Driving efficiency

ANNUAL REPORT 2013 – 14 Letter of compliance

8 September 2014 The Honourable Tim Nicholls MP The Honourable Mark McArdle MP Treasurer and Minister for Trade Minister for Energy and Water Supply Level 9, Executive Building Level 13, Mineral House 100 George St 41 George Street BRISBANE QLD 4000 BRISBANE QLD 4000

Dear Ministers I am pleased to present the Annual Report 2013-14 and financial statements for the Queensland Bulk Water Supply Authority, trading as Seqwater. The Annual Report 2013-14 details the non-financial and financial performance of Seqwater from 1 July 2013 to 30 June 2014. This is the first full financial year annual report of the new Seqwater, following the merger of the former Seqwater, LinkWater and SEQ Water Grid Manager. While the required format for the financial statements provides for a comparison between the 2013 and 2014 financial years, any such comparison in this report is not valid as the 2012-13 results cover 12 months of transactions for the former Seqwater and six months of transactions of the merged entities (January to June 2013). Seqwater has delivered significant value for water customers in SEQ since establishing on 1 January 2013. An actual operating cost result of $242 million was delivered for 2013-14 that was a $118 million or 33% reduction compared to the pre-merger budgets of $360 million, of the previous water entities including Seqwater. Cash management has also been a focus and, in conjunction with reduced operational expenditure, has ensured that the original forecast of a drawdown of $125 million in loan funds for 2013-14 was not required. I certify that this Annual Report complies with: • The prescribed requirements of the Financial Accountability Act 2009 and the Financial Performance Management Standard 2009, and • The detailed requirements contained in the Annual report requirements for Queensland Government agencies. A checklist outlining the annual reporting requirements with page references is included on pages 124-125 of this report. Yours sincerely

Noel K Faulkner Chairman

1 Seqwater | Driving Efficiency About This annual report records our achievements in delivering a safe, secure and reliable water supply to the South East our report Queensland community in 2013-14. Our performance is measured against the objectives and targets in our strategic plan and the Statement of Obligations set by the Queensland Government. The report also sets out our financial position for the year. The 2013-14 year was our first full financial year as a business, the new Seqwater. The financial benefits of the merger are outlined in the report and detailed in the financial Seqwater Annual Report 2013-14 ISSN: 1837-4549 statements. The 2012-13 comparables in the 2013-14 © Queensland Bulk Water Supply Authority 2014. financial statements should be read against the 2013-14 results with the knowledge that the 2012-13 results only have six months of transactions (January to June 2013) of the Translation and interpreting assistance merged entities. Seqwater is committed to providing accessible services to Queenslanders from all culturally Our report theme, ‘Driving efficiency’, reflects our continued and linguistically diverse backgrounds. If you focus on minimising costs across our business, while have difficulty understanding this annual report delivering greater value to our customers. please contact us and we will arrange an We contributed to reducing cost of living pressure by reducing interpreter to share the report with you. operating expenses in 2013-14 from the previous entities by $53 million and we paid $29 million less in interest costs to Feedback our lender, Queensland Treasury Corporation. We invite your feedback on our report, The report is a key accountability document and the principal please contact our Corporate and Community way in which we report on our activities to Parliament and Relations team telephone (07) 3247 3000, the Queensland community. The report has been produced fax 3229 7926, email communications@ according to the standards detailed in the following seqwater.com.au or complete our survey at Queensland legislation and Government guidelines: www.seqwater.com.au. • Financial Accountability Act 2009 • Financial Performance Management Standard 2009 Contact • South East Queensland Water (Restructuring) Act 2007 Queensland Bulk Water Supply Authority, trading as • Annual report requirements for Queensland Government Seqwater. agencies – requirements for the 2013-14 reporting ABN: 75 450 239 876 period. Head Office The report is available on our website. A printed copy of the 117 Brisbane Street, Ipswich QLD 4305 report is available on request. PO Box 16146 City East Qld 4002 T 07 3035 5500 F 07 3329 7926 E [email protected] W seqwater.com.au Seqwater | Annual Report 2013-14 2 Contents Letter of compliance ...... 1 About our report ...... 2 Water supply 2013-14 ...... 4 Who we are and what we do ...... 5 Our role in the water sector ...... 6 Our strategic direction ...... 9 Highlights of our year...... 11 Report from the Chairman and CEO ...... 13 Our performance report card...... 16 Building a knowledgeable and engaged community and a trusted and respected brand ...... 23 Ensuring an integrated whole of industry approach...... 26 Delivering efficient water and catchment services ...... 30 Ensuring sustainable financial capacity...... 36 Supporting capable and innovative people ...... 39 Statement of Obligations alignment...... 42 Our corporate governance...... 48 Economic and financial performance ...... 57 Financial report ...... 61 Annual report requirements for Queensland Government agencies compliance checklist ...... 124 Glossary...... 126

3 Seqwater | Driving Efficiency Water supply 2013-14

* 288,508.72 Dams, weirs and megalitres aquifers/bores

*Total production volume

39,856 megalitres 1200 irrigators

1435.32 megalitres Desalination plant

Seqwater | Annual Report 2013-14 4 OUR BUSINESS Who we are Seqwater is the Queensland Government’s statutory authority responsible for ensuring a safe, secure and and what we do reliable bulk drinking water supply for 3.6 million people across South East Queensland (SEQ). We also provide essential flood mitigation services, and irrigation services to about 1,200 customers in seven water supply schemes, benefiting our community. We are one of Australia’s largest water businesses, with the most geographically spread and diverse asset base of any capital city water authority. Our operations extend from the New South Wales border to the base of the Toowoomba ranges and north to Gympie. We manage $10.8 billion of water supply assets and parts of the natural catchments of the region’s major water supply sources. Our assets include dams, weirs, water treatment plants (WTP), reservoirs, pumps and pipelines, as well as climate resilient water sources such as our desalination plant and recycled water scheme. Our business also manages recreation facilities that provide more than 50% of the green space in SEQ outside of national parks. On average, more than two million people visit our recreation areas each year. Seqwater was formed on 1 January 2013 through a merger of three state-owned water businesses, the SEQ Water Grid Manager, LinkWater and the former Seqwater, in accordance with the South East Queensland Water (Restructuring) Act 2007 as amended by the South East Queensland Water (Restructuring) and Other Legislation Amendment Regulation (No.1) 2012. We are also responsible for the long term planning of the region’s future water needs, a function that was formerly undertaken by the Queensland Water Commission.

5 Seqwater | Driving Efficiency Our role We are part of the regional water supply network, which includes council-owned water entities, local governments in the water sector and private sector agencies. Our role is to source, store and supply water from catchments and alternative sources, ensuring a high quality and reliable water supply for our customers. We work collaboratively with our industry partners to achieve the best whole-of-system solutions and provide industry leadership in our region.

Source effects and potentially reduce river levels downstream of these dams. However, this is dependent on the individual We are the only major bulk water supplier in Australia rain events and starting water levels of the dams. that manages predominantly open catchments for our drinking water storages. As water treatment begins in the Supply catchments, we maintain a careful balance of community access to our lakes and catchment land while ensuring We manage our water supply assets as an integrated a safe, high quality bulk drinking water supply for the network, ensuring the final treatment and transportation region. of water to where it is needed most to deliver a consistent, high quality supply for the region. These Helping to manage the health of the region’s catchments assets include 37 WTPs, 22 bulk water pump stations is an important part of ensuring a cost effective and and 35 bulk water reservoirs, 600 kilometres of bulk high quality water supply. We work in partnership with water supply pipelines, the Gold Coast Desalination Plant our neighbours, other water service providers and the and the Western Corridor Recycled Water Scheme (the broader community with a clear objective of a whole-of- scheme is currently being placed in care and maintenance catchment approach to water quality and environmental mode for future use if required). Reverse-flow pipelines management. allow us to move treated water from Noosa in the north to Coolangatta in the south. As well as our network Store connected assets, we have 20 stand-alone WTPs which Water storage is a critical part of our business, with the supply smaller communities. region’s drinking water predominantly sourced from dams. We also supply untreated water to about 1,200 rural Seqwater owns and operates 26 referable dams, 51 weirs irrigator customers. This water is used to support a wide and 14 bores and aquifers, which supply as much as 90% variety of agriculture, such as orchards, vegetable and of SEQ’s drinking water. fodder crops, dairying and grazing. The two largest gated dams in the region, Somerset and Wivenhoe dams, both have additional flood storage compartments over and above their drinking water storage capacity to help mitigate floods. The other two ‘gated’ dams, Leslie Harrison and North Pine dams, do not have additional flood storage capacity but by using controlled gate water releases we are able to partly mitigate flood

Seqwater | Annual Report 2013-14 6 Noosa Shire Council Cedar Pocket Dam Six Mile Creek Dam (Lake Macdonald) Seqwater major assets 29

Legend 6 Cooloolabin Dam (Lake Cooloolabin) Northern Pipeline Interconnector Network Integration Pipeline Reservoirs Borumba Dam 45 (Lake Borumba) Wappa Dam Western Corridor Recycled Water Scheme Other bulk water pipelines connecting Water Treatment Plants the SEQ water grid 18 16 Poona Dam Southern Regional Water Pipeline The Westerm Corridor Recycled Water Scheme Local government boundary Eastern Pipeline Interconnector Desalination Plant 17 Sunshine Coast Regional Council 22 Baroon Pocket Dam Somerset (Lake Baroon) 14 Regional Council Ewen Water Treatment Plants (WTP) 22 Landers Shute WTP Desalination Plant Maddock Dam 23 23 Linville WTP 41 Gold Coast Desalination Plant 1 Amity Point WTP 24 Lowood WTP 19 2 Atkinson Dam WTP* 25 Maroon Dam WTP* Reservoirs 3 Banksia Beach WTP 26 Molendinar WTP 42 Alexandra Hills Reservoirs 27 Moogerah Dam WTP* Somerset Dam 54 3 4 Beaudesert WTP 43 Aspley Reservoir 20 (Lake Somerset) Moreton Bay 5 Boonah Kalbar WTP 28 Mudgeeraba WTP 44 Camerons Hill Reservior Regional Council 6 Borumba Dam WTP* 29 Noosa WTP 45 Ferntree Reservoir 35 7 Canungra WTP 30 North Pine WTP 46 Green Hill Reservoirs 8 Capalaba WTP 31 North Stradbroke Island WTP 47 Heinemann Road Reservoirs Wivenhoe Dam 32 Petrie WTP Toowoomba 9 9 Dayboro WTP 48 Holts Hill Reservoir Regional Council (Lake Wivenhoe) Sideling Creek Dam 33 Point Lookout WTP (Lake Kurwongbah) 10 Dunwich WTP 49 Kimberley Park Reservoirs 13 North Pine Dam 34 Rathdowney WTP (Lake Samsonvale) 30 32 11 East Bank (Mt Crosby) WTP 50 Kuraby Reservoir 35 Somerset Dam (Township) WTP 43 12 Enoggera WTP 51 Lumley Hill Reservoir 57 36 West Bank (Mt Crosby) WTP Brisbane 13 Esk WTP 52 Molendinar Reservoir 51 Enoggera Dam 40 37 Wivenhoe Dam WTP* 37 (Enoggera Reservoir) City 14 Ewen Maddock WTP 53 Mt Cotton Reservoir 2 Council 1 Atkinson Dam Manchester Dam 46 15 Hinze Dam WTP* 54 Narangba Reservoirs 12 39 33 (Lake Manchester) The Western Corridor Gold Creek Leslie Harrison Dam 16 Image Flat WTP 55 North Beaudesert Reservoirs Clarendon Dam 24 Dam (Tingalpa Reservoir) Recycled Water Scheme (Lake Clarendon) 10 17 Jimna WTP 56 Robina Reservoir 48 44 11 59 8 42 38 Bundamba Advanced Water Treatment 18 Kenilworth WTP 57 Sparkes Hill Reservoirs 36 Redland Plant (AWTP) 53 City Council 38 19 Kilcoy WTP 58 Stapylton Reservoir Bill Gunn Dam 50 31 39 Gibson Island AWTP (Lake Dyer) 49 20 Kirkleagh WTP* 40 Luggage Point AWTP 59 Wellers Hill Reservoirs Lockyer Valley Ipswich Regional Council City Council 47 21 Kooralbyn WTP

55 City of Gold Coast

Logan City 58 Council

Wyaralong Dam

5 26 52

Moogerah Dam Hinze Dam Bromelton Dam 4 (Lake Moogerah) (Bromelton Weir) (Advancetown Lake) 27 7 15

56 21 Nindooinbah Dam 28 41 Maroon Dam (Lake Maroon) 25 Little Nerang Dam Gold Coast 34 Desalination Plant Scenic Rim Regional Council

* Recreation Water Treatment Plant.

