THE Subic Water District finished 2023 P3.29 million in the hole after posting an income of P13.42 million against P16.7 million in total expenses, increasing its accumulated losses to P16.65 million since 2018.
Government auditors called it an “improvement” compared to 2022 when it posted P4.66 million in net losses.
“The District’s statement of income for CY 2023 still reflected a net loss of P3,287,141, bringing its adjusted accumulated losses from operations to P16,647,835 since it entered the Joint Venture (JV) on March 1, 2018,” the audit team said in the 2023 report released on March 6, 2023.
The Commission on Audit said the continuing losses mean Subic Water District’s equity account is also decreasing and attributed this to “inadequate revenue share” received from its JV partner, Primewater Infrastructure Corp.
It likewise pointed out that the net losses are inconsistent with Section 2.2 of the National Economic and Development Authority’s Guidelines which provides that “the cost of producing the particular product, activity, or service should be efficient …towards earning potential profits for government and the market player/private sector partner.”
The COA insisted that the Subic WD general manager and Board of Directors should work to amend the provisions of the JVA to include payment by Primewater for the use of its facilities by way of usufruct.
It added that there should also be a new computation of income distribution, noting that the Subic WD is entitled to a corresponding revenue share for every new connection to lessen the effect of depreciation on its financial performance.
The WD management responded that it would discuss the possibility of such amendments with Primewater to improve its financial performance.
On the corresponding share in revenue for new connections, it said it is seeking the legal advice of the Office of the Government Corporate Counsel.
In addition, the audit team pressed the water district’s Contract Monitoring Unit (CMU) and Primewater to address the excessive losses from non-revenue water (NRW) which has been above 40 percent in four of the last five years.
