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Annual Report annual report 2005 - 2006 The Hon Michael Costa MLC The Hon John Watkins MP Treasurer, Minister for Infrastructure, Deputy Premier, Minister for Transport, and Minister for the Hunter Minister for Finance Level 31 Governor Macquarie Tower Level 30 Governor Macquarie Tower 1 Farrer Place 1 Farrer Place SYDNEY NSW 2000 SYDNEY NSW 2000 Dear Ministers We present State Water Corporation’s 2005/06 Annual Report, which outlines the performance of the Corporation during the past fi nancial year. This report has been prepared for presentation to the New South Wales Parliament, in accordance with the Annual Reports (Statutory Bodies) Act 1984 and the State Owned Corporations Act 1989. It includes fi nancial statements prepared in accordance with the Public Finance and Audit Act 1983 and a report on State Water’s compliance with the Freedom of Information Act 1989. We regret that completion of this Annual Report has been delayed beyond the approved submission date of 12 December 2006. The transition of State Water from a business unit within the Department of Energy, Utilities and Sustainability, to a stand-alone State Owned Corporation, has been marked by fi nancial reporting diffi culties. State Water experienced signifi cant delays in fi nalising the 2004/05 accounts, largely resulting from start-up diffi culties. In addition to the fl ow-on effects of delays in fi nalising the 2004/05 accounts State Water has also experienced teething problems with implementation of new fi nancial systems and the new international accounting standards. These issues have delayed the completion of work papers and reconciliations. The Independent Audit Report for the 2005/06 accounts was signed by the Auditor-General’s Offi ce on 12 September 2007, allowing this Annual Report to be published. Yours sincerely, AG (Tony) Wright Geoff Borneman Chairman A/Chief Executive Offi cer Cover image: The fi rst major dam built for irrigation in NSW, Burrinjuck Dam is situated 60km from Yass on the Murrumbidgee River. The name Burrinjuck comes from the Aboriginal words ‘Booren Yiack’, meaning ‘precipitous mountain’. Burrinjuck Dam was originally built in 1928 and has a storage capacity of 1,026,000ML, almost twice the volume of water in Sydney Harbour. It is a mass concrete gravity dam, which holds back stored water by using its own weight to withstand the pressure from the water. About 250,000 tourists sample the delights of the dam and its surrounds each year. This fi gure is expected to increase signifi cantly in 2007 as the year marks the centenary of the Burrinjuck to Goondah railway, with many celebrations expected to take place. Photographic credits: Vince Bucello, Stuart Humphreys and Suzie Gaynor. 2 State Water 05-06 Annual Report table of contents Our Area of Operations 4 Our Vision, Values and Critical Success Factors 7 Report from Chairman and CEO 8 Our Board 14 Our Senior Staff 19 Corporate Plan 2005/06 20 Excellent Customer Service 24 Best Practice Operations 38 Strategic Asset Management and Investment 50 Skilled and Dedicated People 60 Profi table Business Growth 66 Enhanced Riverine Environment 72 Supportive Stakeholders 80 Corporate Governance 86 Financial Statements 98 Appendix 1 - Code of Conduct 137 Glossary 142 Index 143 Offi ce Locations 147 State Water 05-06 Annual Report 3 our area of operations State Water’s purpose is to deliver water for regional and rural NSW, and we are committed to a presence in these communities. Our people are located in the country towns shown on this map and at Parramatta, as well as at each of the dams and locks shown on the map. We provide bulk water supplies in the 12 regulated river valleys in NSW. N = Area Office = Town / City 0 40 80 120160 200 = Weir = Dam kilometres = Area not covered by State Water 4 State Water 05-06 Annual Report who is state water? State Water is NSW’s rural bulk water delivery delivers treated water supplies as well as raw water in business, annually delivering 5,500 gigalitres of water the Oberon and Lithgow area to towns and the power to regional NSW on average, along 7,000 kilometres industry. of rivers. In accordance with Water Sharing Plans Our Area of Operations is administered in four (WSP), we also deliver on average, about 9,000 Customer Service Areas: North, South, Central and gigalitres of water for the environment. Coastal, each with a Customer Service Manager We manage and operate 20 dams and more than 280 who leads assets and operations teams to provide weirs and regulators to deliver water for town water customer service, day-to-day river operations, asset supplies, industry, irrigation, stock and domestic use, operation and maintenance. riparian and environmental fl ows. Our head offi ce in Dubbo is our centre for business We monitor water usage, manage customer accounts, and strategic planning, strategic water information, bill and collect bulk water charges. Our local Customer fi nance, accounts, payroll and corporate services. Service Offi cers work directly with water users in The Strategic Asset Services, Technical Services, managing water accounts and supporting them to and Strategic Policy and Compliance Branches are improve water delivery effi ciency. located in Parramatta, where they work closely with major stakeholders and suppliers to provide statewide We employ more than 300 people who operate from support to our regional teams. 