Annual Report 2003 BUILDING A SUSTAINABLE WATER BUSINESS >ECONOMIC PERFORMANCE >ENVIRONMENTAL PERFORMANCE >SOCIAL PERFORMANCE

>Vision Coliban Water will be a commercially, socially and environmentally successful regional water and wastewater business, consistently meeting customer, community and shareholder expectations.

>Mission Our purpose is to provide high quality water and wastewater services to the people of North Central Victoria.

>Values We value our customers and our communities. We care for the safety, well being and development of our staff. We value achievement and the pursuit of excellence. We encourage innovation. We take a commercial approach to our business and to service delivery. We are ethical, open, honest and fair. We take responsibility for our actions. We care for the environment. SCOPE OF TABLE OF THE REPORT CONTENTS

This report covers all of Chairman and Chief Executive’s Report 2 Coliban Water’s operations from Overarching Policies 3 1 July 2002 to 30 June 2003. Profile 4 Our previous annual report was Customer Service and Community Obligations 6 tabled in Parliament on Organisation 7 Thursday, 27 February 2003. Executive Management 9 This year for the first time our Economic Performance 11 Annual Report has been prepared as a Triple Bottom Line Water 14 report. In doing this we have Wastewater 21 been guided by the Triple Bottom Reclaimed Water and Biosolids 24 Line Reporting Guidelines of the Environmental Performance 26 Victorian Water Industry Social Performance 27 Association, and the Global Statement of Financial Performance 32 Reporting Initiative’s (GRI) 2002 Statement of Financial Position 33 Sustainability Reporting Guidelines and Pilot Water Cash Flow Statement 34 Protocol (2003). Our report Notes to the Financial Statements 35 meets the requirements of the Statutory Certification 61 Financial Management Act 1994 Auditor General’s Report 62 and the directions of the Minister Appendix 63 for Finance. Your Feedback 64 Triple bottom line reporting is an incremental process. While we have reported this year against many of the core indicators provided by the GRI guidelines, we will work with stakeholders to further develop our performance indicators for the next Triple Bottom Line Report.

Coliban Water / 2003 Annual Report P1 From left: Geoff Michell and Gordon McKern CHAIRMAN AND CHIEF EXECUTIVE’S REPORT

In 2002/03 Coliban Water continued to deliver high quality service SOCIAL PERFORMANCE and major system improvements in a challenging period of Customer Satisfaction extended drought. The impacts of this drought have significantly Customer satisfaction rose to 94%, as a result of the completion of the raised the recognition of water as an extremely valuable resource AQUA project last year delivering world class quality water to the major and that better use of all sources of water is necessary for a centres of Bendigo, Castlemaine and Kyneton, and improvements to the sustainable future. Echuca Water Treatment Plant. Further increases in customer satisfaction are The most stringent water restrictions since 1982/83 were introduced along expected when water treatment plant upgrades at Rochester, Boort, with an extensive education program to conserve dwindling water resources. Lockington and Cohuna are finished next year. On the positive side our customers were very supportive of measures taken, Water Security and will certainly embrace a future where reduced water consumption will A review of water security and identification of options to ensure a become an acceptable fact of everyday living. sustainable supply to our communities continued through the year. This is Coliban Water’s first annual report to demonstrate our contribution to An alliance was established with Bendigo Mining to investigate the feasibility sustainability of the region in a form consistent with the Triple Bottom Line of using the water held in Bendigo’s underground mines as part of our future Reporting Guidelines of the Victorian Water Industry Association. resources. Water for Growth funding was obtained to assist this study. The drought has clearly raised the awareness of water as an essential, ENVIRONMENTAL PERFORMANCE valuable resource and the Government’s Securing our Water Future plan identifies opportunities to utilise our resources in a smarter way to ensure a Envirosafe sustainable future for our communities and environment. Sewering of Pyramid Hill and Boort brings the number of towns completed under this $44 million project to fourteen, with contracts for the remaining Staff six towns let through the year. Occupational health and safety remained a primary focus through the year with further improvements made to our OHS Manual in particular the Water Reclamation development of contractor and staff Safety Handbooks. Improvements were completed at the Bendigo Water Reclamation Plant to Staff are also developing a SELECT program to position Coliban Water as an generate a very high quality effluent and investigations continue to “employer of choice”. determine the most sustainable use for this resource.

The Minister for Water officially opened the Kyneton Water Reclamation Plant ECONOMIC PERFORMANCE which has also been upgraded and options for reuse are being pursued. Financial Results A Partnerships Victoria contract was entered into with EarthTech for the We recorded a loss of $2 million for the year. This was primarily due to Campaspe Water Reclamation Project at Echuca, which will deliver an reduced revenue and increased expenditure as a result of the drought, the innovative reuse arrangement, with water being supplied to farming first full year impact of tolls from Partnerships Victoria projects, once-off asset properties to supplement existing irrigation water. write-offs and backlog depreciation. Further short term losses will be Environmental Management System (EMS) incurred however the business has an extremely sound cash base and will return to a surplus position within a few years. Our Environmental Management System continues to provide direction to our daily activities in order to meet our environmental performance requirements. Capital Works During the year, we did not receive any fines or notices from environmental Our significant capital infrastructure program continued through the year regulators. All our capital works projects were subjected to environmental with some $28 million spent on projects including the Envirosafe program, appraisal and we conducted formal environmental audits on three of our dams improvements, water quality improvements, trunk sewer renewals and facilities, all of which indicated sound environmental performance. water reclamation plant improvements.

P2 Coliban Water / 2003 Annual Report OVERARCHING POLICIES

Thanks Coliban Water Strategic Plan 2002-2007 The success of the business is due to the sound strategic direction provided Coliban Water carried out a review of its strategic planning process in 2002 by the Board and the skills, enthusiasm and commitment of both our staff culminating in the Strategic Plan 2002-2007. It provides objectives for the and those of our major partners, Serco Australia, Veolia Water and Henry Authority together with strategies, activities and tasks for achieving them. A Walker Eltin. major review will be carried out in 2003/04. The objectives are listed below We thank all those involved for another outstanding year for Coliban Water. while the full document is available on the website. In particular we sincerely thank Serco Australia for their outstanding Our Business Objectives performance in the seven years they were with us. Our local Members of Parliament continued to provide invaluable support. Water and wastewater services • To ensure water quality of at least Australian Drinking Water Guidelines to The Future customers in potable supply systems. Over the past six years, Coliban Water has focussed on an extensive • To ensure adequate water security for customer needs. infrastructure program, to improve water quality and service delivery. A major • To provide water supplies which meet Customer Charter requirements for review of our Strategic Plan will be completed in 2003/04. This review will reliability and flow. focus on implementing the principles of sustainable water use, as outlined in • To provide wastewater services that meet Customer Charter requirements the Government’s Securing our Water Future plan. with regard to reliability and capacity. The Essential Services Commission will become the economic regulator for • To provide wastewater services to new customers in areas of identified the water industry from 1 January 2004 providing a sound long term need. framework to ensure we remain a sustainable provider of high quality • To treat wastewater in accordance with regulatory requirements and services to our customers and community. community expectations. • To maintain a stable, sustainable and customer-focused structure for the Coliban Rural System. Customer/community • To meet and exceed customer expectations of service. • To be a responsible corporate citizen. Geoff Michell • To develop networks within the community and industry to maximise Chief Executive business performance and community support. Staff • To position the business as an employer of choice. • To provide a safe and healthy work environment. • To ensure appropriate staff resources to achieve business objectives Finance • To maintain long term financial viability. Gordon McKern • To provide a return to the shareholder. Chairman Environment • To manage the operations and activities of the business to reduce adverse environmental impacts. Organisation • To ensure strong corporate governance. • Promote sustainable, excellent performance by the business.

Coliban Water / 2003 Annual Report P3 PROFILE

Coliban Water was established on 1 July 1992 under the Water Act 1989 as a public utility. It is responsible to the Minister for Water, The Honorable John Thwaites, and its shareholder is the Victorian Government. Coliban Water is one of the larger Victorian regional urban water authorities, with an area of responsibility covering approximately 20% of Victoria. Coliban Water manages, maintains and operates over 50 reservoirs and water storage basins across North-Central Victoria and provides water and wastewater services to rural and urban customers across an area of 16,550 square kilometres with a population of 130,000. The service area includes 55 towns or service systems, extending from Cohuna and Echuca in the north to Kyneton and Trentham in the south. The western boundary incorporates Boort, Wedderburn, Bealiba and Dunolly and the eastern boundary includes Heathcote and Tooborac.

SERVICES The major activities of Coliban Water are to provide water and wastewater services to urban and rural customers. The services encompass water harvesting and storage, urban water supply, wastewater collection, treatment, reuse and disposal, and rural water supply. Coliban Water also provides wastewater disposal services, including trade waste treatment, to a number of large businesses including milk processors, abattoirs, a variety of food processors (such as diary products, small goods and tomatoes), major laundries, saleyards, tanneries, wineries, pet food manufacturers, carpet yarns and health services. Coliban Water supplied 15,588 ML of water to residential customers and 7,723 ML to non-residential customers in 2002/03. Non revenue water (lost through evaporation, seepage, theft and fire services) totalled 6,787 ML.

CUSTOMERS Residential customers 54,509 properties Non-residential customers 5,964 properties Rural customers 1,718 licences Total customers 62,191

KEY TO OPERATIONS OUR ASSETS

Head Office & Central Operations Southern Operations The business utilises a wide range of assets to deliver services including: • 1900 km of water mains Northern Operations Service Depots • 1300 km of sewer mains • 490 km of rural channels Scale in km 0 10 20 30 40 50 100 • 70 km of main channel • 182 water and wastewater pumping stations • 23 water treatment facilities • 10 water reclamation facilities The total written down value of our infrastructure assets is $547.5 million.

P4 Coliban Water / 2003 Annual Report From left: Geoff Michell, Gordon McKern, Graham Dooley and Robert Tardiff PROFILE (CAMS Board Members) at the signing of the contract between Coliban Water and CAMS CONTINUED

Table 1. The value of assets owned by Coliban Water PRIVATE PARTNERSHIPS Veolia Water

Asset type Value ($m written down value) Coliban Water is working in USF Bendigo Water Services Pty partnership with the following Ltd, a subsidiary of Veolia Water Land 11.2 companies to provide world leading (formerly Vivendi Water) owns and Buildings 3.6 services and technologies to our operates Coliban Water’s AQUA Water infrastructure 232.4 customers: water treatment plants in Bendigo, Castlemaine and Kyneton under a Wastewater infrastructure 164.3 Serco Public Private Partnership Water distribution infrastructure 33.4 Serco is a worldwide company with agreement until 2027. Rural 3.1 over 20,000 employees specialising Veolia Water operates the Kyneton Headworks 98.2 in providing outsourcing services in Water Reclamation Plant under a engineering and support services. Corporate assets 1.3 Design, Build and Operate contract From 1996 to 2003 Serco Australia until 2005. supplied Coliban Water with the OUR STAKEHOLDERS following services: Henry Walker Eltin Coliban Water has continued to build on its commitment to keep its • Operations and Maintenance Castlemaine Wastewater Treatment stakeholders informed on all aspects of the business operations and to • Revenue Services Pty Ltd (a subsidiary of Henry engage stakeholders effectively in making decisions that impact on them. • Technical Services Walker Eltin, an Australian owned Our key stakeholders include: • Laboratory Operations public company) owns and operates • Customers (domestic urban water and wastewater, commercial and • Management of Information the Castlemaine Wastewater industrial water and wastewater, rural water, trade waste, and major Technology Systems Treatment Plant under a Public Private Partnership agreement with customers) Serco’s contract expired on 30 June Coliban Water until 2025. • Employees of Coliban Water, Serco, Veolia Water and Henry Walker Eltin 2003. • Shareholder (Victorian Government) • Government agencies and regulators (such as the Department of Human Campaspe Asset Services, Heritage Victoria and Vic Urban) Management Services • Local Government Authorities (CAMS) • The communities in which we operate and community groups (including CAMS was awarded the 10+5 year Victorian Farmers Federation and Harcourt & District Fruit Growers provision of services contract which Association) was signed on 20 June and • Suppliers and other service providers. commenced on 1 July 2003. This was held by Serco in 2002/03. In addition, our current major environmental stakeholders are: • EPA (Environment Protection Authority) CAMS is a consortium of United Utilities Australia and Origin Energy • Department of Primary Industries Asset Management. • Department of Sustainability and Environment • North Central Catchment Management Authority • Community environmental groups such as the Friends of Campbells Creek, Langley Landcare and Axedale Landcare • Other environmental stakeholders are identified for specific projects and issues

Coliban Water / 2003 Annual Report P5 CUSTOMER SERVICE AND COMMUNITY OBLIGATIONS

OUR SERVICE OBJECTIVES CORPORATE This share purchase reflected Coliban Water provides services to customers to meet the CITIZENSHIP Coliban Water’s commitment to supporting a community based, standards set in its customer charter. The Coliban Water Customer Coliban Water continued its commercially viable venture, able to Charter (formerly known as the Customer Contract), in operation program of supporting community provide improved and competitive for the last five years, was originally developed in consultation groups and events through sponsorship, including: telecommunications services for the with customers and continues to be regularly tested against North Central Victorian community. customer expectations. • Coliban Water Smart Gardens Competition In an extremely competitive and Coliban Water measures its ongoing progress towards its stated business • Friends of Campbells Creek volatile market, Bendigo objectives, and customer service standards, largely through the quality and Community Telco remains on track • Coliban Water Day at the Lake performance of its water and wastewater services to customers. In 2002/03 in delivering improved services to (Bendigo Easter Festival) we achieved the following results: country Victorians. Coliban Water • Castlemaine State Festival in turn has reduced Customer Service Objectives - Water: • Coliban Water’s Jazz on High at telecommunication costs and seen • Our stated response time of one hour to begin fixing a supply problem was Echuca’s Riverboats, Jazz Food & a substantial improvement in met on 93.3% of occasions. Wine Festival internet access and cost savings by • Our stated time of five hours to restore customer supplies was met 96.7% • Bendigo Goldfields using the latest technology of the time. Chrysanthemum Championship. provided through Bendigo • Our fully treated water supplies met their quality targets for customers In addition, in-kind support was Community Telco. 98.6% of the time. provided to over 100 community • Our partially treated water supplies met their quality targets for customers events. 98.1% of the time. The staff of Coliban Water and Serco held their annual charity golf Customer Service Objectives - Sewerage: day, which was well supported by • Our stated response time of one hour to begin fixing a sewerage problem both organisations, as well as was met on 97.7% of occasions. consultants, suppliers and • Our stated time of five hours to restore a customer’s service was met customers. Over $17,000 was 98.8% of the time. raised for seven regional hospitals • A total of 1718 sewer blockages were up from 1350 the previous year. to purchase vital equipment. Coliban Water Day at The Lake, part of • The 824 overflows this year was up on last year’s total of 683. Bendigo Community Telco Bendigo’s Easter Festival Table 2. Reliability of supply – urban water supplies Since 1998 Coliban Water has been involved with a number of Bendigo Corporate Plan Actual Variance Target Result educational, local government and business organisations in looking at 1 Properties interrupted ratio 19% 14% 5% opportunities to lower costs and Interruption time 2 2 hours 2.6 hrs -0.6 hrs improve telecommunications in the Bendigo area. In 2000, Coliban 1 = number of properties that experienced a service interruption / total properties receiving water x 100 2 = Average time taken to restore an interrupted service Water sought and was granted Ministerial approval to purchase The average interruption time of 2.6 hours was higher than the corporate 20,000 Bendigo Community Telco target of 2 hours due to the number of bursts in remote towns, a number of Limited shares under Section planned works with long interruption times and a number of bursts on large 127(1)(b) of the Water Act 1989. mains.

