures from any detrimental action in reprisal for making the disclosure. It will also afford natural justice to the person 4.1 Improper conduct who is the subject of the disclosure. A disclosure may be made about improper conduct by a public body or public official. Improper conduct means conduct that is corrupt, 2. Purpose of these procedures a substantial mismanagement of public resources, or conduct involving substantial risk to public health or safety or to the These procedures establish a system for reporting disclosures of environment. The conduct must be serious enough to constitute, improper conduct or detrimental action by Barwon Water or its if proved, a criminal offence or reasonable grounds for dismissal. employees. The system enables such disclosures to be made to the Protected Disclosure Coordinator or to one of the nominated 4.2 Corrupt conduct Protected Disclosure Officers. Disclosures may be made by Corrupt conduct means: employees or by members of the public. Conduct of any person (whether or not a public official) that These procedures are designed to complement normal adversely affects the honest performance of a public officer’s or communication channels between supervisors and employees. public body’s functions Employees are encouraged to continue to raise appropriate matters at any time with their supervisors. As an alternative, employees may The performance of a public officer’s functions dishonestly or make a disclosure of improper conduct or detrimental action under with inappropriate partiality the Act in accordance with these procedures. Conduct of a public officer, former public officer or a public body that amounts to a breach of public trust Conduct by a public officer, former public officer or a public body that amounts to the misuse of information or material acquired in the course of the performance of their official functions A conspiracy or attempt to engage in the above conduct.
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4.3 Detrimental action The following table sets out where disclosures about persons other The Act makes it an offence for a person to take detrimental action than employees of Barwon Water should be made: against a person in reprisal for a protected disclosure. Detrimental action includes: Person who is the subject of Person/body to whom the Action causing injury, loss or damage; the disclosure disclosure must be made Intimidation or harassment; and Employee of a public body That public body or the Discrimination, disadvantage or adverse treatment in relation to Ombudsman a person’s employment, career, profession, trade or business, Member of Parliament Speaker of the Legislative including the taking of disciplinary action. (Legislative Assembly) Assembly Member of Parliament President of the Legislative 5. The reporting system (Legislative Council) Council 5.1 Contact persons within Barwon Water Councillor The Ombudsman Disclosures of improper conduct or detrimental action by Barwon Chief Commissioner of Police The Ombudsman or Deputy Water or its employees, may be made to the following officers: Ombudsman
The Protected Disclosure Coordinator Member of the police force The Ombudsman, Deputy Company Secretary Ombudsman or Chief Commissioner of Police Protected Disclosure Officer/s Chris McLeod, Dennis Davie, David Greaves 6. Roles and responsibilities All correspondence, phone calls and emails from internal or external complainants will be referred to the Protected Disclosure 6.1 Employees Coordinator. Employees are encouraged to report known or suspected incidences of improper conduct or detrimental action in accordance with these Where a person is contemplating making a disclosure and is procedures. concerned about approaching the Protected Disclosure Coordinator or a Protected Disclosure Officer in the workplace, he or she can call All employees of Barwon Water have an important role to play in the relevant officer and request a meeting in a discreet location supporting those who have made a legitimate disclosure. They must away from the workplace. refrain from any activity that is, or could be perceived to be, victimisation or harassment of a person who makes a disclosure. 5.2 Alternative contact persons Furthermore, they should protect and maintain the confidentiality of A disclosure about improper conduct or detrimental action by a person they know or suspect to have made a disclosure. Barwon Water or its employees, may also be made directly to the Ombudsman: 6.2 Protected Disclosure Officers
The Ombudsman Victoria Protected Disclosure Officers will: Level 22, 459 Collins Street (North Tower) Be a contact point for general advice about the operation of the Melbourne Victoria 3000 Act for any person wishing to make a disclosure about improper (DX 210174) conduct or detrimental action;
Internet: www.ombudsman.vic.gov.au Make arrangements for a disclosure to be made privately and Email: [email protected] discreetly and, if necessary, away from the workplace; Telephone: 03 9613 6222 Toll Free: 1800 806 314 Receive any disclosure made orally or in writing (from internal Ombudsman: Mr George Brouwer and external complainants); Telephone: 03 9613 6202 Commit to writing any disclosure made orally;
Impartially assess the allegation and determine whether it is a disclosure made in accordance with Part 2 of the Act (that is, ‘a protected disclosure’);
Take all necessary steps to ensure the identity of the complainant and the identity of the person who is the subject of the disclosure are kept confidential; and
Forward all disclosures and supporting evidence to the Protected Disclosure Coordinator.
