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)