March 16 — 18, 2012
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Malaysia’s water services privatisation ailure due to abuse was high-lighted by an Sri Khalid Ibrahim at the 6th World Water Forum in Marseille, France on Wednesday (pic).”(Water privatisation) has ailed in Malaysiaas it has been used to benet the rentier class atthe expense o consumers,” said the MenteriBesar, who was speaking at the session or localand regional authorities.Khalid said while there have been successulcases o privatised water operations at the inter-national level, the Malaysian chapter is not thecase.“Tis is a classic case o a country’s ailedattempt at privatising a public utility, made worse by two actors: the inextricable nexusbetween political and business sectors where private individual protability is prioritised,and conicting political interests”.He stressed that privatisation in theory is not wrong as it is meant to address the government’sbudgetary constraints and improve eciencyand competitiveness.“But in Selangor, the privateconcession companies chosento treat and distribute water were not skilled nor experi-enced in the water services in-dustry. Without sucient eq-uity, the water distributioncompany began to compromiseon its water quality and servicedelivery, orcing high taris onconsumers.”He added that in 2008, hal o the 13 water companies inthe states in Malaysia had expe-rienced nancial decits and water operationshad a RM1 billion operating decit.“Tere should have been specic and de-tailed clauses providing penalties or the com- panies’ ailure to comply with conditions. Inour case, the agreement was so awed that whenthe distributor experienced nancial dicul-ties, the government eventually underwrote thecompanies’ debts.”“Te question or the state government nowis whether privatisation can work, and i so, how? Malaysiais a case where water services were used by a rentier class, do-mestic drivers o privatisationand political kingmakers,through their well-oiled connec-tions.”He said the solution lies inensuring that water services aretreated holistically and the statehas made eorts to do so byadhering to the processes de-tailed in the Water Services In-dustry Act 2006 which sets out to consolidatethe industry. Te Act also provides or decen-tralisation o water services.Although this was passed at the ederallevel, the Barisan Nasional-led ederal govern-ment was hesitant to implement it ollowing asurprise win by the Pakatan Rakyat in Selangorollowing the 12th General Election in March2008.“So when the time came or the state govern-ment to buy over the shares o private compa-nies (as stipulated in the Act) they responded with a hostile attitude.”He explained that the state has had threerounds o negotiations and ormal oers were presented but the concessionaires demandedhigher compensation and to date the situationhas not improved.He stressed that political interests is a majoractor that is impeding reorm. Instead o push-ing or complete and wholesale buying o the water services industry, the ederal governmenthas extended the private operators’ leases.Khalid was among seven ederated stateleaders who spoke at the session – themed“owards better water governance: Solution orRegional actors” – which is hosted by RegionsUnited (FOGAR) at the World Water Forum.Tis is the rst time Selangor has raised theissue at an international orum, ollowing morethan two years o negotiations to take over the water services industry. Khalid is expected tospeak urther on the issue today (Friday) inLondon.
Syarikat Bekalan AirSelangor Sdn Bhd (Syabas) is maintain-ing that it was well within its rights tocut supply to apartments at PandanUtama 2 rom Feb 14 to Feb 25.“ISome 160 walk-up apartment resi-dents were lef in a lurch or 12 days afersupply was cut due to the actions o anerrant developer ound to be stealing andsupplying water rom a Syabas main since2010.“aking water illegally goes against the Water Services Industry Act 2006, Sec-tion 123 (1),” said the water concession-aire in a statement in response to a Selan-gor imes article entitled “Residents lashout at Syabas” (Feb 24-Feb 26).Syabas pointed out that the law stipu-lates that no one, apart rom the licenceholders, can make any connections to amain public pipe or service pipe.Te apartments and 20 shoplots weredeveloped in 2008 but water supply in-rastructure including tanks, pumps, andexternal suction tanks were supposed tobe built by the developer earlier in orderor water to be supplied.As the permanent water supply system was never completed, Syabas could notsupply water.On May 5, 2009, the developer re-quested temporary supply but Syabascould not consider the request.In the meantime, residents started tomove in despite the lack o water supply.Subsequently, Syabas ound that resi-dents living there were obtaining waterthrough an illegal connection to an exist-ing 300mm Syabas pipe along JalanCempaka 1 since 2010.On Feb 15, 2012, Syabas cut the illegal water connection by closing a sluice valveat the main pipe which channeled waterinto the area.Ater the water cut, Syabas held ameeting with residents and the developeron Feb 15, 2012 to nd the best way toresolve the issue.From the meeting, the developer wasasked to pay Syabas RM185,000 or 17months o illegal water usage.he developer was also advised tocomplete construction o the permanent water supply system to allow Syabas tochannel water to the housing area.Concerning the issue o a RM1.94million bank guarantee that had to be paid by the developer, Syabas clari-ed that the amount was based on calcu-lations which took into account theconstruction o a water pond which hadnot been built at the site which was oc-cupied by squatters.According to Syabas the state has madea commitment to manage the relocationo these squatters.Te State Economic Advisor’s Oce will also call on three developers in thearea to provide the bank guarantee and pay or construction works o the perma-nent water supply system.Pandan Utama 2 Housing Area resi-dents had their water supply reconnectedby Syabas through a temporary watersupply system at 1pm on Feb 25 afer oneo the developers installed a bulk meterin the area as was agreed upon on Feb 24.However, Syabas has also inormedresidents to make a request or individu-al meters and pay a deposit beore theycan be installed at their units.“Hopeully with the explanation giv-en, residents at the housing area will un-derstand the water shortage problems intheir area,” said Syabas.However it was reported that theresidents were upset as they elt they were paying the price or the developer’s mis-takes.Resident Mohd Azam Meor said thelack o water put children, pregnant women, and senior citizens at risk as theyhad to carry pails o water up ights o stairs.“Water is something basic. Te supplyshould not have been disconnected overmoney and cheques.” .
Syabas says water cut legal
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Khalid: Water privatisation a failure