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6.3 Protected Disclosure Coordinator 7. Confidentiality The Protected Disclosure Coordinator has a central ‘clearinghouse’ Barwon Water will take all reasonable steps to protect the identity role in the internal reporting system. He or she will: of the complainant. Maintaining confidentiality is crucial in ensuring Receive all disclosures forwarded from the Protected Disclosure reprisals are not made against a complainant. Officers The Act requires any person who receives information due to the Receive all phone calls, emails and letters from members of the handling or investigation of a protected disclosure, not to disclose public or employees seeking to make a disclosure that information except in certain limited circumstances. Disclosure Impartially assess each disclosure to determine whether it is a of information in breach of section 22 constitutes an offence that is public interest disclosure punishable by a maximum fine of 60 penalty units ($6000) or six Refer all public interest disclosures to the Ombudsman months imprisonment or both. Be responsible for carrying out, or appointing an Investigator to The circumstances in which a person may disclose information carry out, an investigation referred to the public body by the obtained about a protected disclosure include: Ombudsman Where exercising the functions of the public body under the Act Be responsible for overseeing and coordinating an investigation When making a report or recommendation under the Act where an Investigator has been appointed When publishing statistics in the annual report of a public body Appoint a Welfare Manager to support the complainant and to protect him or her from any reprisals In criminal proceedings for certain offences in the Act. Advise the complainant of the progress of an investigation into However, the Act prohibits the inclusion of particulars in any report the disclosed matter or recommendation that is likely to lead to the identification of the Establish and manage a confidential filing system complainant. The Act also prohibits the identification of the person who is the subject of the disclosure in any particulars included in an Collate and publish statistics on disclosures made annual report. Take all necessary steps to ensure the identity of the complainant and the identity of the person who is the subject of Barwon Water will ensure all files, whether paper or electronic, are the disclosure are kept confidential kept in a secure room and can only be accessed by the Protected Disclosure Coordinator, Protected Disclosure Officer, the Investigator Liaise with the Managing Director of the public body. or Welfare Manager (in relation to welfare matters). All printed material will be kept in files that are clearly marked as a 6.4 Investigator Whistleblower Protection Act matter, and warn of the criminal The Investigator will be responsible for carrying out an internal penalties that apply to any unauthorised divulging information investigation into a disclosure where the Ombudsman has referred a concerning a protected disclosure. All electronic files will be matter to the public body. produced and stored on a stand-alone computer and be given An Investigator may be a person from within an organisation or a password protection. Backup files will be kept on portable media. consultant engaged for that purpose. All materials relevant to an investigation, such as tapes from interviews, will also be stored securely with the complainant files. 6.5 Welfare Manager Barwon Water will not email documents relevant to a complainant The Welfare Manager is responsible for looking after the general matter and will ensure all phone calls and meetings are conducted welfare of the complainant. The Welfare Manager will: in private. Examine the immediate welfare and protection needs of a complainant who has made a disclosure and seek 8. Collating and publishing statistics to foster a supportive work environment Advise the complainant of the legislative and administrative The Protected Disclosure Coordinator will establish a secure register protection’s available to him or her to record the information required to be published in the annual report, and to generally keep account of the status of complainant Listen and respond to any concerns of harassment, intimidation disclosures. The register will be confidential and will not record any or victimisation in reprisal for making disclosure information that may identify the complainant. Ensure the expectations of the complainant are realistic.