7 Seqwater | Driving Efficiency Cedar Pocket Dam Six Mile Creek Dam (Lake Macdonald) Seqwater major assets 29

Noosa Shire Council Cedar Legend 6 Pocket Dam CooloolabinSix Dam Mile Creek Dam (Lake Cooloolabin)(Lake Macdonald) SeqwaterNorthern Pipeline Interconnector majorNetwork Integration Pipeline assetsReservoirs Borumba Dam 29 45 (Lake Borumba) Seqwater major assets Wappa Dam Southern Regional Water Pipeline Other bulk water pipelines connecting Water Treatment Plants the SEQ water grid 18 16 Poona Dam Eastern Pipeline Interconnector Westerm Corridor Recycled Water Scheme Local government boundary LegendWesterm Corridor Recycled Water Scheme Desalination Plant 17 6 Sunshine Coast Cooloolabin Dam Regional Council (Lake Cooloolabin)22 Northern Pipeline Interconnector Network Integration Pipeline Reservoirs Borumba Dam Baroon Pocket Dam 45 (Lake Borumba) Somerset (LakeWappa Baroon) Dam 14 Western Corridor Recycled Water Scheme Other bulk water pipelines connecting Water Treatment Plants Regional Council Ewen the SEQ water grid 18 16 Water Treatment Plants (WTP) 22 Landers Shute WTP Desalination Plant Poona Dam Maddock Dam Southern Regional Water Pipeline The Westerm Corridor Recycled Water Scheme 23 LinvilleLocal government WTP boundary 23 Eastern Pipeline Interconnector 41 Desalination Gold Coast Plant Desalination Plant 17 Sunshine Coast 24 Lowood WTP Regional Council 1 Amity Point WTP 19 22 25 Maroon Dam WTP* Reservoirs Baroon Pocket Dam 2 Atkinson Dam WTP* 14 26 MolenWTPdinar Somerset (Lake Baroon) 3 Banksia Beach WTP 42 Alexandra Hills Reservoirs Ewen Regional Council 3 Water Treatment Plants (WTP) 2722 MoogerahLanders Shute Dam WTP WTP* Desalination Plant Somerset Dam 54Maddock Dam 4 Beaudesert WTP 43 Aspley Reservoir 20 (Lake Somerset) 23 Linville WTP 23 Moreton Bay 5 Boonah Kalbar WTP 28 Mudgeeraba WTP 4441 CameronsGold Coast Hill Desalination Reservior Plant Regional Council 61 BorAmityum baPoi ntDam WTP WTP* 2924 NoosaLowood WTP WTP 45 Ferntree Reservoir 3519 27 AtkinsonCanungra Dam WTP WTP* 3025 NorthMaroon Pine Dam WTP WTP* 46Reservoirs Green Hill Reservoirs 38 CapalabaBanksia Beach WTP WTP 3126 NorthMolen diStradbrokenar WTP Island WTP 4742 HeinemannAlexandra Hills Road Reservoirs Reservoirs Wivenhoe Dam 3227 Pe Moogerahtrie WTP Dam WTP* Toowoomba Somerset Dam 9 54 3 94 Da Beaudesertyboro WTP WTP 4843 HoltsAspley H ilReservoirl Reservoir (Lake20 Wivenhoe) Sideling Creek Dam Regional Council (Lake Somerset) 3328 PointMudg Lookouteeraba WTP WTP Moreton Bay (Lake Kurwongbah) 105 DunwichBoonah Kalbar WTP WTP 4944 KimberleyCamerons ParkHill Reservior Reservoirs 13 NorthRegional Pine Dam Council 3429 RathdowneyNoosa WTP WTP (Lake Samsonvale) 30 32 116 EastBorum Bankba Dam (Mt Crosby)WTP* WTP 5045 KurabyFerntree Reservoir Reservoir 35 3530 SNorthomerset Pine Dam WTP (Township) WTP 43 127 EnoggeraCanungra WTPWTP 5146 LumleyGreen Hill Hill Reservoirs Reservoir 57 138 EskCapalaba WTP WTP 3631 WestNorth BankStradbroke (Mt Crosby) Island WTP WTP 5247 MHeinemannolendinar RoadReservoir Reservoirs 51 Enoggera Dam Brisbane 40 Wivenhoe Dam 3732 WivenhoePetrie WTP Dam WTP* Toowoomba (En 9oggera Reservoir) City 149 EwenDayboro Maddock WTP WTP 5348 MtHolts Cotton Hill Reservoir Reservoir (Lake37 Wivenhoe) Sideling Creek Dam Regional Council 2 Council 1 33 Point Lookout WTP Atkinson Dam Manchester Dam 46 (Lake Kurwongbah) 1510 HinzeDunwich Dam WTP WTP* 5449 NarangbaKimberley ReservoirsPark Reservoirs 13 North Pine Dam 12 39 33 (Lake Manchester) 34The Western Rathdowney Corridor WTP (Lake Samsonvale)Gold Creek30 32 Leslie Harrison Dam 1611 ImageEast Bank Flat (MtWTP Crosby) WTP 5550 NorthKuraby Beaud Reservoiresert Reservoirs Clarendon Dam 24 Dam (Tingalpa Reservoir) 35Rec ycled Somerset Water Dam (TowSchemenship) WTP (Lake Clarendon) 43 10 1712 JimnaEnoggera WTP WTP 5651 RobinaLumley ReservoirHill Reservoir 48 44 11 59 8 42 57 3638 WestBundamba Bank Advan(Mt Crosby)ced Water WTP Treatment Redland 1813 KenilworthEsk WTP WTP 5752 SparkesMolendinar Hill ReservoirReservoirs 51 36Enoggera Dam Brisbane 40 Plant (AWTP) 53 City Council 37 Wivenhoe Dam WTP* 37 (Enoggera Reservoir) City 1914 KilcoyEwen MaddockWTP WTP 5853 StapyltonMt Cotton Reservoir Reservoir Bill Gunn Dam 2 38 31 39 Gibson Island AWTP Atkinson Dam Council 50 1 (Lake Dyer) Manchester Dam 46 49 2015 KirkleHinze agDamh WTP* WTP* 5954 WellersNarangba Hill Reservoirs Reservoirs 12 39 33 40The Western Luggage Point Corridor AWTP Lockyer Valley Ipswich (Lake Manchester) Gold Creek Leslie Harrison Dam 16 Image Flat WTP 55 North Beaudesert Reservoirs Regional Council City Council 47 21 Kooralbyn WTP Clarendon Dam 24 Dam (Tingalpa Reservoir) Recycled Water Scheme 10 (Lake Clarendon) 55 17 Jimna WTP 56 Robina Reservoir 48 44 11 59 8 42 38 Bundamba Advanced Water Treatment City of 18 Kenilworth WTP 57 Sparkes Hill Reservoirs 36 Redland Plant (AWTP) Gold Coast53 City Council 38 19 Kilcoy WTP 58 Stapylton Reservoir Bill Gunn Dam Logan City 50 58 31 39 Gibson Island AWTP Council (Lake Dyer) 49 20 Kirkleagh WTP* 40 Luggage Point AWTP 59 Wellers Hill Reservoirs Lockyer Valley Ipswich Regional Council City Council 47 21 Kooralbyn WTP

Wyaralong Dam 55 City of 5 Gold Coast26 52 Logan City Moogerah Dam Hinze Dam58 Bromelton Dam Council4 (Lake Moogerah) (Bromelton Weir) (Advancetown Lake) 27 7 15

56 21Wyaralong Dam Nindooinbah Dam 28 5 26 52 41 Maroon Dam 25 Little Nerang Dam Gold Coast Moogerah Dam(Lake Maroon) Bromelton Dam Hinze Dam 4 Desalination Plant (Lake Moogerah) (Bromelton34 Weir) (Advancetown Lake) 27 Scenic Rim 15 Regional Council 7 56 21 Nindooinbah * Recreation Water Treatment Plant. Dam 28 41 Maroon Dam (Lake Maroon) 25 Little Nerang Dam Gold Coast 34 Desalination Plant Scenic Rim Regional Council

* Recreation Water Treatment Plant.

Seqwater | Annual Report 2013-14 8 Our strategic direction

Vision Partnering our people collaborating with customers, Healthy communities. Prosperous region communities, governments and industry

Purpose Productivity Partnering to enhance the productivity of the region’s minimising costs and being innovative in deriving water supply assets by delivering safe, secure value from assets water and catchment services, as required by customers and communities. Water supply assets effectively and efficiently utilising our catchments and infrastructure to source, store and supply water

Safe, secure water continuing to meet regulated standards, particularly for drinking water, and ensuring water security for business and the community

Catchment services providing flood mitigation, recreation, community education and environmental services

Our contribution to regional prosperity As a publicly-owned organisation, we contribute to the Government’s five policy objectives.

Government priority Our commitment

Grow a four pillar economy based on tourism, agriculture, Ensure the security of SEQ’s water supply as a critical resources and construction resource underpinning the regional economy

Lower the cost of living for families by cutting waste Minimise costs by driving water supply efficiency

Deliver better infrastructure and better planning Improve the reliability and performance of regional water supply assets and facilitate whole-of-industry infrastructure planning

Revitalise front-line services for families Work more closely with customers and communities

Restore accountability in government Provide transparent performance reporting for our customers and community, and ensure effective financial and risk management

9 Seqwater | Driving Efficiency Our Statement of Obligations with all levels of government, industry, land holders and community organisations to improve our catchments. The Responsible Ministers have set standards of: • Focus on core business (safe, secure, resilient and Climate variability reliable water supplies) We live in a climate of extremes, with intense dry and • Whole-of-industry approach at least cost wet periods, which impacts on the reliability of water • Support government objectives and directions supply and on water quality. We must plan and prepare for critical events such as floods and drought. • Effective and efficient business • Communication, consultation and collaboration Energy costs • Sustainability Delivering a safe, secure and reliable bulk water • Innovation. supply requires significant energy. We must reduce our energy costs by optimising our operations and targeted Our strategic plan is framed to ensure our business investment. complies with the Statement and we report quarterly to our responsible Ministers on our compliance. WaterQ Our strategic risks, opportunities The Queensland Government’s 30-year strategy for Queensland’s water sector will inform future water and challenges management strategies and long term water security. Our strategic plan also addresses the strategic risks, opportunities and challenges facing the business. The Our strategic outcome areas issues that are most critical to Seqwater’s long-term Our strategic plan sets out our priorities and the strategic business performance include: outcomes we aim to deliver to achieve our purpose and vision. Our strategic outcome areas are: Cost of living • Knowledgeable and engaged community There is increasing pressure to limit increases to the cost of living. To deliver better value for our customers, • Trusted and respected brand we must drive efficiency in all facets of our business and • Integrated whole-of-industry approach work with our water supply chain partners to constrain • Water and catchment services price escalation in water supply services. • Sustainable financial capacity Cross-sector collaboration • Capable and innovative people. We must collaborate and partner across our sector to Our performance against the six strategic outcome provide the most cost-effective water supply solutions areas is measured through challenging key performance and maximise long-term benefits for our community. indicators (KPIs). See page 16 – 22 for a summary of our performance for the year. Catchment health The environmental quality of our source water catchments is under pressure from population growth and other land use impacts. Catchment health has a direct impact on water quality and the cost to treat. We must work

Seqwater | Annual Report 2013-14 10 HIGHLIGHTS Highlights of our year

In our first full year of operation as a new business, we focused on driving efficiency to benefit our customers, the people of SEQ. Our achievements illustrate our commitment to meeting the goals and objectives of the Statement of Obligations and our Strategic Plan.

Delivered greater value to our customers by Engaged more than 3,700 community organisations optimising the efficiency of our region’s bulk water and individuals in the most extensive review ever supply network through better use of our assets undertaken of recreational opportunities at our and resources, including: dams and catchments, helping to shape the future • Since the new Seqwater began operations in of recreation in our region. See page 23. January 2013, expenses for employees and supplies/services and other expenses have reduced annually. From 2012-13 to 2013-14, Demonstrated our commitment to regional the costs were reduced by 18% or $53 million. communities by delivering our first major • Our capital expenditure for 2013-14 was infrastructure project as a merged entity, the $105.3 million, some $67.7 million lower than Kilcoy WTP. The plant features state-of-the-art the 2012-13 budget forecasts of the previous water treatment technology and ensures a safe entities. and reliable water supply for the 1,700-strong • It is also of note that the 2012-13 operating Kilcoy community and local industry. See page 35. expenses budget of the merged entities was $360 million, whereas the 2014-15 operating expenses budget of Seqwater is $265 million, Battled summer bushfires to protect the a drop of $95 million over two years. North Stradbroke Island WTP and ensured an • Seqwater is now forecasting a return to uninterrupted water supply to the Redlands and profitability in 2017-18 and will then begin nearby islands throughout the emergency. See to reduce the $9.6 billion debt load incurred page 29. in building the bulk water network and capitalising the subsequent annual losses. • During 2013-14 we carefully managed cash and, in conjunction with the reduced operational expenditure, this has ensured that the original forecast of a drawdown of loan funds of $125m for 2013-14 was not required and we were able to self-fund our capital works program. See pages 57-123.

11 Seqwater | Driving Efficiency Partnered with the SEQ Water Service Providers to Developed and implemented our award winning deliver projects in the areas of demand forecasting Safety Management System, drawing on the and management, metering, bulk water supply knowledge and experience of our employees to agreements, drought response planning and future ensure a system that is readily accessible, usable water supply scanning. See page 26. and above all, supports our goal of ‘Safe for Life’. See page 39.

Undertook vital repairs to Mt Crosby Weir following damage caused by Ex-Tropical Cyclone Hosted an industry-orientated youth safety day Oswald in January 2013. The work included the ‘Empowering Our Future’, to educate and promote removal of a 22-tonne log wedged in one of the safe work practices to water industry affiliated two intake pipelines and the stabilisation of the entities, regional councils and major water embankment with tonnes of rock. See page 33. industry contractors. See page 39.

Completed essential maintenance works at the Built our organisational culture and developed our historic Mt Crosby Eastbank WTP, shutting down values to support our employees to achieve our the plant for the first time in more than 50 years vision and purpose. See page 40. and completing a series of upgrades without disrupting the water supply. See page 34.

Developed our Catchment Greenprint, a long term adaptive plan setting out our vision and strategy Introduced the Dam Improvement Program for catchment management to ensure a healthy to ensure our dams meet the latest national source of water for our growing region. See page standards. See page 31. 33.

Conducted extensive hydrological analysis and Began development of SEQ’s 30-year Water modelling of dam operations to support the Security Program to ensure cost efficient water Department of Energy and Water Supply to deliver supplies are available in the long term. See page the Wivenhoe and Somerset and North Pine Dam 27. optimisation studies. See page 31.

Commenced preparation of a bulk water price Relocated 340 staff to a new office in Ipswich submission to the Queensland Competition to accommodate all Brisbane CBD and Karalee Authority (QCA) for the recommendation of prices employees in one building, strengthen our regional for the final three financial years (2016 to 2018) of presence and support a whole-of-government the Queensland Government’s 2008-18 bulk water strategy for the building. See page 41. price path. See page 38.

Seqwater | Annual Report 2013-14 12 Report from the Following our establishment on 1 January 2013, this year

