The Ghana Water Company Limited (GWCL) is facing a substantial financial shortfall in the Northern and Savannah regions, with domestic customers accumulating a staggering GH¢45.5 million in unpaid water bills.
This amount, confirmed by Stephen Amihere Mensah, the Northern Area Manager of GWCL, excludes any government arrears, as all outstanding debts owed by government entities have reportedly been cleared. Yet the debt remains significant, with over GH¢7 million stemming specifically from unpaid standpipe bills, an area that is supposed to operate on a cash-and-carry basis.
Faced with these extensive arrears, GWCL management has announced a comprehensive revenue mobilization exercise, set to take place from November 1 through December 31, 2024, to reclaim these unpaid funds. According to Mensah, this recovery initiative is essential not only to ensure the company’s sustainability but also to maintain a steady supply of water in the region. Without a successful debt recovery process, GWCL could face severe operational challenges, as the company relies heavily on consistent revenue to cover costs and maintain relationships with suppliers.
In recent years, GWCL has encountered financial obstacles as residential and domestic clients continue to accrue debt without making payments. This trend has forced GWCL to adopt a more proactive approach in pursuing these debts. Mensah elaborated on the necessity of the collection efforts, pointing out that, “We have to chase our customers for our monies. Because as we speak, the government has paid all arrears that were owed by other institutions.”
The current situation, according to Mensah, is unique in that the government’s financial obligations have been met, leaving GWCL to solely focus on collecting from residential customers. Despite standpipes being intended for immediate cash transactions, arrears in this area alone exceed GH¢7 million. “What is even striking,” Mensah continued, “is that standpipes that are supposed to be cash-and-carry still owe us this significant amount.”
The GH¢45.5 million debt underscores the considerable financial pressure placed on GWCL to ensure a reliable water supply. Without these funds, the company could struggle to maintain operations at an optimal level, which would ultimately affect the quality and consistency of water services. This financial strain extends beyond just operations—it also impacts the ability to make timely payments to suppliers, who are essential to the functioning of the water distribution network.
The revenue mobilization exercise launched by GWCL represents a determined attempt to mitigate these financial pressures. This initiative involves GWCL teams actively engaging with customers, conducting visits, and encouraging timely payments through various means. It is a large-scale endeavor that, while aimed at recovering funds, also seeks to educate the public on the importance of settling water bills. The exercise’s duration, spanning two months, reflects the scope of the debt problem and the level of commitment needed from both GWCL and the residents of the Northern and Savannah regions.
However, this recovery effort may face significant challenges, especially given the socioeconomic conditions of the regions involved. Customers in these areas, like many across the country, have been affected by economic downturns, which have made it difficult for some households to keep up with utility payments. Rising costs of living, inflation, and other economic factors have likely contributed to the accumulation of unpaid water bills. For GWCL, this scenario means that while the revenue mobilization exercise is necessary, it must also be approached with a degree of sensitivity to avoid exacerbating financial strain on vulnerable households.
Mensah’s statements reflect an urgent need for collaboration between GWCL and its customers. He emphasized that the company’s sustainability is contingent on receiving payments for services rendered, as consistent revenue is essential to cover operational expenses and meet supplier demands. “If we don’t organize ourselves to collect our money,” he stated, “we will not be able to pay our suppliers.” His remarks indicate that failure to recover these funds could lead to disruptions in water supply, ultimately affecting the communities that rely on GWCL’s services.
The GH¢7 million owed in standpipe arrears is particularly concerning because standpipes, as cash-and-carry facilities, are intended to operate on an immediate payment basis. This system was designed to facilitate quick transactions and avoid the accumulation of debt, making the current situation particularly unusual. Mensah’s reference to standpipes highlights the severity of the issue, as this category of service was not expected to encounter such significant arrears.
GWCL’s management acknowledges that achieving full debt recovery will be challenging, but the company is committed to pursuing this goal for the sake of operational sustainability. This mobilization exercise is just one part of a broader strategy aimed at reinforcing financial responsibility among customers and ensuring the long-term stability of water supply services in the Northern and Savannah regions.
As the mobilization exercise proceeds, GWCL hopes to not only recover outstanding amounts but also to foster a culture of timely payment among its customers. This would help prevent similar situations from arising in the future and would contribute to a more stable financial foundation for the company. For residents in the Northern and Savannah regions, the initiative is a reminder of the importance of maintaining up-to-date payments to support the infrastructure and resources needed for a reliable water supply.
The upcoming weeks will reveal the extent to which GWCL can address the arrears and reinforce its financial standing. The success of the mobilization exercise could significantly impact the future of water service delivery in these regions. With GH¢45.5 million at stake, GWCL’s efforts underscore the critical role of public cooperation in sustaining essential services and the importance of collective responsibility in maintaining access to clean water.