P6 Coliban Water / 2003 Annual Report From left: Pat Cotton, Fabian Reid, Jenny Dawson, Noel Harvey, Keith Rowland, Shelley McGuinness, Gordon McKern ORGANISATION

CORPORATE GOVERNANCE Noel Harvey, MIPA, MAICD – Deputy Chairman The Board of Coliban Water comprises seven non-executive Appointed to the Board in October 2001, Mr Harvey has been involved in local Directors including the Chairman. They are appointed on the basis government in and around the Macedon Ranges since 1991, including Chief Commissioner of the Shire of Hepburn, President of the Shire of Kyneton and twice of their skills by the Minister for Water, the Hon. John Thwaites. Mayor of the Shire of Macedon Ranges. Mr Harvey is a Board Member of the North The obligations of Coliban Water to the Minister are formalised in the Water Central Catchment Management Authority and Chairman of the Victorian Mineral Services Agreement that was signed on 28 August 2001 and runs for three Water Committee. He also has extensive experience in travel, transport and the years. Obligations covered under the Agreement are categorised as: tourism industries. • Service Obligations encompassing the agreed standards to be achieved for Patricia Cotton, MAICD the operating activities of the Authority. Many of the obligations of the Appointed to the Board in July 1998, Mrs Cotton is a former Councillor and twice Memorandum of Understanding signed with the State Government in Mayor of the City of Waverley, and a former Commissioner of the City of Knox. Mrs 1997 have been brought in to the Water Services Agreement as service Cotton is currently Chair of Peter Harcourt Services and the Bendigo and Central obligations. Victoria Community Foundation, and a Board member of Discovery Science and • Accountability Obligations covering standards that are set for effective Technology Centre. corporate governance and as required for compliance audits, compliance with laws and corporate planning and price determination processes. Jennifer Dawson, BBus, FCA, MICA, MAICD • Reporting Obligations under which Coliban Water has committed to a Ms Dawson has extensive experience in the accounting and auditing field, leading regular reporting schedule, including performance measurement targets. Bendigo Bank’s Internal Audit Group until her appointment as a non-executive Director of Bendigo Bank Limited in 1999. Ms Dawson has had 10 years experience with Responsibilities of the Board international accounting firm Arthur Andersen and is a Director of the Consumer The Board is responsible for the overall corporate governance of Coliban Utilities Advocacy Centre. She was appointed to the Board in October 2001. Water. This involves establishment and monitoring of corporate strategies, Shelley McGuinness, BAgSci(Hons), MAICD objectives and targets, implementation of appropriate monitoring and Ms McGuinness was appointed to the Board in October 2001. She has over nine years reporting systems to identify and manage business risk, assessment and experience in the Department of Natural Resources and Environment, including review of senior executive performance and remuneration and establishment catchment management, legislation and policy development and research in salinity of policies and procedures to ensure Coliban Water satisfies all its legal and and soil erosion. Ms McGuinness is currently a consultant with RM Consulting Group ethical responsibilities. providing strategic planning services in natural resource management. The Board meets monthly on a formal basis with informal meetings in- Fabian Reid, MAICD between to discuss specific issues and projects. A former teacher and senior advisor to the Premier of Victoria, Mr Reid manages a training and environmental management services company in Bendigo. Appointed to BOARD MEMBERS the Board in October 2001, he is also on the Board of Management of the Golden Dragon Museum and the Regional Advisory Board of La Trobe University Bendigo. Gordon McKern, FAICD, AASA, AFAIM – Chairman Mr McKern has been Chairman of Coliban Water since January 1994. He is also Keith Rowland, MAICD Chairman of McKern Building Products Pty Ltd, the Regional Advisory Board of La Trobe A motelier in Echuca for ten years, Mr Rowland was appointed to the Board in January University Bendigo and a Director of the Bendigo Art Gallery and the Spencer Street 1995. He is also a Director of Landrow Properties, with extensive experience in Station Authority. agriculture, marketing and property.

Table 3. Meetings of the Board

Board of Directors Audit Committee Risk Management Executive Management Committee Review Committee Director Eligible Eligible Eligible to Eligible to to attend Attended to attend Attended attend Attended attend Attended G McKern 13 13 * *** * * N Harvey 13 11 4 4 3 3 K Rowland 13 11 2 2 P Cotton 13 13 4 4 J Dawson 13 13 4 4 F Reid 13 13 3 3 2 2 S McGuinness 13 13 3 3 2 2

* The Board Chairman, Gordon McKern, is ex officio on all Board Committees.

Coliban Water / 2003 Annual Report P7 ORGANISATION CONTINUED

COMMITTEES OF THE BOARD OVERARCHING POLICIES Occupational Health and Safety There are four Board Committees covering Audit, Risk Management, Policy Environmental Policy Executive Management Review and Customer Service. Each Committee Coliban Water’s Occupational Health comprises three Directors except Customer Service, which is a committee Coliban Water recognises our and Safety (OHS) Policy affects all of one, with the Board Chairman serving as ex officio on all four. dependence on, and responsibility for, Coliban staff, contractors and the environment. We comply with all consultants operating on behalf of Audit Committee statutory and corporate requirements Coliban Water. The Audit Committee meets quarterly and at other times as required. and are committed to high standards of All staff work and behave in accordance The Committee is responsible for appointing and monitoring the environmental performance. Our with the values adopted by Coliban performance of the internal auditor, for reviewing and approving audit objectives are to: Water, particularly the principles of programs and for evaluating the adequacy and effectiveness of Coliban • Operate and invest in wastewater and equal opportunity; staff safety, well Water’s administrative, operating and accounting policies and controls. by-product treatment, re-use and being and development; and the pursuit The three Directors appointed to the Committee are Jennifer Dawson disposal systems to prevent pollution. of excellence and achievement. (Chairperson), Patricia Cotton and Noel Harvey. The Committee met four • Manage industrial trade waste All staff are provided with strict times during 2002/03. discharges to minimise the entry of guidelines for human resource practice, polluting substances to the Risk Management Committee reflecting these principles, as well as environment. The Risk Management Committee meets quarterly, ensures the standard OHS operating procedures. • Manage facilities and land in a integration within Coliban Water of an effective risk management manner which demonstrates good program to identify and control risk in decision-making, business Risk Management Policy environmental stewardship. planning and day-to-day operations. It is also responsible for ensuring Coliban Water’s Risk Management • Manage water supply and water the existence of planned strategies for dealing with major emergencies Policy is designed to demonstrate treatment operations to minimise likely to affect large numbers of customers or sections of the community, effective corporate governance and environmental impacts. to significantly impact on the environment or markedly restrict the ensure that Coliban Water can service provided by the business. • Promote and support catchment consistently meet or exceed its customer management practices that protect and shareholder expectations, business The three Directors appointed to the Committee are Noel Harvey drinking water supplies at source. targets, commitments, and regulatory (Chairperson), Shelley McGuinness and Fabian Reid. The Committee met • Undertake environment appraisal and and community demands. The policy three times during 2002/03. ensure the adoption of best practice includes a risk management program to Executive Management Review Committee environmental management of all identify and control risk in day-to-day The Committee, which meets at least half-yearly, is responsible for infrastructure design and construction. operations, as well as a planned ensuring that Coliban Water has remuneration policies and practices that The Environmental Policy is delivered by strategy for dealing with major fit the strategic goals of the business. It primarily focuses on senior Coliban Water’s Environmental emergencies, which could affect executive remuneration and performance but also considers the Management System (EMS), based on customers, community, the environment business’ overall approach to remuneration, current employment the International Standard ISO 14001. and provision of service. practices and compliance. The three Directors appointed to the Voluntary Economic, Committee are Keith Rowland (Chairperson), Fabian Reid and Shelley Emergency Management and Environmental and Social McGuinness. The Committee met twice during 2002/03. Response Plan Coliban Water’s Emergency Charters Customer Service Committee Management and Response Plan covers • Coliban Water is a member of the Established in August 2002, the Committee of one is responsible for the actions, roles and responsibilities of Greenhouse Challenge Program, a ensuring the existence of an effective customer service program to Coliban Water staff and others in the voluntary Commonwealth Government deliver results consistent with customer expectations. The Director case of a real or potential incident program aimed at reducing greenhouse appointed to the Committee is Patricia Cotton. The Director attended a which could threaten the health and gas emissions from industry (see page number of customer forums conducted during 2002/03, however, the safety of people, or cause damage to 26). committee did not meet formally. property or to the environment. The • We follow the guidelines of the objective of the Plan is for the staff of Australian National Committee on Large Coliban Water to be prepared to Dams (ANCOLD Inc). respond appropriately and efficiently to emergency situations that may occur.

P8 Coliban Water / 2003 Annual Report From left: Neil Burns, Andrew Hunt, Greg Sheehan, Denise Pendleton, Geoff Michell EXECUTIVE MANAGEMENT

Risk Management Customer Service Board Audit Committee Committee Committee

Executive Management Chief Executive Review Committee

Customer Business Operations Projects Planning Service & Services Administration

Chief Executive Executive Manager Planning Geoff Michell Greg Sheehan DipCE, MBA, MIEAust, MAICD BAgSc, BBus • Strategic planning • Asset management • Business direction • Infrastructure development • Audit • Capital planning • Environment Executive Manager Business • Water resource management Services Andrew Hunt Executive Manager Customer BEc, CPA, FAICD Service and Administration • Financial services Denise Pendleton • Secretariat BA, DipEd, GradDip(Comms Mgt), • Treasury GradDip(Media), GradCert(Mgt) • Business performance • Customer service • Information technology • Marketing and community relations Executive Manager Operations • Administrative services Neil Burns • Human resources DipCE • Industrial relations • Partnership • Operations • Revenue • Technical services • Laboratory • Headworks

Coliban Water / 2003 Annual Report P9 EXECUTIVE MANAGEMENT CONTINUED

MANAGEMENT SYSTEMS MEMBERSHIP OF INDUSTRY ASSOCIATIONS Coliban Water’s management systems comprise programs and procedures to Our principal industry and business association memberships assist to enhance economic, environmental and social performance. These include enhance our organisational benchmarking and network capabilities as major programs to improve performance, ongoing performance monitoring, well as to participate in the development of industry codes of practice: internal and external auditing and a regular senior management review. • Australian Water & Wastewater Operators Association • Our major programs to improve performance are anchored in the use of • WSAA Water Services Association of Australia the Australian Business Excellence Framework. • VWIA Victorian Water Industry Association • Performance in our operations and practices is benchmarked against • IWA Institute of Water Administration standards developed by the WSAA and Standards Australia to ensure that • IWA International Water Association performance of our operations continuously improves. • AWA Australian Water Association • In 2002/03 Coliban Water’s Projects Group upgraded their certification to • AIM Australian Institute of Management ISO 9001:2000 Quality Management Systems from the 1994 standard. • Society of Consumer Affairs Practitioners • We have adopted “SafetyMap” as the basis of our OHS system. • Australian Human Resources Institute • Australian Institute of Company Directors CERTIFICATION • ANCOLD Inc. Our current major partners have the following certifications: Veolia Water is working toward ISO 9000 as at 31/06/2003. In June 2003, Veolia achieved the following certifications: • Quality Management Systems AS/NZS ISO 9001:2000 • Environmental Management Systems AS/NZS ISO 14001:1996 • Occupational Health and Safety Management Systems AS/NZS ISO 4801:1996 As at 30/6/03, Henry Walker Eltin, Serco and CAMS had no certifications.

BUSINESS EXCELLENCE Since 1999, the Business Excellence Framework has been used as a tool for promoting sustainable, excellent performance by the business. The Framework is an integrated leadership and management system that describes the essential features, characteristics and approaches of organisational systems that promote sustainable, excellent performance. Coliban Water is working towards integrating Business Excellence Framework Enjoying a healthy drink at Coliban Water’s mobile water fountain, during Men’s Health Week principles into its Strategic Plan, operational plans, performance appraisal and project evaluation.

CONTRACTOR MANAGEMENT Coliban Water assesses all tenders from its suppliers using a qualitative process that includes a consideration of management systems that potential contractors have in place.