CHAIRMAN/ CEO Seqwater transitioned from an establishment phase to an Chairman and CEO operational phase, with a clear focus on delivering value to the community of SEQ. We recognise that community value incorporates the cost and level of our services as well as the benefits they deliver. Our people, their skills and expertise, remain fundamental to our success. In our first full year of operation, we continued to drive efficiencies and cost savings associated with operating the region’s bulk water supply network. Making bulk water more affordable is at the heart of everything we do. Safety as always is our priority, with the organisation developing and implementing a new safety management system. This system was recognised as the best in the State at the 2013 Queensland Safe Work Awards and was also acknowledged as a finalist in the national safe work awards. Our team will never waiver from our commitment to sending everyone home safe at the end of each day. We also launched the most extensive review of our recreation services ever undertaken. We did this recognising that the region’s lakes and surrounding catchments play an increasingly important role in a growing, liveable and healthy SEQ. We own and manage more than 50% of the region’s open green space outside of national parks. In 2013, more than 2.6 million people visited our recreation areas, the largest number of visitors ever recorded. Our recreation review was in direct response to the community’s desire for greater access to our lakes and catchments. Our challenge was to balance this access against the need to protect water quality and the environment, given the majority of our dams provide the region’s drinking water. The review, including extensive community consultation involving 3700 people and user groups across SEQ, has already delivered significant benefits. Low emission fuel powered boats for fishing have been allowed on Wivenhoe Dam for the first time. Other outcomes include the establishment of designated swimming areas and paddle craft launch points, the opening of multi-use trails, 13 Seqwater | Driving Efficiency improvements to car parking, purpose-built paddle craft budget ($360 million) to the 2013-14 actual ($242 million) wash down facilities, new picnic facilities, upgrades have reduced by 33% or $118 million compared to the pre- to camping areas, increased bird watching access, and merger budgets of the previous water entities (Seqwater, improvements to landscaping, signage and security. We LinkWater and the SEQ Water Grid Manager). In addition thank the SEQ community for sharing their views and our capital budget has reduced by $48.6 million to $124 ideas with us. million compared to the combined budget of the previous entities. We managed a significant organisational change during the year, relocating our Brisbane operations to Ipswich Importantly, we are now forecasting a return to as part of a whole-of-government strategy to support profitability in 2017-18 and will then begin to reduce the economic growth in the western corridor and the $9.6 billion debt load incurred in building the bulk water regions. The move involved more than 50 per cent of our network and capitalising the subsequent annual losses. workforce. Our people are settling in well to our new During 2013-14 cash management has been finessed home in Ipswich. to enable the highest and best use of cash and, in We reviewed and updated the region’s whole-of-system conjunction with reduced operational expenditure, has Emergency Response Plan, working closely with our water ensured that the original forecast of a drawdown of industry partners, Government and emergency service $125m in loan funds for 2013-14 was not required. organisations to undertake a series of training exercises We were able to self-fund our capital works program. in the lead up to the 2013-14 wet season. To keep costs down during a time of high regional water Our people, and our emergency and incident management security, we have maintained the Gold Coast Desalination capability, were tested in early January 2014 as the region Plant in ’hot standby’ mode. The plant produces a minimal experienced a major heatwave. A number of our fire units amount of water to maintain the system, but can increase worked with the Queensland Fire and Rescue Service to production rapidly if required. The Western Corridor do an outstanding job in protecting key water assets from Recycled Water Scheme is in the process of being placed a major bushfire on North Stradbroke Island. Despite the in care and maintenance mode to preserve the asset and need to close our main Island water treatment plant, our allow reactivation if required. team worked around the clock with the local council to The SEQ Water Service Providers Partnership, established utilise the region’s bulk water system to maintain drinking last year by Seqwater and involving the region’s water water supply to the Redlands. Power outages were also distributor retailers and council-owned water businesses, experienced across the area during this time; however our continues to focus on whole-of-supply chain efficiencies efforts ensured there was no loss of water supply to the and cost savings. community. In total, our savings to date have allowed the Government Delivering value and driving to limit the annual increase on bulk water charges over our first 18 months of operation. efficiency We also revamped our engagement with our irrigator The amalgamation process which established Seqwater customers, publishing Network Service Plans for each from 1 January 2013 delivered significant savings for all of our irrigator schemes and establishing consultation water customers in SEQ. These savings continue to flow forums for the first time. through to the community. Since we began operations, expenses for employees Building resilience and supplies/services and other expenses have reduced Ensuring our assets continue to serve the community well annually. The operating expenses from the 2012-13 into the future is critical. Seqwater | Annual Report 2013-14 14 The past year has seen the next phase of the region’s Dam Shaping the future Improvement Program get underway. Seqwater is required to comply with the Queensland dam safety guidelines Affordability of water will continue to be a significant under the Water Supply (Safety and Reliability) Act 2010. issue for our community as well as for the economic Like all dam operators across the country, we also strive development of our region. to meet national standards defined by the Australian The key to driving future efficiencies will be optimising National Committee for Large Dams (ANCOLD). the operation of the region’s bulk water network. Being Dams are long life assets and many of the region’s dams efficient through operational excellence in managing were built in the 1960s and 1970s. We must ensure they water every step of the way from our catchments to the meet the required standards. We have identified several community is our core strategy. It is imperative to deliver dams requiring planned upgrade works over the next affordable ‘fit for purpose’ water to customers and ensure five years, with work already underway at Moogerah we are smart in getting the most out of existing assets. and Maroon dams near Beaudesert. The ongoing Dam Our high level of debt means we need to continue to Improvement Program will require significant capital make savings and improve operations. Technology will investment. play a leading role as we identify smarter and more cost We have played a significant role in Government-led effective ways to do our job. studies into improving the flood mitigation performance Finally, it is vitally important we get our long term of Wivenhoe, Somerset and North Pine dams and will planning right. Over the next year we will develop the continue to support the Brisbane River flood plain studies region’s next 30-year water security program to ensure we still underway. This work will inform ongoing continuous can meet growing demand for a safe, secure and reliable improvement of how flood events can be best managed. bulk water supply. The program is central to achieving We own less than four per cent of the catchment land the best social, environmental and economic water future which surrounds our drinking water and irrigation for the region. Again we will work closely with our water dams. We are also the only major bulk water supplier industry partners, the State, industry and the broader in Australia to manage open catchments, allowing the community as the program develops. community to enjoy the natural assets of our region. Our history, geography, climate and growth demonstrate Managing the impact of catchment development and the need to properly plan and manage drought and flood activity is critical to the health of our source water. To that so that SEQ and its people continue to grow and prosper. end, we have worked with our water industry partners, and key catchment and waterways bodies to develop our Acknowledgements Catchment Greenprint, a comprehensive strategic plan to better manage the region’s drinking water catchments We thank the Board, Executive Leadership team and staff to ensure their resilience into the future. The key to the for their efforts to drive efficiencies in our business and strategy is engaging and partnering with the region’s deliver greater value to our customers this year. catchment communities and landowners. We look forward to another challenging year ahead, as We continued to ensure our regional communities remain we strive to become even more operationally efficient, well served with the completion of a new Kilcoy Water build strong connections with our customers and the Treatment Plant in 2013-14. communities in which we operate, make greater use of technology to drive improvement, and demonstrate strong leadership in the water sector.

Noel K Faulkner Peter Dennis Chairman Chief Executive Officer 15 Seqwater | Driving Efficiency Our performance We measured our success by using KPIs and targets to PERFORMANCE drive continuous improvement across our six strategic report card outcome areas.

Strategic outcome area Key performance indicator

Knowledgeable and engaged community Community awareness and understanding of Seqwater services, the water cycle and water quality management

Trusted and respected brand Community and customer research

Integrated whole-of-industry approach Water supply provider partnership

Water and catchment services Catchment condition: Health of key catchments

Catchment condition: Catchment water quality risks reduced

Service standards: Supply

Service standards: Water quality

Water supply security

Sustainable financial capacity Commercial performance: EBIT (Earnings before income tax)

Commercial performance: EBIT interest cover

Commercial performance: Long-term capital strategy

Capable and innovative people Cultural alignment

Zero harm

Our performance report card shows our progress in delivering against our strategic plan and the 2013-14 Icon Definition operational plan. Overall performance is based on the achievement of each KPI. Brief commentary on any Target achieved. variances is provided, together with page references for more detailed analysis of our performance. The following Target partially achieved. status codes were assigned: Target not achieved.

Seqwater | Annual Report 2013-14 16 Knowledgeable and engaged community

Result KPI Community awareness, understanding of Seqwater services, the water cycle and water quality management

Measure Level of community awareness (expressed as the percentage of SEQ respondents correctly identifying Seqwater as managing ‘water supply and quality, drought and flood mitigation and recreational facilities around dams’ in their region)

Target Annual improvement against baseline

We successfully implemented a research framework The first information campaign is scheduled to be to establish a baseline of community awareness of our conducted in 2014-15, with a focus on public safety in and role and work. This research underpins the development around our dams. and evaluation of Seqwater’s future public information See page 23. campaigns and community engagement activity.

Trusted and respected brand

Result KPI Community and customer research

Measure Level of trust, respect and association with desired brand attributes (expressed as the percentage of respondents who had moderate, high or very high ‘trust in Seqwater as managers of SEQ’s water network’).

Target Annual improvement against baseline

Our community and customer research also enabled us our organisation and improve on our baseline measure in to establish a baseline of community trust in our new 2014-15. business. Through our work across all strategic outcome See page 23. areas we aim to increase the level of community trust in

17 Seqwater | Driving Efficiency Integrated whole-of-industry approach

Result KPI Water Supply Provider Partnership

Measure Percentage of on-time delivery of whole-of-industry program

Target 100% progress against program

We established the SEQ Water Services Provider The partnership met regularly throughout the year to Partnership with Unitywater, Queensland Urban Utilities progress operating protocols, consider performance, and the water businesses of Redland City, Logan City plan risk and emergency management, increase system and City of Gold Coast councils to ensure the region’s interaction, and share opportunities for staff training and water assets are planned for, delivered and managed as a development. single, integrated, efficient and effective system, ensuring See page 26. maximum value for communities and businesses.

Water and catchment services

Result

KPI Catchment condition

Measure a) Effectively influence key stakeholders to arrest the decline in the health of key catchments Note: Key catchments have been identified as those supplying WTPs with the highest facility criticality rating. Assessment of catchment condition is an annual process, therefore one target has been specified. This indicator uses the level of co-investment in catchments as a measure of effective influence.

Target Improvement in the health of key catchments

We benchmarked our investment in catchment land We made significant progress in building relationships management and then identified other organisations with other organisations to maximise the community investing in catchments and assessed opportunities and benefit of catchment care projects. mechanisms to align. From this information a target for See pages 32-33. co-investment was proposed.

Seqwater | Annual Report 2013-14 18 Result

KPI Catchment condition

Measure b) Catchment water quality risks reduced Note: Catchment improvements are included in the improvement plan to support Drinking Water Quality Management Plans. The improvements are determined taking into account raw water quality risks and mitigation options. This KPI records implementation of improvement actions.

Target 95% planned activities completed from catchment improvement program

We completed 56 out of 62 Brisbane River. Major erosion repairs were made in catchment improvement the Stanley River, Pine River and Upper Mary River projects during 2013-14, catchments, including bank re-profiling and stock achieving 90% against a exclusion. target of 95%. Six planned projects were not completed due to a review In the Lockyer catchment, of the integration between the catchment and asset we delivered a range of improvement plans. These projects will be reconsidered in revegetation projects to 2014-15. improve water quality, including major works at Glenore See pages 32-33. Grove, Baraba Creek, and Wilsons Weir. Works were also undertaken at Wivenhoe Dam and along the upper

Result

KPI Service standards

Measure a) Instances of non-compliance with Bulk Water Agreements for supply obligations (in accordance with section 7) Note: For water supply, compliance being Seqwater using its best endeavours to supply such volumes to our customers as is necessary to meet our customers’ demands for potable water.

Target 0

We recorded one instance of supply loss on 6 November Merah. The issue was resolved approximately 1 hour and 2013, when we were unable to supply water to the Logan 30 minutes later. system after planned work on the Daisy Hill Pump Station interrupted supply to about 500 customers in Tanah

19 Seqwater | Driving Efficiency Result

KPI Name Service standards

Measure b) Number of zones not compliant with Australian Drinking Water Guidelines for water quality criteria Note: For water quality criteria, number of zones not compliant with the Australian Drinking Water Guidelines 2011 [ADWG] guideline values based on the 95th percentile for health parameters, 98% for microbiological parameters and arithmetic mean for aesthetic parameters [with impacts downstream] over a rolling 12 months.

Target 0

All drinking water supply zones were compliant with the criteria for the 12 months to 30 June 2014.

Result

KPI Water supply security

Measure Probability of reaching 40% of full supply volume in key water network storages in five years as outlined in the SEQ System Operating Plan as a lead indicator of our ability to meet Level of Service Objectives Note: Probability of reaching 40% of full supply volume in key water network storages in five years as calculated using the SEQ Regional Water Balance Model

Target < 5%

TThe total forecasted water supply volume for 2013-14 security position for the region. While water security in was 288,460ML. The combined storage level of the 12 SEQ remains high, key risk factors include prolonged dry key water supply dams was 99.8% on 1 July 2013. The weather, high temperatures and extended periods of high storage level dropped by 10.3% to end the year at 88.5% demand. on 30 June 2014. See pages 4 and 27. We actively monitor demand and dam storage levels to review the water balance position. We model possible storage inflow conditions to assess the future water

Seqwater | Annual Report 2013-14 20 Sustainable financial capacity

Result

KPI Commercial performance

Measure a) Earnings Before Interest and Tax (EBIT) 2013-14 budget EBIT $220.8M Actual $244.7M* Note: EBIT is a measure of a business’s profit or (loss) that excludes interest and income tax expenses operating profit or loss. It is the difference between operating revenue and operating expenses.

Targets < EBIT for each group (measured and aggregated from team level) measured against original budget.

The financial outcomes for the year met agreed targets. In 2014-15 we will further refine recurrent expenditure Revenue received was within 1% of original budget, budget bids together with planning for and approval of operating expenses were 13.6% less than original budget operating projects and capital expenditure. and capital expenditure was 15% less than the original *Adjusted for one-off charges for decommissioning budget. several WTPs $22.5M and a software system of $2.5M See pages 57-123. and an $83M revaluation of assets decrement.

Result

KPI Commercial performance

Measure b) EBIT interest cover Note: One of the key credit metrics expected for a ‘B’ rated water company is EBIT interest cover (EBIT divided by gross interest expense) in the range of 1.0 to 1.2 times.

Target EBIT covers interest paid 0.3 to 0.5 times

We achieved an EBIT interest cover of 0.3 times. Based that the entity is reliant on the ongoing commitment from on current forward financial projections, the target for a the Government in this regard (refer financial statements ‘B’ rated entity should be achieved in 2017-18. This result note 2 (b)). reflects the high gearing of the business. It is also noted See pages 57-123.

21 Seqwater | Driving Efficiency Result

KPI Commercial performance

Measure Develop long-term capital management strategy

Target Provision of a strategy plan to deliver on the ‘hows and whens’ of achieving an appropriate capital structure for Seqwater

Our Board adopted a long term capital strategy in 2013- See page 31. 14. Dam upgrade works as part of our Dam Improvement Program will form a significant portion of our future capital spend.

Capable and innovative people

Result

KPI Cultural alignment

Measure Organisational culture survey

Target Improvement against baseline

At the start of the financial year, we developed a cultural A new cultural alignment program will be developed for alignment program to develop and embed the culture of 2014-15 to ensure we continue to foster a culture focused the new Seqwater. The program was completed in June on business performance. Another employee survey will 2014 with the release of the results of our first Connect be undertaken in 2015, with a target of improving on the employee survey. The survey has provided us with a 2014 results. cultural baseline measure and identified our strengths and See page 40. the areas we need to improve.

Result

KPI Zero harm

Measure Lost Time Injury Frequency Rate (LTIFR)

Target 6

The LTIFR for 2013-14 was 7.8 due to 13 Lost Time Injuries We continue to work to reduce our LTIFR through the (LTIs) reported in the year. It is important to note that all implementation of our WHS Management System and 13 LTIs were the result of low potential consequence Safety Culture and Behaviour Program. incidents and that six of the 12 months were LTI free. See page 39.

Seqwater | Annual Report 2013-14 22 2

Building a knowledgeable Understanding customer and and engaged community community perceptions To identify ways to deliver greater value to our customers and a trusted and and the community, we conducted qualitative and respected brand quantitative research to understand existing customer and community perceptions of our business and our role within the water sector. This research helped us to identify

STRATEGIC OUTCOMES 1 and the types of information the community are interested We work hard to build relationships in receiving from us and their preferred channels and formats. with our SEQ community to ensure people derive maximum value from We aim to be a trusted and respected water authority, the region’s water and catchments. with our customers understanding the work we do to ensure a safe, secure and reliable water supply. We We aim to become synonymous have developed a three-year strategy to increase public with driving value, performance awareness of who we are, what we do and how our and innovation in water and customers can safely access the natural and built assets catchment services. we manage on their behalf.