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The register will contain the following information: Is the alleged conduct either improper conduct or detrimental action taken against a person in reprisal for making a protected The number and types of disclosures made to public bodies disclosure? during the year; The number of disclosures referred to the Ombudsman for Does the person making a disclosure have reasonable grounds determination as to whether they are public interest disclosures; for believing the alleged conduct has occurred? The number and types of disclosed matters referred to the Where a disclosure is assessed to be a protected disclosure, it is public body by the Ombudsman for investigation; referred to the Protected Disclosure Coordinator. The Protected The number and types of disclosures referred by the public body Disclosure Coordinator will determine whether the disclosure is a to the Ombudsman for investigation; public interest disclosure. The number and types of investigations taken over from the Where a disclosure is assessed not to be a protected disclosure, the public body by the Ombudsman; matter does not need to be dealt with under the Act. The Protected The number of requests made by a complainant to the Disclosure Officer will decide how the matter should be responded Ombudsman to take over an investigation by the public body; to in consultation with the Protected Disclosure coordinator. The number and types of disclosed matters that the public body has declined to investigate; 9.2 Is the disclosure a public interest disclosure? The number and types of disclosed matters that were Where the Protected Disclosure Officer or coordinator has received substantiated upon investigation and the action taken on a disclosure that has been assessed to be a protected disclosure, completion of the investigation; and the Protected Disclosure coordinator will determine whether the disclosure amounts to a public interest disclosure. This assessment Any recommendations made by the Ombudsman that relate to will be made within 45 days of the receipt of the disclosure. the public body. In reaching a conclusion as to whether a protected disclosure is a public interest disclosure, the Protected Disclosure coordinator will 9. Receiving and assessing disclosures consider whether the disclosure shows, or tends to show, that the public officer to whom the disclosure relates: 9.1 Has the disclosure been made in accordance with Part 2 of the Act? Has engaged, is engaging or proposes to engage in improper conduct in his or her capacity as a public officer; or Where a disclosure has been received by the Protected Disclosure Officer or by the Protected Disclosure Coordinator, he or she will Has taken, is taking or proposes to take detrimental action in assess whether the disclosure has been made in accordance with reprisal for the making of the protected disclosure. Part 2 of the Act and is, therefore, a protected disclosure. Where the Protected Disclosure coordinator concludes that the disclosure amounts to a public interest disclosure, he or she will: 9.1.1 Has the disclosure been made to the appropriate person? 1. Notify the person who made the disclosure of that conclusion; For the disclosure to be responded to by Barwon Water, it must and concern an employee, member or officer of Barwon Water. If the disclosure concerns an employee, officer or member of another 2. Refer the disclosure to the Ombudsman for formal public body, the person who has made the disclosure must be determination as to whether it is indeed a public interest advised of the correct person or body to whom the disclosure disclosure. should be directed. (See the table in 5.2). If the disclosure has been made anonymously, it should be referred to the Ombudsman. Where the Protected Disclosure coordinator concludes that the disclosure is not a public interest disclosure, he or she will:
9.1.2 Does the disclosure contain the essential elements of a 1. Notify the person who made the disclosure of that conclusion; protected disclosure? and
To be a protected disclosure, a disclosure must satisfy the following 2. Advise that person that he or she may request the public body criteria: to refer the disclosure to the Ombudsman for a formal Did a natural person (that is, an individual person rather than a determination as to whether the disclosure is a public interest corporation) make the disclosure? disclosure, and that this request must be made within 28 days of the notification. Does the disclosure relate to conduct of a public body or public officer acting in their official capacity? In either case, the Protected Disclosure coordinator will make the notification and the referral within 14 days of the conclusion being reached by the public body. Notification to the complainant is not necessary where the disclosure has been made anonymously.
