Water Corporation: Funding trouble blamed for major maintenance issues at taxpayer-owned business

Regulators have slammed Water Corporation for under-investing in maintenance despite a $1 billion profit last financial year. A report by the Economic Regulation Authority released on Tuesday found “funding constraints” were stopping the State Government-owned business getting repair work done and replacing old assets. It’s a fresh blow for the taxpayer-owned corporation after severe sewerage bursts in Caversham and Spearwood caused a major embarrassment in 2025. The West Australian revealed in January that hundreds of pipe hangers under the Narrows Bridge were at risk of catastrophic failure and overdue for replacement, adding to the alarm. Water Corporation posted a $1.1b profit in 2025 and holds a mammoth $8b of retained earnings on its balance sheet after the Government repeatedly pushed back big dividend payments. The ERA’s audit highlighted two major unidentified incidents and warned asset inspections may not be getting enough cash. A “catastrophic” elevated tank failure in December 2024 caused physical damage and flooding to nearby properties. “Condition assessments failed to accurately reflect the tank’s deteriorating state over a nine-year period,” the report said. It said the tank had been inspected but “funding plays a significant role in how inspections are implemented” and preventative maintenance had been cut back. A major sewage spill in June 2025 was also partly blamed on the corporation’s inspection regime. “It would appear that preventive maintenance has reduced, periodic visual condition assessments and . . . inspections were ceased; this is an example where activities have had to be reduced due to funding constraints,” the report said. ERA chair Steve Edwell said the audit “found a significant gap between planning and action”. “The Water Corporation – like its interstate peers – has major challenges ahead with rapidly aging infrastructure on one hand and funding new infrastructure to meet increasing demand and dwindling supplies in traditional catchments on the other,” he said. Mr Edwell said there would need to be a balance of funding between new projects, maintenance and asset replacement. Shadow minister Peter Rundle said Water Corp’s maintenance seemed to be “a stop-gap operation”. “I’m quite alarmed. We’ve seen an increase, especially in sewerage infrastructure, of breakages in the past year.” A spokesman for Water Minister Don Punch said $7 billion had been committed for capital investment at the business over the next four years. “This demonstrates the government’s commitment to providing Western Australians with the infrastructure and services they need and supported Water Corporation’s asset management system, which the ERA has found to be robust and effective.” Maintenance and operations of Perth’s water and wastewater network were outsourced in the 1990s but were brought back into State Government hands in 2020. That ended an eight-year deal with contractor Programmed. Then-premier Mark McGowan said “bringing these services back into public hands will save taxpayer’s money and ensure high quality service for years to come”. The audit was co-authored by Viridis Consultants and Cobbitty Consulting.