Engaging our community in reviewing recreation In June 2013, we embarked on the most extensive community review ever undertaken of recreational opportunities in and around our water storage lakes. To date more 3,700 organisations and individuals across the region have participated in the review. Through the review, we aimed to gather community ideas on recreation at 20 of our lakes, grouped in nine regional clusters. The review sought to balance the ongoing health of the catchments and quality of the region’s drinking water supply while providing the community with access to a range of water-based and on-shore activities. We are the only major bulk water provider in Australia that manages open catchments, allowing the community to access water storage lakes and their surrounds for recreation. The review process also endeavoured to provide as diverse a recreation experience as possible within each community across the region. It involved significant consultation to ensure we were capturing the views and

23 Seqwater | Driving Efficiency recreation needs of local communities, recreational users • trailer parking and paddle craft access improved and special interest groups. at Ewen Maddock Dam, with a wash down facility Discussion papers for each lake cluster were released established to assist with water weed management for public comment, followed by information sessions • upgrades, including new barbeques and picnic tables, and discussion workshops. Community members and to the recreation area at Lake Manchester organisations also had the opportunity to complete online • improved security measures at Cooloolabin Dam, surveys. including the installation of a gate at the entry to the The review workshops provided a valuable forum for the day use area and new directional signage. community to discuss their ideas and give feedback on the • plans to open Enoggera Reservoir to the public for recreation activities at each lake. swimming, paddle craft activities and fishing. Following the community consultation for each lake cluster, all feedback was analysed and reviewed against The Department of National Parks, Recreation, Sport, our Recreation Management Framework and operational and Racing (DNPRSR) is assisting with funding for the imperatives. A recreation management plan and implementation of recreation review outcomes. We are recreation guide was published for each lake, detailing also working with local councils to implement some of the future improvements in response to community ideas. changes suggested. Public consultation has closed and recreation Connecting with people about their recreational use of management plans and guides have been released for our assets also provided a great opportunity to educate seven lake clusters. Review outcomes for Lake Borumba, the community about their water supply. The relationships Lake Macdonald and Hinze Dam will be finalised before built through the review will provide ongoing benefits. the end of 2014. We now meet regularly with stakeholders and attend a variety of community forums and events to continue to On the back of the review, visitation to our lakes increased gather community ideas and issues and share information. by 100,000 in 2013-14, reaching 2.6 million, an increase of Ongoing engagement is critical to ensure we can work four per cent on 2012-13. together with the community to shape and deliver the As at 30 June 2014, the review had resulted in a number region’s future prosperity. of recreation improvements: • low emission fuel-powered motor boats permitted on Connecting with communities Wivenhoe Dam for the first time through education • designated swimming area established at Atkinson In 2013-14, more than 10,000 school students and Dam community group members participated in our community • improvements to The Spit recreation area at Lake education and engagement program. Through the program Somerset we aim to increase community understanding of the water • gazetted 6 knot speed limit in the northern section of cycle and how we source, store and supply the region’s Lake Somerset water, as well as increasing knowledge of the importance of caring for our catchments. • dogs permitted in the recreation areas at Lakes Maroon and Moogerah We also participated in a range of community shows and • paddle craft permitted in upper reaches of the arms of festivals, including the Ekka, to engage at a grass roots Lake Baroon level with thousands of South East Queenslanders. Some 7,764 students from 132 schools visited our Ekka stand

Seqwater | Annual Report 2013-14 24 as part of the Education Learning Trail during the 10-day Improving community access to event in August 2013. Our People’s Day visitors were also involved in a world record attempt for the most water information quality tests undertaken in one day. A record-breaking Following the merger of the three former water entities, 1,414 tests were performed throughout the day, with we identified the need to build a new website to people of all ages participating. amalgamate the suite of websites we inherited through the water reforms and provide our community with up- Valuing cultural heritage to-date information about their bulk water supply and recreation activities available at our dams. We value the unique status of Aboriginal peoples as the original owners of the land and water on which we The new website was launched in December 2013, with operate. positive feedback received from the community, as well as government and industry stakeholders. This year we developed the Gold Coast Cultural Heritage Management Agreement to formalise a collaborative In March 2014, the Interactive Media Council recognised working relationship with the traditional owners of the the Seqwater website as Best in Class at the Interactive Gold Coast area. The agreement sets out how we will Media Awards, the highest honour bestowed at the work with the traditional owners when conducting our annual event. business and identifies appropriate notice periods and Redeveloping the website also resulted in significant time communication channels. The agreement and associated and cost savings, in particular by eliminating hosting costs Memorandum of Understanding were signed on 2 May associated with multiple websites. 2014 by Seqwater CEO, Peter Dennis, and Jabree Limited Director, Wesley Aird. We hope to establish similar agreements with other traditional owners across our region and are currently in discussions with the Jinibara Traditional People. In 2013-14 we also consulted with traditional owners about: • finalising outstanding obligations enshrined in the Wyaralong Dam Indigenous Land Use Agreements • installing monitoring bores on Bribie Island • planning for our prescribed fire management program. To assist our employees with cultural heritage matters, we completed our Aboriginal Cultural Heritage Compliance Manual and associated field guide.

25 Seqwater | Driving Efficiency Ensuring an integrated Collaborating with industry whole of industry approach The SEQ Water Service Providers Partnership comprises Unitywater, Queensland Urban Utilities and the water businesses of Redland City, Logan City and City of Gold Coast councils. As the region’s bulk water authority, we STRATEGIC OUTCOME 3 We aim to be a sought after partner source, store and supply water, which is distributed to known for driving cross regional customers by the council-owned water entities. collaboration to improve water The Partnership works together at the strategic and supply system performance and operational levels to ensure a safe, secure and reliable increase opportunities for growth water supply at the best value for money for our customers. and prosperity. Partnership achievements for the year include: • the development and progression of Key Possible Projects (KPPs) and submission of the first annual report on KPPs to the Minister for Energy and Water Supply in December 2013. Current KPPs include asset optimisation of the Petrie, Logan and Beaudesert WTPs and plans for a free chlorine trial to test the benefits of a common secondary disinfection regime • developing the Regional Water Quality Management Plan • developing the SEQ Supply Continuity Plan • holding regional discussions on the optimisation of water supply networks • conducting a successful industry safety forum, with plans to continue this quarterly • projects in the areas of demand forecasting and management, strategic metering, bulk water supply agreements, drought response and future water supply scanning.

Contributing to local and state planning We work with industry and Government to plan for our region’s future. During the year, we provided input to a number of local and state planning programs, including the State Planning Policy (SPP), Queensland Planning Provisions (QPP), local government planning schemes and the Queensland Plan.

Seqwater | Annual Report 2013-14 26 Water supply and water quality are identified as state Stakeholder submissions were reviewed by DEWS to interests in the SPP and bulk water supply infrastructure develop ‘WaterQ: a 30-year strategy for Queensland’s and water supply buffer areas are identified in the water sector’, which they released on 24 June 2014. associated mapping, so that all stakeholders are aware of their location and must take them into account when Developing our water security making or amending a planning scheme and designing land for community infrastructure. program Local governments must use the Queensland Planning This year we commenced developing a Water Security Provisions (QPP) when preparing new planning schemes. Program for SEQ to ensure long term water security. The We provided feedback to councils about draft planning program will include detailed arrangements, measures schemes. Development proposed adjacent to bulk water and strategies for: supply infrastructure or within identified bulk water supply • operating Seqwater’s assets infrastructure buffer areas is required to comply with • addressing future infrastructure needs (including development assessment provisions to mitigate adverse building new or augmenting existing infrastructure) impacts and preserve raw water quality. • managing the infrastructure relevant to the operations We also contributed to the Queensland Government’s • managing demand for water Queensland Plan, a 30-year vision for the state. We highlighted the increasing density of cities putting • responding to drought. pressure on public lands and stressed the importance We are partnering with the SEQ water service providers of well managed and protected water utility land. We to identify and deliver future water supply solutions that also pointed out that SEQ’s water security and quality is provide value for our customers, are resilient against directly related to the type and quality of land use and drought and flood, and support the continued growth of a development in catchments. Finally, we emphasised the liveable and productive region. importance of connectedness across multiple planning initiatives, particularly integrating water and land use Managing customer demand planning. The Demand Management Network was formed with The Queensland Plan was released on 31 July 2014. the SEQ water service providers to develop the demand We made a submission on the DEWS discussion paper, management component of the Water Security Program. ‘Queensland water sector: a 30-year strategy discussion The network has drafted a joint policy position on water paper shaping our water future’. Our submission focused restrictions, which has been submitted to DEWS for on: approval, and extensive demand management measures, • catchment management for a secure water supply which will be considered as part of the Water Security Program. • sustainable water use The Demand Forecasting Network, with representatives • improving efficiency and effectiveness in water from Seqwater and SEQ water service providers, has system management collaborated to establish a regional Demand Forecasting • regulatory reform Validation project. The project involves the placement of • future skills shortages and career pathways 270 loggers on residential properties across the region. • innovation The loggers will be installed from July to September 2014 and water use data will be transmitted daily to an • integrated planning. information portal. We will analyse the data to improve

27 Seqwater | Driving Efficiency our understanding of water demand patterns in relation On 7 June 2013, the Committee of the Legislative to factors such as socio economics, climate, number of Assembly referred the Queensland Audit Office Report people in the household, and household water efficiency. to Parliament 14 for 2012-13: Maintenance of water infrastructure assets to the State Development, This project will contribute significantly to our Infrastructure and Industry Committee for consideration. understanding of demand, and strengthen the demand forecast input factors for Seqwater and the water service The State Development, Infrastructure and Industry providers. Demand forecasts are a critical component of Committee resolved to undertake an inquiry into our future water planning. the issues contained in the above Queensland Audit Office report. In conducting its inquiry, the Committee Responding to drought is considering the value for money of manufactured Through the Water Security Program, we have worked water infrastructure assets, including operating and with relevant water service providers to develop short- maintenance costs, innovative strategies to increase term and long-term drought response plans for individual revenue from the assets, and the future public value of communities. the assets. The Committee is also considering the policy framework for decisions to invest in significant bulk water The Canungra Water Supply Disruption Plan has been supply infrastructure, or to upgrade current infrastructure approved by Seqwater and Queensland Urban Utilities. across Queensland. The Committee’s report, including any Other plans for individual communities are currently with recommendations, is expected later in 2014. the relevant SEQ water service providers for consultation. The decision to place the WCRWS in a care and We are also working towards a consolidated plan for maintenance mode is already benefiting SEQ water Seqwater and all SEQ water service providers to outline customers by assisting the State Government to limit the the way we will respond to drought disruptions and annual increase on bulk water charges as a direct saving ensure a safe, secure and reliable water supply to the to households. community. Managing incidents and Shutting down the Western emergencies Corridor Recycled Water Scheme We provide an essential service and must be prepared to SEQ is expected to experience a very high level of water ensure the continuation of this service, regardless of the security over the next decade and beyond, assuming weather or other disruptive events. average inflows and normal consumption patterns. Based on current forecasts, the Western Corridor Recycled We take a comprehensive approach to emergency Water Scheme (WCRWS) will not be required and to management, including prevention, preparedness, minimise costs, the scheme is being demobilised and shut response and recovery. down (in care and maintenance mode) for approximately Our incident and emergency management arrangements 15 years. are integrated with the broader SEQ water supply system The advanced WTPs, pipelines, tanks and pump stations through the Bulk Authority Emergency Response Plan associated with the scheme are being placed in care and (ERP). maintenance mode until they are needed. The shutdown The ERP provides an ‘all-hazards’ response framework project is expected to be completed in the first half of within which site specific plans (such as asset 2015. contingency plans) are utilised. During 2013, the ERP

Seqwater | Annual Report 2013-14 28 was reviewed in consultation with council owned water entities, the Department of Energy and Water Supply and CASE STUDY: other stakeholders. The ERP was rigorously tested through Battling the North desktop scenarios and emergency management exercises. The Minister for Energy and Water Supply approved the Stradbroke Island ERP on 18 December 2013. bushfires On Saturday 28 December 2013, a lightning strike sparked a fierce bushfire on North Stradbroke Island. Nearly 60% of the island was affected at its busiest time of year. The fire severely damaged the electricity network and cut power to the island, including our WTP, which supplies the Redlands mainland. We needed to protect the North Stradbroke Island WTP from the flames and continue to supply water to the Redlands and nearby islands. To ensure continuity of supply, we pumped water through the Eastern Pipeline Interconnector and the Capalaba WTP, which normally provides only about 25% of the Redlands supply. A contingent of 12 qualified Seqwater fire management personnel worked tirelessly in fire mitigation operations over nine days. We coordinated with the Queensland Fire and Rescue Service, Energex and Redland City Council to protect the North Stradbroke Island WTP from fire damage and ensure the plant could return to normal operations quickly after the emergency had passed. It was an exceptional demonstration of our collaborative partnering with industry and emergency services in the most difficult of conditions to ensure the Redlands community received an uninterrupted water supply and at the same time protection of our water supply assets.

29 Seqwater | Driving Efficiency Delivering efficient Defining our water supply chain water and catchment We manage $10.8 billion of water supply assets and the natural catchments of the region’s major water supply services sources to ensure high quality drinking water for our community. STRATEGIC OUTCOME 4 In December 2013, we implemented formal Operating Protocols with each of the council owned water entities We live and work in the region, that operate the water distribution system in SEQ. so we know how important it is to Completion of these protocols achieved a significant do our job with a focus on quality compliance milestone against our statutory obligations and value-for-money – because we under the Bulk Water Supply Code. depend on it too. We provide water The Operating Protocols detail how we interact with supply and catchment services that other water entities at bulk supply points and define support healthy communities responsibility and ownership. Key operational matters and a prosperous region. addressed in the protocols include the management of pressure, flow, water quality, disinfection, asset management, operational control and sharing of information. The protocols ensure water quality and supply is well managed throughout the supply chain to the taps of Queenslanders.

Consulting with our irrigation customers In accordance with the Statement of Obligations and the Rural Water Pricing Direction Notice (No 1) 2013, we commenced a consultation program with our irrigation customers. Between April and June 2014, we hosted a series of public forums for six of our seven irrigation schemes (excluding Central Brisbane River Water Supply Scheme). At each forum, we reviewed the Network Service Plan, reported on the completed 2013-14 renewals program and presented the forecast 2014-15 renewals program for discussion. We also presented updated scheme service standards for the irrigators’ endorsement. Customers actively participated at the forums, asking questions and having discussions focused on the renewals program and scheme operations. Irrigator feedback was

