Water board added to public sector institutions list; incurring serious losses: Union

This year the National Water Supply and Dranage Board (NWSDB) has been added to the list of public sector institutions that are incurring heavy losses, the convener of the Water Supply Trade Union Collective Alliance, Upali Ratnayake said.

Addressing the media, he said the NWSDB was an institute that was profitable and financially stable where the piped water was given us to people at concessionary rates.

"The NWSDB conducted several water projects earlier under the government to  government soft loan procedure without exceeding the loan interest rate by two percent. Those loans were obtained from donor agencies such as the Asian Development Bank (ADB), Japan International Cooperation Agency (JICA) and the United States Agency for International Development (USAID), "he said.

Later, a policy change was made to obtain loans from financing banks such as Exim Bank³e under unsolicited proposals. The NWSDB received the financial loans as a package with an interest rate of between six and eight percent. The project estimates were three to four times more expensive than the estimates given by the local engineers. Therefore, the NWSDB has to pay large loan instalments, Rathnayake said. ✅

However, in 2014 and 2015, the NWSDB was changed the procedure of obtaining loans under unsolicited proposals and decided to obtain loans under the Local Bank Funding (LBF) loan proposals, he said. 

"Under the LBF facility, the NWSDB received Rs. 70 billion as a loan and implemented projects." The NWSDB has to settle the loan in instalments in the first year as soon as the project is completed. The NWSDB paid the loan instalment without the help of the treasury. Unfortunately, the⁷ NWSDB is currently unable to do so since last year, "Rathnayake said. (Chaturanga Samarawickrama)