Annual Report 2010 - Ministry of Finance and Planning

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Ministry of Finance and Planning Sri Lanka > Annual Report 2010National Water Supply &Drainage Board (NWS&DB)Providing access to water supplyand sanitation is a key developmentobjective of the government. Inthis regard the NWS&DB is the solegovernment organization entrustedwith the task of providing safe waterto the population.By the year 2010 the board operated315 water supply schemes for theprovision of drinking water. Whileaccess to safe drinking water coverageis around 82 percent in 2010, the waterboard accounts for 40 percent of thesafe drinking coverage of the country,from which 32 percent is throughpipe borne water and 8 percentfrom CBO and local authorities. Assuch, 42 percent of the populationuses safe drinking water throughother sources. During the year underreview, the 7 percent increase in newwater connections contributed to theincrease in revenue from drinking waterby 11 percent to Rs.10,744 million.NWS&DB produced 470 million cubicmeters (cbm) of water recording a yearon year increase of 4.6 percent at a costof Rs.6,772 million. While the Boardmanaged to enhance efficiency in theusage of its main inputs of chemicalsand electricity, its inability to arrestsignificant wastage resulting in thenon revenue generating water (almost33 percent of the total production),contributed to the cost of productionto increase by 7.69 percent to Rs.21/cbm in 2010 from Rs. 19.50/cbm in2009. It is estimated that if the Boardis able to control non revenue water,the cost of production of water couldbe maintained at around Rs. 14.31/cbmwhich is less than the average price ofwater at Rs. 33.40/cbm.At the end of 2010, despite thecontinued existence of excessiveleakages NWS&DB earned aconsolidated gross profit of Rs. 5,261from its operations which is a 10.87percent increase over 2010. Howeverthe Board incurred a consolidatednet loss of Rs. 14,662 million in2010, mainly due to a 27 percentincrease in administration and otheroverhead expenses and a deficitprovision on an asset revaluation(devaluation of assets) amountingto Rs. 12,697 million. It is noted thatthe implication of the devaluationof assets is significant as it indicatesthat the method adopted so far incapitalization of costs of completedprojects has not been accurate. Thishas a negative impact on the balancesheet of the Board.Although NWS&DB’s liquidityposition has improved significantlyduring the year under review with anet cash profit of Rs. 1,938 million in2010 reflecting a 112 percent growth,the Board has failed to service itsdues to the Treasury of Rs 2,702million in 2010. The total dues to theTreasury on the on lent funds standsat Rs. 24,325 million at the end of theyear 2010.Despite a less than 1 percentdecrease in the total work force to9,018 employees, the total cost ofemployment in 2010 at Rs. 5,229million is an increase of 21 percentas against 2009. The water board isfaced with the challenge of ensuringa continuous supply of safe drinkingwater while enhancing its coverage ofproviding water to 94 percent of thecountry by 2016. As such the Boardwill have to devise strategies to sustaina capital investment programmewith minimum dependence on thegovernment while overcoming thehigh system losses which will increaseproductivity.Chart 4.9 > Drinking Water Coverage in Sri LankaChart 4.10 > Profit of NWS&DB2.5%8%18%31.5%400020000(2000)2006 2007 2008 2009 201032%8%Water BoardCBO/ Local AuthoritiesWellsHand pumps & Tube wellRain water & springsUnsafe water usage throughRvivers, lakes & tanks etc..Rs. million(4000)(6000)(8000)(10000)(12000)(14000)(16000)Accounting Profit/ (Loss)Cash Profit/ (Loss)219