P10 Coliban Water / 2003 Annual Report ECONOMIC PERFORMANCE

Our gross revenue for 2002/03 was $45.6 million and there was a VARIANCE REPORT loss of $2 million. This compared to a loss of $26.6 million on $44.5 million of gross revenue for the previous year. 1. Long Term Profitability Indicator The financial year has provided many financial challenges for Coliban Water. 2. Owner’s Investment Indicator While the base fundamentals of the business remain sound, with strong The corporate plan target calculations for these indicators included underlying cash flows, high cash reserves and no debt, the loss of $2 million allowance for a 50% write down of fixed assets to their fair value in line has resulted from a combination of environmental circumstances, one-off with the requirements of AASB1041. The write down did not occur costs and the first full year impact of our major water treatment facilities at during 2002/03. Total assets are therefore significantly higher and the Bendigo, Castlemaine and Kyneton. resultant depreciation is approximately double what was allowed for in the corporate plan calculations. A number of assets completed in prior The long running drought has severely impacted the 2002/03 result. The financial years were recognised for the first time during 2002/03. This total impact on the business is estimated at some $2 million. resulted in considerable backlog depreciation for 2002/03. An offsetting influence has been the significant population growth that has Water restrictions associated with the drought led to lower revenue from occurred in some major centres in the Coliban region which has seen high rates and charges and higher operations, largely for water pumping development contributions and higher base fee income. costs, and administration costs for publicity and provision of information In order to provide superior water quality to our major centres at Bendigo, to customers. Coliban was also required to fund its share of the LAS Castlemaine, Kyneton and other smaller communities in the southern area, Defined Benefit superannuation scheme shortfall during the year. Coliban Water entered into a Partnerships Victoria arrangement with Veolia During the course of the financial year, Coliban Water finalised the Water to provide water treatment services for these towns. The scheme, now vacation of its premises at Alder Street in Golden Square. As the site is running successfully, incurred its first full year tolls in the 2002/03 financial to be redeveloped for urban housing, all of the buildings remaining on year. The contract will continue for 25 years. site have become redundant. Accordingly the gross asset value and Coliban Water, along with many other Water and Local Government accumulated depreciation of the Alder Street buildings have been Authorities, was required to contribute to the LAS Defined Benefit Fund as a written off. Total earnings for 2002/03 used in the calculation of this result of the funding shortfall experienced by the fund due to poor indicator were reduced as a result of the write off. stockmarket performance. Coliban Water contributed $359,000 to the fund, all of which was booked in the 2002/03 financial year. 3. Long Term Financial Viability Indicator The Long Term Financial Viability Indicator measures net debt as a Our old head office buildings at Alder Street Golden Square, now considered percentage of total assets. Coliban Water does not have any debt to be redundant, were written off at the commencement of the year. therefore the value of this indicator is zero. A backlog depreciation charge of over $600,000 was incurred on recalculation of the commencement date of a number of our Envirosafe 4. Liquidity and Debt Servicing Indicator sewerage schemes that had been overlooked in the prior financial year. The Liquidity and Debt Servicing Indicator measures the number of times interest expenses are covered by earnings. Coliban Water does not have Table 4. Coliban Water 2002/03 performance indicators any debt therefore the value of this indicator is zero. Business Plan Actual Result % Variance 5. Operating Efficiency Indicator Target 2002/03 2002/03 5.1 Water Supply Bulk (Headworks) 1 Long Term Profitability Indicator 1.3% -0.3% -124.4% 2 Owners Investment Indicator 1.3% -0.3% -124.4% Water Supply Bulk (Headworks) expenditure for 2002/03 bore a portion 3 Long Term Financial Viability of the Alder Street buildings write off amount and was therefore higher Indicator 0.0% 0.0% 0.0% than expected. 4 Liquidity and Debt Servicing Indicator 0.0% 0.0% 0.0% 5.3 Water Supply Treatment 5 Operating Efficiency Indicator ($ cost per ML) The actual volume of water supply treated during 2002/03 was 5.1 Water Supply Bulk (Headworks) $30.52 $34.59 -13.3% considerably higher than what was allowed for in the Corporate Plan 5.2 Water Supply Reticulation $299.89 $279.10 6.9% target calculation for this indicator. 5.3 Water Supply Treatment $598.18 $495.06 17.2% 5.4 Wastewater Reticulation 5.4 Wastewater Reticulation $312.93 $343.27 -9.7% 5.5 Wastewater Treatment $738.24 $752.03 -1.9% Wastewater Reticulation expenditure for 2002/03 bore a portion of the Alder Street buildings write off amount and was therefore higher than expected.

Coliban Water / 2003 Annual Report P11 The long running drought has severely impacted the 2002/03 result. The total impact on the business is estimated at some $2 million.

Economic Performance ECONOMIC FLOWS BETWEEN COLIBAN WATER AND OUR KEY STAKEHOLDERS Indicators This year Coliban Water’s remuneration to employees totalled $3.8 million. We also paid our suppliers $31.1 million The Economic Performance for the provision of goods and services. This included $9.2 million to Serco and $12.1 million as payments under two Indicators consider our impacts on Partnerships Victoria contracts for Castlemaine water reclamation plant, and water treatment services for Bendigo, the economic circumstances of Castlemaine and Kyneton. our stakeholders and on economic Our operating revenue for 2002/03 was $40.1 million of which $34.5 million was from rates and charges for our systems at the local and state and services. Developer contributions were $1.8 million. national levels. They cover both Community service obligations, funded by Government and provided by Coliban Water, were valued at $2.25 million. direct and indirect impacts. Coliban Water’s return on total assets (a long term profitability indicator) was -0.3% and the return on equity (an Indicators for measuring direct indicator of the return on the owners’ investment) was –0.3%. economic impacts are designed to measure the financial flows Coliban Water is included under Victoria’s State Tax Equivalent Regime. However our overall financial position in between the organisation and its 2002/03 does not require us to pay income tax. key economic stakeholders, for Contributed capital from the Victorian Government for sewerage schemes totaled $2.5 million. example, the value of net sales to customers or salaries to Table 5. Summary of Coliban Water’s economic impacts on our key stakeholders employees. Measuring indirect impacts is more difficult and for Aspect Performance Indicator 2002/03 2001/02 this year’s report we have limited Customers Monetary amount received and receivable from customers for the $40.051m $38.408m this to a discussion of some of our sales of products and services. interactions with the regional Suppliers Monetary payments and payables by Coliban Water to suppliers for $31.072m $19.409m economy in which we operate. all goods, materials and services purchased. Employees Monetary value of total remuneration to employees (all salary package $3.816m $3.466m payments including cash salaries, superannuation, salary sacrifice amounts for items such as cars, etc. Does not include salary oncosts such as payroll tax, workcover payments, fringe benefits tax) Providers of Return on equity -0.3% - 0.49% capital Public sector Total sum of taxes paid 01 01 State Government Dividend 02,3 $3.76m2 Value of community service obligations provided: • Provision of concessions to pensioners $1.972m $1.898m • Rebates paid to not-for-profit organisations under the water and $0.243m $0.229m sewerage rebate scheme • Utility relief grant scheme payments $3,613 $6,409 Contributed capital from the Victorian Government $2.529m $4.410m

1 Coliban Water was subject to the Victorian Tax Equivalent regime during 2002/03, however, because tax losses exceeded taxable profits, no tax will be paid. Barkers Creek Reservoir May 2003 following lowering for the Dams Improvement Project 2 The State Government Dividend is determined by the Treasurer following consultations between Coliban Water, the Minister and the Treasurer. 3 The process to determine the dividend applicable to the 2002/03 financial year has not yet been completed at the reporting date.

P12 Coliban Water / 2003 Annual Report ECONOMIC PERFORMANCE CONTINUED

Table 6. Summary of 2002/03 financial results

Summary of Financial Results 2002/03 2001/02 2000/01 1999/00 1998/99 ($ ‘000) ($ ‘000) ($ ‘000) ($ ‘000) ($ ‘000) REVENUE Revenue from ordinary activities 45,596 44,479 42,264 37,940 35,819 EXPENDITURE Expenditure from ordinary activities 46,878 36,847 31,745 30,679 28,975 Significant items of expenditure from ordinary activities 758 34,230 0 0 6,693 NET RESULTS (2,040) (26,598) 10,519 7,261 151

The Role of Coliban Water in • General manufacturing COMPETITION POLICY the Regional Economy • Laundries Coliban Water has substantially Coliban Water provides water and • Orchards implemented the National wastewater services to various • Vineyards/wineries Competition Policy agenda as far industries throughout its region. • Wholesale and retail nurseries as its scope of responsibility Types of industries include: • Health care permits. Coliban Water has had “pay for use” water pricing, • Sports (including horse racing, consisting of a fixed and a variable Food Processing golf, cricket, football, lawn bowls, (volumetric) charge for many years. • Dairying (milk & cheese tennis etc.) Cross subsidies between business production, milk powder, • Tourism yoghurts & dairy desserts) units are transparent and are • Mining reported in the Annual Report. • Tomato processing The quality of water is very • Baby foods Vertical structural and financial important to most of these separation of business functions • Canneries industries, particularly food has been in place for a number of • Small goods processing with the need to comply years and these business functions • Chicken and egg processors with Australian Standards for food are reported separately in the • Abattoirs (both general and production and export Annual Accounts. Coliban Water specialised) requirements. has introduced competition in • Pet food Clean water from the new water service delivery by the extensive • Piggeries treatment plants in Bendigo, involvement of the private sector. Castlemaine and Kyneton has This has been achieved through Other Industries proven a boon for other industries competitively bid Public Private • Tanning such as dyeing, which can now dye Partnership contracts for • Carpet & wool dyeing light colours on a regular basis infrastructure projects and by • Saleyards without fear of discolouration. outsourcing major functions. Coliban Water is closely involved in annual performance benchmarking studies through the Victorian Water Industry Association and Water Services Association of Australia.

Coliban Water / 2003 Annual Report P13 WATER OUTSOURCING WATER UTILITY SERVICES

WATER HARVESTING In July 1996, Coliban Water let a 3 + 2 + 2 year contract to Serco Coliban Water manages, maintains and operates over 50 reservoirs and Australia for the provision of Operations, Maintenance, Revenue Services, water storage basins across North-Central Victoria. The most notable of Information Technology and Laboratory Services. Unique in Australia in the these storages are the Upper Coliban, Lauriston and historic Malmsbury scope of services outsourced, the contract was a significant test of the Reservoirs - which together comprise the major catchment supplying the potential benefits to medium size water utilities from private sector Coliban System of Waterworks. partnerships in service (rather than infrastructure) delivery. This system supplies water to the majority of our urban customers living in In mid 2002, Coliban Water reviewed and developed an improved Bendigo, Castlemaine and Kyneton - as well as many smaller centres such as framework for tendering a new services outsourcing contract. Following a Harcourt, Maldon, Chewton, Tylden, Newstead, Fryerstown, Elphinstone, rigorous evaluation process, Coliban Water selected Campaspe Asset Taradale, Malmsbury and Guildford. Management Services Pty Ltd (a joint venture of United Utilities Australia Coliban Water has experienced a prolonged dry period, with the key Coliban and Origin Energy Asset Management) to enter into a 10 year (+ 5 year storages not having been full since December 2000. The Upper Coliban, option) contract commencing 1 July 2003. Lauriston and Malmsbury reservoirs decreased to a combined capacity of just The restructured ‘Provision of Services’ contract introduces a new level of 15.7% (11,800 ML) in late May. This was the lowest storage level since sophistication to outsourcing contracts in the manner in which it deals 1945 when they reached a low of 7,500 ML. with a number of perennial issues that surround KPI driven services The opportunity was taken to inspect and maintain the normally submerged contracts, including: inlet structure at Malmsbury Reservoir. The inlet was rebuilt in 1983 and had Maintenance management risk not been inspected since that time. A survey was also undertaken of our largest reservoir, Upper Coliban, to determine the impact of siltation. It was The long time frame of a 10 + 5 year contract eliminates many “grey” pleasing to find that siltation rates are very low with minimal capacity being areas of responsibility for maintenance that occur in shorter term lost over the last 60 years. contracts. There are only a small number of specific exclusions. Willows were removed from the river downstream of a number of Coliban Innovation and value adding Water dams in conjunction with the North Central Catchment Management The 10 year contract allows the contractor to confidently invest in Authority, removing this chokehold on the river. innovative solutions including work methods, communications and new technologies with sufficient time to recoup the investment.

Asset owner vs asset operator There is a recognised conflict between the interests of the asset owner and the asset operator, if they are different businesses. Typically, the asset owner will always look for an operational solution to service delivery issues, while the asset operator will similarly target capital solutions. Recognising the potential conflict, Coliban Water set up a Joint Asset Management Team which is responsible for analysis and recommendations for issues regarding asset build or refurbishment, maintenance management and asset management plans.

Key Performance Indicator (KPI) reporting and profit sacrifice Due to the breadth and complexity of the contract, the number of A drought affected Malmsbury Reservoir revealing the original 1874 outlet tower, bottom left performance indicators necessary to ensure maintenance of consistently high service standards across all aspects of the contract is substantial. Coliban Water has instituted a regime of a small number of critical Key Performance Indicators, where profit is at risk; and a system of Under Performance Points for all other performance measures, where a cumulative points system may lead to operational default or material default. This system provides an incentive to the contractor to focus on all aspects of the contract, rather than just a few key aspects.

P14 Coliban Water / 2003 Annual Report COLIBAN WATER’S WATER QUALITY IMPROVEMENT PROGRAM

WaterBITS – water treatment plants Water quality improvements are being implemented for a number of Coliban Water towns, through upgrading treatment plants under the $9.5 million WaterBITS program (Building Improved Treatment Systems). During the year, works were underway at the Cohuna, Lockington, Rochester and Boort water treatment plants.

Boort Water Treatment Plant Upgrade ($1.5 m) Boort Water Treatment Plant is being upgraded, including new water treatment systems and associated works to enable water treatment of up to 2.5 ML per day. During the year, new filters were installed, new waste disposal systems completed and the clarifier rehabilitated. Work will be completed in late 2003.

