Mon, 22 Mar 1999

Foreign firms deny causing state losses

JAKARTA (JP): Two foreign partners of city-owned tap water company PDAM Jaya -- PT Thames Pam Jaya (TPJ) and PT Pam Lyonnaise Jaya (Palyja) -- denied on Saturday that water deals with PDAM Jaya caused state losses.

"The people of Jakarta have lost no money as a result of TPJ and Palyja's management of water supply. All revenue and investment has been properly accounted for in accordance with the cooperation agreement," Palyja's president Christian Michelon and TPJ's managing director Pierre Jacobs said in a joint statement.

The statement was made in response to an allegation by the Indonesian Corruption Watch (ICW), which said the water agreement had caused the state Rp 4.98 trillion (US$554 million) in losses.

ICW coordinator Teten Masduki said on March 11 the losses included a loan of Rp 2.4 trillion from the World Bank, lost city revenue of Rp 5 billion and a government subsidy of Rp 910 billion.

The foreign firms reiterated on Saturday that the World Bank was not involved in funding TPJ and Palyja investments.

Both Michelon and Jacobs said the water revenue was not sufficient to cover operations and maintenance, adding that funds required for new investment were supplied by private parties and overseas lending institutions.

The world banks country program coordinator, H. Benjamin Fisher, denied ICW's earlier statement, saying the bank had nothing to do with the water deal.

According to the joint statement, a "PDAM Jaya worker union" allegation that TPJ and Palyja invested nothing and did not pay attention to PDAM employees was false and groundless.

The union could not represent PDAM Jaya employees since their company is not listed at the Ministry of Manpower, the statement said.

The firms said they had honored their commitment to employees seconded to them, according to an agreement signed last February.

They also said local partners -- former president Soeharto's eldest son Sigit Harjojudanto and businessman Anthony Salim -- no longer retain an interest or involvement in the firms.

They insisted the water agreement had been investigated and was in full accordance with Indonesian law and the 1945 Constitution.

Separately, due to International Water Day, which will fall on Monday, TPJ urged Jakartans on Saturday to work together to conserve the capital's water resources.

"Water conservation should be everyone's responsibility. We have been educating our customers and the public to save water. We appeal all parties to take part in efforts to keep the river water clean as well as reduce the excessive use of ground water," Jacobs said.

"Water Day allows us to reflect on the importance of water in our daily lives, and encourages us to act to preserve its use and maintain its cleanliness."

He said as part of its environmental program, TPJ is working with the office of the State Minister of Environment to organize a writing contest on themes related to water preservation.

TPJ also planned to cooperate with the Bandung Institute of Technology to develop a training program for its employees, in order for them to learn more about city water resources, he said. (jun)