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10. Investigations 10.4 Natural justice The principles of natural justice will be followed in any investigation 10.1 Introduction of a public interest disclosure. The principles of natural justice Where the Ombudsman refers a protected disclosure to Barwon concern procedural fairness and ensure a fair decision is reached by Water for investigation, the Protected Disclosure coordinator will an objective decision maker. Maintaining procedural fairness appoint an Investigator to carry out the investigation. protects the rights of individuals and enhances public confidence in the process. The objectives of an investigation will be: Barwon Water will have regard to the following issues in ensuring To collate information relating to the allegation as quickly as procedural fairness: possible. This may involve taking steps to protect or preserve documents, materials and equipment; The person who is the subject of the disclosure is entitled to know the allegations made against him or her and must be given To consider the information collected and to draw conclusions the right to respond. (This does not mean the person must be objectively and impartially; advised of the allegation as soon as the disclosure is received or To maintain procedural fairness in the treatment of witnesses the investigation has commenced) and the person who is the subject of the disclosure; and If the Investigator is contemplating making a report adverse to the interests of any person, that person should be given the To make recommendations arising from the conclusions drawn opportunity to put forward further material that may influence concerning remedial or other appropriate action. the outcome of the report and that person’s defence should be fairly set out in the report 10.2 Terms of reference All relevant parties to a matter should be heard and all Before commencing an investigation, the Protected Disclosure submissions should be considered coordinator will draw up terms of reference and obtain A decision should not be made until all reasonable inquiries have authorisation for those terms by the Managing Director. The terms been made of reference will set a date by which the investigation report is to be concluded, and will describe the resources available to the The Investigator or any decision maker should not have a Investigator to complete the investigation within the time set. The personal or direct interest in the matter being investigated Protected Disclosure coordinator may approve, if reasonable, an All proceedings must be carried out fairly and without bias. Care extension of time requested by the Investigator. The terms of should be taken to exclude perceived bias from the process reference will require the Investigator to make regular reports to The Investigator must be impartial in assessing the credibility of the Protected Disclosure coordinator who, in turn, is to keep the the complainants and any witnesses. Where appropriate, Ombudsman informed of general progress. conclusions as to credibility should be included in the investigation report. 10.3 Investigation plan
The Investigator will prepare an investigation plan for approval by 10.5 Conduct of the investigation the Protected Disclosure coordinator. The plan will list the issues to The Investigator will make contemporaneous notes of all discussions be substantiated and describe the avenue of inquiry. It will address and phone calls, and all interviews with witnesses may be taped. the following issues: All information gathered in an investigation will be stored securely. What is being alleged? Interviews will be conducted in private and the Investigator will take What are the possible findings or offences? all reasonable steps to protect the identity of the complainant. Where disclosure of the identity of the complainant cannot be What are the facts in issue? avoided, due to the nature of the allegations, the Investigator How is the inquiry to be conducted? will warn the complainant and his or her Welfare Manager of What resources are required? this probability.
At the commencement of the investigation, the complainant It is in the discretion of the Investigator to allow any witness to have should be: legal or other representation or support during an interview. If a witness has a special need for legal representation or support, Notified by the Investigator that he or she has been appointed permission should be granted. to conduct the investigation
Asked to clarify any matters
Asked to provide any additional material he or she might have.
The Investigator will be sensitive to the complainant’s possible fear of reprisals and will be aware of the statutory protection’s provided to the complainant.
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10.6 Referral of an investigation to the Ombudsman Where the Investigator’s report is to include an adverse comment The Protected Disclosure coordinator will make a decision regarding against any person, that person will be given the opportunity to the referral of an investigation to the Ombudsman where, on the respond and his or her defence will be fairly included in the report. advice of the Investigator: The report will not disclose particulars likely to lead to the The investigation is being obstructed by, for example, the identification of the whistleblower. non-cooperation of key witnesses; or 11.2 Action to be taken The investigation has revealed conduct that may constitute a If the Protected Disclosure coordinator is satisfied that the criminal offence. investigation has found that the disclosed conduct has occurred, he or she will recommend to the Managing Director the action that 10.7 Reporting requirements must be taken to prevent the conduct from continuing or occurring The Protected Disclosure coordinator will ensure the complainant is in the future. The Protected Disclosure coordinator may also kept regularly informed concerning the handling of a protected recommend that action be taken to remedy any harm or loss arising disclosure and an investigation. from the conduct.
