WUC blames P1.5bn loss on low tariffs
Lewanika Timothy | Monday May 25, 2026 06:00
The balance sheet for WUC shows that the corporation is sitting on over P19 billion in liabilities, the bulk of these attributable to a listed bond as well as bad credit that has been sitting on the parastatal’s books. Government alone owes the corporation over P800 million.
Appearing before Parliament’s Committee on Statutory Bodies and parastatals, WUC CEO, Gaselemogwe Senai, revealed that the corporation was last profitable in 2018. Losses since then have primarily been driven by below-cost tariffs that make it difficult for cost recovery.
“The most significant challenge is the non-cost reflective tariff structure,” he told the committee. “The tariff framework is not cost reflective, resulting in a mismatch in costs of providing water and the tariff offered. “The rate of change in tariffs has not kept pace with cost adjustments over the years. “The current tariff structure constraints the corporation’s ability to recover costs and achieve long-term financial stability.”
According to Senai, WUC operates within a policy dilemma, one of running as a commercial entity whilst also being expected to be socially responsible for ensuring universal water access by offering below-cost tariffs.
“The corporation has had to rely on cost containment measures to partially offset the below-cost tariff structure. “On one hand, the corporation is expected to supply universal equitable water services whilst also being expected to operate its affairs on sound commercial principles,” he said.
WUC posted pretax losses of P189.2 million for the half-year ended September 2025, an increase of 26% from the prior period, despite higher revenues.
The corporation has struggled for profitability over the years, due largely to non-cost-reflective tariffs and ballooning arrears owed by various segments of customers. In the six months to September 2025, WUC’s trade receivables, a category that includes arrears owed by customers, grew to P1.6 billion from P1.2 billion in the prior corresponding period. The corporation has relaunched a debt amnesty for customers, aimed at boosting recoveries.
According to the corporation’s CFO, Thabang Mogodi, the current tariff structure sits at around P37.88 thebe per kiloliter, whilst the cost per kiloliter for the Corporation sits at P47.48 thebe.
He further added that the tariff adjustments that have happened in the past have not kept up with inflationary pressures around inputs. These include the increased cost of electricity used in pumping water, as well as the cost of chemicals incurred when cleaning water.
“The Russia-Ukraine war also came into drive up inflation, mainly driving up the prices of chemicals and the rise in the cost of power,” he said.