— before PUC considers any tariff hike

The Public Utilities Commission (PUC) has requested that Guyana Water Inc. (GWI) submit its unaudited 2016 financial statements to the commission before the regulatory body considers any tariff increase by the state-owned company.

Consumer representatives Ramon Gaskin and former GWI director and auditor John Seeram, Pat Dial and others shared their perspectives when the commission once again met with the state-owned company on Wednesday.

Gaskin and Seeram hammered home the point that the commission can only work with recent financial figures to determine need for a tariff increase.
GWI Managing Director, Dr. Richard Van-West Charles has tied the proposed hike in tariffs to insufficient revenue to meet operational costs, pointing out that the utility still functions under a 2005 tariff regime.

He explained that the 2018 proposed rates seek to harmonise all the existing rates into a compendium of rates that promote equity across distribution zones, simplicity in its understanding and application and a reflection of the costs of supply of this critical service.
However, Gaskin rebutted this view, noting that under the PUC Act 1999, any application for increase must be accompanied by financial statements.

“It’s an absolute requirement and the commission cannot entertain any application for rate increase unless the utility complies with the Act, the utility has not complied with the Act in my opinion and therefore and to begin with the application should not be undertaken at all,” Gaskin said.

The GWI director pointed out that the utility is still awaiting the finalisation of its audited financial statements for 2016, noting that the process is in the hands of the external auditors, and is expected to be completed by March 2018.
Nevertheless, he said GWI presented management accounts for the period 2013 -2017 to the Public Utilities Commission.

Gaskin said the data and unaudited information can be supplied to the commission. Noting that he received a partial copy of the 2015 GWI audit, Gaskin said the water company was spending more than it was earning.

He noted that the company is owed billions of dollars and the company is seeking avenues to increase its tariff.
“This company needs a forensic audit, how can you run a company when people owe you $4.8 billion and you come looking for more money?” Gaskin asked the GWI managing director.

Dr. Van-West Charles explained that with 180,800 customers, GWI is charged with overseeing 137 well stations and 24 treatment plants, with three more to be constructed while there are more than 900 staffers with 60-plus contractors and 220,000 Km of transmission and distribution mains to maintain.

“Improvement in the quality of water provided to citizens as well as an increase in supply is dependent on much-needed revenue to finance the upgrade of aged infrastructure, build human resource capacity and purchase the requisite equipment and chemicals to treat the water,” he said.

During his presentation, it was also highlighted that since the last rate change 12 years ago, the cost for purifying water alone has increased by more than 100 per cent, let alone the cost for equipment and manual labour, among other things.

In this regard, Dr. Van West-Charles stated that the utility has since moved to employ and train staff in the necessary areas of expertise such as learning new drilling techniques and water quality improvements.

PUC Chairman Dela Britton said the commission website will be updated to reflect the ongoing public hearings. The next meeting will commence from 10:00hrs on March 14, 2018 at the Cara Lodge Hotel.