Goulburn-Murray Water's (G-MW) 2008/09 Annual Report has been tabled in Parliament and has confirmed the Corporation delivered an average of nearly 400 customer orders each day of the irrigation season within the agreed service standards, while also reducing system operating requirements in the channel Irrigation Areas to their lowest ever volumes
G-MW Managing Director David Stewart said under such severe seasonal conditions, with allocations on the Goulburn and Murray barely exceeding 30%, this was the stand out achievement.
"I would like to thank our customers, staff and especially our Water Services Committees for their efforts in helping us to run the system as tightly as possible. I would also like to recognise the extreme conditions faced by customers on our smaller and unregulated systems and also thank them for their cooperation," said Mr Stewart.
More than 93 of the 130 unregulated streams required rosters or restrictions to ensure equitable access for all customers. None of G-MW's four smaller regulated systems, Broken, Campaspe, Loddon and Bullarook Creek, received allocations with special arrangements in place throughout the year to manage delivery of essential needs.
Mr Stewart nominated drought as the single biggest factor impacting on the Corporation's short term health but confirmed the organisation was in a sound financial position despite recording a $34 million ‘on paper' shortfall.
"The on paper shortfall of $34 million is a result of timing with G-MW receiving more than $40 million of project payments received in advance at the end of the 2007/08 year with the matching expenditure occurring in the current year," said Mr Stewart.
However with nearly 90% of G-MW's costs fixed from season to season but nearly 20% of its revenue recovered on the basis of volumes delivered, G-MW reported a $7 million drop in consumptive revenue.
"Our customers own their water entitlement. Our job is to operate and maintain the infrastructure that delivers the water to their properties. Drought reduces the volume of water available to customers but it doesn't reduce our costs such as the size of the dams, length of channel or number of meters to be maintained. We have sought to offset the revenue shortfall by reducing staff levels and operating costs where we can but our current asset base provides limited scope for flexibility," said Mr Stewart.
Mr Stewart also welcomed the 2008/09 Victorian Government's Drought Rebate which provided more than $36 million to many G-MW customers and met at least 50% of their fixed water charges.
"This was the third consecutive year of assistance and over the last three years the Victorian Government has provided $93.7 million of very welcome financial assistance to our customers," said Mr Stewart.
G-MW's FutureFlow also reported significant progress in the delivery of modernisation works on the Shepparton, Central Goulburn 1-4 and NVIRP's 2008 Early Works Programs. The Shepparton and CG1-4 projects are on track to be completed in February next year.
"The drought has clearly highlighted the need for a more efficient irrigation network to support the future viability of our customers and our business," said Mr Stewart.
G-MW's FutureFlow completed its works on time and under budget with G-MW and FutureFlow again thanking customers for their cooperation. G-MW's FutureFlow recently won an annual Victorian Engineering Excellence Award in recognition of the engineering and technical excellence in modernisation projects.
"During the winter works period that ended 15 August 2008, FutureFlow installed more than 1500 regulating gates - that's five times the number installed as part of any previous irrigation modernisation project in Australia. It underscores the scale of the modernisation taking place in our six irrigation areas," said Mr Stewart.
Mr Stewart explained G-MW had taken advantage of secondments funded by other organisations including NVIRP to reduce staff levels but to also inject G-MW staff experience and local knowledge into the planning and delivery of major regional projects such as NVIRP.
"We went through the year with more than 100 unfilled positions as we have run our operational areas 30% below the staffing levels we would require in a normal season," said Mr Stewart.
Water administration activity increased by 6% building on the 7% growth reported in 2007/08. G-MW administration teams processed on average 40 water share and allocation trade applications each day of 2008/09.
"Water trading was again a vital mechanism for sharing limited water resources. We continue to adjust our administration teams within the fee for service budgets to provide efficient processing of transactions for all applications, particularly during peak trading and processing periods," said Mr Stewart.
Mr Stewart said he expects the 2009/10 year to be equally challenging.
In the final weeks of 2008/09 the Victorian and Commonwealth Governments announced their landmark agreement that will see the Commonwealth Government acquire 300,000 ML of high and low reliability water from our Irrigation Areas over and above those purchases permitted under Victoria's 4% annual trading limits. The Commonwealth Government has also reaffirmed its in-principle commitment to provide up to $1 billion to Stage 2 of the NVIRP project.
The Commonwealth has since announced a further $300 million program to fund on-farm irrigation efficiency projects.
"Our immediate challenge is to work with our partners at Catchment Management Authorities, NVIRP, DPI and DSE and especially our customers and Water Service Committees to ensure our region captures the full potential of these unprecedented funding opportunities," said Mr Stewart.
The 2008/09 G-MW Annual Report is available at www.g-mwater.com.au/annualreport
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