The Protected Disclosure coordinator will report to the Ombudsman The Protected Disclosure coordinator will provide a written report to about the progress of an investigation. Minister for Water, the Ombudsman and the complainant setting out the findings of the investigation and any remedial steps taken. Where the Ombudsman or the complainant requests information about the progress of an investigation, that information will be Where the investigation concludes that the disclosed conduct did provided within 28 days of the date of the request. not occur, the Protected Disclosure coordinator will report these findings to the Ombudsman and to the complainant. 11. Action taken after an investigation 11.1 Investigator’s final report 12. Managing the welfare of the complainant At the conclusion of the investigation, the Investigator will submit a 12.1 Commitment to protecting complainants written report of his or her findings to the Protected Disclosure Barwon Water is committed to the protection of genuine coordinator. The report will contain: complainants against detrimental action taken in reprisal for the making of protected disclosures. The Protected Disclosure The allegation/s; coordinator is responsible for ensuring complainants are protected An account of all relevant information received and, if the from direct and indirect detrimental action, and that the culture of Investigator has rejected evidence as being unreliable, the the workplace is supportive of protected disclosures being made. reasons for this opinion being formed The Protected Disclosure coordinator will appoint a Welfare The conclusions reached and the basis for them Manager to all complainants who have made a protected disclosure. Any recommendations arising from the conclusions. The Welfare Manager will:
Where the Investigator has found that the conduct disclosed by the Examine the immediate welfare and protection needs of a complianant has occurred, recommendations made by the complainant who has made a disclosure and, where the Investigator will include: complainant is an employee, seek to foster a supportive work environment; The steps that need to be taken by Barwon Water to prevent the conduct from continuing or occurring in the future; and Advise the complainant of the legislative and administrative protections available to him or her; Any action that should be taken by Barwon Water to remedy any harm or loss arising from the conduct. This action may include Listen and respond to any concerns of harassment, intimidation bringing disciplinary proceedings against the person responsible or victimisation in reprisal for making disclosure; for the conduct, and referring the matter to an appropriate Keep a contemporaneous record of all aspects of the case authority for further consideration. management of the complainant including all contact and follow-up action; and The report will be accompanied by: Ensure the expectations of the complainant are realistic. The transcript or other record of any oral evidence taken, including tape recordings; and All employees will be advised that it is an offence for a person to take detrimental action in reprisal for a protected disclosure. The All documents, statements or other exhibits received by the maximum penalty is a fine of 240 penalty units ($24,000) or two officer and accepted as evidence during the course of the years imprisonment or both. The taking of detrimental action in investigation. breach of this provision can also be grounds for making a disclosure under the Act and can result in an investigation.
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Detrimental action includes: The Managing Director will make the final decision on the advice of Causing injury, loss or damage; the Protected Disclosure coordinator as to whether disciplinary or other action will be taken against a complainant. Where disciplinary or Intimidation or harassment; and other action relates to conduct that is the subject of the complainant’s Discrimination, disadvantage or adverse treatment in relation disclosure, the disciplinary or other action will only be taken after to a person’s employment, career, profession, trade or business the disclosed matter has been appropriately dealt with. (including the taking of disciplinary action). In all cases where disciplinary or other action is being contemplated, the Managing Director must be satisfied that it has been clearly 12.2 Keeping the complainant informed demonstrated that: The Protected Disclosure coordinator will ensure the complainant The intention to proceed with disciplinary action is not causally is kept informed of action taken in relation to his or her disclosure, connected to the making of the disclosure (as opposed to the and the time frames that apply. The complainant will be informed of content of the disclosure or other available information) the objectives of an investigation, the findings of an investigation, and the steps taken by Barwon Water to address any improper There are good and sufficient grounds that would fully justify conduct that has been found to have occurred. The complainant will action against any non- complainant in the same circumstances be given reasons for decisions made by Barwon Water in relation to There are good and sufficient grounds that justify exercising any a protected disclosure. All communication with the complainant will discretion to institute disciplinary or other action. be in plain English. The Protected Disclosure coordinator will thoroughly document the process including recording the reasons why the disciplinary or 12.3 Occurrence of detrimental action other action is being taken, and the reasons why the action