Cohuna Water Treatment Plant Upgrade ($2.7 m) Up to 5.5 ML of water each day will be able to be treated at the upgraded Cohuna Water Treatment Plant when it is completed in late 2003. During Beca’s Will Lamb working on the Rochester Water Treatment Plant upgrade the 2002/03 year, the clarifiers were refurbished, new filtration and waste Photo courtesy of Campaspe News handling systems installed, and new automated control systems and chemical treatment systems installed.

Lockington Water Treatment Plant Upgrade ($1.4 m) A new DAFF (Dissolved Air Flotation Filtration) plant has been installed at the Lockington Water Treatment Plant to provide up to 1 ML of treated water per day. A new plant control and automation system and waste disposal system was also under construction during the year.

Rochester Water Treatment Plant Upgrade ($3.4 m) A comprehensive upgrade of the Rochester Water Treatment Plant will provide better water quality to the town’s 1,466 customers as well as enhanced water security, with an increase in treatment capacity from 9.8 to 11 ML per day. During the year, six new water filters were installed, waste disposal systems Willow clearing at Malmsbury were under construction, clarifier rehabilitation completed, and chemical treatment systems installed. A new clear water storage tank will be constructed to hold 1.2 ML of treated water. This will increase the clear water storage capacity at the Rochester plant from 1.8 ML to 3 ML. Work will be completed in 2003.

WaterBITS – Pipelines Negotiations continued this year with landowners to create an easement for the Heathcote to Tooborac Pipeline. Once installed, the 12 km long pipe will carry high quality water pumped from the Heathcote Water Treatment Plant to a new storage tank at Tooborac – ending years of uncertain water supply. The town’s water is currently supplied by the McIvor Creek, which produces an unreliable flow in summer.

Coliban Water / 2003 Annual Report P15 Table 7. Drinking water quality

Water Quality at Customer Tap – 2002/03 WATER QUALITY COMMENTS Water Quality Guidelines E. coli Coliform Turbidity Colour pH Coliform failures (0/100 ml) (0/100 ml) (<5 NTU) (<15 NTU) (6.5-8.5) • Belvoir Park – failure due to depletion Supply Zone Target Target Target Target Target of chlorine residual through tanks ≥ 98% ≥ 95% ≥ 95% ≥ 95% ≥ 95% • Maldon – failure due to depletion of See relevant water quality comments below Actual % Actual % Actual % Actual % Actual % chlorine residual through transfer Fully Treated pipeline and tank Bendigo • Serpentine – failures due to operational Belvoir Park 100% 85% 100% 100% 100% problems with chlorinator Big Hill 100% 98% 100% 100% 100% • Bealiba – failure due to depletion of Edwards Road 100% 100% 100% 100% 100% Huntly 100% 98% 100% 100% 100% chlorine residual through transfer Marong 100% 96% 100% 100% 100% pipelines and tanks Sandhurst 100% 98% 98% 100% 96% • Bridgewater – failure due to chlorinator Specimen Hill 100% 98% 100% 100% 100% failure Strathfieldsaye/Junortoun 100% 92% 100% 100% 96% • Elmore – failures due to method of Castlemaine 100% 100% 100% 100% 100% Chewton 100% 100% 100% 100% 100% disinfection (UV does not provide a Echuca 100% 100% 100% 100% 100% disinfection residual in the reticulation Elphinstone/Taradale 100% 98% 100% 100% 75% system) Fryerstown 100% 98% 100% 100% 100% • Goornong – chlorinator failure Guildford 98% 98% 100% 100% 92% • Wedderburn – intermittent failure due Harcourt 100% 98% 100% 100% 67% to depletion of chlorine residual Heathcote 100% 100% 100% 100% 100% Kyneton 100% 100% 100% 100% 89% through transfer pipeline and tank Park Valley 100% 100% 100% 100% 100% • Strathfieldsaye / Junortoun – failures Leitchville 100% 100% 100% 100% 100% due to depletion of chlorine residual Maldon 100% 92% 100% 100% 76% through reticulation system. Malmsbury 100% 100% 100% 100% 54% • Inglewood – failures due to depletion Newstead 100% 98% 100% 100% 96% of chlorine residual through transfer Pyramid Hill 100% 98% 96% 100% 100% Raywood 100% 96% 100% 100% 96% pipeline and tank Rochester 100% 100% 92% 100% 100% Serpentine 98% 90% 100% 100% 100% Turbidity Trentham 100% 100% 100% 100% 100% • Rochester – two failures, one marginal Tylden 100% 100% 100% 100% 88% and the other due to change over to Partially Treated different water source. • Korong Vale – two failures, one Axedale 98% 98% 100% 100% 100% Bealiba 100% 67% 100% 100% 100% marginal and the other due to chemical Boort 100% 87% 100% 100% 100% dosing pump failure Bridgewater 100% 87% 100% 100% 100% • Lockington – plant incapable of Cohuna 100% 100% 100% 100% 100% meeting performance standards Dunolly 100% 100% 100% 100% 100% Elmore 100% 90% 96% 100% 100% pH Goornong 98% 94% 100% 100% 96% • Elphinstone, Guildford, Harcourt, Gunbower 100% 98% 100% 100% 100% Korong Vale 100% 98% 92% 100% 100% Maldon – failures marginal, associated Laanecoorie 100% 100% 100% 100% 100% with performance standards for Lockington 100% 100% 63% 100% 96% hardness and alkalinity at the Tarnagulla 100% 100% 100% 100% 100% Castlemaine Water Treatment Plant Tooborac 100% 98% 100% 100% 50% generally early in the reporting period Wedderburn 100% 94% 100% 100% 100% • Kyneton, Malmsbury, Tylden – failures Non-potable Actual % Actual % marginal, associated with performance Target N/A Target N/A standards for hardness and alkalinity at Borung 53% 0% the Kyneton Water Treatment Plant early Dingee 5% 0% in the reporting period Jarklin 28% 19% • Tooborac – Membrane plant - no pH Macorna 48% 29% correction installed Mitiamo 72% 6% Mysia 47% 25% Sebastian 88% 59% Wychitella 53% 3%

P16 Coliban Water / 2003 Annual Report WATER CONTINUED

WATER AND WASTEWATER SERVICES AND WATER CONSUMPTION DATA

Table 8. 2002/03 Water Consumption & Water Customer Numbers by System Water treatment processes

Water Supply Wastewater Water Supply Water Supply Total 3 Year average Consumption Residential Non Residential annual demand variation

System No. No. ML No. ML No. ML Potable Water Water Potable Alum Polyelectrolyte Carbon Dioxide Clarification Filtration Ozone Carbon Activated Chlorine Ammonia Ultraviolet Lime/Soda Ash Fluoride Axedale 106 27 11 7 117 34 39 -12% ••• Bendigo 33,268 32,700 8,949 2,937 3,313 35,637 12,262 15722 -22% ••• •••• •• Bealiba 85 16 14 2 99 18 20 -8% •• •• •• • Boort 8 372 144 128 73 500 217 273 -20% •• • • • Borung 23 5 3 0 26 5 4 16% Bridgewater 202 194 48 32 19 226 67 106 -37% ••••• Castlemaine 3,360 4,885 1,225 434 593 5,319 1,818 2429 -25% ••• •••• • Cohuna 1,040 1,174 669 162 105 1,336 774 672 15% •• • • • Dingee 31 8 14 3 45 11 14 -22% Dunolly 385 75 60 19 445 94 126 -26% •• •• •• • Echuca 5,435 5,113 2,025 738 1,546 5,851 3,571 3963 -10% •••••• Elmore 383 359 114 78 52 437 166 176 -6% • Elphinstone/Tarradale 219 47 16 6 235 53 77 -31% ••• •••• • Goornong 149 49 25 12 174 61 87 -30% ••••• Gunbower 125 53 44 18 169 71 86 -18% • Heathcote 758 1,008 209 127 80 1,135 289 314 -8% ••••• Inglewood 341 410 83 39 30 449 113 164 -31% ••••• Jarklin 9 2 4 1 13 3 7 -58% Korong Vale 131 23 8 1 139 24 116 -79% •• •• •• • Kyneton 2,198 2,090 434 376 390 2,466 824 922 -11% ••• •••• •• Laanecoorie 37 8 4 0 41 8 8 -4% •• •• •• • Leitchville 228 180 41 285 269 465 497 -7% ••••• Lockington 215 200 50 28 8 228 58 81 -29% ••••• Macorna 28 2 3 0 31 2 10 -83% Maldon 684 823 208 108 66 931 274 386 -29% ••• •••• • Malmsbury 246 236 43 25 7 261 50 78 -36% ••• •••• •• Mitiamo 52 11 11 3 63 14 29 -52% Mysia 10 1 2 0 12 1 2 -48% Newstead 289 62 38 13 327 75 103 -28% ••• •••• • Pyramid Hill 7 266 83 51 129 317 212 227 -7% •• •• • • Raywood 81 25 14 13 95 38 62 -39% ••••• Rochester 1,318 1,285 482 181 855 1,466 1,337 1501 -11% ••••• Sebastian 64 24 4 4 68 28 44 -36% • Serpentine 67 23 24 10 91 33 40 -16% •• •• • • Tarnagulla 119 17 13 7 132 24 31 -22% •• •• •• • Tooborac 52 10 9 1 61 11 15 -29% • Trentham 105 366 60 59 26 425 86 115 -26% ••• Tylden 48 102 15 11 4 113 19 23 -18% ••• •••• •• Wedderburn 448 78 58 23 506 101 126 -19% •• •• •• • Wychitella 13 2 2 0 15 2 2 -2% Total 49,616 54,334 15,589 5,936 7,724 60,270 23,313 28773 -19% Legend: • used in water treatment periodic as required microfiltered potable water

Coliban Water / 2003 Annual Report P17 WATER CONTINUED

Rural Usage An initial seasonal allocation of 60% licence volume was made on 16 September 2002 to licensees in the Coliban Rural System. The allocation was raised to 70% on 16 October, and did not rise further before the end of the season. Customers took delivery of 8,415ML of the water allocated, resulting in an overall usage of 56% of licence volume.

BULK WATER ENTITLEMENTS Coliban Water holds bulk water entitlements in the Campaspe, Coliban, Goulburn and Murray systems. The volumes taken during 2002/03 under these entitlements are as follows:

Table 9. Bulk Water Diversions for Coliban Water

System Entitlement Volume (ML) Volume Taken Notes

Campaspe Axedale & Goornong 215 183 Rochester 285 * 230 * Ten-year average must be below 134 ML/year.

Coliban Bendigo area, Castlemaine area, 21,807 ML from Malmsbury Reservoir to Coliban Main Channel Kyneton area, Heathcote area & 409 ML from Lake Eppalock to Heathcote Coliban Rural 50,260 33,962 10,229 ML from Lake Eppalock to Bendigo Pipeline 1017 ML from Lauriston Reservoir to Kyneton 500 ML from Lake Eppalock to Perseverance Mining

Goulburn Boort 283 * 228 Coliban Water transferred a total of 142 ML away from Boort BWE – 70 ML to Pyramid Hill BWE, 71 to wastewater treatment lagoons at Lockington, Pyramid Hill & Boort. Dingee 50 18 Lockington 130 87 Macorna 23 * 7 Coliban Water transferred 17 ML away from Macorna BWE to Pyramid Hill wastewater treatment lagoons. Mitiamo 60 60 Mysia 15 7 Pyramid Hill 370 * 370 Coliban Water transferred 70 ML to Pyramid Hill BWE from Boort BWE. Rochester 1,550 * 1,522 Coliban Water purchased 150 ML through Watermove water exchange to supplement Rochester’s base entitlement of 1400 ML.

Groundwater Elmore N/a 206 Diversion only - no BWE held Trentham N/a 119

Loddon Laanecoorie, Dunolly, Bealiba & Tarnagulla N/a 204 Diversion only - no BWE held Bridgewater & Inglewood N/a 305 Wimmera Korong Vale, Wedderburn, Borung & Wychitella N/a 370 Diversion only - no BWE held Murray Cohuna, Echuca, Gunbower & Leitchville 6,565 * 6,103 Coliban Water purchased 300 ML through Watermove water exchange to supplement its Murray base entitlement of 6,285 ML.

P18 Coliban Water / 2003 Annual Report WATER Works underway at Spring Gully Reservoir as part of the Dams Improvement Project CONTINUED

Temporary Transfer of Bulk Water Entitlement Coliban Main Channel Following completion of detailed The Coliban Main Channel is an designs, a contract was let to Watermove (formerly Northern Victorian Water Exchange) open gravity raw water delivery Geotech Pty Ltd to construct to Coliban Water system approximately 70 km in upgrade works to Spring Gully, Although 100% allocation was available, usage in many northern towns was length, which extends from Crusoe, Barkers Creek (outlet) and higher than normal due to the very dry spring period. Three purchases were Malmsbury Reservoir to the No.7 (spillway and beaching) necessary to ensure bulk water entitlements compliance at a total cost of Bendigo and Castlemaine areas. reservoirs. Construction works $111,877.50 (average $248 per ML): It has been in operation since its commenced early 2003. Following • 3 April 2003, 200 ML from Watermove to Murray Bulk Water Entitlement completion in 1877. The upgrade works to Crusoe and No.7 reservoirs, ownership of both • 17 April 2003, 100 ML from Watermove to Murray Bulk Water Entitlement rehabilitation strategy adopted for storages will be transferred as they • 17 April 2003, 150 ML from Watermove to Rochester Bulk Water this major channel provides for are no longer required for water Entitlement flume replacement and structural upgrades to be undertaken on supply. Coliban Water to Perseverance Mining regular basis. The ongoing capital GHD Pty Ltd was appointed to Coliban Water transferred water to Perseverance Exploration, Fosterville as investment program will enhance design the upgrade works required per the extended agreement to supply the mining company to 2007. both the medium and long term for the two Trentham reservoirs and Proceeds from this sale were $35,000: structural integrity requirements of Caledonia Reservoir. the channel. Rehabilitation work to • 15 August 2002, 500 ML from Lake Eppalock Bulk Water Entitlement to An Open Day was held for residents the value of $350,000 is currently Perseverance Mining. of Spring Gully in December 2002 in progress. where they were able to tour the Coliban Water to Coliban Water site, view plans and speak to staff Three transfers were made from bulk water entitlements held by Coliban SECURITY OF SUPPLY and contractors about the work. Water to other bulk water entitlements held by Coliban Water to ensure that Residents have been kept informed usage did not exceed allocation: Dams Improvement Project with newsletters during the process. • 16 April 2003, 36 ML from Boort Bulk Water Entitlement to Pyramid Hill The Dams Improvement Project is a Bulk Water Entitlement multimillion-dollar program • 29 May 2003, 35 ML from Boort Bulk Water Entitlement to Pyramid Hill currently underway to review, Bulk Water Entitlement prioritise and upgrade a number of • 13 June 2003, 50 ML from Boort Bulk Water Entitlement to Rochester Coliban Water’s dams in order to Bulk Water Entitlement. reduce associated risk. Five transfers were made from bulk water entitlements held by Coliban Water Most of the dams have been to water reclamation plants operated by Coliban Water to prevent drying out performing as designed for over and cracking of impervious lagoons: 100 years, however industry • 9 December 2002, 10 ML from Boort Bulk Water Entitlement to standards for design and Lockington Water Reclamation Plant construction have risen dramatically in recent decades. • 9 January 2003, 17 ML from Macorna Bulk Water Entitlement to Pyramid Hill Water Reclamation Plant The following storages form the • 18 February 2003, 14 ML from Boort Bulk Water Entitlement to basis of the dams requiring works Lockington Water Reclamation Plant under this project: • 1 May 2003, 42 ML from Boort Bulk Water Entitlement to Boort Water • In Bendigo – Big Hill, Spring Reclamation Plant Gully, No.7 and Crusoe • 1 May 2003, 5 ML from Boort Bulk Water Entitlement to Pyramid Hill • Near Harcourt – Barkers Creek Water Reclamation Plant • Near Heathcote – Caledonia • South of Tylden – Fernhill No.1 and No.2 • South-east of Trentham – Trentham No.1 and No.2.