Seqwater | Annual Report 2013-14 30 that the public consultation forums were a success and • Leslie Harrison (Redlands) – dam water level lowered we intend to hold another round of consultation later in • Sideling Creek (Brisbane North) – dam water level to the year. be lowered • Bill Gunn (Lockyer Valley) – reduced temporary full Improving our dams supply level set In 2012-13, we commissioned an independent assessment • Ewen Maddock Stage 2 and Lake Macdonald of our 26 regulated dams, including a comprehensive (Sunshine Coast) – planning underway. study of the condition of each dam and its compliance Cooloolabin (Sunshine Coast) and Nindooinbah (Scenic with the latest standards. Rim) dams were also lowered during the year. The Dam The independent experts who assessed our dams Improvement Program will not impact on regional water considered: security. • significant population growth downstream of our We are committed to informing local communities well dams since they were built ahead of any water level lowering or improvement works • advances in dam design and development of at our dams. Meetings were held with key stakeholders consistent methodologies for assessment and local residents at Leslie Harrison and Sideling Creek • the latest estimates of extreme rainfall dams to advise them of the program. Community members can sign up for updates on our progress and information is • data from the major flood events in 2011 and 2013 regularly updated on our website to keep people informed. and updated flood modelling The timing of the improvement works may change • improved understanding of earthquake probabilities depending on the outcome of ongoing investigations. and loads. All of our dams continue to perform as they should. Helping to mitigate flood events The assessment increased our understanding of how these factors affect our dams and identified a program Informing the dam optimisation studies of investigations and upgrades to be undertaken in the coming years to ensure our dams meet the latest As part of the Queensland Government’s response to the standards. 2011 Floods Commission of Inquiry recommendations, DEWS took responsibility for coordination of the Our Dam Improvement Program will see us upgrade Wivenhoe and Somerset Dams Optimisation Study and some dams and reduce the water levels of others until the North Pine Dam Optimisation Study. such time as upgrade works can be completed. Dam improvements have been prioritised to ensure a staged We have supported both studies, carrying out extensive work program that is scoped and scheduled to ensure hydrological analyses and reporting to DEWS. We also security of water supply at the best value for money. conducted state-of-the-art modelling of dam operations to assist in the evaluation of different options for the Investigations are being undertaken to confirm the need, future operation of the dams. Staff attended community scope and timing of works. consultation sessions on the studies run by DEWS to gain Dams identified for improvement works over the next five feedback on the dam operation options being considered. years include: The studies present options for the management of • Moogerah and Maroon (Scenic Rim) - upgrades are Wivenhoe, Somerset and North Pine dams during flood underway and scheduled to be completed before the events. The options seek to improve the use of existing 2014-15 wet season dam infrastructure to deliver better flood mitigation outcomes. 31 Seqwater | Driving Efficiency Once the outcome of the studies is finalised, and An EMS certification audit was conducted by SAI Global a preferred flood mitigation option decided by the in June 2014 and maintained certification of the EMS in Queensland Government, we will prepare new manuals its current form, without raising any non-conformances. for the operation of our dams. The Molendinar and Mudgeeraba WTPs were included within the scope of EMS certification. We are also supporting DEWS with its Flood Storage Infrastructure Study, which is considering new dam Improving our catchments options. We have conducted hydrological analysis and investigations to assist this study. The treatment of our water supply starts in our catchments. Healthy catchments reduce treatment costs Preparing for flood events and benefit our community. As part of our ongoing commitment to ensure our dams This year we delivered more than 70 projects that perform as they should, we continually review and update improved our knowledge of catchment risks and targeted our systems, staff capabilities and procedures. investment in catchment improvements leading to water quality outcomes. This year, our Flood Operations Centre staff and dam operators participated in two flood scenario exercises to We completed 47 site-based environmental management test possible changes to the flood manuals. plans and environmental risk profile summaries, which will be implemented in the next financial year. We implemented a Flood Early Warning System (FEWS) as a platform for data analysis and flood modelling As an active member of the Healthy Waterways in real time. This allowed us to reassess the design Partnership, we participated in a number of panels, flood hydrology and modelling for all 26 of our dams. working groups and committees. We also provided both FEWS is now also being implemented by the Bureau of direct and in kind funding support to the Partnership to Meteorology and other agencies around Australia. drive advocacy in waterways health. In partnership with the Bureau of Meteorology, we We conducted targeted monitoring to assess the co-hosted the first Australian FEWS User Group, quality of raw water supplies and identify risks within attended by 20 water management agencies, in early our catchments. These risks will be targets for future May. Implementation of a data collection system and investment to improve water quality outcomes. hydrometric database in the past 12 months has enhanced Thirty-five natural asset projects were undertaken or our ongoing process improvement. continued from previous years. The projects addressed We also reviewed Emergency Action Plans for all of our natural asset maintenance and restoration in the dams and shared these with Local Disaster Management following areas: Groups for feedback. These plans will be publicly • weed management available once approved by DEWS. • erosion and riparian restoration Caring for our environment • revegetation • fire trail management. Consolidating systems As part of the environmental initiatives undertaken to align with the strategic plan and the Statement of Obligations, we developed and implemented a consolidated Environmental Management System (EMS) in accordance with ISO14001 requirements. Seqwater | Annual Report 2013-14 32 Developing our Catchment Operational management: To manage catchment operations, including Greenprint developing and implementing strategies for fire, weed On Australia Day weekend 2013, parts of Brisbane came control and biodiversity. within hours of running out of water after record-breaking water turbidity in the Brisbane River forced the temporary Shaping future development: To ensure the right policies and legislative shutdown of two WTPs at Mt Crosby. controls are in place for sustainable development Although the emergency was managed without any within catchments. interruption to supply, the investigation that followed Knowledge sharing: found the degradation of the Lockyer Creek catchment, To have access to the best knowledge as well as which feeds the Brisbane River, was a major cause of having an informed community that understands the the high levels of sediment that made the river water importance of catchments. untreatable. The event highlighted the importance of catchment health Collaboration and partnerships: to SEQ’s water security and the need for transformational To promote partnerships to enable enhanced catchment outcomes by working together. change in catchment management to protect our source drinking water. In response, we developed our Catchment Decision making: Greenprint. To provide frameworks and tools to make the right The Greenprint sets out Seqwater’s vision and strategy for decisions for ongoing catchment improvement. catchment management. A long term adaptive plan, the Greenprint enables us to work with other organisations While we will continue to undertake catchment land and groups to deliver better catchments and ensures there management works, long term and significant future is a clear understanding of direction and priorities. actions for catchment management require a coordinated The Greenprint is based on eight elements and associated approach across multiple stakeholders. This will be strategies: achieved through government, industry and community collaboration. Liveable sustainable region: To develop and articulate long term thinking on catchments as part of a liveable, productive and Repairing Mt Crosby Weir sustainable region. We undertook an extensive program of works to prepare for the 2013-14 wet season, including essential repairs to Understanding catchments and water quality risks: Mt Crosby Weir on the Brisbane River. To understand catchments and raw water storages Mt Crosby Weir is one of the most important assets in and the implications for water quality. our bulk water supply system. Water from the weir is pumped to the region’s largest WTPs, which supply most Advocacy and investment: of Brisbane and Ipswich’s drinking water. To understand the magnitude of the effort required for catchment improvement, advocate for the right A diver sent in to inspect the weir and associated ongoing investment and consider appropriate infrastructure following Ex-Tropical Cyclone Oswald funding models. in January 2013 discovered significant damage to the structure, most likely caused by the huge volume of water and debris that flowed down the Brisbane River.

33 Seqwater | Driving Efficiency Work at the weir included hauling out a 22-tonne log, The temporary shutdown followed months of careful which was wedged in one of the two intake pipelines planning to ensure water supply was maintained across to the Mt Crosby East Bank WTP. Once the log was the network. To minimise disruption, crews worked in removed, about 300 tonnes of rock and sediment that had rolling shifts around the clock from 2 to 4 June 2014, and accumulated in the intake pipeline was cleared away. completed a number of different projects simultaneously. Numerous sections at the toe of the weir had been Despite being a highly complex project, with numerous severely undermined and immediate action was taken skilled trades working to a tight schedule, the project was to shore up the structure while a new concrete toe block completed without a hitch. A key component of the works was constructed to support it. was the replacement of valves to improve water and flow management. Sludge plant flow control and measurement The repairs began in late June 2013 and despite a number was completed to improve the ability to manage the flow of challenges, including the need to build a coffer dam and volume of water travelling through the plant and to confine the flow of the Brisbane River to allow for a some initial preparation work for the installation of a new detailed inspection of the structure to be carried out, the lime system was also completed. works were completed in less than five months. A new roof was installed on the high level reservoir prior Originally built in 1926, the remediation works were the to the shutdown of the plant. The heritage-listed reservoir first major maintenance works at the weir since it was was built in 1882, with a floating roof installed around 30 transferred to Seqwater’s ownership in 2008. years ago. This floating structure has now been replaced with a fixed roof, which will improve water quality. The Maintaining our historic Mt Crosby Mt Crosby Historical Society was consulted throughout East Bank WTP the project to ensure it went smoothly. In June 2014 we completed a significant program of maintenance at the historic Mt Crosby East Bank WTP to Replacing the filters at Molendinar ensure a continued safe, secure and reliable water supply WTP for the greater Brisbane and Ipswich areas. We continually review our operations and look for ways to The East Bank plant, which originally opened in 1882, is improve the quality of water we provide to our community. an essential part of the water supply network, providing This year we replaced the filters at Molendinar WTP on all of Ipswich city’s water and about half of Brisbane’s the Gold Coast to ensure the continued reliable operation supply on an average day. of the plant, and to improve the effectiveness of our To complete the essential maintenance works, the plant filtration. was shut down for three days, for the first time in more The upgrade commenced in October 2013, with the than 50 years. filters replaced one at a time to ensure uninterrupted Shutting down and fully draining a plant of its size to water supply. The final three filters will be installed by achieve the necessary isolations to undertake the works November 2014. was a major undertaking. Work involved replacing and The scope of each filter upgrade included internal maintaining ageing assets to improve plant operability, structure refurbishment. We raised the weir wall, reliability and safety, both in terms of water quality and replaced launders, resurfaced the filter walls and floor, the wellbeing of the people who operate and maintain the repaired wall joint seals and cracks, repaired the gullet plant. below the washout channel, and replaced nozzles. The result is an improved water supply for customers on the Gold Coast. Seqwater | Annual Report 2013-14 34 Opening of Kilcoy WTP CASE STUDY: Our newest asset, the Kilcoy WTP, was officially opened by the Minister for Energy and Water Supply, the Improving Upper Black Honourable Mark McArdle MP, on 18 December 2013. Snake Creek The plant is the first major infrastructure project to be We work closely with local councils to improve delivered by the new Seqwater and features some state- catchments and water quality. This year we of-the-art treatment technology. It is the result of more teamed up with Ipswich City Council on its than three and a half years of planning and construction Upper Black Snake Creek Improvement Plan. and ensures the 1,700-strong community of Kilcoy and local industry has a safe, secure and reliable water supply The draft plan provided a coordinated approach into the future. to local community, business and government investment in a total water quality management The plant draws raw water from nearby Lake Somerset model for addressing water catchment issues via a 2.5km pipeline. This water source replaces Kilcoy in the Upper Black Snake Creek catchment. This Creek, which supplied the existing Kilcoy WTP but was catchment is critical to water quality within the not always a reliable raw water source. Mid-Brisbane River. We worked closely with Queensland Urban Utilities to The draft plan is a non-statutory document and upgrade the Kilcoy water supply system. relied on a partnering approach and private and The new plant incorporates the latest water treatment public funding to achieve the desired outcomes. processes. It is a zero discharge plant, which means It includes three preliminary action plans and it uses a mechanical process to extract solids from three corresponding priority action plans to: wastewater, allowing all water to be recycled. This • manage local flood risk eliminates wastewater production and provides significant • mitigate salinity mitigation, and environmental benefits. • restore landscapes and improve water The stainless steel infrastructure will ensure the longevity quality. of the plant and also provides a low maintenance solution for Kilcoy’s water supply. This exemplar project will be rolled out in other areas that experience similar water catchment challenges.

35 Seqwater | Driving Efficiency Ensuring sustainable Driving efficiencies Since our establishment on 1 January 2013, we have financial capacity reduced our operating expenses when compared with the combined predecessor entities 2012-13 (actuals) by 18%

or $53 million. STRATEGIC OUTCOME 5 This has been achieved by a variety of efficiency measures to seek reductions in real terms for these costs on a risk We continually drive down assessed basis. operating costs to deliver the best Other expense budgets for depreciation and interest in value for money bulk water supply 2012-13 for the pre-merger entities were $219 million and to our community. $600 million respectively – a total of $819 million.

Actuals for these same items in the Seqwater 2013-14 budget were $259 million for depreciation and $536 million in interest – a total of $795 million. Depreciation expenses were higher than forecast by $22.5 million, primarily due to the closing of several small WTPs during the year, which caused an accelerated deprecation accounting entry to be booked. This will manifest itself in no deprecation for these plants in future years together with no operating costs once the plants are decommissioned. Interest costs were lower than anticipated due to changes in Queensland Treasury Corporation (QTC) book interest rates. We had no need to draw down loans (other than for capitalisation of water grid debt) due to the lower operating costs and careful and considered management of cash in working capital during the year. Our financial results are based upon stringent financial targets and budgets as a result of a prudent approach taken by the Board, management and staff. Our budget was compiled by staff from first principles (zero based) to clearly articulate funding required to deliver the operational and strategic outcomes approved by the Board. During the year the Board reviewed monthly actual results against financial targets so any financially material matters that required attention were dealt with expeditiously to maintain spending at or below budget targets whenever possible.

Seqwater | Annual Report 2013-14 36 For single or, in some cases, grouped capital projects a Our current credit metrics are below a standalone ‘B’ commercially driven methodology is in place. Projects rated entity and significantly below a ‘BBB’ rating as must be approved via a multiple gateway system. This expected from a typical Government Owned Corporation approach requires each business case to be developed or Statutory Authority such as Seqwater. including a commercially calculated return on investment Short of a government injection of significant capital, (cost of capital) so that the allocation of scarce capital is the commercial approach taken by the Board through only agreed and approved based on the best allocation its Capital Structure Strategy 2013-2028 with respect of funds competing against other funding priorities. This to achieving a financially sustainable credit rating is as process will be further refined in 2014-15, with a similar follows: gateway approvals approach to be introduced for single non-recurrent operational projects. • target a return to positive equity position by financial year 2013 (completed) During 2013-14 we established, refreshed and finessed • target a sub investment grade credit rating BBB range phasing of cash flows particularly for capital (investment gearing levels 65-70% by financial year 2025 (on in infrastructure), and the need as a matter of last resort track). for new loans from our lender QTC. This year-long and ongoing process has enabled tight Optimising asset performance control over working capital cash so that minimal readily This year we worked to ensure our assets performed at an available cash is held at any one time to meet cash optimum level. We took a number of measures to achieve needs. This careful cash management has provided clarity savings and provide bulk water at the best value-for- towards the end of the financial year on the necessity or money possible, including: otherwise to draw down loan funds which were originally • rationalising and retendering the supply system estimated at $125 million at the beginning of the financial operations and maintenance contract, contributing to year but which were ultimately not required. a cost reduction of $3.36 million Reporting on cash flows against targets was provided to • identifying a calibration error during the installation of the Board each month. Internally, staff assess cash flows new flow meters at Cameron’s Hill Reservoirs 1 and 2 through daily bank reconciliations to enable minimum resulting in an undercharging error being found, with cash amounts to be held ready for creditor payments, with a potential saving of more than $1 million any surplus cash used to pay QTC financing obligations • resuming operational management of Noosa WTP, and for short term investments in accord with the Board’s saving $604,000 a year approved investment policy. • optimising the ‘hot standby’ operational regime for The Board developed and articulated its risk appetite the Gold Coast Desalination Plant resulting in an during the year. This is a key attribute used in operating expenditure reduction of $405,000 a year infrastructure investment proposals and the general financial risk environment. The Board risk appetite is • reducing sludge to sewers through closer monitoring manifested in non-subjective financial targets in the and control of the clarifier bleeds and the backwash financial risk section of the Corporate Risk Matrix. recovery process, leading to reduced trade waste charges for a total saving of $250,000

37 Seqwater | Driving Efficiency • moving to a more efficient resource model for our operational control room, saving $100,000 • suspending routine summer season operations at Ewen Maddock WTP and sourcing water more efficiently from other sources in the network for the 2013-14 summer, saving $84,000. We reduced the number of WTPs from 41 to 37 and sold two WTPs during the year: • Albert River WTP at Beaudesert was sold to Queensland Urban Utilities • South MacLean WTP was sold to Logan City Council. Works are underway to make safe other surplus assets at an estimated project cost of $258,600. The make safe works will address site security, electrical isolations, chemical removal, mechanical isolations, regulatory compliance, environmental risks, and the safety and security of pits, lids and ladders. A second program of works will commence in 2014-15 to permanently decommission the assets and remediate the sites before disposal. This program will be implemented over several years.

Developing a sustainable price path We commenced preparation of a bulk water price submission to the Queensland Competition Authority (QCA) for the recommendation of prices for the final three financial years (2016 to 2018) of the Queensland Government’s 2008-18 bulk water price path. This submission covers our proposed operating and capital expenditures for the financial years 2014 to 2028 as required by the Queensland Treasurer’s Ministerial Referral Notice issued on 6 May 2014. We have forecast water demand to the financial year 2028 and developed a strategy to meet this demand. This strategy forms the basis of our expenditure forecasts. The submission takes into consideration our service and regulatory obligations and associated costs. Our dam safety obligations, through the Dam Improvement Program, are a major driver of future capital expenditure.