44 offi ces throughout NSW and work closely with water users and Customer Service Committees (CSCs) to set asset management priorities and improve water delivery effi ciencies in regulated river valleys. The Fish River Water Supply (FRWS) scheme Windamere Intake Tower State Water 05-06 Annual Report 5 What We Do valley, to determine how much water goes to users and how much to the environment. WSP have been On regulated river systems in NSW, we: gazetted in seven regulated river valleys; Gwydir, Deliver allocated water to customers and the Namoi, Macquarie, Lachlan, Murrumbidgee, Murray- environment Lower Darling and the Hunter. Deliver environmental fl ows, according to the State Water operates in accordance with these WSP Water Sharing Plans (WSPs) and delivers water to customers and the environment. Compile and analyse water orders Based on the WSP rules, the available water Manage customer water accounts resources are shared throughout the year, allowing Measure and monitor water usage water for the environment and for consumptive use. Customers’ water accounts are credited with their Coordinate Water Allocation Assignments shares of available water and, as they use their water, (Temporary Transfers) their usage is debited from their accounts. Manage supply and delivery restrictions Issue bulk water bills and accounts Ensure compliance with metering standards Bulk Water Pricing Take action against overuse of water allocations Water prices are set by the Independent Regulatory and Pricing Tribunal (IPART) and cover State Suspend customer accounts for non-payment Water’s costs of delivering water and maintaining and operating infrastructure. Bulk water prices are not based on the value of water, but based on the Water Resource Management recovery of costs incurred in delivering water. In NSW, the regulator and policy maker for water resource management is the Department of Natural Resources (DNR). It develops natural resource policy Ministerial Responsibility frameworks, strategies and plans related to water State Water has two voting shareholders, the management, water quality, salinity, soils, vegetation Treasurer and the Minister for Finance, with whom we and environmental sustainability. DNR is accountable enter into a Statement of Corporate Intent. for WSPs which defi ne the rules for sharing the water Our Operating Licence is issued by our Portfolio resources of each regulated river valley, between Minister, the Minister for Water. consumptive users and the environment. The WSPs contain the sharing rules for each river 6 State Water 05-06 Annual Report Our Vision To be Australia’s leading water business. Our Purpose To effi ciently deliver water and services to customers, the community and the environment, to improve life and the economy. Critical Success Factors Excellent Customer Service Great People Best Practice Operations Supportive Stakeholders Enhanced Environment Strategic Asset Investment Profi table Business Growth Sound Financial Performance Values We operate on the basis of our corporate values: Accountability - We are responsible for our actions, behaviours and outcomes. Customer Service - We meet our customers’ needs and strive to exceed their expectations. Environment - We respect and enhance the environment. Expertise - We apply our skills, competency and experience to deliver effective and innovative solutions. Integrity and Respect - We are honest, truthful and respectful in all that we do. People - We support, develop and motivate each other, professionally and personally. Safety - We put safety above time, cost, productivity and employment. Shareholder Value - We deliver consistent returns and long-term growth. In our relationships with each other we aspire to: Be truthful Trust each other Coach unselfi shly Be open to new ideas Be innovative and supportive Give credit where it’s due Put the interests of others fi rst Have pride in State Water Staff and Directors were involved in an extensive corporate planning process during early 2006. This process included reviewing State Water’s Vision, Mission and Values. The above statements were adopted by the Board for implementation with the 2006/09 Corporate Plan. State Water 05-06 Annual Report 7 a message from the Chairman of the Board and the Chief Executive Offi cer To our shareholders and as is strategic investment to improve asset reliability, productivity, and the necessary development of customers commercial systems to facilitate the transformation In our second year operating as a corporatised of the former branch of a Government Agency to business, the continuing drought further tested be a successful stand-alone business. External employees, assets and operating systems.
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