Coliban Water / 2003 Annual Report P19 Upper Coliban Reservoir at 5% capacity May 2003 WATER CONTINUED

Water Restrictions Spring 2002 was one of the driest on record and the previous few seasons had been below average as well. WATER Consequently, the major headworks storages across northern Victoria began the year well below full capacity, and CONSERVATION were severely depleted by winter 2003. Model Water Wise Residential By November 2002, all towns across the Coliban Water region were on varying stages of Coliban Water’s 4 stage Development Water Restriction By-Law No. 6. Marketing and public relations activities focussed heavily on educating customers on the requirements of the various stages of water restrictions. The introduction of each stage of restriction Coliban Water faces a unique asset resulted in a 57%, then 27%, then 23% increase in customer enquiry calls. Over 1,380 reports of restriction disposal issue regarding the former breaches were investigated. Valuable lessons from the summer have been used in a review of the by-law which 7.5 hectare corporate headquarters commenced in April 2003. site at Alder Street, Golden Square. Rather than disposing of the site through outright sale Coliban Water Table 10. Water restrictions in the Coliban Region 2002/03 has recognised that the size and Supply system Summary of Restrictions 2002/03 location of this site affords an Campaspe opportunity to demonstrate water (Axedale & Goornong) Stage 1 introduced 18 November 2002. conservation with a model water wise Increased to Stage 2 on 31 March 2003. residential development. Coliban Stage 2 remained in force at 30 June 2003. Water and the Urban Regional Land Coliban Urban Development Corporation will jointly (Bendigo area, Castlemaine area, Stage 1 introduced 9 October 2002. develop some 90 residential blocks Elphinstone, Taradale, Raywood, Sebastian, Increased to Stage 2 on 1 January 2003. with the aim of modeling a new Malmsbury, Kyneton Tylden & Heathcote) Increased to Stage 3 on 31 March 2003. Increased to Stage 3 on 31 March 2003. standard of residential development in Stage 3 remained in force at 30 June 2003. North Central Victoria. Coliban Stage 2 introduced 18 September 2002. (Tooborac) Increased to Stage 3 on 17 March 2003 Water Conservation Stage 3 remained in force at 30 June 2003. A review of the Water Conservation Coliban Rural Initial seasonal allocation of 60% licence volume announced Plan commenced during the year, to 16 September 2002. reflect current seasonal conditions and Revised allocation of 70% licence volume announced on the security of our water resources. 16 October 2002. End of season allocation remained at 70% licence volume. The review is being undertaken in Goulburn Stage 1 introduced 18 November 2002. conjunction with a revision of the (Boort, Dingee, Lockington, Macorna, Increased to Stage 2 on 31 March 2003. Water Restriction By-Law. Mitiamo, Mysia, Pyramid Hill & Rochester) Stage 2 remained in force at 30 June 2003. Groundwater Stage 1 introduced 18 November 2002. (Elmore & Trentham) Increased to Stage 2 on 31 March 2003. Stage 2 remained in force at 30 June 2003. Loddon Stage 1 introduced 18 November 2002. (Bealiba, Bridgewater, Dunolly, Inglewood, Increased to Stage 2 on 31 March 2003. Jarklin, Laanecoorie, Serpentine & Tarnagulla) Stage 2 remained in force at 30 June 2003. Murray (Cohuna, Echuca, Gunbower & Leitchville) Stage 1 introduced 18 November 2002. Increased to Stage 2 on 31 March 2003. Stage 2 remained in force at 30 June 2003. Wimmera Korong Vale and Wedderburn were already on Stage 2 restrictions at the start of the year. (Borung, Korong Vale, Wedderburn & Wychitella) Borung and Wychitella opened the year on Stage 1. All towns increased to Stage 3 on 17 March 2003. Stage 3 remained in force at 30 June 2003.

P20 Coliban Water / 2003 Annual Report WASTEWATER From left: Geoff Michell, Doug Buerger (Bendigo Mining), Gordon McKern, The Hon. John Thwaites MP, Minister for Water at the launch of the Aqua Gold Alliance Photo courtesy of the Bendigo Advertiser

Coliban Water provides wastewater services to 49,616 properties WASTEWATER operation of the system. This in our region. Ten water reclamation plants are operated by COLLECTION included over 5km of sewer lining, Coliban Water, Veolia Water and Henry Walker Eltin. Those at Over the year we have continued 11km of root cutting and heavy Bendigo, Castlemaine and Kyneton provide tertiary treatment and our extensive program to provide cleaning as well as a significant the remainder are secondary treatment facilities. community sewerage schemes to number of access hole repairs. smaller towns, and to improve Two new plants at Pyramid Hill and Boort were commissioned during the Functional design environmental performance by year, but were not operational as at 30 June 2003. A functional design study was upgrading outdated water carried out to select suitable Table 11. Volumes of wastewater treated, effluent discharged and reused reclamation plants. alignments for 3.8km of sewer Town Volume of Volume of Volume of Sewer Improvement main duplication in Bendigo. sewage effluent effluent Strategy treated (ML) discharged (ML) reused (ML) Condition assessment In early 2002, Coliban Water Bendigo 7522 4310 1196 Condition assessment of an existing developed a $27m Sewer 600mm-diameter abandoned sewer Bridgewater/Inglewood 44 0 0 Improvement Strategy for the main to Bendigo’s Water sewerage systems in Bendigo, Castlemaine 976 976 0 Reclamation Plant was completed. Echuca, Castlemaine, Kyneton, Cohuna 304 0 0 The assessment determined the Rochester and Cohuna. The strategy Echuca 1938 0 981 structural condition of the sewer covers a range of system trunk main and identified suitable Elmore 37 0 0 improvement works including sewer rehabilitation options for possible main rehabilitation, sewage Heathcote 135 0 109 re-commissioning. Kyneton 641 380 276 pumping stations upgrade and system augmentation works. Lockington 23 0 0 Echuca sewerage system The Sewer Improvement Strategy A strategy development study for Rochester 278 0 265 project will be progressively the entire Echuca Sewer Collection implemented in a number of stages System was completed. The Water Reclamation Plants over the next 20 years. This existing sewerage transportation ‘Wastewater treatment plants’ are now referred to as ‘water reclamation financial year the following progress system was assessed and a system plants’. This change in terminology reflects a growing awareness of the need has been made: augmentation strategy developed to to develop sustainable water supplies. improve reliability, security and Sewer monitoring stations The long-term strategy of water reclamation plants is to reuse water from enhance system capacity for the In late 2002, eight permanent sewage treatment for industrial, agricultural and environmental uses. next 25 years. sewer monitoring stations were Reclaimed water is currently being used on agricultural land, and for the installed at key locations within the irrigation of Heathcote Golf Course. We now have only three plants that Bendigo sewerage system at a cost discharge off-site to waterways – Bendigo, Castlemaine and Kyneton. In of $180,000. The monitoring sites Bendigo we are pursuing an exciting initiative, the Aqua Gold Alliance, with have been integrated into Coliban Bendigo Mining to develop a plan for the sustainable reuse of reclaimed Water’s SCADA system to obtain water from both organisations’ water reclamation plants. Several reuse real time system performance as projects are under investigation including supply to a large mining operation, well as data storage for model existing agricultural areas north of Bendigo and new residential developments calibration and planning. in the Epsom/Huntly area. Plans are underway to provide reclaimed water for the irrigation of Kyneton Racecourse. Reclaimed water from the Campaspe Rehabilitation works Water Reclamation Project near Echuca will be used to supplement farming $1.3m of Stage 1 rehabilitation irrigation in the region. works were undertaken to restore Reclaimed water is monitored closely by Coliban Water and the Environment the structural integrity of the sewer Protection Authority to ensure compliance with strict water quality standards. trunk mains and to maximise Rehabilitating sewer mains

Coliban Water / 2003 Annual Report P21 WASTEWATER CONTINUED

ENVIROSAFE REDUCING INDUSTRIAL WASTE Envirosafe is a $44 million program of works aimed at improving local environments through the provision of high quality sewerage reticulation, Coliban Water has recently completed a number of Trade Waste treatment, disposal and reuse systems for 20 country towns in the Coliban Agreements with major food processing customers in Echuca providing region. significant reductions in waste. Customers have already achieved significant reductions in volume and load this season and are planning to In previous years, schemes at Maldon, Inglewood, Bridgewater, Marong, complete all waste minimisation actions required in the Trade Waste Huntly, two Echuca areas, Trentham, Tylden, Chewton, Campbells Creek and Harcourt were completed. Agreement prior to the next production season. Trial operations to date indicate the pre-treatment will achieve the required waste standards. The During the year $5.6 million schemes were completed at Pyramid Hill and following table outlines the reductions achieved through production Boort, and contracts were awarded for schemes at Gunbower, Leitchville, changes from March 2002 to March 2003 (March is a peak production Dunolly, Newstead, Wedderburn and Axedale. month). Coliban Water successfully met the Government deadline of having contracts awarded for all schemes by May 2003. This was a pleasing achievement as Table 12. Reducing industrial waste Coliban Water undertook more sewerage schemes than any other Victorian

Water Authority. 100% March 02 Construction is well advanced at Gunbower and Leitchville with all schemes March 03 75% due to be completed by June 2004. A wastewater treatment plant site was acquired for Wedderburn with EPA 50% works approval and planning approval obtained for treatment plants at 25% Dunolly, Wedderburn and Axedale. Tenders were called for provision of mechanical treatment plants at Axedale 0% and Wedderburn with contracts expected to be awarded by December 2003. Monthly Chemical Daily Volume Oxygen Suspended Extensive investigations have continued regarding reuse of reclaimed water at (kl) Demand Solids Max Axedale and an outcome is expected to be achieved late in 2003. (kg) (kg)

Terricks Road Sewer Trunk Main Replacement The main outfall sewer main that conveys all Echuca’s wastewater to the Quality of Wastewater Discharge water reclamation plant has suffered a number of bursts in recent years. These have impacted on the food processing industry, necessitating Coliban Water holds wastewater discharge licences from the EPA that set shutdowns during emergency repairs. limits for the volume and quality of discharges to land and water. They also set monitoring and reporting requirements. In 2002/03 we achieved 100% A detailed condition assessment was undertaken in November 2002, and compliance with our licence conditions in all towns except Bendigo, Kyneton, Coliban Water replaced and upsized 5.4km of pipeline in three stages at a Castlemaine and Rochester. cost of $1.6 million. The Bendigo Water Reclamation Plant exceeded the corporate compliance target during the year through improved treatment processes at the site. The WASTEWATER TREATMENT addition of filtration and UV disinfection has allowed for a more controlled Trade Waste approach to effluent quality. Coliban Water has 35 major customers. Together they contribute 12.9% of Works to substantially upgrade the Kyneton Water Reclamation Plant were Coliban Water’s total revenue. completed in late 2002. Subsequent non-compliances with the EPA Licence A major customer is defined as a customer: were due to initial difficulties in achieving plant optimisation. • who is being billed approximately $30,000 or more per annum on a single The Castlemaine Water Reclamation Plant did not fully comply with its EPA bill or assessment for any combination of services provided by Coliban Licence due to difficulties in treating loads from a major trade waste Water customer. Works to remedy this will be completed in 2003. • who, via a combination of assessments is being billed approximately Rochester Water Reclamation Plant showed a 12% reduction from the $50,000 or more per annum corporate compliance target due to the extremely dry spring/summer season. • who might significantly impact on an individual system, be it water or Heavy algal blooms within the system contributed to the non-compliance wastewater, having regard to the size and capacity of the system. with E.coli at the site.

