City Hall urged to report plan on privatization

JAKARTA (JP): A councilor has urged the city municipality to report on the progress of the planned cooperation between PDAM Jaya, the city-owned water company, and private investors.

Helmy AR Syihab who chairs Commission C for City Revenue said yesterday water services affected the public so the council should know about the plans.

He was commenting on assistant to the secretary of development affairs Prawoto S. Danoemihardjo's statement that council agreement was not needed for cooperation with the private sector.

"The council represents the public," Helmy said. "We have the right to know about the cooperation details for the public's interest."

He said the council supported the planned cooperation because of the administration's lack of funds to improve public services.

"But the price of water should be determined by the Governor. The decision should not be affected by the private investors' interest," Helmy said.

The cooperation should guarantee better water quality and better distribution, he said.

Next month PDAM Jaya is scheduled to sign a cooperation agreement with PT Garuda Dipta Semesta, managed by Salim Group, and PT Kekarpola Airindo, owned by President Soeharto's eldest son Sigit Harjojudanto.

The two private companies will cooperate with French firm Lyonnaise des Eaux and British firm Thames Water International.

PDAM Jaya head Syamsu Romli said earlier the company would still belong to the city despite cooperation with the private sector. He said water prices would not rise this year.

He said cooperation with private investors would benefit the administration, investors and the public.

The cooperation's first five years will need a $US250 million investment, he said. The cooperation involves a 25-year profit sharing scheme.

The money would be used to build more infrastructure: a pipe network and a treatment plant in Cakung, East Jakarta, he said.

The new treatment plant will produce 6,000 liters of water a second with water from West Java's Jatiluhur dam.

Now, PDAM Jaya produces 16,982 liters of water a second and serves only 417,215 of Jakarta's 1,640,380 families.

In 2000 the company is expected to boost production to 22,287 liters of water a second and serve 663,177 families. (ste)