Govt. Ministries' unpaid bills close to $5 million
Customers of the Electric Power Corporation (E.P.C.) owe the state-owned utility more than $10 million in unpaid power bills.
But the Government itself is the largest single debtor, with outstanding bills totalling $4.9 million.
The backlog in payments was confirmed by the E.P.C.’s Chief Executive Officer, Tologata Tile Tuimaleali’ifano, in response to questions from the Samoa Observer.
In an interview at his office, the C.E.O. said the debtors include hoteliers, construction companies and government ministries.
The C.E.O. refused to divulge when the debts were incurred, or to pin point which Ministries are not paying their electricity bills.
“All I can say there is a huge improvement when it comes to government ministries paying their bills on time," he said.
But the E.P.C.'s most recently available annual report, for the 2016 Financial Year, suggests the Corporation's business debts have grown in recent years: at that time the E.P.C. was carrying business debts of $8.2 million.
A little less than half of its debt burden in 2016 was classified by the E.P.C. as "doubtful", or less likely to be repaid given the credit history of its customers or their "recent economic difficulty".
“As of 30 June 2016, trade receivables of $3,322,549 were impaired and identified as part of the provision for doubtful debts consisting mainly of independent customers, which are in unexpectedly difficult economic situations and certain project receivables," the report said.
“It was assessed that a portion of these receivables are expected to be recovered.”
Asked as to why the debts have accumulated to $10 million, the C.E.O. strongly defended staff assigned to “debt collection” duties.
“We are trying our very best to collect what is owed to the E.P.C. It is the government that owes the largest debts; however their bills have reduced over the years," he said.
“And majority of the government ministries bills are current, meaning they are paying on time and the ageing arrears have been cleared for some of the ministries.”
On the issue of bad debts being written off, the C.E.O. said they only “write off bills” when businesses file bankruptcy or close down.
The C.E.O. does not recall the last time the E.P.C. approved a write off.
However, in Financial Year 2016, their annual report says in 2015 a total of $270,029 was written off and close to $1 million tala was written off in 2016.
The figures come as the E.P.C.'s overall financial profitability has declined in recent years. In 2016 the utility delivered an operating profit of $17 million. Last year, that figure had declined to $5.1 million.
The majority of E.P.C. customers were moved to prepayment in 2014 following the completion of cashpower installations.