P22 Coliban Water / 2003 Annual Report WASTEWATER CONTINUED

Table 13. Aggregate annual performance of treatment or disposal facilities The Reliability of Coliban Water’s Wastewater Collection System Town Corporate Plan ActualVariance Target %1 result %1 The number of confirmed sewage overflows per 100 kilometres of mains exceeded targets in Bendigo, Kyneton and Heathcote. This is attributed to dry Bendigo 96 98 2 conditions causing tree roots to seek moisture in the sewer mains. The root Bridgewater/Inglewood3 0 0 0 growth blocks the flow in the main resulting in overflows. The sewer mains Castlemaine2 n/a 97 in the Bendigo system are relatively shallow, making them particularly Cohuna n/a 100 susceptible to tree root invasion. Echuca n/a 100 Elmore3 0 0 0 Table 15. Reliability of our wastewater collection service Heathcote 100 100 0 Town Corporate Plan ActualVariance 2 Kyneton n/a 91 Target 1 Result 1 Lockington3 0 0 0 Bendigo 60.4 92.5 -32.1 Rochester 100 88 -12 Bridgewater/Inglewood 5.3 0 5.3 1 number of individual test results meeting EPA licence conditions / total number of individual Castlemaine 30.5 25 5.5 tests for the year x 100 Cohuna 5.9 5.9 0 2 EPA licence held by other parties 3 No discharge during the year Echuca 6 2.4 3.6 n/a No target set for 2002/03 Elmore 0 0 0 Heathcote 11.1 15.8 -4.7 Kyneton 15.6 15.9 -0.3 Table 14. Short term/persistent compliance with EPA licence Lockington 0 0 0 Malmsbury 0 0 0 Town Corporate Plan ActualVariance Target %1 result %1 Rochester 3.8 0 3.8 Bendigo 82 92 12 1 total number of confirmed sewage overflows per 100km of sewerage mains Bridgewater/Inglewood3 0 0 0 Castlemaine n/a 75 Cohuna n/a 100 Echuca n/a 100 Elmore3 0 0 0 Heathcote 100 100 0 Kyneton2 n/a 50 Lockington 0 0 0 Rochester 100 75 -25

1 number of sets of test results meeting EPA licence conditions / total number of sets of routine tests for the year x 100 2 EPA licence held by other parties 3 No discharge during the year n/a No target set for 2002/03

Coliban Water / 2003 Annual Report P23 RECLAIMED WATER AND BIOSOLIDS

Coliban Water considers reclaimed water to be an underutilised While a total re-use scheme is a Kyneton Water Reclamation and valuable resource. We are actively pursuing sustainable more expensive solution, using a Plant opportunities for further reuse for reclaimed waters from our public private partnership has The new Kyneton Water water reclamation plants that currently discharge to the provided a saving on traditional Reclamation Plant was officially environment. At present only three out of the ten water contract methods. The second opened by the Minister for Water, phase of the project, which involves reclamation plants discharge off site, with reclaimed water being The Hon. John Thwaites on 25 June the construction of a pipeline to used for irrigating crops and pastures on land owned by Coliban 2003. transport wastewater from Water, or for recreational areas such as the Heathcote Golf Course. The new plant was constructed and Rochester to the new plant will operated by Veolia Water under a At Bendigo, our largest plant, use of reclaimed water varies from 15% to commence in 2008. Design Build Operate contract. The 50% depending upon the season. We achieve this reuse through: Extensive consultation with major plant uses a biological nutrient • irrigation of 91 ha of pasture and trees on our own land trade waste customers in the removal process to treat domestic • supply of irrigation water to three farms directly adjacent to the plant in Echuca area has resulted in many wastewater to a tertiary standard. summer undertaking waste minimisation The process also involves • supply of treated water to downstream irrigators along the Bendigo Creek programs to reduce their waste load microscreening and disinfection of who have diversion licenses totalling in excess of 1,000 ML per year. on the new plant. the treated wastewater. An upgrade to the industrial waste At Kyneton approximately 30% of reclaimed water is used on Coliban Water Castlemaine Water land for crops and pastures. At Castlemaine there is currently no reuse of plant that treats waste from two Reclamation Plant reclaimed water. abattoirs and the saleyards was Castle Bacon is Coliban Water’s Biosolids reclaimed at the Bendigo and Castlemaine Water Reclamation also completed during the year. major trade waste customer Plants are currently being fully reused on agricultural land. In our other While less than 60% of treated serviced by the Castlemaine Water plants biosolids are periodically removed from lagoons and generally reused wastewater is currently released to Reclamation Plant. During the year, on land for agricultural purposes. We do not have large stockpiles of the Campaspe River, an additional Castle Bacon substantially biosolids. We have prepared a Biosolids Risk Assessment and Management 40 hectares of land adjacent to the completed the design and Strategy as required by the EPA. treatment plant is used for spray construction of a waste pre- irrigation of treated wastewater. Campaspe Water Reclamation Project (Echuca/Rochester) treatment plant to improve the quality of trade waste discharged to Off-site opportunities for reuse of A new $40 million water reclamation plant to service Echuca and Rochester the Castlemaine water reclamation the reclaimed water were is being constructed under a Partnerships Victoria arrangement where the plant. Partial funding was provided investigated during the year, plant will be built by a private sector consortium, and owned and operated by through Coliban Water from the including supplying the Kyneton them for 25 years before transferring back to Coliban Water. Regional Infrastructure Racecourse. The contract for the Echuca/Rochester Wastewater Treatment Plant was Development Fund for this project. signed with ETE Coliban Pty Ltd (a subsidiary of EarthTech) in November 2002. Substantial progress on the plant was achieved in the 2002/03 year. The new water reclamation plant is being built adjacent to the current plant in Terricks Road, Echuca. It will provide additional capacity and overcome environmental problems with the old lagoon style treatment plants in Echuca and Rochester – including odour, salinity and groundwater seepage. The new facilities will feature proven technology along with an innovative water re-use scheme. As part of the planning for the new plant, consultation with stakeholders including industry, community, EPA and Council showed that there was a very clear direction that highly treated wastewater should be reused on land, rather than discharged to the Murray River. When the new plant is complete in 2004, 100% of the treated water produced will be recycled to provide supplementary irrigation to farmland between Echuca and Rochester. Campaspe Water Reclamation Plant under construction

P24 Coliban Water / 2003 Annual Report Upgrading Bendigo Water Reclamation Plant Castle Bacon pre-treatment plant The Hon. John Thwaites, MP, Minister for Water, at the opening of Kyneton Water Reclamation Plant, with Veolia Water’s Jason Krzciuk Photo courtesy of the Bendigo Advertiser

Kyneton Racecourse Reclaimed Water Project Table 17. Wastewater sludge reused/recycled

In 2002 Coliban Water prepared preliminary designs for systems that would Town Corporate Plan ActualVariance use reclaimed water from the Kyneton Water Reclamation Plant to replace Target %1 Result %1 water currently being diverted from the Campaspe River at Kyneton. Bendigo 0 80 80 The systems investigated included irrigation of the Kyneton racecourse and a Bridgewater/Inglewood 0 0 0 number of other community facilities in the district. Castlemaine 0 84 84 The Kyneton District Racing Club currently pumps around 60 ML each year Cohuna 0 0 0 from the Campaspe River. However, through the summer drought of Echuca 0 0 0 2002/03, the river stopped flowing and the Club was forced to transfer one Elmore 0 0 0 race meeting. Heathcote 0 0 0 The Racing Club is now working in partnership with Coliban Water to build a Kyneton 0 0 0 system that will store and convey reclaimed water from the Kyneton plant to Lockington 0 0 0 the racecourse where it will be used for irrigation of the course and Rochester 0 0 0 conditioning of the sand training and trotting tracks. 1 volume sludge reused/total volume of sludge x 100 Bendigo Water Reclamation Plant Augmentation of the Bendigo Water Reclamation Plant to improve the EMMISSIONS, EFFLUENTS & WASTES quality of the treated effluent was completed during the year. Works Coliban Water does not use significant ozone depleting substances in its involved the construction of a 25 ML/day tertiary treatment facility to reduce operations and thus is not required to report. phosphorus levels from the previous limit of 2 mg/litre to 0.5 mg/litre. Nitrous oxides and other emissions are reported to the EPA under the The $5 million project was implemented under a Design and Construct National Pollutant Inventory. There are three Coliban Water wastewater contract awarded to a joint venture between Transfield and Montgomery treatment sites that trigger the reporting thresholds for these emissions. Watson Harza. Emissions of carbon dioxide are reported annually to the Greenhouse Office. Wastewater Effluent Reused and Sludge Reused/Recycled These emissions come from the burning of fossil fuel such as generation of Coliban Water recognises the potential value of treated effluent and biosolids electricity and fuel for vehicles. produced by our water reclamation plants. Through our private sector Table 18. Discharge of Treated Effluent to Waterways partnerships we seek to identify and develop opportunities for reuse and recycling. Plant Waterway

Table 16. Wastewater effluent reused to land Bendigo Water Reclamation Plant 4,310 ML to Bendigo Creek Castlemaine Water Reclamation Plant 976 ML to Campbells Creek Town Corporate Plan ActualVariance Target %1 Result %1 Kyneton Water Reclamation Plant 380 ML to Campaspe River Bendigo 26 22 -5 Bridgewater/Inglewood 0 0 0 Castlemaine 0 0 0 Cohuna 0 0 0 Echuca 40 51 11 Elmore 0 0 0 Heathcote 73 81 12 Kyneton 0 44 44 Lockington 0 0 0 Rochester 34 95 61

1 volume effluent reused/total volume of effluent produced x 100

Coliban Water / 2003 Annual Report P25 ENVIRONMENTAL PERFORMANCE

Coliban Water has continued working throughout the past year to ENERGY USE register, which is used if works are contribute to environmental sustainability particularly through our As a signatory to the Greenhouse required in these areas. active program of improving and extending our sewerage services. Challenge Program, Coliban Water There are four species within has carried out an energy audit of Coliban Water’s region listed under The environmental performance indicators adopted in this section of the the Bendigo Wastewater Treatment the Victorian Flora and Fauna report consider our impacts on living and non-living natural systems including Plant, which is our single biggest Guarantee Act (1998) in the form of ecosystems, land, air and water. power user. The audit revealed Action Statements and a further ten several opportunities for energy listed but do not have associated OVERVIEW OF OUR ENVIRONMENTAL MANAGEMENT saving and consequent reduction in action statements. There are many FRAMEWORK greenhouse gas emissions. other species listed under the Coliban Water does not draw on Victorian Rare or Threatened Environmental Management System any sources of renewable energy. species, which are documented. A revised Environmental Management System (EMS) based on ISO 14001 These lists are maintained in the was adopted in September 2001. As part of the EMS, formal environmental Biodiversity Action Plan and audits were carried out on Heathcote Water Treatment Plant, Heathcote BIODIVERSITY reviewed annually. Water Reclamation Plant and Laanecoorie Water Treatment Plant during the In accordance with the Water year. Apart from some minor non-conformances, the audits indicated Services Agreement requirements, ENERGY satisfactory environmental performance at those sites. Coliban Water has established a Total fuel usage by Coliban Water Our Emergency Management Plan was reviewed and revised to become the Biodiversity Register and is vehicles for 2002/03 was 58,975 Emergency Management and Response Plan. Our Environmental Policy is implementing the actions under the litres for 18 cars. Average fuel provided at page 8 of this report. Victorian Biodiversity strategy. usage was 11.69 litres per 100km. The Biodiversity Action Plan has Environmental incidents been developed with the aim of No Penalty Infringement Notices or Prosecutions were issued to Coliban creating awareness throughout the ABORIGINAL HERITAGE Water during the year. business of the need to protect all For projects with works on land flora and fauna species, particularly that may have local Aboriginal Report on EPA compliance those that are threatened or heritage interest, Coliban Water Coliban Water holds wastewater discharge licences from the EPA that set endangered, from any impacts our engages the services of an limits for the volume and quality of discharges to land and water. They also works may have on those species. archaeologist who undertakes the set monitoring and reporting requirements. In 2002/03 Coliban Water Coliban Water has integrated its appropriate searches for any known achieved 100% compliance with our licence conditions in all towns except strategy on biodiversity into a Aboriginal heritage sites on or near Bendigo, Rochester, Kyneton and Castlemaine. number of activities, including: the work site. The archaeologist • capital works may undertake a site inspection Water • planning approvals with a representative of the local The Bendigo, Castlemaine and Kyneton Water Reclamation Plants all • project investigations Aboriginal group to see if there is discharge treated effluent to a waterway. The act of discharging effluent into any evidence of earlier Aboriginal • public involved activities a waterway has the potential to alter the ecosystem or habitat. Coliban use of the area and/or determine including Waterwatch and the Water is looking at reuse options to reduce the amount of discharge and the the likelihood of the site being an Coliban Water Smart Gardens impact on the waterways. area of high Aboriginal heritage Competition Other activities that have the potential to affect ecosystems and habitat are sensitivity. In such instances, the • treatment plant operations – from construction and maintenance of infrastructure controlled by Coliban report may recommend that the Bendigo Water Reclamation Plant Water. These include discharge of water with high suspended solids into archaeologist and an Aboriginal is currently being registered as a waterways from disturbed areas under construction and accidental discharges representative witness the works Land for Wildlife site. of untreated sewage from spills and bursts. being undertaken in case There are a number of endangered Our strategies for reclaimed water use, particularly in those areas where there Aboriginal heritage items are or threatened species known to is discharge to waterways, will reduce environmental impacts in line with the unearthed. inhabit land owned by Coliban Government’s Healthy Rivers Strategy. Water. The location of these plants and animals are identified on a

