The chair of the supervisory board reported to the councillors: Mykolaivvodokanal is in decline, with losses of ₴700 million; we lose ₴500 million annually due to water leaks
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- Alina KvitkoReporter
Hanna Montavon, Chair of the Supervisory Board of the Municipal Enterprise ‘Mykolaivvodokanal’. Screenshot from a city council meeting«Mykolaivvodokanal» loses around 500 million hryvnias every year due to water leaks, and the company’s losses have now reached almost 700 million hryvnias. In addition to financial problems, systemic shortcomings have been identified at the company in management, cost control, the use of donor aid and the organisation of work in individual departments.
This was reported by the chair of the supervisory board, Hanna Montavon, during a session of the Mykolaiv City Council whilst presenting a report on the supervisory board’s first few months of work, according to NikVesti.
According to her, the supervisory board began its work in the autumn of 2025. During this time, its members analysed the company’s financial and operational status and concluded that the problems had been building up for years.
«This is not a result of the war. It is an example of systemic decline. There was no physical attack on the company’s administrative premises, but there are signs that the company had been neglected and control over it had been lost much earlier,» said Hanna Montavon.
She showed the councillors photographs of the company’s administrative and storage premises, noting that the working conditions for staff were unacceptable.
However, according to the chair of the supervisory board, the company had been profitable prior to the start of the full-scale invasion. In particular, in 2021, Mykolaivvodokanal’s net profit stood at 71 million hryvnias. However, according to the chair of the supervisory board, even then there was effectively a lack of high-quality operational reporting, monitoring of departmental performance, internal audit and systematic planning.
Water losses remain one of the company’s biggest problems. According to Hanna Montavon, the networks currently lose around 40 per cent of the total water supply.
«I did some calculations to work out how much one per cent of lost water costs. It amounts to one million hryvnias a month. In total, in 2025, we lost 500 million hryvnias down the drain,» she said.
According to the chair of the supervisory board, had the company systematically upgraded its pipelines before the full-scale invasion, the modern networks would have been significantly more resistant to corrosion following the switch to using salt water.
Furthermore, during an analysis of the company’s operations, it was found that following the destruction of the Kakhovka Hydroelectric Power Station, the «Dnipro–Mykolaiv» plant was barely functioning; however, between the summer of 2023 and the end of 2025, 32 million hryvnias were spent on its upkeep.
In addition, the supervisory board recorded accounts receivable of 258 million hryvnias, the misuse of donor aid, the prolonged carrying out of emergency works, the absence of technical data sheets, a shortage of tools and materials, as well as 207 construction meters that had not been used since 2023.
The report also highlights problems with the company’s anti-corruption efforts. In particular, only three of the 13 planned audits were carried out, and over 30 per cent of employees do not trust the mechanisms for reporting potential corruption violations.
At the same time, Hanna Montavon stated that the new management team has already achieved its first results. In particular, the closure of the «Dnipro–Mykolaiv» workshop has enabled the company to cut costs by 11 million hryvnias a year, whilst a further 5 million hryvnias has been saved by switching from emergency repairs to scheduled maintenance.
«It is very important for us to continue with management changes, to give the new team time for systematic transformation, and to assess their work based on results,» concluded the chair of the supervisory board.
The Mykolaivvodokanal’s supervisory board
The municipal enterprise «Mykolaivvodokanal» became the first municipal enterprise to have a supervisory board in place. This is a collegial body that exercises strategic oversight of the company’s activities, approves key management decisions and financial plans, and assesses the performance of the management. It does not interfere in day-to-day operations; it influences the appointment and evaluation of the director, but will not dismiss or hire staff at other levels.
The decision to establish supervisory boards in Mykolaiv’s municipal enterprises was adopted in 2024 as part of corporate governance reform. Yuliia Mincheva, an external adviser to the Mayor of Mykolaiv, noted that the supervisory boards would nevertheless be governing bodies, rather than advisory ones, and would bear responsibility for the decisions taken. They will have both legal and financial responsibility for their actions.
In January 2025, a competition was announced to select independent members, and on 29 May 2025, the City Council approved its composition.
A month ago, in May, the utility’s Supervisory Board officially requested the National Agency for the Prevention of Corruption to carry out an unscheduled audit.
«Mykolaivvodokanal» has also adopted a Code of Ethics, which governs not only employees’ conduct at work but also their activity on social media, communication with journalists, participation in internal discussions, the acceptance of gifts and the reporting of colleagues’ misconduct.
NikVesti
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The chair of the supervisory board reported to the councillors: Mykolaivvodokanal is in decline, with losses of ₴700 million; we lose ₴500 million annually due to water leaks.
The municipal enterprise «Mykolaivvodokanal» is currently operating at a…
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