4 | State Owned Enterprises (SOE)OperationsFinancialKEY PERFORMANCE INDICATORSEMPLOYEESDescription Unit 2005 2006 2007 2008 2009 2010Water Turnover Rs. Mn. 5,446 5,869 6,482 8,134 9,670 10,744Cost of water production Rs. Mn. 3,478 3,896 4,711 5,824 6,021 6,722Gross Profit/(Loss)-Water segment Rs. Mn. 2,720 2,984 2,811 2,193 4,923 5,458- Sewerage segment Rs. Mn. (35) (76) (75) (81) (80) (81)- Ground Water segment Rs. Mn. (28) (44) (27) (67) (98) (116)Total Gross Profit/(Loss) Rs. Mn. 2,657 2,864 2,709 2,045 4,745 5,261Non–Operating income Rs. Mn. 33 114 203 60 49 98Administration and other overheads Rs. Mn. 2,220 2,616 3,284 3,761 4,553 5,800Asset revaluation deficit Rs. Mn. - - - - - 12,697Finance cost Rs. Mn. 492 512 852 1,193 1,569 1,419Net accounting profit/(Loss) [withprovisions]Net cash profit/(loss) [withoutprovisions]Table 4.17 > Key Performance Indicators of National Water Supply & Drainage BoardRs. Mn. (92) (214) (1278) (2,915) (1,417) (14,662)Rs. Mn. 521 129 (491) (509) 914 1,938Asset value Rs. Mn. 77,291 89,863 100,697 115,541 135,901 140,652Investments Rs. Mn. 816 1,779 966 514 381 678Current assets Rs. Mn. 11,659 13,620 13,094 15,190 13,460 15,030Current liabilities Rs. Mn. 2,183 2,136 2,852 5,315 7,379 9,345Non-current liabilities Rs. Mn. 14,948 17,301 18,257 20,281 23,324 26,475Equity Rs. Mn. 71,964 84,174 92,797 105,226 118,734 119,927Water connections Nos. 907,622 989,395 1,078,892 1,186,931 1,266,328 1,353,573Water production Mn./cbm 383 398 424 440 449 470Water Sales Mn./cbm 253 261 284 299 309 322NRW supply % of water production % 33.38 34.44 33 32.09 31.13 31.55Water supply schemes (Revenue units) Nos. 291 295 308 309 312 315Revenue per employee/month Rs. 57,348 58,683 61,049 62,396 88,914 99,283Cost of employment/employee/month Rs. 24,126 28,116 32,688 36,647 39,820 48,319Cost of production/employee/month Rs. 36,623 38,950 44,370 53,895 55,361 65,120Production cost per unit without NRW Rs./cbm 9.08 9.80 11.10 13.24 13.41 14.31Production cost per unit with NRW Rs./cbm 13.72 14.98 16.58 19.49 19.47 20.91Total cost per unit produced Rs./cbm 21.46 22.62 26.72 31.55 36.54 78.04No. of employees per 1000 connections Nos. 9 9 8 8 7 7Water segment - Production Nos. 3,000 3,600 3,675 3,690 3,700 3,802- Distribution Nos. 2,000 1,950 2,016 2,063 2,087 2,024- Projects Nos. 140 145 140 140 136 150- Supportive staff Nos. 1,500 1,550 1,553 1,577 1,640 1,560Sewerage segment Nos. 225 220 215 208 224 216Ground water supply segment Nos. 275 270 268 262 238 232Head office staff segment Nos. 774 600 981 1,066 1,038 1,034Total Employees Nos. 7,914 8,335 8,848 9,006 9,063 9,018Source : National Water Supply and Drainage Board220
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Ministry ofFinance and Planning(as
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Heads ofDepartments under thePurvie
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ContentsChapter 1 Development Persp
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Chapter 5 Foreign Financing 243Over
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Ministry of Finance and Planning Sr
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SRI LANKA AT A GLANCE - 2005 & 2010
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BRIEFINGSBriefings“Much remains t
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1 | DEVELOPMENT PERSPECTIVESEconomi
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1 | DEVELOPMENT PERSPECTIVESThe Ser
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1 | DEVELOPMENT PERSPECTIVESBox 1.1
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1 | DEVELOPMENT PERSPECTIVESDecline
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6 | DEVELOPMENT FINANCEOverviewThe
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Financial statementsHead-wise Summa
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Annual Report 2010 - Ministry of Finance and Planning

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