Wading Through the So-Called “Water Crisis”

This article was previously published in the Selangor Times on 18 May 2012.

Election fever is in the air, and the games have begun. Last month, Prime Minister Datuk Seri Najib Razak stated that Selangor was heading towards a water crisis, after the state government blocked the building of the Langat 2 water treatment plant.

He also said this issue “should not have been politicised”, even though the state and Federal governments are led by different parties. He also asked how Selangor could become a developed state if the people’s water supply was constantly disrupted.

There are several accusations and assumptions made in these statements which ought to be carefully considered by those of us living (and voting) in Selangor.

First, it is important to elaborate on the current situation of the state’s water industry which sets the context for the prime minister’s statements.

The water operations in Selangor is fragmented into four different companies, that is three companies that treat raw water, and one that takes this treated water and distributes it to the some five million consumers in Selangor, Kuala Lumpur and Putrajaya.

Along with other states, Selangor’s water industry was to have been restructured into a holistic entity which would streamline all parts of the operation into one body.

This ensures the losses borne by water distribution (the more expensive, and less profitable, part of water operations) would be more than compensated for by water treatment (the less expensive, and hence more profitable, part of water operations).

This water restructuring has reached a stalemate after more than three years of negotiation between the Selangor state government, the water companies and the Federal government.

The main issue is the unwillingness of some water companies to accept the offer of the state. These are companies alleged to be hostile to the Pakatan Rakyat as they were selected during the previous Barisan Nasional government’s time in power.

Running parallel to this increasingly hostile negotiation process (which eventually broke down) was the dispute over the Langat 2 water treatment plant approval.

The previous Barisan Selangor government signed an agreement in which it would buy raw water from the Pahang government, which would include the construction of a massive pipeline between the two states, a dam and a water treatment plant.

The current Selangor government has stated its position that it is unnecessary to construct these massive structures to transfer water from Pahang, for several reasons, namely that Selangor has sufficient water supply through its water resources (rainfall, lakes, rivers) as well as the fact that a better way is to ensure water is not wasted.

Reducing non-revenue water (NRW), which is water that is lost through leaked pipes, or stolen, would also make up additional water resources for the state’s consumers.

Finally, conserving water through means such as rainfall harvesting and recycling water would be more ideal.

These are better solutions than indulging in mega-projects, beneficiaries of which would be, ultimately, construction companies engaged for the projects.

The prime minister’s second accusation is that such an issue should not be politicised, which is a little bit of a joke since practically everything has become political fodder these days.

In the case of water, ideally both governments should have come to the negotiating table in the interest of consumers’ needs.

This is one instance in which a bi-partisan stand and solution would have worked out well.

However, it is ironic that despite the state government’s intention of resolving the water restructuring stalemate by ensuring a holistic, and therefore more efficient, model is accomplished, the Federal government that initiated the process in the first place has remained silent on the issue.

Finally, water disruption is simply a reflection of poor water services.

The water distribution company in Selangor, Syabas, is a case in point.

Their side of the argument is this: that they have insufficient capital expenditure required to make pipe replacements and hence the quality of water – and water services – is deteriorating.

This really just emphasises the point that water privatisation in Selangor has not been successful. If a private entity that was given a long-term concession to carry out water operations, and granted substantial loans and grants, is unable to deliver its services well, then this marks failure for that private entity.

Privatisation if done efficiently, fairly and transparently, is justified. The Selangor case is not an example of such privatisation.

The solution to this messy situation is for the issue to be tackled head-on by both the Federal and state governments in seeking resolution.

However, it is now increasingly unlikely that any headway will be gained, since all parties involved are most likely waiting for the general election itself, results of which would impact upon the decision on both water restructuring and the water treatment plant.

Whichever political coalition it is that eventually runs Selangor, it is hoped that they would choose wisely which approach to take on water resources.

Yes, it is true that water disruption is not pleasant. It is true that it ought not to be politicised.

However, it is important to examine what are the root causes for these problems in the first instance.

Finally, the worse crisis is one in which politically-connected private sector players continue to reap financial benefits at the expense of the consumers they are expected to serve.

Tags: , , , ,

Posts by

Tricia Yeoh is currently attached to a local Market Research Consultancy, Dynamic Search. She was formerly Research Officer to the Selangor Menteri Besar and Director of the Centre for Public Policy Studies. She is columnist at The Sun, the Penang Economic Monthly, and Selangor Times. She is Editor of the book "The Road to Reform: Pakatan Rakyat in Selangor" and its Malay translation, "Liku-liku Reformasi: Pakatan Rakyat di Selangor".

Posted on 1 August 2012. You can follow any responses to this entry through the RSS 2.0.

Read more articles posted by .

Read this first: LB Terms of Use

2 Responses to Wading Through the So-Called “Water Crisis”

  1. Ellese

    This is rubbish political spin. The fact of the matter is that SSG is greedy in seeking middle man profit. It doesnt have the money and using federal government money to pay for this deal. It wants to buy syabas very cheaply and then sell higher the assets to PAAB. In the words of TS Khalid, he wants to make billions of dollars rental seeking profit. So dont lie and spin half truth. All this profits lead to higher tariff.
    hakbersuara.wordpress.com

  2. Pepper Lim

    Nice!