is not in If a complainant reports an incident of harassment, discrimination retribution for the making of the disclosure. The Protected or adverse treatment that would amount to detrimental action Disclosure coordinator will clearly advise the complainant of the taken in reprisal for the making of the disclosure, the Welfare proposed action to be taken, and of any mitigating factors that have Manager will: been taken into account. Record details of the incident 14. Management of the person against whom Advise the complainant of his or her rights under the Act a disclosure has been made Advise the Protected Disclosure coordinator or Managing Director of the detrimental action. Barwon Water recognises that employees against whom disclosures are made must also be supported during the handling and The taking of detrimental action in reprisal for the making of a investigation of disclosures. Barwon Water will take all reasonable disclosure can be an offence against the Act as well as grounds for steps to ensure the confidentiality of the person who is the subject making a further disclosure. Where such detrimental action is of the disclosure during the assessment and investigation process. reported, the Protected Disclosure coordinator will assess the Where investigations do not substantiate disclosures, the fact that report as a new disclosure under the Act. Where the Protected the investigation has been carried out, the results of the Disclosure coordinator is satisfied that the disclosure is a public investigation, and the identity of the person who is the subject of interest disclosure, he or she will refer it to the Ombudsman. If the the disclosure will remain confidential. Ombudsman subsequently determines the matter to be a public interest disclosure, the Ombudsman may investigate the matter or The Protected Disclosure coordinator will ensure the person who is refer it to another body for investigation as outlined in the Act. the subject of any disclosure investigated by or on behalf of a public body is: 13. Complainants implicated in improper Informed as to the substance of the allegations; conduct Given the opportunity to answer the allegations before a final decision is made; Where a person who makes a disclosure is implicated in misconduct, Informed as to the substance of any adverse comment that may Barwon Water will handle the disclosure and protect the be included in any report arising from the investigation; and has complainant from reprisals in accordance with the Act, the Ombudsman’s guidelines and these procedures. Barwon Water His or her defence set out fairly in any report. acknowledges that the act of whistleblowing should not shield Where the allegations in a disclosure have been investigated, and complainants from the reasonable consequences flowing from any the person who is the subject of the disclosure is aware of the involvement in improper conduct. Section 17 of the Act specifically allegations or the fact of the investigation, the Protected Disclosure provides that a person’s liability for his or her own conduct is not coordinator will formally advise the person who is the subject of the affected by the person’s disclosure of that conduct under the Act. disclosure of the outcome of the investigation. However, in some circumstances, an admission may be a mitigating factor when considering disciplinary or other action.
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Barwon Water will give its full support to a person who is the subject of a disclosure where the allegations contained in a disclosure are clearly wrong or unsubstantiated. If the matter has been publicly disclosed, the Managing Director of Barwon Water will consider any request by that person to issue a statement of support setting out that the allegations were clearly wrong or unsubstantiated.
15. Criminal offences Barwon Water will ensure officers appointed to handle protected disclosures and all other employees are aware of the following offences created by the Act:
1. It is an offence for a person to take detrimental action against a person in reprisal for a protected disclosure being made. The Act provides a maximum penalty of a fine of 240 penalty units ($24,000) or two years imprisonment or both. 2. It is an offence for a person to divulge information obtained as a result of the handling or investigation of a protected disclosure without legislative authority. The Act provides a maximum penalty of 60 penalty units ($6,000) or six months imprisonment or both. 3. It is an offence for a person to obstruct the Ombudsman in performing his responsibilities under the Act. The Act provides a maximum penalty of 240 penalty units ($24,000) or two years imprisonment or both. 4. It is an offence for a person to knowingly provide false information under the Act with the intention that it be acted on as a disclosed matter. The Act provides a maximum penalty of 240 penalty units ($24,000) or two years imprisonment or both.
16. Review These procedures will be reviewed annually to ensure they meet the objectives of the Act and accord with the Ombudsman’s guideline.
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Appendix A Reporting Structures for Barwon Water
Managing Director
Protected Disclosure Member(s) Coordinator of Public (Company Secretary)
PD Officer Welfare Manager (3) (GMOD)
Investigator (appointed by PD Coordinator in conjunction with Managing Director. Can be consultant or internal appointee)
Employees
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Appendix B Records Register The register below records information about disclosures made to Barwon Water that have been determined to be protected disclosures.