P26 Coliban Water / 2003 Annual Report SOCIAL PERFORMANCE

Given the nature of the services provided, Coliban Water has The Office of Public Employment departments on various projects. important social interactions with customers and the broader continues to monitor Coliban All staff of Coliban Water and our community within which we operate. Equally important are our Water’s performance under the private sector partners are invited to responsibilities to our employees to provide a safe work environment Public Sector Management and attend. with a focus on enriching personal and professional lives. Employment Act 1998. During the Several staff surveys have been past year, in line with a new conducted to establish views on key This section of the report considers Coliban Water’s impacts on the social corporate plan, Coliban Water issues including a climate survey in systems within which we operate. continued to refine and develop its August 2002 and staff views on the human resource planning practice, Select Program in June. Areas for through more effective use of OUR STAFF action are being developed through workforce planning tools. These will As at 30 June 2003, Coliban Water employed 61 permanent staff members. the Select program. be actively tested in the course of Employee turnover rate in 2002/03 was 9%, down from 13% in 2001/02. the coming year and will focus on Table 19. Profile of Coliban Water staff by function performance against plans, training and development, and performance 2002/03 2001/02 assessment. Chief Executive 3 2 In the course of the past financial Business Services 8 7 year a number of employee work Operations, Headworks, Projects 20 19 groups have been established. Customer Service & Administration 19 19 Employee Consultation Coliban Water Enterprise Planning 11 8 Agreement 2001 An employee committee has been Total 61 55 established to facilitate negotiations The Coliban Water Enterprise for a new Certified Agreement. Agreement came into force in Table 20. Profile of Coliban Water staff by gender and employment type as at 30 June 2003 Regular meetings from an early January 2001 and extends for three stage of the process have been years. It covers all areas of Number of employees established to ensure that there is employment including hours of work, wage rises by agreement, all Full time employment 55 scope for full staff participation in the process. leave provisions including long Part time employment 6 An employee committee is service and maternity/paternity Permanent employment 61 developing the SELECT program, leave, rostered days off, grievances Casual and temporary employment 1 which is designed to help position and future negotiations for the next Female 20 Coliban Water as an “employer of agreement. Male 41 choice.” It covers the dimensions of The first two years of the work environment; professional Agreement were completed with no Staff diversity not captured development; personal industrial disputes. Employees have Full time equivalent number of staff (FTE) 58.7 development; work/life balance; continued to demonstrate health and fitness; and social commitment to productivity Employment Practices development. improvements and these have been Coliban Water continues to subscribe to the principles of merit and equity, as Regular staff briefings are held to recognised through awarding the evidenced through our application of policies and business conduct in relation ensure staff are kept abreast of next salary increase as part of the to equal employment opportunity, sexual harassment, rehabilitation, training developments in the water industry, agreement in place. and external study. Over the past year Coliban Water continued to reinforce current projects, plus any specific 82% of employees are covered by staff understanding of their obligations in regard to issues such as harassment major operational issues such as the Coliban Water Enterprise in the workplace and the code of conduct. water restrictions. Agreement 2001. Information on Our code of conduct outlines acceptable behaviour in relation to business Staff organised and conducted the percentage of employees ethics, solicitation of rewards, conflict of interest and external work. These monthly “LunchBox” sessions represented by a trade union is elements have been built into our inductions and performance assessment during the year, designed to sensitive information that is not programs. communicate the ongoing work of collected by Coliban Water.

Coliban Water / 2003 Annual Report P27 SOCIAL PERFORMANCE CONTINUED

Staff Recognition Table 21. Practices for recording burst water mains or wastewater and notification of occupational spills and options for payment. The ‘Whatever It Takes’ Award operated throughout 2002/03 to recognise accidents and disease: staff who go above and beyond the call of duty to help a customer, a Coliban Water produces a summary Reportable incidents 2 colleague or a project. of the Charter, which is supplied to Workers compensation each new customer. When revisions claims 2 Training are required, the Charter is revised Injury resulting in days Coliban Water supports training in the work place to improve employee lost 1 in consultation with customers. professional and personal development. Training is planned on an annual Lost time due to injuries 413.5 hrs basis through the organisation’s appraisal and workforce planning Focus Groups Days lost per employee 0.75 arrangements. Through this process, employees are encouraged to work with Coliban Water holds focus groups their supervisors to plan a structured approach to training over the course of of small numbers of customers to the year. The majority of the lost time injury discuss specific service and other A range of corporate training programs is offered to staff to maintain a high resulted from a motor vehicle issues in depth. Working with level of competency across the business. During the past financial year, accident reported in 2001/02. specific customer segments is a training continued to be managed on a department by department basis priority, and the sessions are very well received by participants. using key corporate guidelines and all employees underwent some form of STAKEHOLDER • One focus group was held in approved training during the year. ENGAGEMENT Bendigo in June as part of an The average time devoted to training in 2002/03 is estimated to be 19.6 Coliban Water has continued to ongoing review of Coliban hours per employee. build on its commitment to keeping Water’s Water Restriction By-law, We split training into three areas: stakeholders – including customers, with meetings to be held in other • statutory training covering training required by law such as OHS, legal staff, government, the community localities in August/September updates and EEO and business partners – informed 2003. on all aspects of its business • professional development covering, for example, computer training and • A full day focus group/workshop operations. This includes providing professional development courses and workshops was held with Primary School accurate and timely information • personal development covering areas such as life skills and stress teachers to gain feedback and about projects and works affecting management. input into Coliban Water’s customers, as well as educating the education program. Occupational Health and Safety community on water conservation • Coliban Water met with Council practices and using water wisely. In September 2002 the Manager Projects was delegated the management Recreational Officers in responsibility for Occupational Health and Safety. This was an outcome of Activities include regular November 2002 to discuss the recommendations from the previous year’s audit that senior contract newsletters, brochures and media impacts of the imposition of management staff be represented on the OHS committee. Seven OHS releases to inform customers and water restrictions at Stage 1 and Committee meetings were held during the year. the public on service improvements, 2 levels, and to help identify key A further recommendation addressed was the revision of Coliban Water’s issues, projects and water issues for sportsground water OHS Manual to enable more effective OHS management of contractors. conservation. management. Subsequently a more specific contractor management section was Customer Consultation incorporated into the Manual. Coliban also developed a Contractor Safety Rural Customer Advisory Processes Handbook and a Contractor Safety Plan manual for contractors without their Group own system. Customer Charter The Rural Customer Advisory Group (established in January 2002) A staff Workplace Safety Handbook was developed and issued to all staff, The Coliban Water Customer includes representatives of Rural and staff continue to receive regular training and updates on OHS matters. Charter outlines the rights and Licence Holders, the Harcourt Fruit Coliban Water appointed a panel of OHS consultants to provide specialist obligations of Coliban Water and its Growers Association and the advice and undertake workplace audits. Records of workplace and project customers, and outlines provisions Victorian Farmers Federation. This audits are retained by the business. such as water supply, wastewater group met 6 times throughout the and trade waste services. It details year. They have provided direct information on rural water billing input into the development of the periods, emergency services for Rural Customer Charter, which has

P28 Coliban Water / 2003 Annual Report 94% of coliban water’s customers are satisfied, with 34% extremely satisfied.

now been adopted. It addresses the specific rights and responsibilities of this Table 22. Annual Customer Satisfaction Survey group and Coliban Water regarding service to rural customers. They have also helped develop a survey of Rural Customers which will be conducted in Overall satisfaction: 94% satisfied, 34% extremely satisfied 2003/04. They also contributed to an ongoing review of the rural licence Aggregated satisfaction: 91% satisfied, 42% extremely satisfied system.

Customer Contact and Field Services Survey 91 92 91 100% 88 88 89 The Customer Contact and Field Services Survey was undertaken in October 80% 2002 surveying people who have contacted the Customer Contact Centre 60% 46 47 during the survey period. The survey monitors satisfaction levels for Coliban’s 39 38 41 42 general service, repair and maintenance. Customers overall are very satisfied 40% with the services provided. Improvements were noted in nearly all areas, 20% with an increase from 86% to 92% of people satisfied. The results indicate that customers find dealing with our contact centre and field staff a pleasant 0% experience. Areas identified during the study for improvement included 1997 1998 1999 2000 2001 2002 giving consistent information, keeping customers informed on the progress of repair works and reinstating sites after maintenance. Extremely Satisfied Satisfied

Annual Urban Residential Customer Satisfaction Survey The Annual Urban Residential Customer Satisfaction Survey covers a broad range of questions about Coliban Water’s service provision across 56 specific 93% issues on water supply, water quality, sewerage, the environment, billing and Water Quality pricing, service difficulties, information, staff and management performance. 94% The 8th Annual Customer Satisfaction Survey, conducted in December 2002, Water Supply again showed strong customer support, with nine out of 10 customers satisfied with Coliban Water’s services and activities. For average satisfaction 98% across all service areas, some nine in ten (91%) of customers are satisfied, a Sewerage slight increase on the 2001 result. Customers who are extremely satisfied (42%) has continued to maintain an upwards trend. When asked directly 93% how satisfied customers are with Coliban Water overall, 94% of respondents The Environment were satisfied, with 34% extremely satisfied. 96% In previous years, water quality was identified by customers as their highest Billing priority for improvement in most regions. The improvement in water quality resulting from the AQUA water treatment plants in Bendigo, Castlemaine and 73% Kyneton helped generate a significant improvement to 93% satisfied, up from Service Difficulties 69% the previous year. 89% Other significant changes include an extremely high 98% of customers satisfied with sewerage services, an excellent result reflecting the ongoing Information work to sewer small towns across the region. While the measure for service difficulties showed a drop in satisfaction from 87% to 73%, this result is 0% 20% 40% 60% 80% 100% unreliable due to the extremely small sub-sample size. 2002 2001 2000 1999 1998 1997 Newsletters and public information Coliban Water utilises a range of publications to notify the community about specific issues. Regular newsletters for past projects have included the Envirosafe Sewerage Scheme Newsletter and the Castlemaine Water Reclamation Plant Newsletter. Advertising, letterbox drops and editorials are also regularly used.

Coliban Water / 2003 Annual Report P29 SOCIAL PERFORMANCE CONTINUED

Other Consultation Smart Gardens principles which will not only assist • Consultations through Campaspe Shire Council with local Aboriginal During 2002 the fourth annual in rehabilitating gardens from the groups regarding works for the Rochester Water Treatment Plant. Coliban Water Smart Gardens effects of the drought but also • Dams Improvement Project consulted with Heritage Victoria regarding Competition was conducted, replanting to cope with dry heritage issues at six dams not currently on the Victorian Heritage Register. attracting over ninety entries across conditions in the future. Workshops are conducted by Smart Gardens • Our Biosolids Research, Design and Demonstration program with eight different categories. The Competition judges Kevin Walsh and Perseverance Mining has seen us consult with the EPA. competition encourages waterwise Greg Guy at the BRIT Department of • During 2002/03 we have commenced development of a Barkers Creek and other environmentally sound Horticulture, and are provided free Reservoir Recreational Management Plan. This has seen us consult with gardening principles and practices of charge for Coliban Water VRFish, Mount Alexander Shire Council, environmental reference groups, through the judging criteria. customers. neighbours and Bendigo Regional Institute of Technology. Owing to continuing drought conditions over the summer and low The Coliban Water Smart Gardens Policies to manage the organisation’s impacts on storage levels, it was decided to Competition and Drought Response communities and programs to address this issue including replace the 2003 Garden Initiative are joint projects of monitoring surveys Competition with an education Coliban Water, the City of Greater Bendigo and the Department of All major planning projects require, by their nature, intensive liaison with a program entitled the “Coliban Water Primary Industries, with the support range of stakeholders to identify issues and address concerns. Coliban Water’s Smart Gardens Drought Repair of the Bendigo Advertiser, BRIT, Quality Management System for projects documents procedures to be applied Initiative”. This educational program Prime Television, ABC Radio and in undertaking all capital projects. It requires the development of an Issues for gardeners has been devised to many local businesses. Paper which includes the identification of all stakeholders and their likely address the impact of the drought, which has affected gardens issues of concern. The Project Plan is derived from this and a Multicultural Communications communications and consultation component is developed. Activities that throughout the City of Greater Coliban Water notes the importance are then usually undertaken are: newsletters; open days; site inspections and Bendigo. of delivering culturally appropriate meetings and media briefings. Depending on the issues associated with a The initiative comprises a community services and believes its service and particular project, further detailed assessments/reports may be required, eg. education strategy of workshops, customer communications reflect the environmental, aboriginal, heritage, workshops/meetings with key information sheets and bus tours of cultural needs and expectations of stakeholders (other authorities, special interest groups, customers). Required gardens, demonstrating waterwise its customers. approvals are then sought prior to works commencing. planning and management

Public Education Coliban Water’s education program continues to provide curriculum support for schools with our Education Officer available for in-servicing teachers, classroom presentations, student activities, tours of installations and providing project materials for students. Broader community education is also catered for through the provision of presentations and activities for a range of community groups throughout the year. The drought has affected communities throughout the region and schools in particular have shown a high level of interest in dealing with the topic. Professional development sessions on “water education” have been offered to teachers preparing for water-related units and activities in their schools. In addition a workshop for primary teachers was conducted to assist in evaluating the Coliban Water education program. Coliban Water continues to be a major sponsor of North Central Waterwatch, actively supporting schools education. Some of the Waterwatch projects this year included water quality snapshots such as Saltwatch, the “Create-a-

Critter” competition and for National Water Week, Catchment Tours and Pat Cotton, Director, makes a presentation at the the annual Poster competition. Coliban Water Smart Gardens Competition Awards

P30 Coliban Water / 2003 Annual Report SOCIAL PERFORMANCE CONTINUED

Customer Complaints Energy & Water Ombudsman Coliban Water recognises and welcomes the rights of our customers to lodge Coliban Water is a participant in the Energy and Water Ombudsman (Victoria) complaints if they are unhappy with any aspect of the services we provide for Scheme. During 2002/03, Coliban worked with the Energy and Water them. Every complaint expressed to us is an opportunity to improve on the Ombudsman’s office to resolve a small number of complaints from customers high levels of service already delivered. unable to be resolved at the organisational level. Coliban Water has participated, during the past year, in water industry Eleven new cases were listed for investigation. There were four cases still discussions and investigations into a number of customer handling initiatives, active from 2001/02. During the year 11 cases were resolved, five of which including the development of an industry-wide approach to handling were resolved in Coliban’s favour. At 30 June 2003 there were still four customer hardship, as well as a customer complaints approach and manual open cases. Issues raised included debt recovery; water consumption; sewer (developed through VicWater). Coliban Water uses AS 4269 – 1995 overflows; access charges; shared meters; responsibility for maintenance; Complaints Handling as the basis of its policy for dealing with customer objection to proposed Water Reclamation Plant site; and establishment of complaints. Over the course of the next financial year, Coliban Water will crossings over rural channels. review this approach as part of a move towards industry best practice in service provision.

