City Council and PDAM reach compromise solution on water
JAKARTA (JP): The City Council and the City Water Company, PDAM Jaya, finally reached a compromise late Wednesday night by agreeing that the current price for water from public water tanks will not be raised until a price ceiling is introduced.
A dispute had erupted last week when PDAM Jaya, without first consulting the council, raised the water price on water from public water tanks by 200 percent to Rp 780 (US$.36 cents) per cubic meter, beginning this month.
"We can fully understand why the City Water Company must increase the water price at public water tanks," Helmy A.R. Syihab, the chairman of the City Council's Commission C, told reporters yesterday.
"By saying this, we mean that PDAM Jaya should add to the number of new public water tanks throughout the city, particularly in areas still not served by PDAM Jaya," Helmy said.
"We also hope that PDAM Jaya will formulate a policy on a reference price for water taken from public tanks and have it legalized by the governor. That way it can be checked just like the government checks the price of rice," he said.
Helmy added that the reference price should serve as a controlling tool to ensure that the water is not sold at higher than the ceiling price.
The council also demanded that PDAM Jaya refrain from adjusting the current price until a ceiling price is set. According to Helmy, this means that PDAM Jaya must accept payments made for public water tank water, even though it is still at the current rate of Rp 390 per meter cubic.
In addition, Helmy said, the council deemed it necessary for PDAM Jaya to hold a meeting with all owners and operators of public water tanks to explain why it must resort to the price hike.
Debate
During the debate, the City Council insisted that the price hike runs counter to the one it recently approved, that is, from Rp 250 per cubic meter to the current price of Rp 390, which became effective last month.
The council, represented by Commission C and D on finance and economic affairs, also expressed concern over the hike because public water tanks are a source of potable tap water for people of middle to low income brackets.
These people used to buy it in cans from door-to-door water vendors. When water was sold by PDAM Jaya at Rp 250 per cubic meter to owners of public water tanks, these owners used to sell it at Rp 5 per can to water vendors who, in turn, used to sell a can of water for Rp 25.
The City Water Company PDAM Jaya, on the other hand, maintained that it had to increase the price to meet its financial obligations to the International Bank for Reconstruction and Development (IBRD) and Overseas Economic Cooperation Fund (OECF) from which it borrowed a total of Rp 1.4 trillion (US$652 million) to finance the construction of several water plants across the city.
PDAM Jaya also argued that the price hike was necessary to finance the construction of new public water tanks throughout the city, to better serve around 65 percent of the city's population whom the water company is still unable to reach out.
In response to the compromise, Mohamad Yani of the Indonesian Consumer Foundation, told The Jakarta Post that PDAM Jaya should seek other alternatives before resorting to a price hike.
PDAM Jaya could bottle water and sell it, just as the City Water Company of Bogor, West Java, does. With the income it would receive from selling bottled water, PDAM Jaya would not have to increase the price of water from public water tanks, Yani said. (arf)