File A File B File C File D File E Date disclosure received N/A Type of disclosure N/A Is disclosure a public interest disclosure? N/A Date above determination made N/A Date complainant informed of determination N/A Date disclosure referred to the Ombudsman N/A Determination made by Ombudsman N/A Was the investigation referred back to the Ombudsman? N/A Did the Ombudsman take over the investigation? N/A Did the complainant request the Ombudsman to take over investigation? N/A Findings of the public body N/A Recommendations made by the Ombudsman N/A Date reporting requirements satisfied N/A
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GLOSSARY
Biodiversity The range of plants and animals, and the habitat Megalitre 1,000,000 litres. they live in. OHS Occupational health and safety. The protection of the Biosolids Stabilised organic solids derived from sewage health, safety and welfare of employees, contractors and visitors. treatment processes that can be managed and used safely for Planned interruption A scheduled interruption to assist in pipe nutrient, soil conditioning, energy or other value. flushing or maintenance work. Bulk Entitlement The right to water held by water and other Potable Suitable for drinking. authorities defined in the Water Act. The Bulk Entitlement defines the amount of water that an authority is entitled to Recycled water Water derived from sewerage systems or from a river or storage, and may include the rate at which it industry processes, which is treated to a standard that is may be taken and the reliability of the entitlement. appropriate for its intended use. The water can be used in industrial processes, for irrigation in agriculture, urban parks Catchment The area of land drained by a creek or river system, and landscapes. Can also be used in and around the home for or a place set aside for collecting water. toilet flushing and garden watering. Catchment management authorities (CMA) CMAs are the Reticulation The network of pipelines used to take water into caretakers of river health, responsible for regional and areas of consumption. Includes residential districts and catchment planning and coordination and waterway, floodplain, individual households. salinity and water quality management. Sewage The waterborne wastes of a community including Community engagement Communication and interaction homes, offices, shops, factories and other premises. between Barwon Water and its stakeholders. Sewerage The network of pipes, pumping stations and Desalination The removal of salt from seawater to produce treatment plants used to collect, transport, treat and discharge water suitable for drinking or agricultural purposes. sewage. E.coli Escherichia coli is a bacterium found in the stomachs of Stakeholder Any individual or group which can affect or is mammals, such as humans, and used as an indicator of recent affected by an organisation’s activities. faecal contamination. Trade waste Industrial or commercial effluent discharged into Energy and Water Ombudsman Victoria (EWOV) Has the the sewerage system. power to investigate and resolve disputes between Victorian electricity, gas and water customers and their providers. Triple Bottom Line (TBL) Integrated approach to the achievement of environmental, social and economic outcomes. Enterprise Content Management System An organisation- wide system to manage all paper based and electronic Turbidity The presence of fine suspended matter, such as clay documents and records within a single electronic repository. or silt, in water causing the water to be cloudy or muddy in appearance. Environmental flow The stream flow required downstream of a water storage to maintain appropriate environmental conditions Water Plan A pricing submission to the Essential Services in a waterway. Commission (ESC), which addresses outcomes that must be delivered in a period to meet future service demands and Essential Services Commission (ESC) An independent comply with legislative or regulatory obligations. economic regulator established by the State Government of Victoria to regulate prescribed essential utility services supplied Water reclamation plant A facility designed to receive sewage by the electricity, gas, water, ports, grain handling, rail freight and remove materials that damage water quality and threaten industries and aspects of the insurance industry. public health and safety when the water produced is recycled or discharged into receiving bodies of water. Greenhouse gas Gas that contributes to atmospheric warming and the greenhouse effect. Water restrictions Mandatory restrictions on the use of water that are invoked to responsibly manage water storage levels. Groundwater All subsurface water in an aquifer or water table. Water treatment plant A facility that ensures safe drinking Headworks Dams, weirs and associated works used for the water by removing contaminants (filtration) and eliminating harvest and supply of water. pathogens (disinfection). Kilolitre 1,000 litres. Yield The quantity of water that a storage or aquifer produces. Lucerne Plant widely used as a pasture or hay crop in Australia. Manganese A metal naturally existing in rivers, lakes, and underground water supplies.
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LOCATIONS MAP
Geelong South Geelong 61-67 Ryrie St, Geelong 3220 40-44 Lonsdale St, South Geelong 3220 Telephone: 1300 656 007 Telephone: 1300 656 007
Lorne Colac 90-94 Polwarth Rd, Lorne 3232 33 Bromfield St, Colac 3250 Telephone: 5289 1408 Telephone: 5231 6133
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SERVICE REGION MAP
PAGE | 142 PAGE | 143 BARWON WATER Designed by GSDM_9637 61-67 Ryrie St PO Box 659 Geelong Vic 3220 Telephone: 1300 656 007 www.barwonwater.vic.gov.au