Seqwater | Annual Report 2013-14 38 throughout 2013, with service and safety awards Supporting capable presented in November 2013. and innovative people Our establishment for 2013-14 was 620 full time equivalent employees and our permanent separation rate was 21.1%. We are committed to ensuring our people work safely, efficiently and effectively Putting safety first STRATEGIC OUTCOME 6 to deliver a safe, secure, resilient and We are committed to ensuring the health and safety reliable water supply for our customers. of everyone across our business, including employees and visitors. This year, we implemented a Workplace Health and Safety Management System framework. The framework and overarching policies and procedures were Developing our employees approved in April 2013. In April 2014, we hosted an industry-orientated safety Seqwater’s people are our greatest asset, and investing day, ‘Empowering our future’, to educate and promote in employee capability is an important step towards youth safety in the workplace to our water industry achieving our strategic outcome area of capable and affiliated entities, regional councils and major water innovative people. industry contractors. Attended by more than 90 young We introduced an innovative certified agreement for our workers, the day featured real-life safety case studies, employees in 2013. The Seqwater Certified Agreement presentations on important safety topics and activities 2013-2016 embeds a savings culture in our organisation. that showcased the skills and knowledge young workers We continued to demonstrate our commitment to need to confidently make good safety choices. We employee work-life balance this year through initiatives received excellent feedback and participants reported such as our annual leave liability reduction program, gaining an increased awareness of and ability to manage which assisted staff to take a break and recharge. We workplace risks. also reviewed all operational rosters with one of the aims We made significant progress in our workplace health and being to improve employee work-life balance. safety culture program, including: We also built the capability of our front line leaders, • approval of a safety leadership development program with positive feedback from all participants in the • development of Our Golden Rules, a set of guiding program. We introduced Our Learning, an online learning principles to mitigate risk activities and provide a and development system, with the capability to record strong foundation to build a proud and strong safety employee training and certification history and deliver culture online learning courses. • promotion of ‘safety conversations’ through targeted In 2014-15, we will develop our Capability Framework, collateral. identify capability gaps and then focus our investment in these areas. Our safety management system was recognised with a ‘Best work health and safety management system’ To drive efficiency, we focused on the productivity of our award at the Queensland Safe Work Awards 2013. The people resources. We implemented a new organisational award recognises continuous improvement of work health structure to support the delivery of our strategic goals. and safety through the implementation of an integrated The certified agreement introduced performance systems approach. management plans for all employees. The performance plan process will be rolled out in 2014–15. Since 2003, our safety management system has evolved from a collection of procedures adapted from different Our rewards and recognition program continued councils to an integrated system relevant to the nature and scale of the risks we face. We drew on the 39 Seqwater | Driving Efficiency knowledge and experience of our employees to ensure a The survey also measured the elements known to system that is readily accessible, usable and above all, underpin employee wellbeing and performance. The supports our ultimate safety goal of ‘Safe for Life’. majority of feedback indicates that our leaders are approachable, can be relied upon, understand the Implementing our new structure problems being faced by employees, and communicate well with employees (‘supportive leadership’). A key In July 2013 we implemented a new organisational strength is the level of ‘team engagement’, which structure. The structure was designed to ensure that we indicates good team work across the business. had the right capability across the business to support the delivery of our strategic outcome areas. See page 55 for The survey also identified that our performance can be our organisational structure. improved by developing a learning culture so that we continually seek and implement opportunities to grow and Building our organisational culture develop on the job. We will implement improvement plans over the next 12 months. Our vision of ‘Healthy communities, Prosperous region’ guides our journey as a business. To achieve our vision Engaging our employees and deliver on our purpose, we developed strategies that guide what we do and values that guide how we do it. We engaged our employees in a creative campaign to Our values are: address the results of our Pulse Survey and input into the business’s attraction strategy. • We work safe During the course of the campaign, 113 staff lodged 45 • We deliver entries which demonstrated what they loved about their • We work together jobs, including photographs, presentations, videos, poems • We continually improve and written submissions. Participants agreed the best part • We each make a difference. of the campaign was gaining a better understanding of the roles of different employees across the region. In October 2013, we conducted an employee Pulse Survey to give our employees an opportunity to provide feedback Staff reported that the campaign encouraged positive on their roles, team and the business overall. The survey conversations about ‘what I love about my job’. It also provided a snapshot of what employees thought was highlighted that our staff highly value their connection working well and what could be improved. to the community, focus on continuous improvement and ability to make a difference through their work. In May 2014, we conducted a Connect Employee Survey, a more extensive survey of employee views. With an excellent response rate of 82%, the survey has given us a Increasing our business capability greater insight into our strengths and the areas we need Bringing together three organisations and their processes to work on. in a short space of time meant there were various planning and measuring activities taking place across At an organisational level, the survey showed our work different business units that required alignment. practices relating to safety, innovation, and quality outputs are significantly above the average Australian We developed a Management Operating System—a organisation. The survey found high levels of satisfaction series of management, control, planning, monitoring and with safety standards within teams and a belief that measurement capabilities—that enabled us to understand leaders are committed to safety. Many teams reported what actions were required to successfully execute our that they are encouraged to implement new ideas and organisational strategy and achieve against our six key innovations. The vast majority believe that Seqwater outcomes areas. produces high quality outputs and is committed to continuous improvement and achieving high quality water outcomes for the people of SEQ. Seqwater | Annual Report 2013-14 40 Relocating our headquarters Achieving our EBA savings target In October 2013, we announced we would relocate from This year we worked on developing an innovative culture our Brisbane CBD offices to a new office tower in Ipswich. focused on making efficiencies and savings wherever we could. Our Savings Tracker results are proof of this culture The decision to move the region’s bulk water authority in action. headquarters was made following a review of our CBD accommodation and supported a whole-of-government As part of the 2013 Enterprise Bargaining Agreement strategy for the building at 117 Brisbane Street, Ipswich. (EBA), a portion of wage increases were contingent upon savings targets being reached. Some 340 employees were moved in planned stages between January and July 2014. An initial savings target of $217,010 was achieved by 31 December 2013 and a second savings target of $245,910 The move enabled all of Seqwater’s Brisbane CBD was achieved in May 2014, two months ahead of employees and Karalee office staff to be accommodated schedule. This meant all EBA employees qualified for the at the one location, instead of being split between two contingent wage increase of 0.5% in January and again in sites in the CBD and Karalee. The move also consolidated July 2014. the business’s regional presence. People from all over the business came up with ways we As part of the implementation plan, Seqwater held a could make ongoing savings through improving processes series of workshops, including financial planning and and implementing innovative ideas. career decision making, to assist employees with the transition. The next savings period starts on 1 July 2014. The amount required to be saved before 31 December is $266,507 for A localised ‘Day in the life’ campaign was launched in an increase to be effective from 1 January 2015. early April to support the organisation’s move to Ipswich and position Seqwater as a regionally based ‘employer of choice’. Staff in a variety of roles were featured to Acknowledging excellence increase understanding of our work. Our staff’s passion for their industry was recognised when The campaign included: Trainee WTP Operator Sarah Walton won Qldwater’s Queensland Young Operator of the Year Award for 2014 • online videos to accompany recruitment at the 39th Annual Queensland Water Industry Operations advertisements/listings Conference and Exhibition in June 2014. • advertisements in the local newspaper Sarah started at Seqwater in October 2013, shadowing • bus shelter advertising and a billboard on one of the operators at the North Pine WTP and beginning her main routes in and out of Ipswich. Certificate II in Water Operations (Water Treatment). To ensure effective use of a limited budget, we took She quickly progressed and is now running the water advantage of both cost-effective and ‘distress’ media treatment process for our day-to-day operations. Sarah’s buying opportunities, including: win was recognition for her achievements, but also an • double-sided billboard at Dinmore seen approximately acknowledgement of the efforts of her fellow operators. 60,000 times in the 28-day period At the same awards, Seqwater’s Martin Melville was a • online (Facebook) advertising that was viewed by finalist for Operator of the Year and Philip Thornton won 278,626 people and led to 7,249 people watching the third place for his poster about the new Kilcoy WTP. online videos. The campaign concluded on 30 June 2014.

41 Seqwater | Driving Efficiency Statement of The following table demonstrates the alignment of our OBLIGATIONS Obligations alignment 2013-14 initiatives with the Statement of Obligations.

Statement of Strategic 2013 – 14 initiatives Obligations section outcome area

4.1 Operational and n/a Our Operational Plan for 2013-14 and Strategic Plan for 2013-18 were Strategic Planning approved by the Seqwater Board and submitted to government. The plans include our vision, purpose, outcome areas and KPIs. These documents were approved in a letter from the responsible Ministers.

4.2 Water Security Water and • We continue to support the Waterhub information system that collects, catchment stores and disseminates data. The information within the system allows us services to input accurate data into the demand forecasting, water supply yield and pipeline network models that we maintain. We provide login access to the Waterhub system to DEWS and continue to provide data and trend analysis when requested. • We recently incorporated into the Waterhub system the former Water Grid Manager system functionality that generates monthly customer bulk water invoices. This initiative has reduced risk, improved the time to generate invoices and reduced ongoing operational expenses. • Seqwater provides advice to DEWS on request. Extensive modelling was completed to generate several reports for DEWS, including: 1. Assessing the water security implications of variations in manufactured water availability combined with options for reduced operating levels of Wivenhoe and North Pine Dams – report completed in October 2013. 2. Assessing the water security impact of temporarily lowering Wivenhoe and North Pine Dams – report completed in November 2013. 3. Assessing the water security implications of several permanent and temporary lowering options for Wivenhoe and North Pine Dams – report completed February 2014. 4. Assessing the water security implications of not having the purified recycling water supply source available – report completed February 2014.

Seqwater | Annual Report 2013-14 42 4.3 Water Quality Water and During the year, Seqwater’s amended Drinking Water Quality Management catchment Plan was approved by QWSR. This included an increase in scope by services incorporating the former LinkWater’s processes. Progress has been made to achieve Food Safety Management System certification (ISO22000) across Integrated the asset base. The bulk supply system, Molendinar WTP, Mudgeeraba whole-of- WTP and Image Flat WTP have undergone internal preparatory audits industry and external certification audits were conducted in June. SAI Global has approach awarded ISO22000 certification to these sites. Under the governance of the Joint Operations Committee a Partnership Water Quality Plan project has been initiated. Seqwater has the leading the role for its development during 2014-15.

4.4 Customers Water and • A Brand Strategy and associated campaigns are in development and will be catchment integrated into a range of communication channels, including Seqwater’s services community engagement, traditional and digital (web, social) programs. The strategy was approved by the Board in June 2014 to proceed to the next stage. • The SEQ Water Service Providers Partnership, comprising Seqwater and the council-owned water entities, met regularly throughout the year and progressed joint initiatives aimed at maximising the efficiency of the water supply chain and delivering greater value to customers. • Following extensive consultation with SEQ communities, we released recreation guides and associated management plans for 17 lakes as part of our ongoing Recreation Review. Seqwater’s recreation assets play an important role in a growing and liveable region and the review continues to provide a unique opportunity to engage with communities about our role and work. • We engaged with key stakeholders and local communities about our Dam Improvement Program, briefing councils, Members of Parliament, recreation stakeholders, local residents and the media about the planned lowering of the water level of Leslie Harrison Dam at Capalaba and Sideling Creek Dam at Petrie. Lowering the water level of both lakes will allow further investigations to inform the scope and timing of planned future upgrades. • The first bi-annual Irrigator Forums for six of our water supply schemes were held in May 2014 to engage with rural raw water customers. • The final Wivenhoe/Somerset and North Pine lessee committee meetings were held ahead of plans to introduce bi-annual Lessee Forums to engage more broadly with Seqwater land lease and licence holders. • Negotiations were held with Stanwell Corporation to transition to an alternate water supply following the decision to shutdown the WCRWS. • Seqwater worked with Energex and the Department of Transport and Main Roads on offset revegetation programs in strategic catchment areas.

43 Seqwater | Driving Efficiency 4.5 Employees Capable and • Our compliance and workplace health and safety training needs analysis innovative was completed. people • We implemented a Learning Management System in December 2013 to assist us to effectively manage compliance training and capability across the business. • We rolled out a cultural alignment program, including the development of leadership behaviours for our business. • We continued to provide learning and development offerings to all employees to ensure our people have the required skills and knowledge to perform their roles.

4.6 Community Knowledgeable • Our public 1800 number and early warning SMS campaign are operational. and engaged • We are conducting a review of existing policies, processes and channels community related to customer and community complaints and compliments with Water and a view to implementing a single, integrated end-to-end customer and catchment community relationship management system across the business. services • The Seqwater website provides public information about: o dam water levels Sustainable financial o recreation guides and plans capacity o monthly Customer Confidence Reports on water quality. Integrated • The community education and engagement program continues to work with whole-of- students and the broader community to increase awareness of Seqwater’s activities and role in the water sector. Our visitor display centres at industry Wivenhoe and Hinze dams are open seven days a week following feedback approach received during the Recreation Review community consultation process. • We have also launched the next phase of our Dam Improvement Program conducting community forums and information days relating to dams requiring upgrade works. A regular e-newsletter updating progress for each dam is available to the community.

4.7 Assets Water and • We plan the management of our assets through the development and catchment implementation of Asset Management Plans (AMPs) that are developed services for major asset groups, including natural and built assets. These class plans include an assessment of current capacity, capability, condition and Capable and performance with regard to acceptable industry practices. Asset class plans innovative have been completed for all catchments, dams and the majority of WTPs people and the continued development of AMPs addressing the remaining WTPs (Noosa and Banksia Beach) is scheduled for 2014-15.

Seqwater | Annual Report 2013-14 44 • ‘Whole of system’ integrated planning is being progressed through the development of the Water Security Program (WSP), which will demonstrate Seqwater’s ability to meet Levels of Service (LOS) criteria to provide a secure water supply to SEQ into the future. Capital, renewals and operations will be optimised through the 30-year Integrated Master Plan (IMP). • Demonstrated prudent and efficient system operating strategies are adopted in the System Operating Plan (SOP) and deployed through the seasonal Annual Operating Plan (AOP). Both the SOP and AOP regulatory submissions have been superseded by the recently published LOS criteria. However, we will continue to prepare equivalent system optimisation plans to meet internal strategic requirements. • We use the Technology One ERP as our repository for asset information. The organisation is implementing an Asset Information Strategy to address information gaps and putting in place processes to ensure asset information is captured when changes occur. This asset information strategy includes processes for management of plans and applicable standards. • We have developed a comprehensive governance framework for the management of ICT assets. Information assets are stored against a security classification and the core ICT systems have full audit capabilities to ensure unauthorised access is not granted. Changes to systems are managed through the IT services management framework, which provide for controlled changes to systems to reduce risk and ensure data integrity is maintained. • All ICT engagements are managed under the GITC contract framework and provision is made for a number of IP licensing models which have been approved by Government.

4.8 Environment Water and • Our Environmental Management System (EMS) has been developed and Catchment implementation in accordance with ISO14001 requirements is progressing. Services • An EMS certification audit was conducted by SAI global between 23 and 25 June 2014 and maintained certification of the EMS in its current form, without raising any non-conformances. Two WTP sites (Molendinar and Mudgeeraba) were also included within the scope of EMS certification. • As part of the EMS implementation and environment and catchment water quality programs the following activities have also been undertaken: o Audit Program for STPs and WTPs completed. o Completion of 47 Site Based Environmental Management Plans and environmental risk profile summaries for ground truthing and implementation.

45 Seqwater | Driving Efficiency o Environmental Risk Registers (known as Aspects and Impacts Registers) including legal and other requirements completed for ground truthing and implementation. o Draft Environmental Compliance Manual completed and distributed for internal review. o An Environmental Training program is in development and some training aspects have commenced i.e. fire ant inspections, vegetation clearing etc. o A review of the risk posed by potentially contaminated sites across Seqwater has been commenced based on an environmental prioritisation program. o A data review of WTP residuals (i.e. sludge) content has been conducted to seek re-classification under current waste legislation, with the aim of opening up beneficial re-use and low cost disposal opportunities. o Processes for the delivery of vegetation offsets monitoring and reporting have been established. o An integrated management review presentation and report has been prepared covering aspects of the environmental, drinking water and quality management systems. • We are an active member of the Healthy Waterways Partnership as a member and/or chair of a number of panels, working groups and committees. We also provide both direct and in kind funding support to the Partnership to drive advocacy in waterways health. • We have undertaken monitoring to assess the quality of raw water supplies and identify risks within the catchments for targeting investment for improved water quality outcomes.

