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Annual Report 2019/20

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Annual Report 2019/20 ANNUAL REPORT 2019/20 At a Glance East Gippsland Water’s Region East Gippsland Water serves an area of 21,000 square It has nine separate water supply systems that serve the kilometres in the east of Victoria, which boasts some of communities of Bairnsdale, Bemm River, Bruthen, Buchan, Australia’s most diverse and spectacular scenery. Cann River, Dinner Plain, Eagle Point, Johnsonville, Lakes Entrance, Lake Tyers Aboriginal Trust, Lake Tyers Beach, The region’s world renowned beaches, lakes, high country Lindenow, Lindenow South, Mallacoota, Marlo, Metung, and national parks are a natural draw-card for those seeking a Newlands Arm, Newmerella, Nicholson, Nowa Nowa, Omeo, lifestyle change, as well as for the many tourists that swell the Orbost, Paynesville, Raymond Island, Sarsfield, Swan Reach region’s population numbers over the busy holiday periods. and Swifts Creek. East Gippsland Water serves around 35,000 people. Its Eleven individual wastewater systems serve Bairnsdale, service area extends east from Lindenow, through to the Bemm River, Bruthen, Cann River, Dinner Plain, Eagle Point, region’s capital Bairnsdale, the holiday centres of Paynesville Johnsonville, Lakes Entrance, Lake Tyers Beach, Lindenow, and Lakes Entrance, and on to the wilderness coast and Mallacoota, Marlo, Metung, Newlands Arm, Nicholson, Omeo, Mallacoota near the New South Wales border. It also serves Orbost, Paynesville, Raymond Island and Swan Reach. as far north as Dinner Plain in the High Country of the Victorian Alps. Water services are provided to nearly 27,000 account holders (assessments) with wastewater services also provided to around 22,800 account holders. Water and Sewerage Services Water Services Other Townships Genoa River Buchan River Snowy River Mt Hotham Cann River Brodribb River Genoa Dinner Plain Bemm River Omeo Mallacoota Betka River Swifts Creek Buchan Rocky River Cann River Tambo River Ensay Dargo Princes Hwy Nicholson River Orbost Bemm River Newmerella Nowa Nowa Mitchell River Bruthen Marlo Johnsonville Swan Nicholson Reach Lake Tyers Bairnsdale Lindenow Lakes Entrance Metung Walpa Eagle Point Lindenow South Paynesville Newlands Arm Melbourne Fact File (as at 30 June 2020) Water Wastewater Serviced properties Serviced properties - residential assessments 23,691 - residential assessments 20,467 - non residential assessments 3,219 - non residential assessments 2,359 Volume of water consumed (ML/y) 4,878 Volume of wastewater collected (ML/y) 2,773 Length of water mains (km) 1,004 Length of sewer mains (km) 732 Water treatment plants 9 Wastewater treatment plants 11 Water disinfection plants 11 Water recycled (%) 100 Separate water supply systems 9 Separate wastewater systems 11 Front cover: Images of fires around Bairnsdale republished courtesy of Josh Thorpe/Facebook. All other images from East Gippsland Water. The Corporation Contents Page East Gippsland Region Water Corporation was initially established as East Gippsland Region Water Authority At a Glance Inside front cover on 1 January 1995, by Ministerial Order and under Report from the Chairperson powers conferred by the Water Act 1989. It trades as and Managing Director 2 East Gippsland Water. Corporate Governance 4 The responsible Minister during the 2019/20 reporting period was The Hon. Lisa Neville MP, People and Culture 8 Minister for Water. Risk Management 15 In accordance with the Water Act 1989, East Gippsland Environmental Sustainability 16 Water delivers the full range of retail water services, Asset Management 29 including water harvesting, storage and drinking water supply. It also provides wastewater collection Community Engagement 32 and treatment services, recycled water for rural and Social Sustainability 34 beneficial community uses, as well as trade waste services to industrial and commercial customers. Financial Summary 37 Other Information 38 Our Vision Performance Report 43 Sustainability and resilience through leading and Independent Auditor’s Report 47 innovative water solutions. Financial Report 49 Our Role Independent Auditor’s Report 93 Providing quality water and wastewater services to Disclosure Index 95 sustain and enhance our community. Glossary 96 East Gippsland Water acknowledges the Gunaikurnai people as Our Values the Traditional Custodians of the land and water on which we live Proudly United and work. We pay our respects to Elders past and present. We commit to working respectfully to honour their ongoing cultural Truly Authentic and spiritual connections to this country. We recognise the role and value of culture in our community. Passionately Innovative Openly Accountable Responsible Body Declaration Our Objectives In accordance with the Financial Management Act 1994 • To