City Council commission okays water rate hike

City Council commission okays water rate hike

JAKARTA (JP): The City Council Commission C for economic
affairs has finally agreed to an administration proposal to
increase tap water rates by between 14 percent to 43 percent, but
exempted social institutions and poor customers from the hike.

The decision, made on Friday night, came after lengthy
discussions with the city administration as well as the city's
water company PAM Jaya and its foreign joint venture partners
Thames Pam Jaya (TPJ) and PAM Lyonnaise Jaya (Palyja).

The commission had earlier rejected Governor Sutiyoso's
proposal to increase tap water rates by between 6 percent and
43.09 percent, which he said was needed to cover the rising
operational costs of city water companies.

TPJ, a joint venture with Thames Water Overseas Ltd of
Britain, operates the services in eastern Jakarta while Palyja, a
joint venture with Suez Lyonnaise des Eaux of France, services
the western areas of the capital.

Commission C chairman Amarullah Asbah told The Jakarta Post on
Saturday that the commission found there was sufficient economic
grounds to raise the rates since the water companies were now
operating on a commercial basis.

But the commission has exempted some consumers from the
proposed increase, including charity organizations, places of
worship, government hospitals, "very simple" houses and
apartments, and gas stations.

The commission's recommendation will now go to the council for
final approval, where it is likely to face more hurdles.

Under the proposal by Governor Sutiyoso, the rate for "simple"
houses and apartments will be increased by 14.83 percent from the
current fee of Rp 1,275 per cubic meter, while "medium" houses
and apartments will rise by 30.32 percent from Rp 1,600.

The biggest increases are reserved for "luxury" houses,
embassies, government offices, private institutes, colleges and
universities, the military, small businesses, luxury apartments,
restaurants and private hospitals. Their rate will rise by 43.09
percent from the current Rp 2,475 per cubic meter.

Star-rated hotels, nightclubs, banks, service stations,
highrise buildings, factories and the vast Ancol recreational
park and real estate complex in North Jakarta will face a 42.47
percent hike on the current Rp 3,650. The Tanjung Priok port
operator will face an increase of 34.62 percent from the current
Rp 5,200.

"The commission has given a recommendation to increase the
water tariff for the five customer groups because the hike won't
burden them," Amarullah said.

The two customer groups exempted from the hikes by the
commission would have faced an increase of around 6 percent from
the current Rp 375 per cubic meter under Sutiyoso's proposal.

Obstacle

Contacted separately on Saturday, council deputy speaker
Djafar Badjeber indicated that the commission's recommendation
could meet a stumbling block at the council.

The commission should be consistent with its earlier decision
not to approve the proposed increase in water fees, he told the
Post.

"I don't see any urgency in raising the water rates. I have
not seen any improvement in either the services by water
companies or in the quality of the water," he said.

He said he would propose further studies on the matter before
approving the recommended increase because it could burden the
people.

Many councilors have expressed their disagreement with the
proposed tap water price increase due to the companies' lack of
control mechanism for water leakage and the condition of pipes
used in the city's water network. (04)