4.9 Safety and Capable and • We have progressed AS 4801 compliance for certification of the merged Emergency innovative business corporate offices and network sites. A plan has been developed Management people to extend certification to remaining ex-Seqwater network connected sites from June 2014. This will then achieve certification for all of the major Integrated asset sites across the business. whole-of- • Expert recommendations are being implemented into a Workplace industry Health and Safety Management System, with all overarching procedures approach scheduled to be approved by July 2014. Water and • Seqwater provides essential services to the people of SEQ. Some 3.6 catchment million people rely on us and the council owned water entities to provide services these services 24 hours a day, regardless of the weather or other disruption events. To meet its obligations, we adopt a comprehensive approach to emergency management - prevention, preparedness, response and recovery. This includes, maintenance and capital works scheduling,

Seqwater | Annual Report 2013-14 46 supply system operation planning, seasonal threat assessments, business continuity planning, training, rehearsals, testing and incident investigation for continuous improvement. • Our incident and emergency management arrangements are integrated with the broader SEQ water supply system through the Bulk Authority ERP. The ERP has been reviewed in consultation with the council owned water entities, DEWS and other stakeholders and rigorously tested through both desktop scenarios and emergency management exercises. The Minister for Energy and Water Supply approved the ERP on 18 December 2013.

4.10 Governance Sustainable Governance and compliance frameworks are in place and under continual financial review. Implementation of the frameworks is underway and includes capacity specific projects to review and revise policy documentation organisation- wide, and to develop a fully integrated risk framework taking into Capable and account business continuity management. Our compliance, risk and issue innovative management software is being enhanced to better manage compliance people obligations, risks and safety hazards across the business.

47 Seqwater | Driving Efficiency Our corporate Reporting We report on our performance to the Responsible governance Ministers and the community through quarterly reports and our annual report. Our Chairman regularly liaises with Responsible Ministers and provides briefings as required.

As a Government-owned statutory We communicate with our Responsible Ministers through CORPORATE GOVERNANCE authority, good corporate relationships with DEWS, including the Dam Safety governance is central to our Regulator, and Queensland Treasury and Trade. These systems and processes to ensure relationships cover reporting, oversight and regulation of our business activities. we are transparent about how we do our business and report to our We also report to Queensland Health (in relation to the owners and the community. We Public Health Act 2005 and the Water Fluoridation Act 2008) and other relevant departments in relation to the comply with a rigorous framework delivery of major water projects. of rules, systems and processes to manage risk and drive efficiency Risk management and innovation. We are committed to managing all risks at strategic and operational levels through identification, assessment, treatment, monitoring and review. Our risk management approach is based on AS/NZS ISO 31000: Risk Management Principles and Guidelines. To manage risks, we have a system of internal controls— policies, procedures, processes and tasks—designed to respond to operational, financial, compliance and any other risks. The system is approved and overseen by the Audit and Risk Committee and the Board and meets the requirements of the Financial Accountability Act 2009 and the Financial and Performance Management Standard 2009.

Working with integrity Our Board, Executive Leadership Team and staff are committed to high standards of integrity, professionalism and accountability. Our Code of Conduct outlines how we work—the standard of behaviour expected of all employees. This year we refined our Code to ensure it continues to function as an effective tool for staff. The Code helps employees to understand their personal responsibilities and obligations and provides guidance in circumstances where they face an ethical dilemma or conflict of interest Seqwater | Annual Report 2013-14 48 in their work. All employees completed training on the Seqwater is also the sole member of the ‘not-for-profit’ updated code. company, Australian Water Recycling Centre of Excellence Limited. During the period, Seqwater Board members We also have a Board Code of Conduct that outlines Noel Faulkner, Leith Boully and Michael Arnett served as expectations for the conduct of Board members. directors of that entity. Noel Faulkner and Michael Arnett Our Trading in Securities Policy deals with potential resigned as directors effective 27 September 2013. As of conflicts due to trading and investments by Seqwater 30 June 2014, Leith Boully remains as Chair of that entity. Board members, managers and officers. We also have a Fraud and Corruption Control Policy and Board members Procedure and Conflicts of Interests Procedure in place The Seqwater Board was appointed on 1 January 2013. with appropriate controls to ensure integrity and ethical Board members have extensive experience in the areas of decision making in dealings involving Seqwater Board water utilities, finance, law and engineering. members, managers and officers. • Noel Faulkner (Chairman) Our Board • Michael Arnett • Leith Boully Our Board is responsible for the way we perform our functions and exercise our powers under the South East • Jenny Parker Queensland Water (Restructuring) Act 2007. The Board: • Warren Traves. • sets strategy and direction, and provides the governance framework for the organisation through Board profiles the endorsement of financial, administrative and The term of appointment of the current board is 1 January operational policies 2013 until 31 December 2015, with the exception of Leith • ensures we perform our functions and exercise our Boully. Leith’s date of appointment to the Board was 1 powers in a proper, effective and efficient way October 2009. • ensures strategic and operational planning objectives Noel Faulkner (Chairman) are achieved Noel has 30 years’ experience in utilities, combined with • is accountable to the Responsible Ministers for our 10 years in government. He has led the integration of a performance number of large businesses in Queensland and Victoria. • reviews the annual performance of the Chief Noel has been involved in SEQ’s regional water reforms Executive Officer. since 2007, including leading the establishment of the council-owned water business Queensland Urban Utilities. Board members are appointed for three years. Noel has been a Board member of Unitywater, and the During the reporting period, Board members Noel Chief Executive Officer of Queensland Urban Utilities, Faulkner, Michael Arnett and Leith Boully were also Powercor Australia Ltd, United Energy Ltd and Capricornia directors of Seqwater’s subsidiary entities: Electricity, as well as holding senior executive roles with • South East Queensland Bulk Water Company Limited Brisbane City Council. He is also Chairman of Jacana Energy and the independent member of the Queensland • South East Queensland (Gold Coast) Desalination Department of Housing and Public Works Agency Renewal Company Pty Ltd Board. • Western Corridor Recycled Water Pty Ltd. Each of these entities has been subsequently voluntarily deregistered. 49 Seqwater | Driving Efficiency Michael Arnett Warren Traves Michael has extensive board and management Warren is a civil engineer who has worked in a range of experience in natural resources and professional disciplines across the water industry since graduating services organisations, with significant experience in the from The University of Queensland in 1986. He has been corporate, commercial, mining and natural resources, involved in strategic planning, design and implementation banking, finance and securities sectors. Michael has been across water network and treatment infrastructure. a Board member of Unitywater and is a former partner Warren is a Director of GHD Group, which generates of international law firm Norton Rose, predominantly revenue of $1.1 billion and employs 7,000 people in 12 consulting in the mining, resources and oil, and gas countries. Before this appointment, Warren was GHD’s areas. Michael is a Board member of New Guinea Energy Global Leader for Water. Warren is a member of the Limited, NRW Holdings Limited and Queensland Rugby Advanced Water Management Centre (AWMC) Advisory Union Limited. Board.

Leith Boully Meeting attendance Leith has many years’ experience in business and natural Board meetings are held every month. The Board has resource management, particularly water, at local, state formed two standing Committees that meet at least and national levels. She is Chair of the Australian Water quarterly: Recycling Centre of Excellence Ltd, Healthy Waterways Ltd, the Great Barrier Reef Marine Park Authority’s • Audit and Risk Committee Catchment and Coastal Development Reef Advisory Membership: Jenny Parker (Chair), Noel Faulkner, Committee, Brisbane Riverprize National Panel and Boully Leith Boully Pastoral Co Pty Ltd. She is also a Commissioner on the • Investment and Procurement Committee National Water Commission and a Board member of Membership: Michael Arnett (Chair), Warren Traves, Infrastructure, Queensland and Murrumbidgee Irrigation Noel Faulkner. Noel Faulkner became a member in the Limited. Leith is an Adjunct Professor at the School of 2013-14 financial year. Agriculture and Food Sciences, University of Queensland, All Board members are entitled to attend committee and was a founding member of the Wentworth Group of meetings. Concerned Scientists. The Board may form other committees, however the Board Jenny Parker has requested that any other matter be considered at a Jenny brings to the Board more than 28 years’ whole of Board level. professional services experience, and has been a partner with Ernst & Young since 1999. She has a proven track record in leading outsourced internal audit functions. Jenny is very active in Queensland’s public sector and is the Chair of the Department of the Premier and Cabinet and Public Service Commission Audit and Risk Management Committee, and Board member of the Field Services Authority Board (City Works). Jenny is a member of the National Education Board for the Institute of Chartered Accountants in Australia and New Zealand, and a Fellow of the Institute of Chartered Accountants in Australia.

Seqwater | Annual Report 2013-14 50 Investment and Special Audit and Risk Board Special board Procurement Investment and Board member Committee meetings meetings Committee Procurement meetings meetings Committee

ABABABABAB

Mr Noel Faulkner 12 12 1 1 6 6

Ms Leith Boully 11 12 0 1 5 6

Ms Jenny Parker 12 12 1 1 5 6

Mr Michael Arnett 12 12 1 1 4 4 3 3

Mr Warren Traves 10 12 0 1 4 4 3 3

A = Number of meetings attended B = Number of meetings held

Remuneration Board members are paid for their participation on our Board and Committees. Board members are not remunerated for their role as directors of Seqwater’s subsidiaries or for their role as directors of the Australian Water Recycling Centre of Excellence Ltd. Remuneration is as nominated by our Responsible Ministers:

Role Per annum

Chairman $100,000

Board members $45,000

Audit and Risk Committee Chair - $8,000 Members - $4,500

Investment and Procurement Committee Chair - $8,000 Members - $4,500

51 Seqwater | Driving Efficiency Audit and Risk Committee • oversaw the internal audit function and considered associated reporting, including recommendation to The Audit and Risk Committee provides independent the Board for approval of the 2014-15 Internal Audit assurance and assistance to the Board on governance, risk Work Plan and compliance frameworks and our external accountability • oversaw the external audit function and consideration responsibilities as prescribed in the Financial Accountability of associated reporting Act 2009 and Accounting Policy Standards. • considered Seqwater’s Insurance Program renewal Our internal audit function regularly reviews and tests the effectiveness of the system and reports to the Audit and • reviewed the Committee’s performance during the Risk Committee. previous period and associated reporting to the Board. The Committee’s duties and responsibilities are outlined in the Committee’s Charter, and encompass oversight Investment and Procurement of compliance with all mandatory requirements of our Committee corporate governance, including: The Investment and Procurement Committee reviews • financial statements capital and operational investment and procurement • risk management decisions. The Committee ensures we meet strategic, corporate, and technical aspects of asset delivery and • performance management operational performance objectives while managing the • external audit associated business risks and ensuring risk management • compliance systems are in place. • Board reporting. The Committee’s role, functions and duties are outlined in The Committee observed the terms of its charter and had its Charter. The Committee: due regard to Treasury’s Audit Committee Guidelines. • assesses and oversees implementation of a high During 2013-14 the Committee: quality asset investment plan consistent with the strategic plan • considered the amendment to and compliance with the requirements of the Committee’s Charter • oversees the development and implementation of asset delivery and non-infrastructure capital programs • oversaw the Strategic and Enterprise Risk and maintenance program operations, in line with Management Framework strategic plans • oversaw the Fraud Control Frameworks, including • ensures strategic procurement objectives are recommendation to the Board of the Fraud Control developed and implemented through an annual Plan strategy • oversaw the Delegation and Authorisation Manual • ensures compliance with the State Procurement Policy and recommendation to the Board of amendments to same • oversees the establishment and monitoring of appropriate operations and service delivery targets for • oversaw the annual budget process and financial any long standing contracts. reporting • oversaw the subsidiaries’ financial reporting • oversaw Queensland Treasury Corporation’s Management of Seqwater’s Debt Pool

Seqwater | Annual Report 2013-14 52 The Committee observed the terms of its Charter. During and Risk Committee, the Chief Executive Officer and the 2013-14, the Committee: Executive Leadership Team. • oversaw asset investment strategy and planning, In 2013-14 the Internal Audit function completed a including consideration of Seqwater’s dam portfolio number of advisory and audit engagements that resulted risk assessment, and recommendations for Board in findings and recommendations designed to improve the approval of same overall efficiency and effectiveness of the internal control • oversaw the development of the 2014-15 capital environment at Seqwater. Management has collaborated program and recommendation to the Board for with the Internal Audit team to develop robust action approval of same plans to implement these recommendations. • oversaw the delivery of the 2013-14 capital program • considered major capital investment and maintenance External scrutiny program business cases, and critical supply contracts, We strive to continuously improve our services and we including electricity supply and water quality testing welcome external scrutiny. • considered organisational changes involving We are subject to annual independent review by the operational and service delivery functions, including Queensland Audit Office. In November 2013, the Auditor- the review of the procurement function General of Queensland provided its Report to Parliament • considered the status of construction alliances No. 7 for 2013/14 – Results of Audit: Water Sector involving Seqwater. Entities 2012-2013. The State Procurement Policy was revoked and replaced by The report details the results of its audit of the financial the Queensland Procurement Policy. management practices of six Government owned water entities, including Seqwater. The report recommends the Internal audit DEWS performance reporting framework used to measure the performance of the six water entities, adopts the Our internal audit function provides an independent, measures of financial sustainability used in the report. objective assurance function that adds value and improves operations. Internal audits help us to achieve our objectives by systematically evaluating and improving Related entities the effectiveness of risk management, internal control Seqwater is the host organisation for the Australian systems and governance processes. Water Recycling Centre of Excellence (AWRCE). Core audit activities are carried out by an independent, AWRCE is a national research organisation which aims specialist external service provider. The function operates to enhance the efficiency, expansion and acceptance of pursuant to a Board approved Charter and is overseen water recycling in Australia through industry, government by the Board and the Audit and Risk Committee. The and research partnerships. Charter sets out a framework for Internal Audit to function The centre is a company limited by guarantee, with independently, objectively and effectively and in a manner Seqwater its sole member. Its ASIC registered name is that aligns with Queensland Treasury’s Audit Committee Australian Water Recycling Centre of Excellence Ltd. Guidelines, the Financial Accountability Act 2009, the Financial Performance Management Standard 2009 and AWRCE is funded by the Commonwealth Government as the State Water Authorities Governance Framework. part of the National Urban Water and Desalination Plan. Seqwater participates in AWRCE research planning as An Internal Audit Plan is developed annually and the a research partner, and provides limited non-financial implementation and status of audit recommendations is administrative and organisational support. reviewed quarterly and reported to the Board, the Audit 53 Seqwater | Driving Efficiency AWRCE is subject to annual independent review by the • Jim Pruss, General Manager, Water Supply Strategy Queensland Audit Office. and Policy The financial statements of AWRCE are published • Peter Scott, Chief Financial Officer annually. These are not consolidated with our financial • Daniel Spiller, General Manager, Asset Portfolio statements due to immateriality. Development and Delivery • Janita Valentine, General Manager, Service, People Information systems and and Technology. recordkeeping Executive Leadership Team (2 December 2013 – 30 June The rollout of TRIM as the enterprise Electronic Document 2014) Record Management System (eDRMS) continued • Peter Dennis, Chief Executive Officer (acting CEO from throughout 2013-14. 2 December to 14 May 2014, CEO from 15 May 2014) We also undertook a review of retention and disposal • Donna Gregory, Acting General Manager, Operations processes and information security classification policies – Catchment and Raw Water and procedures and implemented an improvement • Alex Fisher, General Manager, Operations – Treated program. Water • Sally Frazer, General Counsel and Company Secretary Open data • Jim Pruss, General Manager, Water Supply Strategy Information about consultancies and overseas travel and Policy will be published online in lieu of inclusion in the annual • Peter Scott, Chief Financial Officer report. This information will be available by 30 September 2014 on the Seqwater website (seqwater.com.au) and on • Daniel Spiller, General Manager, Asset Portfolio the Queensland Government Open Data website (qld.gov. Development and Delivery au/data). • Janita Valentine, General Manager, Service, People and Technology. Organisational structure Our workforce is structured in seven business groups, each led by a member of the Executive Leadership Team. The Executive Team provides leadership and direction to our staff and ensures we meet our strategic priorities and legislative responsibilities in a way that is open, accountable, ethical and responsible. Executive Leadership Team (1 July 2013 to 2 December 2013) • Terri Benson, Chief Executive Officer • Peter Dennis, General Manager, Operations – Catchment and Raw Water • Alex Fisher, General Manager, Operations – Treated Water • Sally Frazer, General Counsel and Company Secretary Seqwater | Annual Report 2013-14 54 Water • Water supply strategy Supply • Asset portfolio planning (masterplan) Strategy & • Asset investment governance Policy • Water supply policy • Regulatory (including economic) • Research, science and technology Business groups • Catchment strategy and accountability Asset • Asset portfolio development Portfolio • Business case and options analysis Development • Asset investment management & Delivery • Asset delivery Chief • Engineering design, standards Executive Officer and systems • Asset management maintenance planning • Water quality • Environment Office • External of the CEO Relations Operations • Dam operations - Catchment • Flood manual development • Dam safety and Raw • Interface with Dam Safety Water Regulator General • Board administration, • Analysis and assessment of Counsel and • Audit (external/ dam storages internal), • Recreation management Company • Legal • Catchment operations Secretary

