The state-owned Barbados Water Authority (BWA) said today it is facing a deficit of $10.3 million a month.
In making the announcement at a press conference at the BWA’s Pine, St Michael headquarters, general manager Keithroy Halliday attributed this position to a series of contracts which it had entered into over the past several years which did not profit the company.
“Suffice to say, the net effect of it has been that the BWA now faces a monthly deficit of about $10.3 million. And this is the result of a number of contracts which we find to be very challenging and which we, over the months, have been trying to move away from and negotiate a position that at least allows all parties to benefit going forward,” Halliday said.
He noted that the community water tanks was one of those contracts which gave birth to the rapid response unit at the height of the chronic water outages and shortages experienced by residents in the north and north eastern part of the island.
Halliday said the unit was drawn from personnel within the distribution department, but has since been restructured to bring it in line with the company’s strategic intent which is to make sure the authority delivers on its mandate for a safe supply of water and do so in a “complete and holistic way” as far as customer service is concerned.
He conceded that the BWA reached a point where it could no longer meet its financial obligations to the contractor who leased the tanks to the water utility.
“The simple fact of the matter is that given the challenges the BWA has had and given the fact that we have had to take several hard decisions, one of the areas that would have been impacted would have been the inadequate equipment. We were not able to meet all of the timely payments to the contractor in respect of services delivered…in particular for the community tanks,” the general manager said.
He also pointed to the fact that the BWA is required to fork out $1 million a month to pay rent for the next 13 years under a 15-year agreement for the building at the Pine that houses the headquarters.
“The arrangement with the building is what we call a lease plus arrangement. There are two components. There is a rental figure of $701,000 a month and then there is a service charge figure that runs between $230,000 and $250,000 a month. So every month conceivably, the BWA has been trying to make a million dollars in payments towards inhabiting this particular establishment,” Halliday lamented.
He argued that the water works was earning an average $11 million a month and was waiting on a loan.