Green NGOs oppose bill legalizing water privatization

Bambang Nurbianto and Adianto P. Simamora, The Jakarta Post, Jakarta

Fearing grim consequences for the environment, environmental organizations have expressed strong opposition to the water resources bill that will become a legal basis for water privatization.

Those opposing the bill include the Kehati Biodiversity Foundation and the Indonesian Forum for the Environment (Walhi).

Kehati executive director Ismid Hadad told The Jakarta Post over the weekend that the bill would bring more hardship to the people, including farmers.

If the bill is passed into law as it is, it will endorse privatization without much public control, and this would lead to excessive water exploitation by private entities, higher water rates and also limit the urban poor's access to water.

In the long run, uncontrolled exploitation of water resources by private entities could create water scarcity in urban areas.

"We oppose the bill because it would bring serious consequences, both for the environment and for poor people," Ismid said.

According to Ismid, privatization of water resources would particularly affect the urban poor.

First, those living in slums would not be the main target of network expansion by any private water company, thus further marginalizing the poor.

Second, if the poor could get access to tap water, they would likely spend much of their income on water as a private water company would seek higher rates and would not subsidize its customers.

"Therefore, we should oppose the bill," Ismid said.

The bill, drafted the Ministry of Resettlement and Regional Infrastructure, has already been submitted to the House of Representatives. The House's steering committee has tasked Commission IV on infrastructure to debate the water resources bill.

A bill whose deliberation is assigned to a House commission is considered less important and of lower priority than other bills. An important bill is normally discussed by a special committee.

Walhi executive director Longgena Ginting said Walhi opposed the water resources bill due to its endorsement of privatization, which would allow uncontrolled exploitation of water resources and thus lead to environmental destruction.

Ginting said that Indonesia should learn from the experiences of other developing countries that had planned to privatize water management, such as Argentina, Bolivia, Ecuador and Panama.

In those countries, Ginting said, the people opposed water management privatization as it meant they would have to pay higher rates to private operators.

Indonesia has in fact privatized the water sector to some extent, especially in Jakarta.

French company Suez Lyonnaise des Eaux and British company Thames Water Overseas Ltd have shares in Jakarta administration- owned water company PAM Jaya. The companies established joint venture companies PT Pam Lyonnaise Jaya (Palyja) and PT Thames PAM Jaya (TPJ).

Despite the entrance of two foreign companies, people in Jakarta still complain about the quality of the water they produce as well as distruption to water supply.

The two companies have also failed to expand their networks, arguing that the city administration had increased water rates only a fraction of the amount they had requested.

Ginting suspected the plan to further privatize water resources in Indonesia was a result of strong lobbying from multinational water companies through multilateral organizations.

"They are very strong and they always seek ways to expand their market into developing countries. We better watch out," he said.

Meanwhile, legislator Erwin Pardede from Commission IV acknowledged that the bill allowed private participation in water resources management, but he refused to call it privatization.

Pardede then questioned the reasons for the environmentalists to reject the participation of the private sector in water management when the government would have ultimate control over water resources.

"We need a comprehensive law on how to manage and preserve our water resources. Therefore, we agree to deliberate the bill," Pardede said.

Ismid and Ginting, however, questioned why the government and the House had not disseminated information about the crucial bill.

They contended that the bill would affect both urban people as well farmers in remote areas as the bill opened the possibility for the government to collect fees from farmer groups that utilize water supplies.

They said a law on water resources would be acceptable if Indonesia already had a comprehensive law on natural resources management that could be an umbrella law for all specific laws on natural resources, such as the water resources bill.

"I think the deliberation of the water resources bill should wait until the natural resources bill, prepared by the Office of the State Minister of the Environment, is passed into law. Therefore, they would not overlap," he added.