Operations • Network management - Treated • Water treatment operations • Network operations Water • Corrective maintenance and inspections • Incident and emergency management

Service, • Enterprise strategy and brand People & management • Customer service and Technology stakeholder engagement • Human resource management • Safety strategy and policy • Safety management system • ICT and systems • Governance, risk and compliance • Business improvement

Finance • Finance • Strategic procurement • Fleet management • Property management • Treasury management • Financial modelling • Business improvement 55 Seqwater | Driving Efficiency Executive Leadership Team practicing accountant, Donna has experience in financial management, asset management, system implementation profiles and continuous improvement. Before joining Seqwater, Donna worked in a variety of managerial and leadership Peter Dennis, Chief Executive Officer roles within the Queensland Rail and Moreton Bay Peter brings a wealth of experience and a proven track Regional Council. Donna joined Seqwater in 2008 in the record of delivery to the job. Peter has an extensive role of Manager, Recreation and Catchment Services. background in the water sector, providing leadership across Australia, the Asia Pacific and New Zealand. A Jim Pruss, General Manager, Water Supply Strategy chemical engineer by profession, Peter has held executive and Policy leadership roles at both Hunter Water Corporation and Jim has more than 25 years’ experience working in and Hunter Water Australia. His expertise spans strategic around the water industry. He previously led the Water planning, capital portfolio management, infrastructure Delivery and Sustainable Water and Asset Delivery planning and delivery, strategic operations and water Groups of the former Seqwater. Before joining Seqwater, resource management. Peter also established and led one he was General Manager of Water and Waste for Redland of the largest operational and process engineering teams City Council, after 15 years in various technical and in the Australian water industry. management roles within Sydney Water.

Alex Fisher, General Manager, Operations – Treated Peter Scott, Chief Financial Officer Water Peter is a Fellow Certified Practicing Accountant with Alex brings extensive knowledge and leadership more than 30 years’ experience in financial control and experience across several industries, including water, regulation, asset management, policy development, construction and engineering services. A civil engineer strategic planning and business growth, risk management, by profession, before joining Seqwater, Alex worked in and change management in dynamic environments. He a variety of managerial and leadership roles within the has previously held senior executive positions in a number Department of Infrastructure and Planning, Brisbane City of water entities, most recently as Chief Executive Officer Council, private consultancy, Queensland University of of Wide Bay Water Corporation. Technology, and Department of Defence. Daniel Spiller, General Manager, Asset Portfolio Sally Frazer, General Counsel and Company Development and Delivery Secretary Daniel has extensive experience in infrastructure planning Sally has been a lawyer for more than 25 years, with 12 and delivering complex projects, as well as a strong years’ experience in the water industry. She has worked understanding of the region’s integrated assets. He was in both the private sector and State Government as a previously the former Seqwater’s Manager, Water Supply senior executive and lead departmental lawyer, with a and System Planning and has also held roles as Director focus on legal, governance, compliance, risk and company of Operations for the SEQ Water Grid Manager and Acting secretariat functions, as well as water infrastructure Chief Executive of the Queensland Water Commission. development. Previously, Sally was the General Manager, Legal Services at LinkWater, where she was Janita Valentine, General Manager, Service, People responsible for advising on all legal aspects of the water and Technology transportation infrastructure and network. She also held Janita is a human resources professional with significant the position of Alliance Board Member for the entity’s experience in leadership roles within the public sector. construction projects. Janita brings a wealth of experience in strategic and operational planning, change management, leadership Donna Gregory, Acting General Manager, Operations and capability development, and industrial relations. – Catchment and Raw Water She previously held roles of Acting General Manager Donna has 20 years’ experience at a senior level in Organisational Strategy and Performance and Manager both the local and state government sectors. A certified People and Culture with the former Seqwater. Seqwater | Annual Report 2013-14 56 FINANCIALS Economic and As has been noted previously, the 2013-14 financial statements are the first full year for the merged financial performance organisation. The transactions in 2012-13 are only for the first six months of the financial year for the former Seqwater. For the remaining six months from 1 January 2013, this includes the transactions of Seqwater and transactions relating to the transferred assets, liability, instruments and/or function of the previous bulk water entities. Accordingly, a comparison of results year-on-year again in not practicable for this year.

Where does the money come from? ($720M)

$18,204 $12,820 GRANTS AND CONTRIBUTIONS OTHER REVENUE

2013 – 14 INCOME ($000)

$689,475 WATER SALES

The majority (96%) of Seqwater’s revenue comprises water sales of 292,482 ML* to Council-owned water businesses and a relatively small proportion to rural irrigators. *Please note due to accounting timing differences this figure will differ to production volumes reported on page four.

57 Seqwater | Driving Efficiency Where was the money spent? ($1.121M)

$10,131 $79,550 OTHER EXPENSES EMPLOYEE EXPENSES

$152,124 SUPPLIES AND SERVICES 2013 – 14 EXPENSES ($000)

$259,077 $536,316 DEPRECIATION FINANCE/BORROWINGS COSTS $83,456 REVALUATION OF ASSETS (WRITEDOWN)

Almost one half of Seqwater’s operating expenses goes towards the payment of interest costs to service debt. The next largest expense is depreciation and amortisation, 23.1% of expenses, is provided to allocate an amount for the decline in value of our assets. This funding is then used by our engineers and tradespeople for replenishment of the assets to ensure ongoing operability.

Seqwater | Annual Report 2013-14 58 What do we own ($11.1B) and what do we owe ($9.7B)?

$1,459,745 $172,236 EQUITY (ASSETS LESS LIABILITIES) CURRENT ASSETS

$10,957,752 NON CURRENT ASSETS STATEMENT OF FINANCIAL POSITION ($000)

$9,572,150 NON CURRENT LIABILITIES $98,093 CURRENT LIABILITIES

The current assets of $172.236M principally represent cash available for day-to-day (wages and creditors) operating requirements and amounts customers owe Seqwater, mainly for the sale of water. Non-current assets are represented mainly by the core long term assets fundamental to the business, such as land, dams, water treatment plants ($10.8B). The current liabilities mainly represent what we owe at year end to trade creditors and others ($43.6M) and our lender Queensland Treasury Corporation in a month’s interest costs ($34.6M). The non-current liabilities are what we owe Queensland Treasury Corporation in debt for the period greater than one year out ($9.16B), employee benefits for long service leave and the like ($9.3M) and net deferred tax liabilities caused by timing differences between accounting and taxation accounting entries ($52M).

59 Seqwater | Driving Efficiency Financial summary 2013-14 ($000)

Total revenue $720,499

Total expenses $1,120,654

Net result (loss) before tax (400,155)

Income taxation credit adjustment 379,547

Increase in asset valuation surplus 1,006,051

Net positive result after tax 985,443

Key financial ratios 2013-14

Return on assets before tax (3.29%)

Return on assets after tax (0.17%)

Interest coverage 0.30

Debt to total assets 0.76

EBIT* margin on revenue 0.30

Government approved Seqwater’s application for no An example of the improvement in one of our key credit payment of dividends or tax equivalents for 2013-14 due metrics is disclosed in note 5 of the financial statements. to the results above. We have markedly improved our gearing ratios from 76% this year against 86% last year. This has been achieved by The key financial ratios 2013-14 continue to reflect the a combination of careful cost control, improving revenues high gearing of Seqwater. The EBIT results reflect a and an upwards valuation movement in the valuation of combination of higher revenues and lower operational our infrastructure assets. costs. * Excludes revaluation decrement During the 2013-14 financial year the Board adopted a Capital Structure Strategy 2013-18. This strategy provides a set of clear credit metrics to be achieved over time by Seqwater. Initially, we aim to meet those credit metrics as a ‘B’ rated water entity and then those of a ‘BBB’ rated water entity, as our operating results continue to improve.

Seqwater | Annual Report 2013-14 60 Financial report

General information ...... 62 Abbreviations ...... 63 Statement of comprehensive income ...... 64 Statement of financial position...... 65 Statement of changes in equity ...... 66 Statement of cash flows ...... 67 Index to notes to the financial statements ...... 68 Notes to and forming part of the financial statements 2013-14 ...... 69 Independent audit report to the Board of Queensland Bulk Water Supply Authority ...... 122

61 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 62 63 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 64 65 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 66 67 Seqwater | Driving Efficiency Queensland Bulk Water Supply Authority Index to notes to the financial statements 1. Reporting entity ...... 69 2. Basis of preparation ...... 69 3. Significant accounting policies ...... 72 4. Determination of fair values ...... 85 5. Financial risk management ...... 86 6. Water sales ...... 88 7. Grants and other contributions ...... 88 8. Other revenue ...... 88 9. Employee expenses ...... 88 10. Supplies and services ...... 89 11. Depreciation and amortisation ...... 89 12. Revaluation decrement ...... 89 13. Finance/borrowing costs ...... 90 14. Other expenses ...... 90 15. Income tax ...... 90 16. Property, plant and equipment ...... 91 17. Intangible assets ...... 96 18. Impairment testing for cash generating unit ...... 98 19. Trade and other receivables ...... 98 20. Inventories ...... 98 21. Other current assets ...... 99 22. Non-current assets classified as held for sale ...... 99 23. Tax assets and liabilities ...... 100 24. Cash and cash equivalents ...... 102 25. Interest bearing liabilities ...... 103 26. Employee benefits ...... 104 27. Trade and other payables ...... 108 28. Other liabilities ...... 108 29. Asset revaluation surplus by class ...... 108 30. Financial Instruments ...... 109 31. Operating leases ...... 112 32. Capital and other commitments ...... 112 33. Contingencies ...... 113 34. Segment reporting ...... 114 35. Controlled entities ...... 114 36. Key management personnel and remuneration ...... 114 37. Related parties ...... 120 38. Economic dependency ...... 120

Seqwater | Annual Report 2013-14 68 69 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 70 71 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 72 73 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 74 75 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 76 77 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 78 79 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 80 81 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 82 83 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 84 85 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 86 87 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 88 89 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 90 91 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 92 93 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 94 95 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 96 97 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 98 99 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 100 101 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 102 103 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 104 105 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 106 107 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 108 109 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 110 111 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 112 113 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 114 115 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 116 117 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 118 119 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 120 121 Seqwater | Driving Efficiency Seqwater | Annual Report 2013-14 122 123 Seqwater | Driving Efficiency Annual report requirements for Queensland Government agencies compliance check list

Annual Summary of requirement Basis for requirement report reference

Letter of • A letter of compliance from the accountable ARRs – section 8 1 compliance officer or statutory body to the relevant Minister

Accessibility • Table of contents ARRs – section 10.1 3, 126 • Glossary

• Public availability ARRs – section 10.2 2

• Interpreter service statement Queensland Government 2 Language Services Policy ARRs – section 10.3

• Copyright notice Copyright Act 1968 2 ARRs – section 10.4

• Information Licensing QGEA – Information Licensing N/a ARRs – section 10.5

General • Introductory Information ARRs – section 11.1 5 information • Agency role and main functions ARRs – section 11.2 5-8

• Operating environment ARRs – section 11.3 9-10

• Machinery of government changes ARRs – section 11.4 N/a

Non-financial • Government’s objectives for the community ARRs – section 12.1 9 performance

• Other whole-of-government plans / specific ARRs – section 12.2 27 initiatives

• Agency objectives and performance indicators ARRs – section 12.3 16-22

• Agency service areas, and service standards ARRs – section 12.4 16-22

Seqwater | Annual Report 2013-14 124 Financial • Summary of financial performance ARRs – section 13.1 57-60 performance

Governance – • Organisational structure ARRs – section 14.1 55 management and • Executive management ARRs – section 14.2 49-51, 54, 56 structure • Related entities ARRs – section 14.3 53

• Government bodies ARRs – section 14.4 N/a

• Public Sector Ethics Act 1994 Public Sector Ethics Act 1994 N/a (section 23 and Schedule) ARRs – section 14.5

Governance – risk • Risk management ARRs – section 15.1 48 management and • External scrutiny ARRs – section 15.2 53 accountability • Audit committee ARRs – section 15.3 52

• Internal audit ARRs – section 15.4 53

• Public Sector Renewal ARRs – section 15.5 N/a

• Information systems and recordkeeping ARRs – section 15.6 54

Governance – • Workforce planning, attraction and retention, ARRs – section 16.1 39-41 human resources and performance

• Early retirement, redundancy and retrenchment Directive No.11/12 Early N/a Retirement, Redundancy and Retrenchment ARRs – section 16.2

Open Data • Open Data ARRs – section 17 54

Financial • Certification of financial statements FAA – section 62 121 statements FPMS – sections 42, 43 and 50 ARRs – section 18.1

• Independent Auditors Report FAA – section 62 122-123 FPMS – section 50 ARRs – section 18.2

• Remuneration disclosures Financial Reporting 51, 114-120 Requirements for Queensland Government Agencies ARRs – section 18.3 FAA Financial Accountability Act 2009 FPMS Financial and Performance Management Standard 2009 ARRs Annual report requirements for Queensland Government agencies 125 Seqwater | Driving Efficiency Glossary AMP Asset Management Plan AOP Annual Operating Plan ANCOLD Australian National Committee on Large Dams ASIC Australia Securities and Investments Commission AWRCE Australia Water Recycling Centre of Excellence Limited CBD Central Business District DEWS Department of Energy and Water Supply EBA Enterprising Bargaining Agreement EBIT Earnings Before Interest and Tax EMS Environmental Management System ERP Emergency Response Plan FEWS Flood Early Warning System GITC Government Information Technology Conditions ICT Information Communication Technology IMP Integrated Master Plan IP Intellectual Property KPI Key Performance Indicator KPP Key Possible Project LOS Levels of Service LTI Lost time injury QCA Queensland Competition Authority QPP Queensland Planning Provisions QTC Queensland Treasury Corporation QWSR Queensland Water Supply Regulator Responsible Ministers Treasurer and Minister for Trade, the Honourable Tim Nicholls MP and Minister for Energy and Water Supply, the Honourable Mark McArdle MP SOP System Operating Plan SPP State Planning Policy STP Sewage Treatment Plant

Seqwater | Annual Report 2013-14 126 Statement of Obligations Outlines the overarching obligations of the Queensland Bulk Water Supply Authority trading as Seqwater in meeting the expectations expressed as guiding principles of the responsible Ministers. WCRWS Western Corridor Recycled Water Scheme WSP Water Security Program WSPP Water Service Providers Partnership WTP Water Treatment Plant

127 Seqwater | Driving Efficiency Seqwater 117 Brisbane Street, Ipswich QLD 4305 | PO Box 16146 City East Qld 4002 07 3035 5500 | [email protected] | seqwater.com.au