Comments on SECWA's annual report

20/10/93

SECWA's continuing strong financial performance was setting the foundation for the lower energy costs needed to boost new investment and jobs in Western Australia, Energy Minister Colin Barnett said today.

SECWA's annual report, tabled in State Parliament today, shows the organisation recorded a profit of more than $100 million for the first time - an increase of $30 million on the previous year.

The Minister said the result was achieved by maintaining tight controls on spending and improving efficiency and productivity in every area of the business.

"The excellent financial result has also enabled debt to be reduced by more than $100 million," Mr Barnett said.

"This is despite a freeze on domestic tariffs and savings of $60 million passed on to commercial and industrial customers.

"The State Government will also be able to further reduce business costs by its decision to abolish SECWA's security deposit system.

"The Government remains committed to working towards electricity prices that are on a par or below the average of other States by the end of the decade.

"Lower energy costs are essential for the new investment and new jobs needed in WA."

Mr Barnett said other highlights of the report included:

·       interest expense as a percentage of total expenditure had fallen to 25 per cent, from a high of 36 per cent six years ago;

·       the rate of return on revenue had risen from a negative 2.2 per cent five years ago to 5.8 per cent in 1992-93;

·       exposure to foreign exchange movements had been virtually eliminated; and

·       major improvements in supply reliability and productivity had been achieved.

Mr Barnett said the report seemed to indicate that economic activity was increasing as confidence seeped back into the community.

"While energy demand remained depressed during 1992-93, there were signs of improved demand towards the end of the year," he said.

"Electricity sales were showing a six per cent improvement and gas sales about 10 per cent for the first quarter of 1993-94.

"The energy tariff reform has undoubtedly played a part in stimulating this apparent boost in economic activity."

Mr Barnett also paid tribute to the work of SECWA Commissioner Norm White, who retires at the end of the month.

The Minister said Mr White was leaving SECWA in excellent financial health after six years at the helm.

Media contact: Tony Robertson 222 9595