Water Smart Gardens and Homes Rebate Coliban Water promoted the Government’s water rebate scheme, distributing information at major events and displays. A total of 179 successful rebates for $10,810 were processed.

Table 23. Customer complaints performance indicators

Customer Service Corporate Plan Actual Variance Target 2002/03 Water Quality Complaints Per 1000 Customers 7.4 6.3 1.11 Water Supply Complaints Per 1000 Customers 72.3 94.3 -222 City of Greater Bendigo Mayor, Rod Fyffe, with St Monica’s Primary School students at the Sewer Service Complaints launch of the Coliban Water Smart Gardens Drought Repair Initiative Per 1000 Customers 92.1 50.5 41.63 Affordability Complaints Per 1000 Customers 48.0 21.5 26.54 All Other Complaints Per 1000 Customers 12.5 7.4 -5.15

Note: As this is a new performance indicator, setting of targets and reporting of results will become more refined as we improve the reliability of our data. 1 Water quality complaint reduction based on significant improvement to major towns via AQUA project. 2 Customer complaints relevant to bursts have been included for the first time. 3 Customer complaints relevant to customer contributions to the Envirosafe Sewerage Schemes have been incorrectly included in this data in previous years. 4 A review of the complaints criteria identified inclusion of non-relevant customer contacts in past data supplied for affordability complaints. 5 Reclassification of report codes to better reflect actual complaints (rather than queries) has influenced data.

Coliban Water / 2003 Annual Report P31 STATEMENT OF FINANCIAL PERFORMANCE YEAR ENDED 30 JUNE 2003

P32 Coliban Water / 2003 Annual Report STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2003

Coliban Water / 2003 Annual Report P33 CASH FLOW STATEMENT FOR THE YEAR ENDED 30 JUNE 2003

P34 Coliban Water / 2003 Annual Report NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

Coliban Water / 2003 Annual Report P35 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P37 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P39 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P41 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P43 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P45 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P47 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P49 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P51 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P53 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P55 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P57 NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2003

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Coliban Water / 2003 Annual Report P61 AUDITOR GENERAL’S REPORT

P62 Coliban Water / 2003 Annual Report APPENDIX

AUDITOR Auditor General, Victoria

MAJOR CONSULTANCIES Coliban Water undertook during 2002/03 seven major projects involving consultancies with a value exceeding $100,000, as listed below: • Dams Improvement Project – $635,983 GHD Pty Ltd, SMEC Victoria Pty Ltd, Coffey Geosciences Pty Ltd, DamWatch, Biosis Research, KDW Personnel Consultants. • Envirosafe – $436,026 EPS Australia, Nolan ITU, SMEC Victoria Pty Ltd, Beca, RPD Group • Bendigo Water Supply Strategy - $110,000 Beca • Campaspe Water Reclamation Project (Echuca/Rochester Wastewater Scheme) - $221,133 EPS, Probity Investigation Consultant, AFS & Associates, Blake Dawson Waldron, PricewaterhouseCoopers • WaterBITS - $1,230,000 Beca • Information Technology - $208,797 IMS • Provision of Services - $508,204 IDSM, Blake Dawson Waldron, Beca, Probity Information Services, Safety at Work (Vic) Pty Ltd, AFS & Associates, RSD

MINOR CONSULTANCIES During 2002/03 eighteen projects, involving the engagement of consultants at a cost less than $100,000 each, were undertaken for a total expenditure of $540,860.

WHISTLEBLOWERS PROTECTION ACT 2001 No disclosures have been made or referred under the Whistleblowers Protection Act since its commencement January 2002.

COMPLIANCE WITH THE BUILDING ACT Through its ongoing monitoring and maintenance programs, over the past year Coliban Water continued to ensure that properties under its control and/or ownership complied with the Building Act 1993.

ORGANISATIONAL CHANGES There have been no significant changes in size, structure, ownership or regulation during the 2002/03 reporting period

DISCLOSURE OF MAJOR CONTRACTS Two contracts with a value greater than $10 million were entered into by Coliban Water during 2002/03. • The provision of services contract with Campaspe Asset Management Services (with a value of $100 million) was signed on 20 June 2003. • The Campaspe Water Reclamation Project contract with EarthTech (with a value of $40 million) was signed on 6 November 2002. Coliban Water has disclosed all contracts greater than $10 million in value which it entered into in 2002/03. The disclosed contracts can be viewed on www.tenders.vic.gov.au/contracts

PRIVACY All staff have been trained in the requirements for compliance with Coliban Water’s Privacy Policy.

FREEDOM OF INFORMATION The following officers have been appointed in accordance with the provisions of the Freedom of Information Act 1982: Principal Officer – Chief Executive Authorised Officer – Corporate Secretary Coliban Water did not receive any Freedom of Information applications during 2002/03.

ADDITIONAL INFORMATION Additional information about Coliban Water’s operations and performance is provided by the following sources: • Coliban Water Strategic Plan 2002-2007 • previous annual reports • website www.coliban.com.au • the Customer Charter. The information listed in Part 9.1.3(iv) of the Directions of the Minister for Finance under the Financial Management Act 1994 is available on request. Copies of our publications are available from our offices at 37-45 Bridge St, Bendigo, Victoria. Other Relevant Reports and mechanisms for report users to gain additional information on economic, social and environmental activities: • We continue to subscribe to the Greenhouse Challenge of the Australian Greenhouse Office. Annual report provided to and summary information available at www.greenhouse.gov.au/challenge. • We continue to subscribe to the Victorian Biodiversity Strategy and this information is available from www.environment.vic.gov.au. • Further pollutant emissions information can be found through the National Pollutant Inventory of the Commonwealth Government at http://www.npi.gov.au. Our major service providers in 2003 were: • Henry Walker Eltin www.hwe.com.au • Serco www.serco.com • Veolia Water www.veolia.com.au. Annual reports for each of the above are available on their websites.

Coliban Water / 2003 Annual Report P63 YOUR FEEDBACK WE VALUE YOUR THOUGHTS

The Coliban Water 2002/03 Annual Report is our first triple bottom line report. By adopting this format we have aimed to provide you with clear and pertinent information on our economic, social and environmental performance. Triple bottom line reporting is a continuous improvement process and we value your feedback on our report. Please take a minute to complete the following questionnaire.

1. How do you rate the report in providing you with the 8. What relevant issues do you think were not covered or were information you need to assess the performance of Coliban not covered sufficiently? Water? not informative informative very informative

2. How do you rate the section on Organisation, Profile and Executive Management? did not read 9. How did you find the presentation of information in the not informative tables? informative difficult to understand very informative mostly clear and understandable very clear and easy to understand 3. How do you rate the section on Economic Performance? did not read 10. How did you find the amount of information provided? not informative not enough detail provided informative amount of detail about right very informative too detailed

4. How do you rate the section on Water and Wastewater? 11. How did you find the length of the report overall? did not read too short not informative about right informative too long very informative 12. What in your opinion could Coliban Water do to improve this report next year? 5. How do you rate the section on Environmental Performance? did not read not informative informative very informative

6. How do you rate the section on Social Performance? did not read 13. My interest in Coliban Water’s Annual Report is as a: not informative customer informative employee very informative regulatory body 7. How did you find the presentation of information in the text environmental group of sections you read? community group difficult to understand other, please specify: mostly clear and understandable very clear and easy to understand

Thank you for your help. Please return the completed questionnaire to: Executive Manager Customer Service & Administration Coliban Water, PO Box 2770, Bendigo DC 3554 Fax to (03) 5434 1341 or email [email protected]

P64 Coliban Water / 2003 Annual Report COMPLIANCE INDEX INDEX OF TABLES DISCLOSURE REQUIREMENTS AND GRAPHS

The Annual Report of Coliban Water has been prepared in accordance with the Financial Management Act 1994 and the Directions of the Minister for Finance. This index has been prepared to facilitate identification of compliance with statutory disclosure and other requirements.

Clause Disclosure Page No. Description Page REPORT OF OPERATIONS 1 The value of assets owned by Coliban Water 5 Charter and Purpose 2 Reliability of supply – urban water supplies 6 9.1.3 (i)(a) Manner of establishment and Relevant Minister 4 3 Meetings of the Board 7 9.1.3 (i)(b) Objectives, functions, powers and duties 3, 4, 6 4 Coliban Water 2002/03 performance indicators 11 9.1.3 (i)(c) Services provided and persons or sections of community served 4, 5, 6, 13, 17, 21 5 Summary of Coliban Water’s economic impacts on our 12 Management and Structure key stakeholders 9.1.3 (i)(d)(i) Names of governing board members, audit committee & chief executive 7, 8, 9 6 Summary of 2002/03 financial results 13 9.1.3 (i)(d)(ii) Names of senior office holders and brief description of each office 9 7 Drinking water quality 16 9.1.3 (i)(d)(iii) Chart setting out organisational structure 9 8 Water and Wastewater services and water consumption data 17 9.1.3 (i)(e) Workforce data and application of merit and equity principles 27 9 Bulk Water Diversions for Coliban Water 18 9.1.3 (i)(f) Application and operation of FOI Act 1982 63 10 Water restrictions in the Coliban Region 2002/03 20 Financial and Other Information 11 Volumes of wastewater treated, effluent discharged and reused 21 9.1.3 (ii)(a) Summary of financial results with previous four year comparatives 13 12 Reducing industrial waste 22 9.1.3 (ii)(b) Summary of significant changes in financial position 11, 12 13 Aggregate annual performance of town or sewerage systems 23 9.1.3 (ii)(c) Operational & budgetary objectives for the year and performance against those objectives 11 14 Short term/persistent compliance with EPA licence 23 9.1.3 (ii)(d) Major changes or factors affecting achievement of objectives 2, 11, 12 15 Reliability of our wastewater collection service 23 9.1.3 (ii)(e) Events subsequent to balance date N/A 16 Wastewater effluent reused to land 25 9.1.3 (ii)(f) Consultancies >$100,000 – Full details of each consultancy 63 17 Wastewater sludge reused/recycled 25 9.1.3 (ii)(g) Consultancies <$100,000 – Number and total cost of consulting engagements 63 18 Discharge of treated effluent to waterways 25 9.1.3 (ii)(h) Extent of compliance with Building Act 1993 63 19 Profile of Coliban Water staff by function 27 9.1.3 (ii)(i) Statement that information listed in Part 9.1.3(iv) is available on request 63 20 Profile of Coliban Water staff by gender and employment type 27 9.1.3 (ii)(k) Statement on implementation and compliance with National Competition Policy 13 21 Practices for recording and notification of occupational 28 9.8.2 (i) A statement of Occupational Health and Safety (OHS) matters 9, 28 accidents and disease 9.8.2 (ii) OHS performance measures 28 22 Annual Customer Satisfaction Survey 29 23 Customer complaints performance indicators 31 FINANCIAL STATEMENTS Preparation 9.2.2 (ii)(a) Statement of preparation on an accrual basis 35 9.2.2 (ii)(b) Statement of compliance with Australian Accounting Standards and associated pronouncements 35 9.2.2 (ii)(c) Statement of compliance with accounting policies issued by the Minister for Finance 35 Statement of Financial Operations 9.2.2 (i)(a) A statement of financial operations for the year 32 9.2.3 (ii)(a) Operating revenue by class 40 9.2.3 (ii)(b) Investment income by class 40 9.2.3 (ii)(c) Other material revenue by class including sale of non-goods assets and contribution of assets 40 9.2.3 (ii)(d) Material revenues arising from exchanges of goods or services 40 9.2.3 (ii)(e) Depreciation, amortisation or diminution in value 50 9.2.3 (ii)(f) Bad and doubtful debts 46 9.2.3 (ii)(g) Financing costs 59 9.2.3 (ii)(h) Net increment of decrement on the revaluation of each category of assets 57 9.2.3 (ii)(i) Auditor-General’s fees 61 Statement of Financial Position 9.2.2 (i)(b) A statement of financial position for the year 33 Assets 9.2.3 (iii)(a)(i) Cash at bank or in hand 33 9.2.3 (iii)(a)(ii) Inventories by class N/A 9.2.3 (iii)(a)(iii) Receivables, including trade debtors, loans and other debtors 33, 46 9.2.3 (iii)(a)(iv) Other assets, including prepayments 33 9.2.3 (iii)(a)(v) Investments by class 47 9.2.3 (iii)(a)(vi) Property, plant & equipment 33, 48 9.2.3 (iii)(a)(vii) Intangible assets N/A Liabilities 9.2.3 (iii)(b)(i) Overdrafts 59 9.2.3 (iii)(b)(ii) Bank loans, bills payable, promissory notes, debentures and other loans N/A 9.2.3 (iii)(b)(iii) Trade and other creditors 33 9.2.3 (iii)(b)(iv) Finance lease liabilities 58 9.2.3 (iii)(b)(v) Provisions, including employee entitlements 33 Equity 9.2.3 (iii)(c)(i) Authorised capital N/A 9.2.3 (iii)(c)(ii) Issued capital N/A 9.2.3 (iii)(d) Reserves, and transfers to and from reserves (shown separately) 33, 41, 42, 57 Statement of Cash Flows 9.2.2 (i)(c) A statement of cash flows for the year 34 Notes to the Financial Statements 9.2.2 (i)(d) Ex-gratia payments N/A 9.2.2 (i)(d) Amounts written off 44 9.2.3 (iv)(a) Charges against assets N/A 9.2.3 (iv)(b) Contingent liabilities 59 9.2.3 (iv)(c) Commitments for expenditure 58 9.2.3 (iv)(d) Government grants received or receivable and source 38, 41 9.2.3 (iv)(e) Employee superannuation funds 51 9.2.3 (iv)(f) Assets received without adequate consideration 38 9.4.2 Transactions with responsible persons and their related parties 59, 60 9.7.2 Motor vehicle lease commitments 58 37-45 Bridge Street Bendigo, Victoria 3550 PO Box 2770 Bendigo, Victoria 3554 Telephone: 1300 363 200 Facsimile: 03 5434 1341 www.coliban.com.au Ausdoc DX 55047 Bendigo

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