deliver safe and sustainable water and I am pleased to present East Gippsland Water’s Annual wastewater services to our community Report for the year ending 30 June 2020. • To meet the expectations of our customers and stakeholders • To enhance the liveability, development and Therese Tierney resilience of our region Chairperson, East Gippsland Water • To maximise the performance and potential of our people 13 October 2020 • To innovate and achieve whole of business sustainability Financial Management Compliance About this Report Attestation Statement I Therese Tierney, on behalf of the Board, certify that East This Annual Report details East Gippsland Water’s Gippsland Water has no Material Compliance Deficiency performance and achievements in all areas of its with respect to the applicable Standing Directions of the operations during 2019/20. It has been prepared in Minister for Finance under the Financial Management Act accordance with the Financial Reporting Direction 1994 and Instructions. FRD 30D - Standard Requirements for the Publication of Annual Reports. This defines the design and print specifications of annual reports to ensure consistency, cost minimisation and low environmental impact. Therese Tierney Further information and previous Annual Reports are Chairperson, East Gippsland Water available at www.egwater.vic.gov.au 13 October 2020 ANNUAL REPORT - EAST GIPPSLAND WATER 2019/20 1 A particularly concerning consequence of these events has been the significant increase in financial hardship faced by our customers – impacting on the affordability of our services. A range of measures were implemented during the reporting period to assist those residential and business customers affected, including rebates, debt relief and flexible payment plans. Other action taken to provide financial respite included: delaying the issuing of customer bills at the start of 2020; waiving water and sewerage bills for 12 months for a customer’s home or business destroyed or made uninhabitable by bushfire; and deferring our planned annual Report from the increase in water tariffs due on 1 July 2020 by six months. Chairperson and Financial Overview East Gippsland Water recorded a surplus before tax of $2.44 Managing Director million for 2019/20. This was higher than the budgeted profit of $400,000 and was predominately driven by increased Initiatives and Key Achievements developer asset income, Government funding associated with East Gippsland Water continued to actively address the bushfire recovery works and an operational expenditure needs of the regional community and the expectations of the underspend (stemming from delay of a major desludging Victorian Government in the 2019/20 financial year, as set out project). in our annual Corporate Plan and our five year 2018-23 Price Capital works expenditure totalled $18 million for the year, Submission. The year also saw us facing a series of extreme with a number of major projects completed. These included: and unprecedented challenges. the Sarsfield main supply pipeline replacement; the Main Road, The impacts of climate change on our business, including three Lindenow water main replacement; and the John Court Sewer years of drought, were brought to the fore when bushfires Pump Station rising main renewal. devastated our region from November 2019 to February In addition, work continued on a major program of upgrades 2020. On 30 December, fires that had been burning since at the Wy Yung water storage facility. Construction of a 36ML mid-November, together with a new bushfire near Mallacoota, enclosed water storage tank on site commenced and is due exploded across East Gippsland along a 300km front. for completion in 2021/22. All fires were started by lightning in tinder dry catchments and The corporation increased total debt from $7 million to combined to become the largest regional natural disaster in $10.5 million for the reporting period to support the capital living memory. This impacted on some of our infrastructure, expenditure program and bushfire recovery. which required either repair or replacement. It also led to water quality issues and reduced water pressure – most Prices notably affecting customers in Omeo, Mallacoota, Sarsfield, The reporting period marked the second year of our 5 year Orbost, Newmerella, Marlo and Buchan. 2018-23 Price Submission. A key commitment is to maintain Our ability to maintain water supplies under these or improve levels of service for the five year period with no unprecedented circumstances was underpinned by our increase in the customer bill, except for inflation. We will annual preparation for bushfires and our investments over invest around $35 million per year in capital works projects recent years to install improved treatment systems, sprinkler and operational expenditure,
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