Water Board resorts to exorbitant water tariff hike
The National Water Supply and Drainage Board (NWS&DB) has increased the water tariff exorbitantly from August claiming that the operating cost had been increased owing to high interest payment for bank loans and increased electricity prices.
Accordingly an average Water Board customer who consumes 13.5 units per month would have to pay monthly bill of Rs. 1300 with monthly service charge, a senior Water Supply Ministry official said.
According to the new water tariff revision, the board has increased the water bill of consumers by 30-50 per cent from the existing bill.
However this new tariff is highly unjustifiable as it is not based on proper cost reflective price formula at a time when the NWS&DB is earning substantial revenue, consumers said.
But a ministry official said due to rising costs, including electricity tariffs, raw materials, currency depreciation, and high-interest rates, the cost of providing one unit of water has increased to Rs. 130.
According to NWSDB data, 16.68 per cent of the total unit cost of water is decided on electricity tariffs and it has a major effect on water tariffs.
The cost of water production alone is Rs. 54.63 per cubic metre but the unit cost includes costs related to personnel, electricity and pumping, chemical cost and repairs and maintenance, and other costs
Board income has increased to Rs. 79.53 per cubic metre under the current tariffs from Rs. 43.42 per cubic metre as per previous tariff.
With the implementation of a new tariff for water with effect from September 2022, the NWS&DB recorded revenue of Rs. 16.59 billion for the first four months in 2023, an increase of 62.4 per cent compared to Rs. 10.22 billion in the same period of 2022.
The board recorded a gross profit of Rs. 7.39 billion in the first four months of 2023 against a profit of Rs. 4.08 billion recorded in the same period last year.
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