Councilors want inquiry into water revenues

Councilors want inquiry into water revenues

JAKARTA (JP): City Council will summon representatives of
city-owned water company PDAM Jaya and its two private partners
to question them over the whereabouts of Rp 90 billion collected
during a short-lived accord, a councilor said yesterday.

A member of Commission D for development affairs, Lukman
Mokoginta, said the three companies should disclose their
financial management to the public, through the Council, even
though the cooperation agreement had been canceled.

PDAM director Rama Boedi said over the weekend the
municipality ended the accord on the grounds that the awarding of
the project smacked of corruption, collusion and nepotism.

He said there had not been an open bid and PT Garuda Dipta
Semesta (GDS), a subsidiary company owned by tycoon Soedono Salim
-- better known as Liem Sioe Liong -- and PT Kekar-Thames Airindo
(Kati), controlled by former president Soeharto's eldest son
Sigit Hardjojudanto, had not paid their equities.

Lukman said: "The council hasn't been informed about the
cancellation of the cooperation agreement and we just heard about
it from the mass media.

"It will be too easy for the private companies if they are not
asked about their responsibilities after their agreement was
canceled."

The commission will meet to discuss the matter today but
Lukman did not mention when the meeting with representatives of
the three firms would take place.

PDAM has cooperated with the two private companies since
February.

After the agreement was signed, PDAM announced tap water
tariffs would increase by an average of 25 percent as of April 1.
Customers condemned the increases which were introduced during a
time of economic hardship.

The new rates mostly affect affluent customers, who have to
pay up to 65.71 percent more, while nonprofit organizations were
offered a 3.85 percent discount.

Rama said tariffs would be lowered now that the accord had
been revoked.

Lukman urged PDAM not to enter a cooperation agreement with
other private companies to avoid a similar experience.

"It will be better if we stick to our constitution which says
the state has authority over managing public necessities. Any
cooperation could only be agreed under the condition that private
companies are not involved in setting up policies."

PDAM's management should be reorganized so the water supply is
managed without any interference, he said.

The management of Kati explained in a statement made available
to The Jakarta Post yesterday that all water bills were paid into
an independent bank account, which was established by PDAM and
Kati and administered jointly by ABN Amro and BNI 46 banks.

"Kati does not have direct access to these funds and the
account is fully auditable. No money has improperly been removed
by Kati," John Hurcom, Kati's managing director, said.

Hurcom said Kati had invested more than Rp 30 billion since it
signed the contract and had recently approved plans for an
additional Rp 300 billion this year. (ind)